Based on previous hurricane events, the increase in gasoline prices should be short lived, but this outcome is uncertain and will depend on the extent of damage to refining capacity. Improvements in the labor market have continued.
To prevent a disorderly failure of Bear Stearns and the unpredictable but likely severe consequences for market functioning and the broader economy, the Federal Reserve, in close consultation with the Treasury Department, agreed to provide funding to Bear Stearns through JPMorgan Chase. Over the following weekend, JPMorgan Chase agreed to purchase Bear Stearns and assumed Bear's financial obligations.