The Bear Stearns deal: Buying a “house on fire”

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Today’s Senate hearing on the Fed-backed rescue of Bear Stearns provided a few interesting insights and quotes. Both the New York Times and the Wall Street Journal have new information on how the deal came about.

Call it a bailout: ‘ ‘If you want to say we bailed out the market in general, I guess that’s true,’ Fed Chairman Ben Bernanke testified. ‘But we felt that was necessary in the interest of the American economy.’ ‘

A House on Fire: ‘ ‘Buying a house is not the same as buying a house on fire,’ JPMorgan Chase CEO James Dimon (pictured) said, explaining his low-ball offer for Bear Stearns.’

Hammerin’ Hank: If Bear Stearns shareholders who were nearly wiped out choose to blame a single person for the rock-bottom price, after today they will blame Treasury Secretary Henry M. Paulson Jr. The New York Times: ‘Treasury Undersecretary Robert Steel said that his boss, Mr. Paulson, had said during the negotiations that the price should be low because the deal was being supported by a $30 billion taxpayer loan.’

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Photo Credit: AP