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|User Info||Letter from FL's ****tard Senator Martinez; entered at 2008-04-30 09:22:59|
Registered: 2007-12-03 Miami
I just received this response (a month after sending email letter) from Martinez. At least we know he is starting to listen.|
Below is a response to the recent comments I received from you:
Dear Mr. xxxxx:
Thank you for contacting me regarding the role of the federal government in the economy. I appreciate hearing from you and would like to respond to your concerns.
As you may know, on March 16, 2008, under the supervision of the Federal Reserve, the Bear Stearns Companies signed a merger with JP Morgan Chase which JP Morgan Chase would assume counterparty risk and management control of Bear Stearns. This transaction was secured by a loan from the Federal Reserve Bank of New York of $30 billion, which would cover any losses in Bear Stearns' investments in mortgage-backed securities and exotic investment paper.
When testifying before the Senate Committee on Banking, Housing, and Urban Affairs, Jamie Dimon, CEO of JP Morgan Chase, affirmed that his company “would not and could not assume the substantial risk of acquiring Bear Stearns without the support of the Federal Reserve.” According to the testimony of Federal Reserve Chairman Ben Bernanke, “Normally, the market sorts out which companies survive and which fail, and that is as it should be… Our financial system is extremely complex and interconnected, and Bear Stearns participated 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.”
The American economy is strong and resilient, but subprime mortgage-backed securities have shaken investor confidence and our markets. I share your concern about government interference in the market, and I take Congress’ oversight role of the Federal Reserve and the Department of Treasury very seriously. As a member of the Senate Committee on Banking, Housing and Urban Affairs, I will continue to closely monitor the Fed and the Administration to ensure a proper balance between protecting our economy and allowing our free market principles to reign. I will continue to work with my colleagues in the Senate to determine how we can use the resources of the federal government in a reasonable and responsible manner in order to mitigate future losses.
Again, thank you for sharing your views with me. For more information about issues and activities important to Florida, please sign up for my newsletter at http://martinez.senate.gov.
United States Senator