Maybe the sky is not falling, but the worse day of losses in the history of the NY Stock Exchange -- PLUS Global Stock exchanges falling from 5% to 9% around the world -- is as close as anyone wants to get. The ramifications of the U.S. House of Representatives vote to defeat the "Emergency Economic Stabilization Act of 2008" are being felt around the globe.
The United States is facing economic paralysis, and we don't know what to do about it. What is interesting is that the scale of the proposd solution is so large that the public reaction was -- "The tax payers shouldn't pay to bail out the greedy crooks on Wall Street." The response of the market to this balky reaction was a $1.2 trillion loss in one day -- much worse than the $700 billion cost of the rescue plan. Most taxpayers don't understand the necessity of this action, but perhaps a couple of days of reflection -- and a few more business failures -- will confirm the necessity to act.
SO, NOW THAT "THE MARKET" HAS OUR ATTENTION, CAN WE HAVE A DO OVER?
Our Presidential candidates are simply left to sound bites:
"This is a moment of national crisis, and today's inaction in Congress as well as the angry and hyper-partisan statement released by the McCain campaign are exactly why the American people are disgusted with Washington," the Obama-Biden campaign said in a statement released shortly after the vote.
"Barack Obama failed to lead, phoned it in, attacked John McCain and refused to even say if he supported the final bill. ... This bill failed because Barack Obama and the Democrats put politics ahead of country," Holtz-Eakin, a senior policy adviser for McCain, said.
Clearly, Presidential politics hasn't played a significant role in getting us closer to a resolution. This crisis won't lend itself to a silver bullet solution. It will require a broad-based restructuring of both our fnancial markets, our consumptions-based economy, and the housing sector, which is at the foundation of this collapse.
The question is which Presidential candidate is going to better handle the mess that gets handed to them?
Hang onto your job, and what little savings and investments you have. This is going to be a bumpy ride for all of us.
Posted By: Roger E Madison Jr
Tuesday, September 30th 2008 at 1:55AM
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