The $700B financial bailout failed to pass the House.
In 1987, the Down Jones went down 20%, and we survived.
If the market assessment on the importance of the bailout is only 7%, then the whole thing has been another "weapons of mass destruction" error in intelligence.
Which isn't too surprising, since it was all just one guy's opinion.
This sums it up:
This financial calamity is not like other disasters we've faced. The drip, drip of the global financial catastrophe is a sort of invisible disaster. Last week my bank failed. Failed. In an instant, Washington Mutual went from "Whoo hoo" to "uh-oh." And what changed for me? Nothing, as far as I can tell.[Update:]
My wife got a flyer in the mail from WaMu suggesting we refinance. She called them yesterday [2008/09/30 - after the bank failed and was sold of to JP Morgan Chase] and it turns out we have a better interest rate than they are currently offering. But the lady on the phone was pushing us to get a second mortgage!
There is no credit shortage.
Okay, maybe there is:
“The money markets have completely broken down, with no trading taking place at all,” said Christoph Rieger, a fixed-income strategist at Dresdner Kleinwort in Frankfurt. “There is no market any more. Central banks are the only providers of cash to the market; no one else is lending.”
But why would it last? People in the business of loaning money will still loan money - they'll just be more selective, as they have been for the last six months or so.
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