THE CONGRESSIONAL DILEMMA ON THE $700M BAIL-OUT PLAN
What a nasty situation U.S. congressmen are finding themselves in courtesy of the $700M financial bail-out plan. The U.S. senate has now passed on the ball to the U.S. Congress after approving a sweetened version of EESA to force another showdown at the lower house. Lobbying is being done around the clock to insure the passage of the bill. Concessions from both parties are being offered and accepted without hesitation or second thoughts. And why not, everyone was a given a terrifying preview of what might happen again if approval of the modified Emergency Economic Stabilization Act of 2008 is once more derailed. The 778 points Dow dive last Monday after Congress failed to pass the bill, sent a terrifying reminder to everyone concerned. The spill off effect in other bourses worldwide was just as unnerving.
A lot of finger pointing ensued in the aftermath of the failed passage of the bill. Had the congressmen simply done their jobs clean without the unnecessary political grand standing and uncalled for fire brand speeches aimed at gaining political advantage over the issue, the Dow would not have dropped that much. The current scenario is a chilling reminder of the stock market crash of 1929. Stocks started to nose dive on October 24, 1929 - Black Thursday. Leading Wall Street Bankers tried to remedy the situation by pooling their resources together. Their efforts failed resulting into the now infamous Black Tuesday Stock Market Crash of October 29, 1929. This pulled down the country into the era of the Great Depression.
We may really see a repeat of 1929 , and, what a friend and fellow blogger aptly termed as "The Collapse of The House of Card." The effect will be felt in all corners of the globe and will be long lasting. Recovery will be slow and painful.
The congress men who will once again shoot down this bill come Friday will be praised by the growing number of their discontented constituency. But, will they be willing to put in their hands the blame for not doing anything to prevent another Black Friday scenario in the U.S. I doubt it. On the other hand if they choose to support the bill and pass it, they may prevent a world wide financial crisis but they risk the chance of not being voted back into office by their disgruntled constituents.
DAMNED IF YOU DO, DAMNED IF YOU DON'T INDEED!