Fidelity Select Fundranker

Fundranker Blog—Bailout Defeated

Bailout Defeated

The U.S. House of Representatives rejected the bailout bill in a close vote 228 to 205. Even before the news of the bill’s failure reached Wall Street, the Dow Jones Industrial Average started falling. After the vote, it plunged even faster, falling 777 points for the day, its largest one-day point loss ever. Democrats supported the bill in greater numbers than Republicans, but significant percentages of both parties’ legislators voted against it.

What’s next? Conventional wisdom is that Congress must do something, and do it soon, but there is much concern that this particular bailout package is not necessarily the best plan. The stock market has given its snap opinion on doing nothing. Will Congress regroup and work this through to develop and pass a plan with strong bipartisan support before they adjourn for the year? Perhaps if Congress slows down a little, commits to working on the plan for a week or two weeks, it can give both Wall Street and Main Street more confidence that a viable solution to our financial system problems can be found and implemented.

Posted 9/29/08 7:02pm ET in Economy