STOCK markets crashed worldwide yesterday as US politicians rejected a £400billion plan to bail out its financial system. </h2> On Wall Street, the Dow Jones was down 777 points — its largest one-day drop in history — even bigger than after the 9/11 terror attacks.

And in London — even before the shock vote in the US House of Representatives — the FTSE-100 fell by 5.3 per cent after a tumultuous day.

Markets are expected to fall sharply again today unless the rescue package is swiftly put to US lawmakers again and passed quickly.

But that is not expected before Thursday at the earliest as tomorrow is a Jewish holiday.

Doom ... US traders watch as bail-out vote results come in

Last night leaders of both parties were in crisis talks to work out a way to tailor the bill to get it passed by the House on a second vote.

Injection

Lawmakers insisted the bail-out can be rescued.

The shock vote effectively torpedoes hopes that turmoil in world money markets can be quickly halted.

Yesterday saw five European and US banks, including Bradford & Bingley and America's No4 bank Wachovia, either rescued or nationalised. Banking stocks across Europe also tumbled.

And there was another huge cash injection into world markets from central banks including the Bank of England.

The House of Representatives voted 228 to 205 against President George Bush's rescue package.

House Speaker Nancy Pelosi announced after the vote: "The crisis is still with us."

The blow means credit markets will effectively remain frozen, so banks cannot borrow the money they need to keep business going.

Mr Bush had urged lawmakers to "send a strong signal" of confidence to world markets. He said he was "very disappointed", adding: "We've got a big problem."

Many who blocked the move were from his own party — and that of presidential hopeful John McCain.

More than two-thirds of Republicans opposed it, along with 40 per cent of Democrats.

Gloom ... Speaker Nancy Pelosi faces newsmen

The snub followed complaints from US voters about using public cash to aid Wall Street.

Last night Prime Minister Gordon Brown said: "The vote in America is very disappointing.

"We will do whatever it takes to ensure the stability of our system."

Tory leader David Cameron said: "A deal is needed to stabilise financial markets not just in America but elsewhere."

Last night Democratic presidential candidate Barack Obama pleaded for a bail-out deal.

He urged: "Democrats, Republicans, step up to the plate. Get it done."

But in one glimmer of good news, oil prices fell $10 a barrel to $96 yesterday.

In July it peaked at more than $147.

This just about has it right

Interesting take on it, recd this from a friend over night:

Friends,

Let me cut to the chase. The biggest robbery in the history of this country is taking place as you read this. Though no guns are being used, 300 million hostages are being taken. Make no mistake about it: After stealing a half trillion dollars to line the pockets of their war-profiteering backers for the past five years, after lining the pockets of their fellow oilmen to the tune of over a hundred billion dollars in just the last two years, Bush and his cronies -- who must soon vacate the White House -- are looting the U.S. Treasury of every dollar they can grab. They are swiping as much of the silverware as they can on their way out the door.

No matter what they say, no matter how many scare words they use, they are up to their old tricks of creating fear and confusion in order to make and keep themselves and the upper one percent filthy rich. Just read the first four paragraphs of the lead story in last Monday's New York Times and you can see what the real deal is:

"Even as policy makers worked on details of a $700 billion bailout of the financial industry, Wall Street began looking for ways to profit from it.

"Financial firms were lobbying to have all manner of troubled investments covered, not just those related to mortgages.

"At the same time, investment firms were jockeying to oversee all the assets that Treasury plans to take off the books of financial institutions, a role that could earn them hundreds of millions of dollars a year in fees.

"Nobody wants to be left out of Treasury's proposal to buy up bad assets of financial institutions."

Unbelievable. Wall Street and its backers created this mess and now they are going to clean up like bandits. Even Rudy Giuliani is lobbying for his firm to be hired (and paid) to "consult" in the bailout.

The problem is, nobody truly knows what this "collapse" is all about. Even Treasury Secretary Paulson admitted he doesn't know the exact amount that is needed (he just picked the $700 billion number out of his head!). The head of the congressional budget office said he can't figure it out nor can he explain it to anyone.

And yet, they are screeching about how the end is near! Panic! Recession! The Great Depression! Y2K! Bird flu! Killer bees! We must pass the bailout bill today!! The sky is falling! The sky is falling!

