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Press reaction to bailout | UK banks could benefit | US critics gloat | Gerard Baker
President Bush today acknowledged "we got a big problem" as the political wrangling over his proposed $700 billion bailout for Wall Street continued to threaten the measures.
The plans, which pulled the world's stock markets back from a freefall last week when they were announced, have been in serious doubt after Republicans on Capitol Hill refused to back them last night.
Nevertheless hopes rose again today after Republican and Democrat leaders signalled they were close to a deal.
The optimism was bolstered by news that Republican presidential candidate John McCain had decided to break off from the negotiations to attend a televised debate with his rival Barack Obama in Oxford, Mississippi.
His campaign team confirmed the decision had been taken after "significant progress" toward a financial sector bailout had been made.
"Mr McCain is optimistic that there has been significant progress toward a bipartisan agreement now that there is a framework for all parties to be represented in negotiations," the statement said.
The move came as Roy Blunt, a Congressman from Missouri, was named as the designated negotiator for House Republicans on the bill going forward. Earlier they had told the White House they could not support the plan, pressing instead for an insurance-based alternative that would involve a smaller role for the Government.
Over the day key figures from both parties expressed cautious optimism about the possibility of reaching agreement.
Barney Frank, the Democrat chair of the House Financial Services committee and a key figure driving the $700 billion Wall Street bailout, told The Washington Post that a deal on the plan can now be reached "within a few days," now that the House Republicans were back at the table.
Before stepping back into the negotiations, House Republican leader John Boehner told the reporters this afternoon: “Our goal in attempting to come to an agreement is protecting the American taxpayers. There are a lot of options on how to do that. There are a lot of proposals out there that will work.”
Earlier in the day President Bush had made a terse statement outside the White House in which he once again urged Congress to "move quickly" to resolve a crisis that threatens to rock the world economy to its foundations.
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If the 6-year market cycle bottoms again in 2014 it will be at the trough of the 120-year Grand Cycle. So while markets may recover for the next couple of years, the big tsunami is still four years away. Those with cash and gold in the period 2012-14 should invest when suicides have peaked!
Anthony, Bangkok,
Wouldn't it be nice if our government just gave every one of its citizens $2 billion each? They would still have $90 billion leftover. That would make everyone happy, wouldn't it?
Yen, Syracuse, UT, U.S.A.
The total value of all CDS contracts is something like $450 trillion so I'm afraid that $700 billion is a drop in the ocean! The size of the debt is so colossal that it will decimate everything. The banks markets should suffocate on the derivative fraud they created. NO TAX PAYER CASH PLEASE!!!!!
john, poole,
The US Constitution strictly forbibs 'BILLS OF CREDIT' (the dollar bill in other word/PAPER PROMISES). It only allows for currency to consist of either GOLD or SILVER COINS (of a stated fineness).
These rules were placed in position precisely to avoid BANKERS creating a mess of this nature.
Andrew, Haworth, England
"If money isn't loosened up, this sucker could go down."
This sucker wants to know: what exactly is George W. Bush trying to tell us?
Jay, Anne Arundel County, MD, USA
I expect Bin Laden has just cracked open a bottle of non alcholic Champagne in his cave.
ronnie, bucks, UK
The Rothschild wealth. House of Rothschild Merchant Bankers
who are a Jewish organisation covered up. Founded in 1776 in Germany had 5 sons, 1(Nathan control UK Banking) James
France. Salmon, Austria. Prussia Amschel, & Italy Carl. Never been audited, because they control the world. All in it.
Daphne Kenward, Cambridge, UK
Yes George, you and your banker friends have a problem and you want your country's taxpayers to bail you and them out.
Paul, Coventry,
Russian or Ukrainian!?
Sergey, Rostov-on-Don, Russia
The De Rothschild hand is all over this Credit Crunch. Crash the market and move in, when the government begins to use public money to bail out the market. They own all the Gold in the world, who owns the gold own the money runs the show. Bits of paper is worthless like the US dollar and the pound.
