WASHINGTON - With the economy on the brink and elections looming, Congress approved an unprecedented $700 billion government bailout of the battered financial industry on Friday and sent it to President Bush who quickly signed it. "We have acted boldly to help prevent the crisis on Wall Street from becoming a crisis in communities across our country," Bush said shortly after the vote, although he conceded, "our economy continues to face serious challenges." Underscoring that somber warning, the Dow Jones industrials, up more than 200 points at the time of the House vote, had fallen into negative territory an hour later. They fluctuated as the afternoon wore on. The final vote, 263-171 in the House, capped two weeks of tumult in Congress and on Wall Street, punctuated by daily warnings that the country confronted the gravest economic crisis since the Great Depression if lawmakers failed to act. There were 58 more votes for the measure than an earlier version that failed on Monday. "We all know that we are in the midst of a financial crisis," House Republican leader John Boehner of Ohio said shortly before casting his vote for a massive government intervention in private capital markets that was unthinkable only a month ago. "And we know that if we do nothing, this crisis is likely to worsen and to put us into an economic slump like most of us have never seen," he said. House Speaker Nancy Pelosi, D-Calif., said the bill was needed to "begin to shape the financial stability of our country and the economic security of our people." Treasury Secretary Henry Paulson pledged to begin using his new authority quickly, and Federal Reserve Chairman Ben Bernanke said the central bank would work closely with the administration. Wall Street welcomed the action, but investors also were buffeted by a bad report on the job market. The Labor Department said employers slashed 159,000 jobs in September, the largest cut in five years and further evidence of a sinking economy. At its core, the bill gives the Treasury Department $700 billion to purchase bad mortage-related securities that are weighing down the balance sheets of institutions that hold them. The flow of credit in the U.S. economy has slowed, in some cases drying up, threatening the ability of businesses to conduct routine operations or expand, and adversely affecting consumers seeking financing for mortgages, cars and student loans. Some state governments have also experienced difficulty borrowing money. The House vote marked a sharp change from Monday, when an earlier measure was sent down to defeat, largely at the hands of angry conservative Republicans. On Friday, 91 Republicans joined 172 Democrats to support the bill, while 108 Republicans and 68 Democrats opposed it. Twenty-five Republicans and 33 Democrats switched their votes from "no" to "yes." One Democrat who supported Monday's version, Rep. Jim McDermott of Washington, opposed the bill Friday. One Republican who didn't vote Monday, Rep. Jerry Weller of Illinois, voted "yes" on Friday. http://news.yahoo.com/s/ap/financial_meltdown Only posted part of the article but I'm glad to see this thing went through.
Yay! A bad bill passed under stress and threats. What could go wrong? I guess we get find that out over the course of the next few months.
at least they were able to stall it 4 days making the situation worse AND adding some fat pork to the bill. 2 birds with one stone! YAH!
No kidding. If they were going to pass it anyway, which I hate the idea of, at least pass the one that doesn't have $150B+ added to it.
Hooray, my dad's IRA is saved! http://finance.google.com/finance?c...223066155000&chddm=391&q=INDEXDJX:.DJI&ntsp=0
What a load of bull****. We just got ripped off by the business and political elite. EMERGENCY EMERGENCY GIVE US YOUR MONEY OR SOMETHING BAD WILL HAPPEN ... **** you Bush, **** you Congress, **** you Wall Street, you're all a bunch of ****ing *****.
I'm embarrassed by what occured today. Today I feel like America as I know it crumbled. This bill was unessecary. Regulation was needed on Wall Street, not money being thrown at the problem. There is also a lot more envolved with this recession or whatever people want to believe we are in. Rising oil prices and higher minimum wages there was less money to spend, which leads to fewer jobs which led to defaulting loans. In spite of the Dow going downhill over the last few months, there have been positives in the economy. The dollar was regaining value, oil was dropping, and I honestly believe prices would have leveled out. What have we acheived now? Maybe this leads to people getting more credit, but why is that a good idea? The credit market needs to shrink as people have buried themselves in debt and people need to get out of such serious debt. But what does my opinion count for? One vote for against a guy who got elected anyway and voted yes on both proposals.
This bill reminds me of the mass exodus of Hurricane Rita More folx gonna be hurt by the evacuation than the actual storm Rocket River
The term "epic failure" is thrown around a lot on this board and the internet in general. But this really, and truly, from start to finish, top to bottom, was an epic failure.
No offense to just about all of you intended, but how can any of us, from Congresspeople to BBS posters to U. Chicago economists really think we understand a problem as complex as this one? In physics, we call it "the many body problem." And here you have tens of thousands of interdependent variables. I just don't get why anyone would celebrate. And likewise, I don't get how anyone *knows* this was the wrong thing to do so that eye-rolling and hyperbolic negative statements are warranted. IMHO, none of us knows crap about what happens next and whether this was the right or wrong thing to do in short order.
the illiquid asset purchase program (which has been misrepresented as a bailout) is not the solution. it's just one thing in a long list of many things that needs to be done. it's not the best solution but it is a stop gap until an exchange can be created for this assets to be traded and cleared for all the public to see.
That's the point though. We definitely had a problem, but only one solution... one solution for a problem nobody really understands... and nobody really knows if it will work or not. In fact, there are a lot of folks saying it won't work. Yet here we all are. The fact that we only had time to look at the one solution proposed by the administration is no accident. The process gets to me the most, but make no mistake, this is a bad bill. I think it will be worse than taking the time to craft a good bill, but as has been pointed out by many people here, I don't understand finance and we needed to act NOW!
We had to do what the administration wanted and we had to do it NOW! so we could prevent a massive failure. http://www.rgemonitor.com/roubini-m...rrest_the_risk_of_the_mother_of_all_bank_runs
Did you notice what happened the longer the bill stayed in congress? It got fatter and fatter. It got more expensive. The only thing these jerks no how to do is spend money and this is the ONLY reason it got voted down on Monday. I know for a fact the two local reps voted it down because it did not do anything for low income housing.