Falling for whom? NOTHING in this "bailout" package will lower the price of the gas you have to put in your car to get to work. NOTHING in this bill will protect you from losing your home. NOTHING in this bill will give you health insurance.

Health insurance? Mike, why are you bringing this up? What's this got to do with the Wall Street collapse?

It has everything to do with it. This so-called "collapse" was triggered by the massive defaulting and foreclosures going on with people's home mortgages. Do you know why so many Americans are losing their homes? To hear the Republicans describe it, it's because too many working class idiots were given mortgages that they really couldn't afford. Here's the truth: The number one cause of people declaring bankruptcy is because of medical bills. Let me state this simply: If we had had universal health coverage, this mortgage "crisis" may never have happened.

This bailout's mission is to protect the obscene amount of wealth that has been accumulated in the last eight years. It's to protect the top shareholders who own and control corporate America. It's to make sure their yachts and mansions and "way of life" go uninterrupted while the rest of America suffers and struggles to pay the bills. Let the rich suffer for once. Let them pay for the bailout. We are spending 400 million dollars a day on the war in Iraq. Let them end the war immediately and save us all another half-trillion dollars!

I have to stop writing this and you have to stop reading it. They are staging a financial coup this morning in our country. They are hoping Congress will act fast before they stop to think, before we have a chance to stop them ourselves. So stop reading this and do something -- NOW! Here's what you can do immediately:

1. Call or e-mail Senator Obama. Tell him he does not need to be sitting there trying to help prop up Bush and Cheney and the mess they've made. Tell him we know he has the smarts to slow this thing down and figure out what's the best route to take. Tell him the rich have to pay for whatever help is offered. Use the leverage we have now to insist on a moratorium on home foreclosures, to insist on a move to universal health coverage, and tell him that we the people need to be in charge of the economic decisions that affect our lives, not the barons of Wall Street.

2. Take to the streets. Participate in one of the hundreds of quickly-called demonstrations that are taking place all over the country (especially those near Wall Street and DC).

3. Call your Representative in Congress and your Senators. (click here to find their phone numbers). Tell them what you told Senator Obama.

When you screw up in life, there is hel_l to pay. Each and every one of you reading this knows that basic lesson and has paid the consequences of your actions at some point. In this great democracy, we cannot let there be one set of rules for the vast majority of hard-working citizens, and another set of rules for the elite, who, when they screw up, are handed one more gift on a silver platter. No more! Not again!

Yours,

Michael Moore

[email protected]

MichaelMoore.com

P.S. Having read further the details of this bailout bill, you need to know you are being lied to. They talk about how they will prevent golden parachutes. It says NOTHING about what these executives and fat cats will make in SALARY. According to Rep. Brad Sherman of California, these top managers will continue to receive million-dollar-a-month paychecks under this new bill. There is no direct ownership given to the American people for the money being handed over. Foreign banks and investors will be allowed to receive billion-dollar handouts. A large chunk of this $700 billion is going to be given directly to Chinese and Middle Eastern banks. There is NO guarantee of ever seeing that money again.

P.P.S. From talking to people I know in DC, they say the reason so many Dems are behind this is because Wall Street this weekend put a gun to their heads and said either turn over the $700 billion or the first thing we'll start blowing up are the pension funds and 401(k)s of your middle class constituents. The Dems are scared they may make good on their threat. But this is not the time to back down or act like the typical Democrat we have witnessed for the last eight years. The Dems handed a stolen election over to Bush. The Dems gave Bush the votes he needed to invade a sovereign country. Once they took over Congress in 2007, they refused to pull the plug on the war. And now they have been cowered into being accomplices in the crime of the century. You have to call them now and say "NO!" If we let them do this, just imagine how hard it will be to get anything good done when President Obama is in the White House. THESE DEMOCRATS ARE ONLY AS STRONG AS THE BACKBONE WE GIVE THEM. CALL CONGRESS NOW.

Excellent sbk, excellent.

I see that you post the article without comment, SBK. If you put this in General, you'd very likely be contending with a flame war.

Question. Why did the government, not bail out Manufacturing when it was needed?

I see that you post the article without comment, SBK. If you put this in General, you'd very likely be contending with a flame war.

