BREAKING NEWS: House rejects bailout bill

By Michael J.W. Stickings

The House of Representatives a short while ago voted 228 to 205 against the bailout compromise worked out over the weekend. (It needed 218 votes to pass.). As CNN is reporting, "[a]bout 60% of Democrats voted for the measure, but less than a third of Republicans backed it."

Quick notes:

-- Kucinich was right.

-- Bush is apparently "very disappointed" with the result. Presumably much of his disappointment is directed at the renegades in his own party.

-- Boehner: "If I didn't think we were on the brink of an economic disaster it would be the easiest thing to say no to this."

-- Frank: "If we defeat this bill today, it will be a very bad day for the financial sector of the American economy and the people who will feel the pain are not the top bankers and top corporate executives but average Americans."

-- It's certainly a bad day for the markets. As of 2:55 pm, the Dow is down 552.68 (or 4.95%) and the Nasdaq is down 144.08 (or 6.70%).

-- I still think a bailout bill in some form -- if not this one, after some arm-twisting, then this one with some alterations to appease both sides and to make Congress appear to be more united than it really is -- will be passed sooner rather than later. The leadership of both parties is behind it -- the Democratic leaders more than their Republican counterparts -- and there will be increasing pressure on Congress to do something. (And, right now, this bill is all they've got.) Not least because the markets are tumbling.

-- And tumbling... It's now 3:00 pm. The Dow is down 552.04, the Nasdaq 147.73. At 3:02 pm, the S&P 500 is down 76.26 (or 6.29%).

-- Up here in Toronto, at 3:03 pm, our leading index, the TSX Composite, is down 853.38 (or 7.04%).

Stay tuned.