on the elite panic and the failure of the Democratic leadership to come up with a proposal other than the Bush plan.

Nothing -- absolutely nothing -- could be politically safer than opposing George W. Bush. And yet the entire Democratic leadership, Barack Obama included, lined up to support a cockamamie plan proposed by this scorned and shriveled figure, a plan that was transparently nothing more than an audacious raid on the Treasury by Big Money hoods and yet another authoritarian power grab by a gang of murderous, torturing, warmongering toadies. This was the plan and these were the people that the Democrats decided to fight for.

...

So Monday's rejection of the bailout plan is not a catastrophic political defeat for George W. Bush; he has no political standing, no political future. But it is a vast and humiliating defeat for the Democratic leadership, across the board, who, as Democrat Lloyd Dogget of Texas said

“never seriously considered any alternative” to the administration’s plan, and had only barely modified what they were given. He criticized the plan for handing over sweeping new powers to an administration that he said was to blame for allowing the crisis to develop in the first place.

Now the Democratic elites have had their collective head handed to them on a platter. It is a dish most richly deserved. And although it is almost possible to believe that they will learn anything from this episode, there is now a chance -- a chance -- that we can at least have a discussion of alternatives to the Bush scheme.

it like that.

[frame: VICTORY FOR THE AMERICAN LITTLE PEOPLES!]

It's because they're so little that the biggies don't see them, eh?

Dems ought to do.

First, Bernhard at Moon of AL is getting pessimistic (as is Roubini, whom he quotes, so do click over).

Last thought for now: 9/29 will be a marked day for historians - maybe even as big (bigger?) than 9/11. Osama Bin Laden's goal to bankrupt the U.S. was achieved without him doing anything remarkable. The U.S. did it on its own.

An end of an era. As said in earlier comments, the end of the quarter tomorrow will be devastating for lots of financial entities. They will have to report real numbers instead of made up stuff because the Paulson bill, which gave the authority to fake balance sheets by 'mark to fantasy', was rejected. The Paulson bill could probably have helped to make the dive smoother.

Many hedge funds will be slaughtered as redemptions will come in at an unprecedented scale. All of the capital they have and which will now be redrawn is highly leveraged in risky bets on all kind of financial 'products'. They will have to sell, sell and sell everything.(My emphasis)

Does Roubini's outlook seem likely? He has been pretty correct all along, so his take is pretty scary. Bernhard's predition (we'll know soon enough, like tomorrow)? Any econ/business types want to add anything?

Second, Sterling Newberry lists 4 relatively simply steps for the Dems to legislate and implement, and then do the real overhaul in the next Congress. Lot fewer billions right now--and his plan calls the Banker Boiz' blackmail bluff--if it is a bluff.

What now? It's very simple, we need a shot of adrenaline to get lending going, until there is time to deal with the larger crisis at hand. The bill that should be crafted should be designed to get us through to January, and to give us time to work on a more comprehensive and fairer redesign, not bail out, of the banking system.

Severely limits Paulson's ability to toss money around. Has Dems acting like, well, the Democratic wing of the Democratic Party.

um, i hate to say this, but "some people" we listen to, well, let me put it another way:

we need a shot of adrenaline to get lending going

it's called "nationalization." and "selling off assets of immediate value." and "strict regulation including executive compensation limits." just give me the powers republican have assumed for themselves at the expense of the Constitution, and i'll show you what i mean.

i adore SN, truly. but sometimes i find his "we can't do without the banking class" orientation frustrating. what is "lending?" why do banks lend, and to whom? with what money, from where?

in this age when we can decide to have a New War, on Terra, which eats up trillions uncounted, i think that fearmongering can have a benefit, should any progressives be willing to take that step. simply, it is: you fucked it up, bankers. you're done. give us your assets, shut up and go home. we're going to spend/use every last one of them protecting ~330m american citizens from the tens of trillions of dollars of fuckup shitpile on the global markets that you want us to eat. sorry, that's not going to happen.

/end perfectionist progressive rant/

"You'd better get this straight. Wise up before it's too late." -- Sister Sledge

Paulson can do this without Congress now. He may already have, there's something out there about push more money into the pipeline today trying to get money moving.

http://www.bloomberg.com/apps/news?pid=2...

http://business.timesonline.co.uk/tol/bu...