Quotes From Bear Stearns Hearing

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"Normally, the market sorts out which companies survive and which fail, and that is as it should be. However, the issues raised here extended well beyond the fate of one company. Our financial system is extremely complex and interconnected, and Bear Stearns participated extensively in a range of critical markets. The sudden failure of Bear Stearns likely would have led to a chaotic unwinding of positions in those markets and could have severely shaken confidence." Federal Reserve Chairman Ben Bernanke.

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"The focus was not on this specific institution, but on the more important strategic concern of the implications of a bankruptcy. The failure of a firm at that time that was so connected to so many corners of our markets would have caused financial disruptions beyond Wall Street." Undersecretary of Treasury for Domestic Finance Robert Steel

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"I happen to believe that this was the right decision considering everything that was on the table in the closing hours on that Sunday; that the alternative and I don't think this is hyperbole could have been devastating, both at home, and around the world for that matter. ... But I think it's appropriate that we look at the rationale leading up to it, why decisions were made and not made earlier and later during the process, what was a part of that negotiation." Sen. Chris Dodd, D-Conn.

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"I want to hear from our witnesses why they thought it was necessary to stop the invisible hand of the market from delivering discipline. That is socialism at least that's what I was taught, and I would imagine everybody at that table was taught the same thing and it must not happen again." Sen. Jim Bunning, R-Ky.

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"Even though the firm was adequately capitalized and had a substantial liquidity cushion, unfounded rumors and attendant speculation began circulating in the market that Bear Stearns was in the midst of a liquidity crisis. ... Due to the stressed condition of the credit market as a whole and the unprecedented speed at which rumors and speculation travel and echo through the modern financial media environment, the rumors and speculation became a self-fulfilling prophecy. ... There was, simply put, a run on the bank." Alan Schwartz, president and chief executive officer of Bear Stearns Cos.

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"One of the concerns we had was how much exposure can we take on top of all their exposures. So we already had plenty of mortgage exposures and risky security exposures. And we could do nothing that would leave JP Morgan in a precarious position. ... You have to look at how many straws can you put on the camel's back. And we are fairly conservative. And we went as absolutely far as we can go, both in terms of taking risky assets, taking more mortgage assets and having to borrow another $30 billion." James Dimon chairman and chief executive officer of JP Morgan Chase & Co.