Yesterday the U.S. Congress rejected the first go round of the bailout bill. And the markets, writhing with emotion, rumors and innuendo plummeted 777 points. Oh, and Wachovia bit the dust, adding to a large pile of bodies on Wall Street. Yep,what did the dow go down? 777. Of course if you are a Vegas Gambler, you might see 777 as lucky. (And if you want to read about 777 check out this web page)

So, my e-mail inbox like many others has been loaded with e-mails railing back and forth on which political party is to blame. News flash: this did not happen overnight, both parties are responsible.

So I look at it this way:

As opposed to the way Lower Merion Township enacts ordinances , the US Government in this case can't just put something in place and fix it later. Both Republicans AND Democrats voted "no" on the first pass of this bill.

The leaders of both political parties should be almost in tears, because BOTH political parties share culpability in this economic mess, no let's be honest, meltdown. You can trace the roots of this all the way back to at least Carter - and every administration since then of both political parties. Reagan's party on years of booming jelly beans played a part, and let's not forget that Bill Clinton is the President who allowed the repeal of the Glass-Steagal Act of 1933. The repealing of that act played a large part where we are today. This link will give you an easy to digest synopsis of it - see Investopedia for a Cliff Notes explanation.

With regard to this legislation, I for one DO want more assurances, and I DO want executive compensation dealt with. I think (personally) that present and former Wall Street honchos need to be dragged up to Capitol Hill just like Enron and WorldCom Executives. I believe executives from other failed firms and banks should be quizzed as well.

The markets run as much on emotion as anything else, and 777 is a horrible reality check. But look how we got here: greed. You know what else I want to see personally? I want restrictions and investigations into all those number fudging mortgage brokers and real estate agents across the country who upsold people into homes they couldn't afford.

Yes, the credit markets need to get back in business because life needs to go on: people still need money for educational loans, mortgages, small businesses, etc. And until a plan is in place that won't happen. But maybe a couple days of "time out" won't hurt. Or it won't hurt anymore than what has happened already.

Some feel we have skipped right past recession to skirting with depression. Am I scared like every other American? Yes. But panic is not a luxury Americans can afford right now.

It sure makes you rethink a lot locally, doesn't it? As in who really has money for all this development in local municipalities like Tredyffrin, Lower Merion, and Radnor? Will Lower Merion be able to float a new bond issue mid October? I say no, but anyway that's another conversation for another day.

Don't throw the baby out with the bathwater just yet. Sit tight until Thurday. I'm not being Pollyana here, just being a realist. No one knows how this is going to play out yet. And I can't help but wonder: if the U.S. Government can afford to bail out all these wheeler dealers, why can't they help the average Joe or Jane a little more? I think taxes should be more proportionate, and as an average middle class person, I think the top 2% need to pay a little more - which will undoubtedly have some people screaming at me, but cry me a river you might have to cut down on the expensive toys a little. When I have to clip coupons I don't feel so sorry for those whose ideas of clipping coupons involves Henri Bendel and Neiman Marcus...

I'm sure the recreational shoppers and passive income set are sweating it, but who knows, in the end, this reality check might be a good thing? After all, what's that saying about having to make mistakes in order to learn? Well, it's time to learn. And while everyone is worried about Wall Street, let us not forget Main Street.

Here's some suggested and interesting reading:

NY Times: Your Money
‘Is My Money Safe?’ and Other Questions to Ask By RON LIEBER and TARA SIEGEL BERNARD
Published: September 29, 2008

For all of you on Main Street who have been watching the turmoil on Wall Street for the last few weeks, Monday’s shockwaves rattled even the most steadfast.

The day began with the announcement that another big bank — Wachovia — had been taken over, just days after Washington Mutual collapsed and was sold. In early afternoon, the House rejected the bailout package for the financial industry. Stocks plunged...What is a regular investor to make of it all? What about people who have money in bank accounts? Below are some answers to questions that are probably on your mind.

Q. Why did the stock market fall so far so fast on Monday?

A. The element of surprise surely didn’t help, since everyone was expecting the bailout bill to pass. There may have been a bit of investor disgust thrown in, too, a sense that our representatives in Washington just don’t get it....Q. What’s likely to happen in the markets over the next few days?

A. It’s possible that Monday’s market moves will spook members of the House of Representatives enough that they will be willing to change their votes with only a modest amount of compromise. Or, there may be hasty efforts to write a new bill from scratch.

...Q. What about more bank failures?

A. They will happen. In recent days, we’ve seen the F.D.I.C. getting out in front of troubles at big banks....What’s less clear, however, is how many healthy institutions are left to take in other big banks that may run into trouble.

As always, stay within F.D.I.C. deposit limits. Then, the worst-case scenario is that it will take a couple of days to extract your funds from a failed bank.

House rejects bailout; Dow plunges 777 points
By Larry Eichel
Inquirer Senior Writer

In a historic vote that undermined investor confidence and reinforced fears of harsh economic times ahead, the House of Representatives yesterday rejected the Bush administration's $700 billion financial rescue plan.

The stock market plummeted in response, with the Dow Jones industrial average suffering its largest one-day point loss ever, falling more than 777 points, or nearly 7 percent, to close just above 10,365.

Other market measurements, including the broader Standard & Poor's 500, did even worse, making this Wall Street's worst day since the Black Monday of October 1987. Overall, securities lost more than $1 trillion in value.

Glen Beck CNN:Commentary: Financial meltdown is an absolute disaster

CNN:Commentary: America can't go cold turkey on credit

Bloomberg: U.S. Stocks Rally on Speculation Bank Rescue Plan Will Pass
By Eric Martin

NYTimes: Senate Leaders Pledge Action on Bailout By CARL HULSE and MATTHEW SALTMARSH
Published: September 30, 2008