WASHINGTON — The House on Monday defeated a $700 billion emergency rescue package, ignoring urgent pleas from President Bush and bipartisan congressional leaders to quickly bail out the staggering financial industry. Stocks plummeted on Wall Street even before the 228-205 vote to reject the bill was announced on the House floor.
And the shock waves can be felt the world over......
In the US, the Dow Jones fell nearly 300 points in morning trade to 10,869 as the market took fright at several bank nationalisations in Europe and the US despite the approval of the "son of Tarp" — the Troubled Asset Relief Programme —bailout.
European stocks tumbled the most in eight months, sending the Dow Jones Stoxx 600 Index to the lowest level since January 2005, after bank bailouts accelerated and the $700 billion plan to rescue American financial institutions failed to unlock money markets.
Anglo Irish Bank Corp. Plc, Dexia SA and Deutsche Postbank AG plunged more than 20 percent after the governments of Belgium, the Netherlands and Luxembourg were forced to rescue Fortis and the U.K. seized Bradford & Bingley Plc. Hypo Real Estate Holding AG slid 74 percent as the German government and a group of private banks provided a 35 billion-euro ($50 billion) guarantee for the commercial-property lender.
Europe's Stoxx 600 fell 5.5 percent to 251.43, the steepest decline since Jan. 21. The gauge is down 31 percent this year as banks worldwide racked up more than $590 billion in credit losses and writedowns, pushing the global economy toward a recession.
``There's more pain to come,'' said Andy Lynch, who manages about $3 billion at Schroder Investment Management Ltd. in London. ``People knew the bailout was going to happen. Now it's back to the same-old, same-old of capital writedowns and weekend bailouts. Earnings estimates for next year still are too high.''
3 comments:
Economic Armageddon here we come. The ripple effectsof this is going to be felt in the remotest villages of the world. This is a major big deal.
The collapse of Capitalism???
"Teacher," they asked, “when will all this happen? What sign will show us that these things are about to take place?”
He replied, “Don’t let anyone mislead you, for many will come in my name, claiming, ‘I am the Messiah,' and saying, ‘The time has come!’ But don’t believe them. And when you hear of wars and insurrections, don’t panic. Yes, these things must take place first, but the end won’t follow immediately.” Then he added, “Nation will go to war against nation, and kingdom against kingdom. There will be great earthquakes, and there will be famines and plagues in many lands, and there will be terrifying things and great miraculous signs from heaven.
“But before all this occurs, there will be a time of great persecution. You will be dragged into synagogues and prisons, and you will stand trial before kings and governors because you are my followers.
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