On Thursday, Sept. 18, 2008, the astonished leadership of the US Congress was told in a private session by the chairman of the Federal Reserve that the American economy was in grave danger of a complete meltdown within a matter of days. “There was literally a pause in that room where the oxygen left,” says Sen. Christopher Dodd (D-Conn.). As the housing bubble burst and trillions of dollars’ worth of toxic mortgages began to go bad in 2007, fear spread through the massive firms that form the heart of Wall Street. By the spring of 2008, burdened by billions of dollars of bad mortgages, the investment bank Bear Stearns was the subject of rumors that it would soon fail. “Rumors are such that they can just plain put you out of business,” Bear Stearns’ former CEO Alan “Ace” Greenberg tells FRONTLINE. The company’s stock had dropped from $171 to $57 a share, and it was hours from declaring bankruptcy. Federal Reserve Chairman Ben Bernanke acted. “It was clear that this had to be contained. There was no doubt in his mind,” says Bernanke’s colleague, economist Mark Gertler. Bernanke, a former economics professor from Princeton, specialized in studying the Great Depression. “He more than anybody else appreciated what would happen if it got out of control,” Gertler explains. To stabilize the markets, Bernanke engineered a shotgun marriage between Bear Sterns and the commercial bank JPMorgan, with a promise that the federal government would use $30 billion to cover Bear Stearns …
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AIG got money because of their investment relationship with Goldman Sachs. GS has to many people influencing policy in Washington DC to let them collapse. Just look at the “deal”. GS got 100 cents on the dollar. NO other firm got that. All of Goldman’s chief competition was wiped out.
4:34 is that another voice finishing his sentence?
@SwerVQE The country did go into a depression, regardless of who they chose to bail out.
If AIG got the money, then so should’ve Lehman.
@DaPakiGamer if aig fell this country would have went into a depression.
Lehman didn’t receive a bail out. But why did AIG???
Was it because they had too many dealings with Goldman Sachs and Paulson couldn’t let Goldman get hurt?
FDIC insolvency , shear the sheeple
Kill 666 buy .999
The next bubble will be the treasuries which is just burst……….
@jscottupton That is a failure of our financial system. Nice try though
@jscottupton We wouldn’t have this shit happen if the corrupt debt-based monetary system wasn’t built on a ponzi pyramid scheme logic. It guarantees vicious cycles of boom and bust. How convenient that the superrich elite and politically connected socialize their risks at the expense of us taxpayers, and all the small businesses and sole proprietors are allowed to fail. Screw bailouts! And fuck the Federal Reserve.
Ultimately, this is a failure of GOVERNMENT. The government created the FED. The government outlaws real money and substituted fiat money. The government forced mortgage companies to loan money to people who normally would not qualify.
FDIC Insurance would have made all the serfs King! now THAT is mountain top removal and poetic justice! but they never mention that on the news. All they say is the market would “collapse”