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James Hackett was named President and Chief Executive Officer of the Company in December 2003, and Chairman of the Board of the Company in January 2006. Prior to joining the[…]

The Federal Reserve has been very vocal about moral hazard, Hackett says.

Question: Why did Bear Stearns merit government intervention?

Jim Hackett: Yeah, I think that is a tough on to wrestle with, because there is I think the federal reserve has been very vocal about this issue more hazard of not bailing out those that basically exercised excess behavior and took advantage of markets that more as discipline at that point, but of course as you know without government intervention, we started to discipline in the market in a major, major way, which is always it the way what is government is usually way behind the free market curve and what the end up doing is as usually doing worst rather than better. That one of course happens here as well, but as I understand that the federal reserve actually adopt in an approach and based on that lot of healthy player to come in where there is at least an equal chance that it is neutral to good from a tax payer perspective, what they have done as supposed to neutral to bad. Therefore for us to feel like they bailed out their turns and post, saving one of the key financial players would be a mischaracterization. I think saving one of the key financial players is a better way to describe it and I also think that as a tax payer, you won’t necessarily be disadvantaged by what happened.


Recorded On: 3/24/08