In the minutes released from a meeting of Fed Governors to approve Bear Stearns' acquisition by JPMorgan and the establishment of a lending facility to primary lenders on March 14 and 16, the Fed reaffirmed that the moves were "based on recent, rapidly changing developments."

"There developments demonstrated that there had been impairment of a broad range of financial markets in which primary dealers finance themselves. The available evidence also indicated that the dealers might have difficulty obtaining necessary financing for their operations from alternative sources."



Members also discussed whether six months was a sufficient time period for the primary lending facility to be in place.

Participating in the meeting were Fed Chairman Ben Bernanke, Vice Chairman Donald Kohn, and Fed Governors Kevin Warsh, Randall Kroszner and Frederic Mishkin.

By Erik Kevin Franco and edited by Cristina Markham