The much maligned financial bailout has passed the US House 263-171. Apparently adding billions more in spending for pork was enough to buy the votes of dozens of congressmen. Who knew that politicians would vote for anything as long as their district got a cut? I have no doubt that most members of congress voted without reading the legislation, because the bill was around 430 pages long last time I heard.

Despite the fact that congressional leaders, the Bush administration, and the Federal Reserve predicted that the bailout was necessary to stave off absolute economic catastrophe, the stock market was less enthused. The Dow Jones Industrial Average lost 157.47 points or 1.5% by the end of the day. This is especially worrying because the Dow had been up over 200 points when the bill passed.

I expect that the market will probably swing upward for at least a day or two before dropping at an even faster rate when it is realized that the bailout can’t fix the problem. The Federal Reserve is already extending hundreds of billions of dollars worth of new credit to banks and that has not helped. If this bailout fails to rescue the economy, and I believe it will, then let’s hope that congress does not feel the need to throw even more money at the problem. The more congress spends, the more the federal reserve has to print. The more the Fed prints, the less you can buy with your dollars.

This is going to be a rough year.