The "memo" is from Michael Moore, the filmmaker who is a notorious Bush hater. Whichever way the Bush administration acted, Michael Moore would be opposed to it. If Bush did nothing, then Moore was savage him for playing the violin while Wall Street burned. So since Bush advocated taking bold steps to stave off a financial crisis (although months too late in my view), then Moore will savage him for plundering the treasury.

Must say Georgie Boy looked absolutely shaken in his plea for a revised plan to be accepted. His advisers have finally got it through to him about how deep the pooh really is.

I see that you post the article without comment, SBK. If you put this in General, you'd very likely be contending with a flame war.

The "memo" is from Michael Moore, the filmmaker who is a notorious Bush hater. Whichever way the Bush administration acted, Michael Moore would be opposed to it. If Bush did nothing, then Moore was savage him for playing the violin while Wall Street burned. So since Bush advocated taking bold steps to stave off a financial crisis (although months too late in my view), then Moore will savage him for plundering the treasury.

Exactly.

Moore is nothing but a clown, but I enjoy him as long as he does not take himself seriously!

My question is, why should the government bail them out at all ?

They created their own pile of crap, let them sleep in it. If it wasn't for their overwhelming greed, they wouldn't have been handing out so many dubious loans in the first place.

I'm sure all those financial companies work in similar ways, where they get to write off bad debts against their overall earnings, in order to lower their taxes. Even though, in the case of a bad loan, they still sell it to another agency. So they get that money, and get to write off the full value of the loan against their taxes.

Think of this. On average every year, banks and credit card companies send out around 3 BILLION credit card applications, in a nation of just over 300 million people. That's almost 10 applications for every single person in the US.

So what if a percentage of those people wouldn't normally qualify for a nickel in credit. If they default, sell their account to a collection agency, and write the value of it off at tax time.

They basically did the same thing with mortgages. Lending to people that shouldn't have been borrowing. Little money down, high payments, long amortizations. High risk all around, yet in their lustful frenzy to try and attract as much business as possible, they apparently never considered the "what if" factor.

And now the government wants to spend 700 billion to bail them out, so they start fresh and do it all over again ?

And now the government wants to spend 700 billion to bail them out, so they start fresh and do it all over again ?

I am by no means a financial expert, not even close, in fact I wouldn't know where to start, but after reading everything I can find on this subject about the current situation (I have quite a bit of free time) I can only draw one conclusion ...... &lt;deleted&gt; 'em, all of them, every pin-stripe suited chin-less wonder that wouldn't recognise a real days work if they tripped over it while it was carrying a twenty foot high neon sign with the legend 'a real days work'

Don't even save the system, by all means save a company that actually produces something, you have a product then, but for gods sake don't save an institution whose only product is greed.

I do not know the right way on this almighty cock-up, greedy people got big bonuses for selling a non-viable deal, hoping to get away with their crookery by selling disguised packages to other unscrupulous banks.

However by letting them stew in their own fires just wont work, the shysters are already wrapped up in their holidayhomes baking in the sun on the exclusive holiday Isles that few can afford, OK the big financiers are still about, but how are you going to let them burn, they do not give a hoot.

It is just not the big city boys who are hurting, their bonuses built through Ivory Towers with a brilliant game plan ( for them ) but was built on unfortunate foundations for us poor mortals, it is not them who will suffer, but Joe Bloggs, the technician and Jane Doe the receptionist, out of work at Bradford & Bingley & Lehman Bros who can't pay their mortgage.

People looking for a re-mortgage, where the supply has dried up dramatically, a housing crash, lost pensions, savings wiped out and shares in free fall, just how, by doing nothing helps the Joe Mode of this world.

OK people have cocked up and they shouldn't profit by it, but to do nothing, I am at a loss how that benefits anybody and if anybody says, it will help out the first time buyers, they still can't afford one without help and if they can, there isn't a mortgage out there to finance one.

I do not know whether it is right to intervene or not, but with Ireland now guaranteeing all savings, the UK raising the ante to 50K, Holland and Belgium supporting the giant Fortis, in the US Lehman, Washington, AIG et al, surely they can't all be wrong, or is it one big global financier stitch up?

Moss ( in disillusionment ) but still Good Luck

And now the government wants to spend 700 billion to bail them out, so they start fresh and do it all over again ?

