
The conventional wisdom is that markets around the world should open higher again on Monday. Financial stocks still have to gain back all those loses from their peaks last year. If their balance sheets are going to be made whole, they should rally for days.
None of that may happen. Over the weekend, the Treasury will present the Congress with its "rescue" package. Most Representatives and Senators have said they will support the program "in principle." The devil is in the details, and on Monday it may become clear that extended and heated debate makes it more likely that there will be no "universal solution" at all.
There are still a lot of free market supporters in Congress. They believe that financial companies got into deep trouble on their own and that fixing that is a form of socialism. There may be enough elected officials in this camp to hold up any deal for a long time. They may even be able to kill it in the name of saving tax-payers money.
If the Treasury proposal is in trouble Sunday night, the markets could have another massive sell-off early in the week.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
9-20-2008 @ 3:15PM
Limoman said...
And Why Didn't you tell us How to Capitalize on all this? Mr. McIntyre ?
Not one mention from you over the apst several months about how to short sell companies if you think their PPS is going to go down...
Let alone Not one word about "Naked Selling" .
At the least? You or onw of your writers could have just Mentioned this as an Option to investing in a down market..
Thanks alot.. For nothing!
9-20-2008 @ 3:36PM
Big Al said...
WOULD ANYBODY CARE TO COMMENT ABOUT THIS LITTLE DETAIL OF THIS BAILOUT PLAN:
"Decisions by the treasury secretary related to the buyback program could not be reviewed by any court, according to a copy of the department's draft legislation obtained by Reuters. "
??? WOW ???
9-20-2008 @ 5:33PM
clikdawg said...
Well, Al, this is what we call "diffusion of responsibility", and it will enable continued raids on the Treasury while permitting the President and Congress to publicly deplore that which will benefit them privately.
Always remember the core principle of that many-faceted rule, "Catch-22":
"We can do anything you can't stop us from doing."
And that brings us one step closer to bringing our de facto plutocracy out in the open where everybody can smell it.
9-20-2008 @ 5:38PM
Coy C. Keller said...
Why preferential treatment for BIG BUSINESS???
If you proposed helping out the little man, there would be such an outroar,
"THAT"S SOCIALISM".
yET WHEN THE GOVT. BAILS OUT INEPT BUSINESS, THEY SAY IT'S PATRIOTIC TO RECUE SUCH THIEVES.
Tell me of anything more hypocritical, and those failures in Wash. went for it, hook, line and sinker. If we vote in EITHER THE REPUKES OR THE DEMOCROOKS, we deserve such phoniness.
9-21-2008 @ 8:14AM
Howard said...
Save the cheer leader, save the world. As soon as they save the home owner from the thieving banks, this all stops!!
9-20-2008 @ 7:05PM
william lindblad said...
Welcome to the U.S.S.R. - the United States Socialist Republic. So much for the pun, what happens to the bail out plans remain the option of Congress. It is one thing to try to sell 500 billion, another to sell 700.
The prices seem to be rising and anyone with half a brain knowns that the true figure will exceed 3 trillion. This makes for a host of problems as medicare costs around 500 billion, the war many more, add in the rest of the Fed. budget and we are getting close to figure that can, at least technically, bankrupt the U.S.
Raising taxes is going to be a moot option given the layoffs that are ensuing and the general effect will be to further depress the economy. Throw in rising oil which is a harbinger of inflation and it is not a pretty picture.
Wall St. is going to take a major dive, it is just a matter of time.
9-20-2008 @ 8:18PM
clikdawg said...
Eight years of the same Big Lie modus operandi, and y'all are still buying into the official cover stories -- in this case, the half-trillion dollar "mortgage debacle" line of b.s. ... just like you bought into the "mushroom cloud" thang, etc., etc., etc. ...
They're just requisitioning your money, Sports Fans, to do with as they please; and fronting it with the standard Doomsday Scenario. Bankrupt the nation? You bet -- but by design, not accident or ineptitude. The idea is to create a Mexican-style peonage society, savvy? As much of the wealth as is humanly possible concentrated in the absolute minimum of hands. And a strong Middle Class just screws that pooch all to hell.
But just keep lettin' 'em plead to the lesser charge of stupidity, if it makes you feel any better -- but you better get used to knucklin' your forehead and tuggin' your forelock whenever they sashay past, compadres ...
9-21-2008 @ 4:11PM
lg said...
no one has brought up the ugly oil subject in this mess, as the energy costs across the board has dried up liquidity in the system that otherwise would be there in the banking system
9-22-2008 @ 8:54PM
Rickey said...
Paulson needs to go. It's unbelievable that he wants 700 Billion dollars to bail out those who decided to gamble in the stock market and loss.
Maybe he can reimburse me for my lotto tickets since I didn't win.
That money should be given to Fannie and Freddi which we now own, to provide low interest mortgages to low and middle income home buyers.
They cannot find money to fix Social Security but they can find almost two trillion dollars to bail out wall street.
Very interesting!!