And yet JPMorgan - the bank that bought the stock of Bear Stearns in March 2008 with a $30bn assist from the U.S. government - is offended. The suit alleges that Bear Stearns’s bankers and traders manufactured and sold about $20bn of mortgage-backed securities containing home loans they knew were fraudulent. What JPMorgan objects to is that the government asked it to buy Bear Stearns 'over the course of a weekend' to help keep the financial system from collapsing, and now, more than four years later, it has the temerity to sue.
Bloomberg contributor William D. Cohan writes that he can imagine Jamie Dimon, JPMorgan’s chief executive officer, saying: If this is the thanks we get, you can pretty much be assured that next time you ask us to save a failing systemically important institution, we’ll just walk away.
Methinks the bank doth protest too much. JPMorgan didn’t buy Bear Stearns as a favor to Treasury Secretary Henry Paulson, New York Fed President Timothy Geithner and Federal Reserve Chairman Ben Bernanke; it bought Bear Stearns because it saw an opportunity to acquire on the cheap a company with assets it coveted. JPMorgan admired Bear Stearns’s clearing business, its commodities trading, a few of its bankers and traders and, most of all, its sleek, new skyscraper at 383 Madison Avenue, across the street from JPMorgan headquarters at 270 Park Avenue.
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