I am by no means a financial expert, not even close, in fact I wouldn't know where to start, but after reading everything I can find on this subject about the current situation (I have quite a bit of free time) I can only draw one conclusion ...... &lt;deleted&gt; 'em, all of them, every pin-stripe suited chin-less wonder that wouldn't recognise a real days work if they tripped over it while it was carrying a twenty foot high neon sign with the legend 'a real days work'

Don't even save the system, by all means save a company that actually produces something, you have a product then, but for gods sake don't save an institution whose only product is greed.

It's the 'spend a penny to save a pound' theory. Worth it if it works. I know - big 'if', but...

Another point about this, is this "bail-out" apparently is just to "buy" the bad/risky loans/mortgages from these financial institutions.

So these guys rack up 700 billion in (private sector) bad loans, and the government jumps in to bail them out (with public tax dollars), leaving them with just their "good" loans (and little or no risk to their profit margin).

Meanwhile the gov't assumes responsibility for those bad loans and has to contract out (with more public tax dollars) to other (private sector) firms to oversee and manage those loans. Private sector firms are already clamouring for pieces of that pie and why not ? Big $$ to manage what everyone already knows are bad loans, so if they fail no one is to blame, and they won't lose any income as a result !

And if a large percentage of those high risk loans and mortgages fail, who pays (or doesn't get repaid) ?

The public of course.

There is an awful lot wrong with this bale out, even down to the fact that all the senators are jockeying for position for hand-outs for their particular cause, in its basest form, it is bribery, but can someone give me a viable alternative?

Letting the Bankers burn, for what reason? They may lose some market shares, they have enough in the bank to weather the storm, the people who will suffer is old Joe Mode, I agree with what is being said, jobs for the boys, money going round the same robin, but if there is an alternative, I haven't heard it yet.

Has anyone, because if they have, I can then join the chorus of this mismanagement, with a viable and sustainable get out clause?

Good Luck

Moss

Best comment I have read on this is that the same minds thinking in the same ways are expecting to fix the problem. Not a comforting thought.

Stephen Colbert gives the the best explanation for the financial crisis that I've ever heard

http://www.colbertnation.com/the-colbert-r...siness-syphilis

Stephen Colbert gives the the best explanation for the financial crisis that I've ever heard

http://www.colbertnation.com/the-colbert-r...siness-syphilis

Very clever!

Best comment I have read on this is that the same minds thinking in the same ways are expecting to fix the problem. Not a comforting thought.

Perhaps not Sib, but I am still awaiting a viable alternative, so I can join in the last hurrah for a broken banking system, anyone got a viable system to stop the rot?

Its now reached Iceland with billions being lost to Foreign investors, there is a run on Royal Bank of Scotland, the Shares took a record loss yesterday I believe, the Aussies have made a shock interest cut and Germany has nationalised a major bank..

The Brits are angry with the Irish and Germans.............again The Icelanders have closed all dealings with their Internet Bank, the Yanks are all squeezing for part of the windfall and Brown & Darling fiddle while the financial markets burn.

Somebody must have an alternative?

Good Luck, I fear we will need it

Moss

Just received this picture of the Euro bankers leaving the meeting happy with their bail out package.........

Certainly a black week for Aussie expats with the Dollar around 24B.

Just received this picture of the Euro bankers leaving the meeting happy with their bail out package.........

Now that is very funny - if a bit too true...

Just received this picture of the Euro bankers leaving the meeting happy with their bail out package.........

Now that is very funny - if a bit too true...

Are you sure it wasn't them auctioning their cars or possibly it was the credit company doing "snatch back's"

I just checked the rate.

The sceadugenga relief fund is in the process of being set up at the moment.

speaking of relief funds

http://www.funnyordie.com/videos/cbabb3addc

Hil-flipping-arious!

I think that we are now discovering how true the saying 'money is the root of all evil' actually is.

I think that we are now discovering how true the saying 'money is the root of all evil' actually is.

Hate to be a pedant but it's actually "For the love of money is the root of all evil:" 1 Tim 6.10

I think that we are now discovering how true the saying 'money is the root of all evil' actually is.

Hate to be a pedant but it's actually "For the love of money is the root of all evil:" 1 Tim 6.10

A subtle difference, me thinks

Moss