Well, maybe this gives Congress a little time to investigate an alternative plan. Hopefully.

Time to pass the D plan and let the Senate Rs filibuster it or Bush veto it.  I guess we need to be the grown-ups again.  But be sure to add in some political popular things to hit them with in ads.

And just this morning a McCain spokesperson was taking credit for how McCain had saved the bill. Is it possible for a 72 year old man to curl up into the fetal position because I suspect that is what McCain wants to do.

The economy will not be in "even more dire straits." The regional banking system is fine. Address the credit markets first, the crap mortgages later. Fix banks' capital adequacy ratios before you make a blanket commitment to let a Goldman Sachs banker use public money to buy up all the sh*t that his pals in NY and Barney Franks' and Andrew Cuomo's and Jamie Gorelick and their DC pals created and are now trying to dump onto John Q Public.

How 'bout we ask Jimmy Cayne and John Mack and Stan Neal and Jamie Gorelick and Jim Johnson and Frank Raines and Paulson and Corzine's pals, et al to pony up 90% of their take from this mess into the pot? You could get to a billion right there: call it a confidence building measure.

Breaking: Sources close to Senator John McCain say he will suspend Gov. Sarah Palin from her debate with Senator Joe Biden.  "The failure to pass the recovery plan demands she focus all her energy along with me and we will both head to Washington and be on call." The paid informant confirmed McCain had decided on this course before the vote and before today's airing of Palin's interview with Katie Couric on CBS Evening News. He's urging CBS to not air the interview as it my further "harm their effort" in Washington.

Except, would Reagan have actually been against it?

Tep: I agree that local and regional banks are sound.  I agree that the capital and liquidity problems come first.  But ... and it's a big but ... a downward spiral in stock prices and big bank lending will seriously harm the economy.  People seeing their retirement saving evaporating are going to stop spending money, and eventually the banks that can find their assets in all the crap paper they've got, will go back to lending, but only at much higher rates than we've seen in a decade plus.  We may not have a depression, but we could easily have the hardest recession since 1932.

I'm not saying Paulson's approach was the only, or even best, but much as we love to scorn them, the country cannot function without functioning large banks, including investment banks.

Would it be hilarious if a Democrat complained of a plan to dismantle Social Security entirely as amounting to a nail in the coffin of FDR?  Each party has its saints and its sainted policies.  

I'm sorry but there's been a horrible, panicky confusion of problems. In the real economy, there is no crisis. This is not Malaysia or Russia ca. 1998. There are solvent, ready customers for the stuff that many tens of thousands of solvent US firms MAKE. Real products serving real needs for real customers. If Goodyear Tire or Intel or Procter & Gamble or GE Medical or Apple Computer needs cash to pay their suppliers, that is an entirely different problem -- related, sure, but totally distinct from -- the problem of 4% of US mortgages in 90-day+ delinquency.

The task is to find out which financial institutions truly are INSOLVENT, ie on the hook for huge %s of toxic mortgage crap, and to decouple that small subset of financial institutions from the rest of the financial system. Obviously, one of those houses is the former employer of our new Finance Commissar. Funny how we're being exhorted to rescue his plan asap, before his and Buffett's firm's share price declines. Far better to let Goldman and maybe a few dozen other banks fail, recapitalize maybe a few dozen others, and pump money into the remaining 99% or more of this country's 8,000 or so financial institutions that are solid.

Sorry but this plan stinks of favoritism.

"a downward spiral in stock prices and big bank lending will seriously harm the economy"

Lending, sure. Stock price decline, not at all.

Stock cycles come and go; deep declines are followed by big rises. There's no fundamental economic reason that stocks should have the P/E ratios currently assigned them by Buffett's Mr Market, who, as Buffett says, is prone to irrational mood swings, both exuberant and morose.

Again, fix what needs to be fixed in the banking sector. Do not bail out Goldman Sachs. Do not bail out real estate speculators and people who never should have been pushed into home "ownership".

Uhhh...Tep...uhhh...Wachovia just basically failed. I think that qualifies as a "regional bank"

Tep, Paulson cashed out his Goldman stock before becoming Treasury Secretary. Just sayin.

I'm not convinced that this is a disaster for McCain. It probably won't work out, but then, he needs to be pursuing high-risk high-upside tactics at this point. The only rational interpretation of his behavior (not the only interpretation - that he has lost it is an increasingly popular theory) is that he wanted to ruin bailout negotiations, while pretending to do his best to rescue them. If that's right, things went according to plan. Now he has to win the spin game. He probably won't, but the potential payoff is huge:

theenlighteneddespot.wordpress.com/.../bailout-fail-redux

VA - Wachovia is not a regional bank. IIRC those are banks w  s.t. like $30b-$200b or so in assets

traytiger - there's a bit more to it than that. Over $100m, if Marty's math is right, for Hank:

blogs.tnr.com/.../paulson-s-plenty.aspx