[lbo-talk] Fed's looking a little scared

[Doug Henwood]

[This press release just came out. Earlier this morning, they  
announced that Bear Stearns, a brokerage firm that serves a lot of  
hedge fund clients that has had trouble with some of its own funds  
lately and which has been rumored to be in trouble, had a line of  
credit with JP Morgan Chase, which in turn has a direct pipeline to  
the Fed's discount window. Bear can't borrow directly from the Fed,  
so this is the next best thing. This is all highly unusual.]

<http://www.federalreserve.gov/newsevents/press/monetary/20080314a.htm>

Press Release

Release Date: March 14, 2008

For immediate release

The Federal Reserve is monitoring market developments closely and  
will continue to provide liquidity as necessary to promote the  
orderly functioning of the financial system. The Board voted  
unanimously to approve the arrangement announced by JPMorgan Chase  
and Bear Stearns this morning.