averted. bear stearns has been bailed out by the government and now, they ve been bought out by a competitor. the government had never stepped in before, in the history of our republic. but the fed decided to change that because they decided it wasn t because bear stearns was too big to fail as we like to say, it was too interconnected to fail. the fed knows this is just one firm. when one tall building on wall street falls, is probably going to land on another one which could land on another one. was that institutional risk, the idea that you might have an uncontrollable fire on wall street that considered bernanke and the policymakers. the big question is, are there other banks in a situation similar to bear
aig, and there was a real view by the way, that if aig went under, the game was over. aig does business with every major financial institution and in 130 countries. aig will destroy much of the capital for nation process in the western world. paulson, bernanke, gardner, they saw the risk that this could be not just a fire that would burn wall street down, but that could burn down our economy, and burn down the world economy. it s uncle sam to the rescue but oh, what a price tag . the federal government is to saving aig from possible collapse with an 85 billion dollar loan, all of it, your money. the move was designed to bring stability to the financial markets, did it work? maybe, down the road but not
losing their jobs. we are close to a depression, forget the recession. where my going to deposit a check, bernanke and paulson were really concerned about whether or not people would be able to go to an atm. the treasury secretary told congress that a bailout is the only way to prevent a collapse. america s economy is facing unprecedented challenges. and we are responding with unprecedented action. it s no stretch to say that after this week the era of big government is back. it s an urgent request from the bush administration to congress, for $700 billion to quickly stabilize the financial system. thursday afternoon we started to hear about this thing called tarp and it had many different variations, what it was going to be but basically, they were going to infuse capital directly into some of these companies pray this troubled asset relief
economists say the nation is at increasing risk of recession, what do you say? i say the fundamentals of our nations economy are strong. firms begin to announce losses from some prime mortgage- backed securities but the idea was, this is under control and been been a key who was the chairman of the federal reserve and pulse and was secretary of treasury said this is contained. a u.s. economy is resilient. i believe our economy will continue to grow although at a lesser pace than we saw . paulson had been the chief executive of goldman sachs, so he was an insider, for better or worse. he knew where the bodies were buried. testified before a house committee, federal reserve chairman threw his weight behind the stimulus package. bernanke was an expert in
blitzer saying lehman is going next. so what i m saying today is that, you know, silicon valley bank is like bear stearns a few years ago. neil: so you have a contagion sense of this, that when you hear janet yellen talking about the fact that is not another lehman mow men, another bear stearns and merrill lynch going into the hands of forced government, arranged marriages with the likes of j.p. morgan chase and of course the bank of america. this is not that, you say? i say that she s she was head of the fed and head of the treasury. you know, bernanke got a nobel prize for being the fed chairman. these guys are the ones that caused the problem.