Bailout Flameout: House Rejects Bailout Bill, Dow Nosedives 777 Points
When I got the news that the House had rejected the bailout bill, my jaw hit the floor! We all knew the Dow had been under pressure pre-market and from the opening bell, but I thought the political pressure to act fast would have been overwhelming, but it didn’t turn out that way.
Stunningly, members of both parties saw things in the bill they didn’t like and they balked not only at the provisions in the bill but the price tag as well and voted the bill down. The market reacted just as you would have expected. Down hard.
If past experience is any guide, tomorrow should be a wild day on Wall Street. If the Asian markets sell off later this evening, the Euro zone markets will take their cue from them and sell off in lock step.
I can’t help feeling angry at the incompetents both inside the financial markets who never met a loan they didn’t like, to whom 30 to 1 leverage seemed like a prudent risk and toward the “regulators” inside of government who are handsomely paid to be our watchdogs while we are working 45 to 60 hours a week so that we can pay their salaries.
It’s time some folks got fired and some others need to go to jail. I hope the public won’t forget this episode in American history. This 2-3 trillion dollar debacle is not going to be swept under the rug. The public didn’t get it’s money’s worth and it’s time for the taxpayer’s to be paid back by the financial market pirates and the government pirates who just wrecked the economy.
~~John Cronin
September 29th, 2008 at 5:16 pm
I don’t pretend to be a financial expert, but it seems to me that we, the average joe, have a lot of blame in this matter. As a culture we advocate leaving beyond our means. I truly believe that the only real solution to the financial crisis we are in is a long-term, gradual retrenchment, where credit is a lot more difficult to get.
When I bought my home 2 1/2 years ago I was offered mortgages that seemed too easy. I am not stupid, thought, and I knew that I would have to pay it back with interest, so I purposely took a conventional loan, bought a house that was not as nice as I would have liked, but where the terms of the loan I knew I could comply with. We can blame the lending institutions for predatory lending practices, and certainly it is deserved. We can blame the government for pushing loans for high risk people, and that is deserved too. But when it comes down to it, we as American citizens need to take responsibility and live within our means.
I don’t want to live through another great depression, but sadly the lessons learned in the 1930s seems to have been long since forgotten, or in many cases never learned by the younger generation.
September 29th, 2008 at 5:30 pm
John, I cannot believe the sequence of events today. At least, they are going back to the drawing board. Today’s market dip cost Americans one trillion dollars. I’ll bet phones ring off the hook and e-mails are flying. Pelosi has to blame, her comments were nasty. It seems hardly fair we all have to pay for her partisanship!
September 29th, 2008 at 7:11 pm
Someone needs to knock heads. Today’s events were completely unacceptable - on both sides.
It is also unacceptable that they have adjourned util thursday. At the very least, they need to close the markets until then. The last thing we need is a 1000 pt. drop on the DOW tmrw.
September 29th, 2008 at 7:24 pm
I do not understand all the ends and outs in this mess but I do know we need to get the best option possible for the middle class and not have this one rushed through. We have time to consider better options that are not as costly to the average tax payer.
Also, part of the bill should include the reforms of the practices that have led us to this point. We can’t keep throwing good money after bad.
Many economist have said that this plan will not work. That tells me that they could be asking for more $$$$$$$ down the road. The market needs to correct itself. In a Free market businesses must be allowed to fail. Survival of the fittest.
September 29th, 2008 at 7:36 pm
One thing I have not heard reported much in the news is the fact that many of the congressmen both Dem and Rep. were getting calls 200 to 1 against this bailout.
Our congressmen Bishop said “This bill had been greatly improved but it still gave to much authority to Paulson.” Bishop felt like there was still room for improvement and he thought that they could produce a better bill by Thursday.
I think they delaying working on the bill because of a Jewish Holiday.
September 29th, 2008 at 7:40 pm
John Cronin, well said. Well said.
While America has turned purple holding its financial breath, Congress is shooting spit wads and flicking boogers at each other behind doors and in front of the cameras. Greedy-guts Wall Street execs are sipping martinis and laying low - not a peep out of ‘em. And where is Obama and McCain today? Why aren’t they talking to us? Because they don’t want to be on the record.
Buffoons, bullies, bimbos, bozos, and belly-achers.
Bizarre!
September 29th, 2008 at 10:44 pm
The sad thing is that palosi could have twisted a few arms and gotten it pass so now they will beat us with this vote.
September 29th, 2008 at 10:55 pm
Noelle- all good points. I made the same housing decisions- locked in at a low rate five years ago. We drive two older, nearly paid for, practical cars. Nearly every day there were offers to borrow up to 125% of the value of my home- ridiculous.
It may seem extreme, but over the past year we had lost about 30% of the value of our mutual funds. In response, we sold them all off on Friday before the big drop. We plan on paying off all unsecured debt, and will invest in ourselves rather than the stock market from now on!
September 30th, 2008 at 4:02 am
MAYBE NOW IS THE TIME TO SAY NO , TIME TO DRAW THE LINE AND FINALLY SAY NO MORE , AMERICA’S HAD ENOUGH .
LET’S HEAR WHAT THE REPUBLICANS HAVE TO SAY , WE CAN’T WAIT A FEW DAYS TO SEE IF THERE IS SOME OTHER WAY TO DO THIS ?
September 30th, 2008 at 4:31 am
Another hit on Palin:
http://www.cnn.com/2008/WORLD/americas/09/29/zakaria.sarah.palin/index.html
September 30th, 2008 at 7:22 am
Another ‘hit’? Dont cha think she brings on some of this herself? I’ll get back to ya on that.
September 30th, 2008 at 8:03 am
WSJ on Monday reported that subpoenas have been issued to the top brass at Fannie and Freddie. All you have to do to get Government to respond to you is to hit them “upside” the head with a cast iron skillet. And, lo and behold, someone rolls up their sleeves and finally goes to work for the taxpayers who fund this dog and pony show.
September 30th, 2008 at 8:29 am
If congressmen were receiving phone calls 200 to 1 against this bill and then congress voted against this bill, why is everyone disappointed that this bill did not pass? Shouldn’t we be grateful that our leaders listened to the people.
There are better solutions that need to be considered before we rush to pass this bill.