The Bailout plan did not pass yesterday, and the stock market lost 7% for the day. Today the market is starting out higher, but will it hold. Will the lawmakers agree on a new bill once they return on Thursday. Is a bailout really needed. Should we be using the word bailout. Is the word bailout confusing or misleading the average American as to what is really going on. Will the banking system work through its problems without a bailout.
After days of delicate negotiations between U. S. government officials, Treasury chiefs and Congressional leaders, agreement seemed to have been reached Sunday on details of a $700 billion plan authorizing Treasury Secretary Henry Paulson to buy “toxic debts" from banking institutions to allow them to resume borrowing normally. But the bill failed at the first legislative hurdle Monday as lawmakers in the House of Representatives rejected it by 228 votes to 205.
So many questions. These are just some of the questions that I have about this situation. When I watch CNBC each day I hear about the seizing of the credit markets and that will have an impact on the average person. This will happen because we won't be able to get a loan for a house, a car small business will not be able to get short term financing for day to day business operations. this will lead to a slower economic activity and eventual layoffs they say. it will be interesting to see what happens with the stock market over the next couple of days while there is no plan in place.
The politicians are playing the blame game already. One thing is clear they only have re-election on their minds. They will do what they think will get them re-elected.
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