Bear Stearns Sale to JP Morgan. BS for Main Street Investors and Taxpayers. Investigation Urged.

Main Street Investor’s Advocate Decries JP Morgan’s Purchase & Federal Guarantee, Calls Action Outrageous and Inconsistent.

03/19/08: Securities Arbitration UPDATE: Paul Young, founder and CEO of Securities Arbitration Group today called on Main Street investors to “urge investors to write to every federal legislator demanding an investigation of the $30 Billion guarantee to JP Morgan Chase in the acquisition of historically risk-taking Bear Stearns. ”

Paul Young: “I think the Fed bailout is terrible on many levels. Congress has a duty to Americans to fully investigate the totality of the circumstances of this remarkable guarantee to a private financial firm of taxpayer money.

Young continues: “Of equal importance is the new and unprecedented decision of the Fed to loan taxpayer money directly to securities firms, like they do banks without Congressional oversight or approval. This is potentially disastrous. I call on Rep. Henry Waxman to hold hearings forthwith.”

The longtime advocate for burned investors for 20 years who has been a leading voice to champion the rights of Main Streeters burned by Wall Street is “is concerned by the low price paid by JP Morgan knowing that many investors will stand to lose a lot of money” but is “more interested as to the seeming imbalance and unfairness between the FED’s $30 billion credit line to facilitate the buyout as contrasted with their longstanding market forces stance of the FED and the Bush administration, plus the resistance to helping regular Americans hurt by Wall Street misdeeds. I think it is absolutely outrageous,” said Young. “And the Fed, in the dark of night, also engineered this new program to provide a new source of cash to the top 20 Wall Street firms.”

Securities Arbitration’s position is that no federal agency or quasi-governmental agency has moved this quickly and forcefully to help individual investors victimized by the misdeeds of Wall Street. But when Wall Street gets in trouble, as now, the private enterprise, market forces champions are only too quick to help large institutions recover from their own mistakes or ignorance (or worse).

“Who pays in the end? The investors, the taxpayers,” reminds Young. “While the Bear Stearns top people count their money on the way to the Hamptons, the investors on Main Street get hurt. This action, which may be the first of many like it to come, makes the Long Term Capital $5 billion federal bailout in 1998 look like small change,” concludes Young.

As we have been asking for days, weeks, years: WHO IS LOOKING OUT FOR MAIN STREET?

MORE: RED PHONE RINGING FOR MAIN STREET -

The Economy. It is the foremost domestic concern for Americans. As well it should be. And it hits lives hard and daily.

Rising unemployment, rising prices and surcharges for almost all products (see OIL as major culprit!), the worst housing recession ever (NYU Prof. Roubini’s “Global Economics”), a mortgage meltdown spiking foreclosures (real people impacted – your audience), and many more significant problems in the national and worldwide economy, combine to cause immediate and long term pain for Main Street people.

While the red phone has been ringing unanswered in Washington and Wall Street for months many phones on Main Street are being disconnected.

Wall Street. What did they do wrong? “They forgot,” says money expert Paul Young. “They forgot their moral and legal obligations to treat small, individual investors with fairness, with full disclosure, with reality-based investing alternatives and products. And now they themselves (the Wall Street firms) are being supported with foreign govt. infusions of cash to our biggest financial institutions – something unthinkable until recently (see Citigroup, Merrill, others).

But hurting MORE, and much more, are Main Street investors. Real people with savings and/or retirement monies being hurt and victimized yet again for another cycle of greed and negligence. Why? What happened?

Wall Street got greedy and very risky again (see: ENRON, etc.). Firms have returned to packaging and selling investors unsafe products (see LIMITED PARTNERSHIPS, 1990s) such as mortgage backed securities, and other high risk and hard to understand, highly esoteric investments. Wall Streeters have once again failed to provide the safety and security most investors both need and want in troubled times. Most are not Las Vegas-type gamblers.” And, as Marketwatch’s money columnist David Weidner wrote on March 4th, echoing what Paul Young has been proclaiming for many years, “Greed, dear readers, is the key factor in every story on the business page, every move the market makes, every bailout or rescue plan that great economic forces put into play.” Greed has long been ascribed as the reason Wall Street abuses Main Streeters as responsibilities repeatedly clash with the need and desire for fees and commissions. It is as true today, or more so, than it was 20 years ago when Securities Arbitration began.

As the Los Angeles Times reported recently, many claims involving high risk packaged investments, derivatives (a looming huge disaster), and other esoteric investments, will likely end in federal court class action lawsuits. Seasoned reporters will recall the 1990s LP scandals and the resulting class actions that were, as the new ones are anticipated to also achieve, settlements for pennies on the dollar. Pennies. Fair? No. Avoidable? For many individual investor-victims: YES.

A better answer is securities arbitration. Better and best. Securities arbitration answers the red phone when it rings off the hook.

Available to most (not all) burned investors, it was clearly proved in the 1990s LP scandals that successful individual case arbitration claims resulted in the fortunate minority who learned of and used their right to individually arbitrate their disputes with Wall Street received upwards of 75 to 120 cents on the dollar – a vast improvement over the dime-on-the-buck deals that a number of class actions on the very same LP products in class actions against the very same Wall Street firms produced. “I know. I did dozens of arbitration cases then and we achieved great results as above quoted in each arbitration while the class actions proceeded to low payoffs, saving Wall Street a lot of money and causing burned Main Streeters to lose twice,” reports Young.

The best friend of the burned investor is securities arbitration. “If possible, securities arbitration. Tested, true, and it works. Time effective, cost efficient, claims are judged as they should be: individually, not in a grouped with thousands of strangers, as class actions are litigated. Available in all states, securities arbitration is the one realistic pathway for those real Main Streeters truly victimized by Wall Street.

“But, to our continued dismay, the great, real-life opportunities presented by securities arbitration are now harder to get covered by the media - for many reasons,” says Young, whose idea of a good day, other than helping burned investors, is talking to reporters, doing radio and TV and other media to talk about his passion and focus for almost 20 straight years – securities arbitration.