Bear Stearns: Sold For Just $2 A Share - The Bank Worth $140bn Last Week

[Purveyor]

America's fifth largest bank last night became the biggest casualty so far of the global credit crunch - sold off to a rival at a knockdown $2 a share, a discount of 94% on last week when it was valued at $140bn.

The board of Bear Stearns bank approved the buyout by JP Morgan Chase for $236m after a weekend of frantic negotiations. Had the deal not been done, the bank would almost certainly have gone bankrupt.

Last night the US Federal Reserve cut the rate at which it lends money to banks and made more money available for them to secure short term loans.

George Bush is to meet the chairman of the Federal Reserve Paul Bernanke and the US treasury secretary Henry Paulson today. Paulson said: "The government is prepared to do what it takes to maintain the stability of our financial system. That's our priority."

To Democrats, though, Bush is not doing enough to help. "We're in the most serious economic problem we've been in in a very long time. The president's hands-off attitude is reminiscent of Herbert Hoover in 1929, in 1930," said Senator Charles Schumer, a New York Democrat.

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http://www.guardian.co.uk/business/2008/mar/17/jpmorgan.useconomy1