The Bear Stearns buyout turns ugly. Jaime Diamon got too greedy!

All that glitters isn't gold. Jaime Diamon is learning that the hard way. He thought, he was going to pick up Bear Stearns for a song, at a knock down price of us$2 a share, and at rate or taxpayers' nickels & dimes; he hastily signed an agreement which according today's New York Times [24 March 2008] whereby JP Morgan Chase guarantees Bear's trade, and so suddenly in less than week since the deal was announced it looks as though he mortgaged JP Morgan's purse for what he throught was a steal of a buy and a done deal. It ain't. Suddenly, he's upped the ante by offering us$10 a share, but that won't soothe the turbulent waters of anger of Bear's shareholder large or small. The offer is a slap in the face, he has to come up with a mininum of us$30 a share, the very price Bear closed at on 14 March last. Do the sums on your fingers and toes, and that makes the deal less good than Diamon had thought. He would've to burden JP Morgan with billions of dollars in debt which the Fed may very well not cover. Angry, 'apopletic' the New York Times reports, he's threatening to walk away from the deal, letting Bear fall into bankruptcy. But the Fed won't let that happen, and so it looks as though Bear has a chance to lumber through the crisis as Bear. Diamon isn't even sure that the US government will allow the spike of by 5 in share prices he's offering.
If Diamon and the Fed and the Gang of 4 who now are bringing aid and succor to investment banks up to their nose in subprime debt did not envision a cold reception at the way they brought Bear Stearns down, you cannot but think how dumb they are. The first news of Bear's heist brought the markets in Asia and Europe tumbling and the scurrying of the mice in the US government to rescue not only the deal but to bring some calm in not only the US but the world market. So much for the savvy say of the anal hair stylist Hank Paulson and the toilet room attendent Ben Bernanke...
And now there is a turf war going on between Paulson at the Treasury and Bernanke at the Fed about the need of regulating banks and mortgage markets and keeping an eagle eye on the financial con games of the banking industry so that CDO's, ABS' and the like won't rise again or at least for another 50 years!
Paulson hates regulation for it would crimp Goldman's style; Bernanke knows what bank failure means having studied the collapse of world markets in 1930, ushering in the Great Depression. Each are advocates of laissez faire capitalism but Paulson would rather see a Goetterdammerung in the markets than let them be manicled to good regulation, but Bernanke the wiser of the two jackasses strives to save the system. Bernanke knows that to preserve his class' privileges you've to give a little to say the whole. Which brings us back to Jaimie Diamon who slick as he is, let his greed get the better of him, and now his leadership is in question and his shareholders have might cotton to thread about the imploding debt which a revised deal in taking over Bear Stearns entails. Already rumours are on the street that hidden in JP Morgan's balance sheet is debt upwards to us$300 billion. True or not...it is enough to shake the might Morgan bank. Additionally, no one questioned the roaring engine of anger and revenge of Bear's stockholders big and small, and they do matter for it is they who have to hand over share so that JP Morgan can 'rescue' and kill Bear at the same time. And now it looks as though this hostile takeover might remain hostile and bitter and costly to fool's gold Diamon.