Left, Right, or Wrong?

Archive for the ‘Breaking News’ Category

After much wrangling and some tense moments between Democratic lawmakers, the House of Representatives passed an historic health care reform bill. This marks a significant milestone for both Democrats and the country as a whole. I was personally pleased that House Speaker Nancy Pelosi called Representative Patrick Kennedy to tell him of the news. Now the long road to reconciling this bill with a version from the Senate begins. Democrats in the Senate have been disappointing in how they have not taken a strong stand on the public option for much of the process. Part of this is due to the politics of getting a bill out of committee to the general Senate for a vote. Part of this, however, is a larger issue between conservative or ‘Blue Dog’ Democrats and their brethren, the more progressive Senators.

In the end, if this bill fails to pass the Senate, it is not the Republicans the American people will solely blame. To a smaller, but significant measure, the American people will also blame the Democrats who voted against supporting and pushing this bill – including a strong and needed public option.

We can only hope that Democrats, unlike their Republican counterparts, realize before all is said and done, that this bill must pass to end the symbolic divide between the  favoritism that business interests have had under the Bush Administration vs. the needs of the American people – especially the shrinking middle class.

The Dow Jones Industrials plunged another 730 points today falling sharply on rumors that we are already in a recession. Nationwide, in fact, economic indicators have pointed to a sharply slowed economy. Fed Chairman Bernanke said the economic situation – which had already begun to slow prior to the crisis – has  worsened much more with the jitters on Wall Street. The White House and the Treasury Secretary continue to attempt to pump money directly into banks in order to loosen lending and hold off further declines in confidence and numbers on Wall Street to little affect.

Wall Street, it appears, has ideas of its own.

In trading around the world, the US bailout seems unable to stop a global plunge. Russian trading fell 15% forcing a market closure. Trading in London, Paris, and Frankfurt all fell more than 6%. Trading in Asian markets has fallen 4% so far. It is anticipated that trading in the US will follow world trading by losing more market share.

The operative phrase that is repeated in report after report is “investors are losing confidence”. It seems clear now, that the US stock plunge is far from over. We can expect more of a slide today when the NYSE opens.

Despite early bipartisan support, including the support of the President and Housing Secretary, the GOP in the House, by a 2-to-1 margin voted against the bill that would bail out the financial sector and allegedly stabilize the economy. Democrats, a majority of whom voted in favor of the bill, were aghast when the Republican GOP leadership opposed the bill. This bill was – after all – not the perfect Democratic bill. In fact, what is perhaps the most interesting detail of this whole mess is that the Democrats could have passed the bill in the house along party lines if they had written a bill that the Democrats could all support. Instead, they wrote a bill trying to address part of what they wanted and part of what the GOP wanted. Unfortunately, the GOP leadership had different thoughts – that is to say – we want it our way or the highway.

As a result, the GOP leadership – ignoring what is clearly best for our country – decided to scuttle the bill and in the end, defecting Democrats aided in the 2-to-1 GOP vote against the bill. Since that event, the stock market has taken the single largest plunge in it’s history – more than that of black friday – falling 777 points. That loss translates to approximately a 7% drop in the stock market.

A little advice to Democrats: write a bill that all Democrats can support – if the GOP is going to trash a gift then write the bill you really want and let the Senate and House negotiate the resulting bill.

In another series of unsettling market events, Wachovia Bank was acquired by Citigroup and Bradford and Bingley was nationalized by the British Government. In the meantime, 10 central banks including the US Federal Reserve  has attempted to quell  financial unrest by making approximately $330 Billion available to money markets worldwide.

At this moment, the US Congress is putting the $700 Billion bailout plan to a vote.

Congress and the White House have reached a tentative deal on a $700 Billion bailout plan for the credit crisis. It appears that many of the restrictions for US corporations and protections for citizens the Democrats demanded are in the tentative plan.

Nancy Pelosi on the plan:

All this is done in a way to insulate Main Street and everyday Americans on the credit crisis on Wall Street and in doing so, as I said, bring stability to the markets as we try to turn around our economy and protect our taxpayers.

While all this is happening, it appears that another mortgage bank, Bradford and Bingley may be nationalized by the British Government to avoid collapse.

In one of the worst economic turns since Black Friday, Lehman Brothers, one of the largest investment banking firms in the country, filed for bankruptcy over the weekend spurring a stock tumble in all the major indexes around the world. The company, founded in 1850, had survived the great depression, and other major economic turbulence, only to fall prey to the subprime mortgage crisis. At the time of filing, Lehan Brothers listed their debt at $613 Billion.