Stock Market Continues Adjustment: $700 Billion Mistake Didn't Make a Dent

I wrote on September 28th the following: No $700 billion ever made can stop a crash of a financial system that people have lost their trust in and believe is unstable.

And today's stock market results bear that out: the Dow was down over 800 points today before the market underwent a last-minute rally, which allowed the Dow to close down 300+ points instead of the 800 points that looked likely as the clock ran out.

The problem now is that the global markets are crashing as well. A lot of Western countries do not have an FDIC to safeguard their deposits as we do, and when a government rushes in to save a bank, it has adverse effects on their own stock markets, which are also tied into Wall Street. And investors are panic selling, because they believe that the financial system is weak and unstable.

Welcome to the dark side of globalization.

Is it too late to revoke the bailout? If it isn't going to work, then they should not proceed with it at all.

This has been the strangest bill in quite a while; the size of it is HUGE; Wall Street didn't want it, the politicians say they didn't want it but attached $150 billion in pork to buy off their colleagues to vote for it, Wall Street put it's reaction on public display by losing hundreds of points on the days that the House and Senate voted on this bill; then they said it probably wasn't the fix that was needed. Then Wall Street lost hundreds of points more over worry that the money won't come fast enough. And the taxpayer's on the hook for the entire $850 billion package with little to no hope for a return.

The entire mess should be repealed and re-thought; throwing money away like this is UTTER stupidity!

$700 Billion Bailout/Mistake is Actually $850 Billion With Vote Buyoffs

The $700 bailout of Wall Street's Folly will actually be $850 billion with the bribes paid out to members of Congress to change their votes from "nay" to "yay."

Here is the list of pork that was added to the bill:

• $100 million for the construction of a race track.
• $49 million to spread the taxes out from the Exxon Valdez oil spill disaster over three years.
• $239 million payout to fishermen who suffered losses during the Exxon Valdez oil spill.
• $3.3 billion for a "Secure rural schools and community self-determination program."
• $3.3 billion in tax cuts for people who don't pay state taxes.
• $478 million for Hollywood.
• $148 million for wool subsidies.
• $33 million for development costs to American Samoa.
• $10 million for a fringe benefit to employers whose employees ride their bicycles to work.
• $322 million for manufacturers of efficient appliances--not for people who buy them!
• $192 million for rum duties. The pirates will be very happy about this provision.
• $2 million for production of wooden arrows for children.

The provisions listed above are the most objectionable ones (in my opinion) in the entire objectionable bill; here is the complete list as compiled by the Taxpayers for Common Sense watchdog group.

House Passes Senate Version of $700 Billion Mistake: Wall Street's Folly is Now Washington's Folly Too

The House rushed through passage of the $700 billion bailout bill, and President Bush hurriedly signed it, clearing the way for this new chapter of the fiasco to proceed.

And Wall Street didn't even bat an eye. When the Senate passed the bill, Wall Street rewarded it with a 350 point loss. When the House and the Administration did their thing today, Wall Street yawned, turned over and lost another 157 points.

Why?

Because now they don't think that this was the right thing to do. Thanks a lot, guys.

In the meantime, here is the complete list of Representatives who changed their vote:

Republican Representatives: Alexander, Barrett, Biggert, Boustany, Buchanan, Coble, Conaway, Dent, Fallin, Frelinghuysen, Gerlach, Hoesktra, Knollenberg, Kuhl, Myrick, Ramstad, Ros-Lehtinen, Schmidt, Shadegg, Shuster, Sullivan, Terry, Thornberry, Tiberi, and Wamp. One note: Welling didn't vote for the first time in his tenure.

Democratic Representatives: Abercrombie, Baca, Berkley, Braley, Carson, Cleaver, Cuellar, Cummings, Edwards (MD), Giffords, Green, Hirono, Jackson (IL), Jackson-Lee, Kilpatrick, Lee, Lewis (GA), Mitchell, Ortiz, Pascrell, Pastor, Rush, Schiff, Scott (GA), Solis, Sutton, Thompson(CA), Tierney, Watson, Welch (VT), Woolsey, Wu, and Yarmuth.

One important note: Jim McDermitt (D-WA) was the sole Representative to switch his 'yea' vote to 'nay' the second time around.

I don't think any of the Representatives listed above or any of their colleagues that voted 'yea' for this bill should be returned to Congress for another term by their constituents.

This is a huge and costly mistake. It should have been a $700 billion loan, not a freebie.

Time for some incumbents to be turned out of office. Specifically, 75 senators and 263 Representatives.

And we've only seen the beginning of this bailout. Now everyone will want one too.

Wall Street Should Fend for Itself: They Made That Bed, Now They Should Sleep in It

I am now opposed to bailing Wall Street out of it's "toxic debt" problem that it alone is responsible for. The American taxpayer should NOT be made to pay for Wall Street's Folly, beyond what has already been agreed to.

In my opinion, the bailouts of Fannie Mae, Freddie Mac, AIG and Bear Sterns were correct, because of their interconnecting relationships to the U.S. and global currency markets. The damage from the collapse of those companies would not have been confined to Wall Street. Lehman Brothers was not bailed out because it was self-contained, as many of the other companies who stand to benefit from this $700 billion mistake-in-progress are.

The standard that the Bush Administration followed before should be the standard that is used now in deciding which companies to save, and which ones to allow to go by the wayside.

The other companies who have "toxic debt" need to get on a payment plan and pay off their debt. If the government wants to help, they should negotiate and set a fair interest rate with the creditors, which will allow the companies to clean up their own friggin' mess. People have to do the same thing; why should it be different for a company that goes into deep debt?

This is entirely appropriate for a system that cheers when blue-collar workers lose their jobs and pensions, while the system sees it's stock value soar. Why then, should blue collar taxpayers be stuck with the company's bill?

SHAME on Wall Street!

And the government needs to come up with a better plan.

Congress is Asking Administration All the Right Questions: $700 Billion Bailout is Unbelievable

Democrats and conservative Republicans in Congress appear to be asking all the right questions about the Administration's plan to take over all of the "toxic debt" that Wall Street ran up.

The Secretary of the Treasury and the Federal Reserve Chairman appeared before Congress for a second day to push through the Bush Administration's bail-out plan. Congress gave the two a frosty reception again and started right in on the proposal, asking for modifications to the plan. And it appears that there has been a tiny bit of progress.

The Democratic position is that the plan should also help common people who are struggling with their mortgages and are in danger of foreclosure. They want to change the bankruptcy laws of the nation so that struggling homeowners can be thrown a lifeline too and restructure their mortgages.

Conservative Republicans think that this plan is financial socialism, which they don't agree with and won't support. They want everyone to stop and think this thing through before enacting a bad plan that gets rushed through just because the Administration wants it.

One of the committee members asked if it was possible to give Wall Street a fraction of what was asked for in the plan: $150 billion instead of $700 billion, with the possibility of the Administration coming back and asking for more. They got a big "NO!"

I'm still not convinced. I think that $700 billion is just the start and they'll come back and ask for another $500-$750 billion in six months. We can't afford that!