Bailout Brouhaha
Posted by Kirk M on 29 Sep 2008 | Tagged as: Times a changing
Well, it happened, the $700 billion dollar bailout was voted down 228 to 205 in the house today. The vote against the measure was 228 to 205, with 133 Republicans turning against President Bush to join 95 Democrats in opposition. The bill was backed by 140 Democrats and 65 Republicans.
Of course the stock market, which was already falling as speculation of the bill’s rejection ran rampant, tumbled even farther once the news got out that the bill was actually rejected.
Wall Street was pinning its hopes on the government’s $700 billion financial system rescue plan. But the fervently wished-for bailout was rejected Monday by the House of Representatives in a stunning turn of events, and investors reacted with a vengeance. Major U.S. stock indexes plummeted Monday in one of their worst sessions ever.
The ugliness was widespread, with major indexes posting their worst percentage declines since the 1987 stock market crash. The Dow industrials fell 5.4%, the S&P 500 sank 7.8%, and the Nasdaq plunged a jaw-dropping 9.1%.
Another Black Monday for Wall Street: BusinessWeek
So why did this wonder bailout bill fail to even pass a House vote? Well, the McCain campaign blames Obama outright of course (what else?), for not supplying good leadership when it was needed while the best I could find on the Democratic side was Obama continuing his ongoing rhetoric that McCain’s deregulation is far too risky for the economy (I tend to agree with this).
Of course the former stands to reason since it’s well known that Obama carries so much weight when it comes to his presence in Congress that it would actually sway the majority of the House vote to reject the bailout. If he hadn’t been there at all or hadn’t any say in the matter whatsoever, it’s obvious that the bailout would have passed hands down, no problem.
Yeah right, get real here.
That both McCain and Obama had both previously stated they were voting in favor of passing the bailout before the vote actually took place obviously meant that only McCain was telling the truth and Obama was just pulling our leg.
So what’s in this for the everyday working men and women out there? Those who basically live from paycheck to paycheck with no long term investments or large portfolios to sweat over? Well…looks like fuel prices might get cheaper:
Crude for November delivery dropped $10.52, or 9.8%, to close at $96.37 a barrel on Nymex. It was at its weakest closing level since Sept. 16.
In dollar terms, the futures marked their second-largest one-day drop on the New York Mercantile Exchange. The largest was set in January 1991 at a daily loss of $10.56, according to FactSet Research.
The failure of the bailout plan’s passage "will drop the oil price some more … because oil traders perceive this will hurt the economy — and as a result reduce oil demand," said Charles Perry, president of Perry Management, an energy-consulting firm.
The bottom for oil prices is probably around $90 now, but prices could go lower in the next month or two, he added.
Oil drops more than $10 as bailout plan fails to pass: MarketWatch
Uh…that’s good…
…isn’t it?
Possibly Related Matter
2 Comments »
on 29 Sep 2008 at 11:51 pm 1.janeywan said …
Lower gas prices will give us incentive to go to our failing banks to get the paper that has no value. Or something like that.
on 02 Oct 2008 at 8:37 pm 2.Kirk M said …
Hi janeywan,
Now I could swear on a thousand pomegranates that I had already replied to your comment but obviously my mind or possible the pomegranates were a bit moldy…sorry about leaving you like this.
Anyway, I went to the bank today and lo and behold, my $8.00 was still there…or at least $6.00 of it was. The bank took out their monthly $2.00 fee of course. Perhaps those blue collar folks who basically live from paycheck to paycheck will turn out to be the lucky ones during these “interesting times”.