Treasury Chief Defends Fed Intervention

By: AP
By: AP

WASHINGTON (AP) -- Treasury Secretary Henry Paulson is defending the Federal Reserve's decision to help rescue Bear Stearns Co., the teetering Wall Street investment firm.

He says the Fed acted properly in "working with market participants to minimize the disruptions." The central bank on Friday stepped in to keep Bear afloat and prevent more damage to the nation's financial system if Bear's problems caused other financial firms to fall.

"When you go through a period like this," Paulson said in a broadcast interview Sunday, "policymakers need to balance various consequences."

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