A modified version of the Paulson-Bernanke plan to rescue the financial system has been passed by both houses of the Congress and signed into law:
WASHINGTON – With the economy on the brink and elections looming, Congress approved an unprecedented $700 billion government bailout of the battered financial industry on Friday and sent it to President Bush who quickly signed it.
“We have acted boldly to help prevent the crisis on Wall Street from becoming a crisis in communities across our country,” Bush said shortly after the vote, although he conceded, “our economy continues to face serious challenges.”
Underscoring that somber warning, the Dow Jones industrials, up more than 200 points at the time of the House vote, had fallen into negative territory an hour later. They fluctuated as the afternoon wore on.
The final vote, 263-171 in the House, capped two weeks of tumult in Congress and on Wall Street, punctuated by daily warnings that the country confronted the gravest economic crisis since the Great Depression if lawmakers failed to act. There were 58 more votes for the measure than an earlier version that failed on Monday.
The bill has changed quite a bit from its original three page form into the hundreds of page behemoth that passed today. Some of the changes were needed, including provisions for additional oversight, others sweeteners to garner support in the Congress.
At this point I think we can only hope that the fact of the passage of the bill will boster the flagging financial system. And wait.