About 60 protesters opposed to the U.S. Federal Reserve’s help in bailing out Bear Stearns entered the lobby of the investment bank’s Manhattan headquarters on Wednesday, demanding assistance for struggling homeowners.
Demonstrators organized by the Neighborhood Assistance Corporation of America chanted “Help Main Street, not Wall Street” and entered the lobby without an invitation for around half an hour before being escorted out by police.
“There are no provisions for homeowners in this deal. There are people out there struggling who need help,” said Detria Austin, an organizer at NACA, an advocacy group for home ownership.
Bear Stearns employees were amused and perplexed, some taking pictures. One man in the lobby applauded.
“Homeowners, that’s more than $1 trillion (in mortgage debt), you’re crazy,” another man in a suit screamed at a protester on the street.
The protesters blamed Bear Stearns and JPMorgan Chase & CoCo employees for helping fuel the mortgage crisis.
Demand for mortgage debt from investment banks including Bear Stearns encouraged lenders to drop standards to create new loans. Some lenders resorted to scams and fraud to initiate loans.
The banks repackaged and resold the debt to investors.
“Blame the mortgage tsunami on Bear Stearns,” read one sign. Another read, “Bear Stearns employees aren’t worth $2.”
After leaving Bear Stearns, the crowd moved to JPMorgan.
“We will go to their neighborhood, we will educate their children on what their parents do. They should be ashamed,” NACA founder Bruce Marks said of employees at both banks.
On March 16, JPMorgan Chase & said it would acquire its rival the Bear Stearns Co Inc. for $2 per share, in a deal brokered by the Federal Reserve aimed at heading off a bankruptcy and a spreading crisis of confidence in the global financial system.
On Monday, JPMorgan raised its offer to about $10 a share to appease angry stockholders who vowed to fight the original deal. Bear Stearns traded at $11.25 a share at 3:30 p.m. on Wednesday, up 2.8 percent.
As part of the deal, the Fed agreed to guarantee up to $29 billion of Bear Stearns assets.
The agreement has raised concerns that the U.S. government is prepared to help rescue a failing Wall Street bank while declining to bail out millions of home owners facing the possibility of foreclosure.
