The House of Representatives rejected the most recent bailout proposal, led by House Republicans. But with House Democrats having the ability to pass any bill all by themselves, this is a failure by Senator Nancy Pelosi to bring her party together as well. I expect another attempt to tweak the bill for passage, probably later this afternoon. The markets reacted negatively to the news, initially.
The bailout bill failed in the House, and it wasn’t especially close. The final tally was 207-226, with Democrats supporting it 141-94, while Republicans opposed it 66-132.
How did the markets react? Initially, with panic. Dow dropped from around a -290 to more like a -660, but then recovered within minutes to a -400. Within a few minutes after that, it rose a little further to about -360, a 300-point gain, but it continued to go up and down, and probably will all day long.
Former Representative from Arizona, JD Hayworth, just stated on my local radio that there will probably be another attempt to pass it today, but the bill will not gain any more Republican support than it currently has. Hayworth, my favorite rep ever, expressed pride at his ex-colleagues and disdain for Pelosi's leadership and her inability to bring her party together.
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