The US Congress has failed to approve the bailout bill that the financial sector is so desperate about. In a surprise defeat, the bill was rejected by a majority of members. And even more puzzling is the fact that it has been rejected after a group of hard line Republicans opposed to it. Stock markets have reacted negatively to this outcome. At the time that I'm writing this post, the S&P500 is off by almost 7%!
I'm afraid that cynical politics related to the next US presidential election have undermined the bipartisan effort that appeared to be underway to help Wall Street out of its woes. Make no mistake about it: the financial system is in danger and definitely needs governmental support. As I have argued in this blog for several times, the lack of regulation and banking oversight led us to this debacle. However, now is not the time to ask questions. Now we need action, bold action.
Eventually, we'll reach the point where we may talk about reform. But we are not there yet. First things first.
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