Daphne Kenward, Cambridge, UK
Bush should threaten to support publicly in the upcoming election every GOP who opposes the this bailout. That ought to bring them in line......(LOL)
JPHR, Lelystad, Netherlands
97% of mortgages are being paid on time. So we abandon ship for 3% ? This ' bailout ' is pure Socialist ' crisis ' mode. The usual Chicken Little scenario again. Do nothing. Dr Johnson said " nothing concentrates the thoughts of a man than the threat of an imminent hanging "
Desmond Taylor, Houston, USA TX
Judging by the timing of the market disaster you are now facing, I would start thinking that coincidence was not at play here but rather some kind of strike by someone out there, After all there is a cyber war out here happening right now, This disaster is most certainly manufactured.
Donulvi-Dolam, Sydney, Australia
Democrats, don't fold into Republican demands.
"Its an emergency, give me what I want, and later we can negotiation what you want" is a classic old-style win-loose negotiation tactic.
Once the other side has what they want, the have no motivation to negotiate what our side wants.
Keith S, Winnipeg, Canada
Lie about the threat Iraq posed to the world, attack the country, kills tens if not hundreds of thousands of civilians, wasting billions in an unnecessary war. What is 'God' telling you now GW? Looks like Divine justice to me.
Farrukh, Woking,
Someone smart spotted the $750 million 'limit at any one given time' clause in the bailout proposal (it's not a rescue plan) and deduced that this was the 'credit limit' of a minimum two year finance deal to fleece the American tax payers and cause deferred suffering to the people of the world. Phew
NDG, Tokyo, Japan
One thing is certain, Bush certainly doesn't have any leadership qualities anyone will miss. What a pathetic figure he cuts.
harrison M, hartlepool,
right Simon, the banks are holding a gun to theUS government's head. in normal life we call that robbery. Congress should have some guts and call their bluff
peter c, Devizes, Wessex
Perhaps one day we'll all speak Chinese. Watching these fools, it seems ever more likely.
Neil, Norwich, UK
The 'plan' being talked about is Paulson's 3-page proposal, now expanded to 40 pages by the Democrats to suit their own agenda, including a payoff for Obama's ACORN pals. No way the Reps will swallow it. If Dems want it, they can vote it through themselves, and get slaughtered at the ballot-box.
John B, Middlesbrough, UK
Maybe AFTER George Bush plea. But not BECAUSE OF George Bush plea. George Bush has become totally irrelevant. All that is left is respect for the office of the President itself.
Jim Houghton, Los Angeles, CA, USA
The full extent of banks' exposure to debt is unknown. Once the $700 billion goes down the black hole, what then? It won't be long before they are back for more. Time to face the music and stop living in never-never land.
Margaret, Alva, Scotland
If this 700Bn is let lose on the us economy it push the $ down like a rocket. No lending to usa any more so they are going to print this money. If we try and copy usa on this(cos we have on every thing else) kiss your saving good bye, and prices for goods out of control. Time to take the Euro for uk
oliver, colchester,
I didnt do my numbers in Q3. I'm unemployed from Oct 1st. Its painful but I accept its right. When i did my numbers I did very well on bonuses. I was paid well to deliver. I haven't.
There should be a very long list of people being fired for
$700,000,000,000 starting with the regulators
Mike, London, UK
Simon Shaw - you are totally correct, this is indeed what these wasters are saying.
R McAuley, Antrim, UK
capitalism. has. failed.
only the state can raise us to collective human dignity.
dave, london,
Mr Bush and his posse have wreaked more destruction on America (and the world) than Osama Bin Ladin could ever have hoped.
John, Cleggan, Ireland
I recall the story of the little boy who cried "wolf" too many times and in this regard his case to justify war against Iraq. This is perhaps the true cry for "wolf" but I suspect he has now lost all credibity. The true lesson is leadership here is the important of speaking the truth.
Richard Francis, Mississauga, Canada
Capitalist have a big problem...... This is to all of you who have been making fun of Marxist theories all this past years. Free market economy and world economy is doom. Capitalism can not regenerate itself because it goes against the idea of the capital.
Karl, NJ, USA
This isnt funny anymore.
'Give us 700BN dollars or the situation will get really bad for you.'
What they are really saying is: 'Its going to get really bad for you lot anyway. But give us 700BN Dollars and it wont be too bad for us.'
Simon Shaw, Croydon, UK