What A World

The U.S. economy is on a roller-coaster ride with huge dips and climbs. Last week, September 19, 2008, Secretary Of The Treasury, Henry “Hank” Paulson, announced that due to the slumping financial markets, the U.S. Government must enact an emergency bailout plan to stave off financial crisis. In a nutshell, his 3-page proposal, “Troubled Asset Relief Program, (TARP)“, requests 700 billion Dollars (U.S.) to purchase bad debts from banks and institutions using taxpayer money. The debts that are in question are considered “toxic”, “illiquid” and weighing down the banks and financial markets heavily. In order to avoid a disaster in the U.S. economy and some global markets, Paulson urged the U.S. Congress to quickly pass the Bush Administration’s $700 Billion Dollar “bailout plan” , as-is, immediately!

Now, after the U.S. House of Representatives rejected a re-write of Paulson’s TARP, to include more oversight , CEO compensation limits and more taxpayer protections. The Emergency Economic Stabilization Act of 2008 was rejected by House Republicans by a margin of 2 to 1 in spite of the arduous work of both Democrats and Republicans on September 28, 2008. There were rumors that The Emergency Economic Stabilization Act of 2008 would pass with bipartisan cooperation between the parties, long nights through out the weekend, and assurances that the American Taxpayer would be repaid. That very same day, the stock market plunged 777 points in one day for the largest point drop in U.S. Market History and causing a ripple effect in Financial Markets around the World!

Here we go again! The U.S. Senate is making suggestions and amendments to try and improve upon the Emergency Economic Stabilization Act of 2008 and pass it later on today! For example, Democratic Presidential Candidate, Barack Obama has requested that increasing the amount of money insured by the FDIC (Federal Deposit Insurance Corporation) at banks and other financial institutions, from it’s current rate of $100,000 to $250,000. This increase could allay some fears of depositors with over $100,000 in the banks that they could lose their hard earned money.  Republican Presidential Candidate, John McCain shares the thought that an FDIC increase would be benficial. So hold on, let’s see if the U.S. Senate will pass the bill, this time!