Fed Officials: Bear Stearns Action Not a Bailout

It was NOT a bail out. A LOT of people lost their shirts. From 6 figure execs to the guy in the copy center downstairs - no one got "bailed out".

The Fed took unorthodox actions to prevent the COMPLETE collapse of Bear in order to protect the ENTIRE U.S. financial system.

The risks the collapse of such a large investment bank would have posed for the financial system as a whole were unperceivable.

They were already battling a major crisis of investor confidence and a classic "run on the bank". They were taking on water and about to sink.

That lack of confidence could have very easily spread like a virus which would have caused a domino effect to other banks and institutions and we would've been up to our ankles in blood on the street.

The $30b the Fed loaned Bear to facilitate its sale to JP Morgan was not a bail out.

Tell a guy who had $3M in a retirement fund which became a few hundred thousand OVER NIGHT that he was "bailed out" and see what he tells u. Be ready for a left hook.