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Congress votes, dow drops, and Minnesota reacts
The headline screamed high above pedestrian's heads in Downtown St. Paul late Monday afternoon. "Stocks nosedive" and "biggest one day drop ever" were the words that caught the attention of many as they walked by the Minnesota Public Radio building. The 700 billion dollar bailout package never made it through the House of Representatives, and the market reacted within minutes, ending up 777 points down, the largest daily drop ever. What was billed as a bi-partisan solution on Sunday was rejected by mixed party votes on Monday. Minnesota's 8 Representatives split their votes, and they didn't follow party lines. Republican John Kline joined Democrats Keith Ellison, Betty McCollum and Jim Oberstar in voting yes for the plan. Republicans Jim Ramstad and Michele Bachmann teamed up with Democrats Collin Peterson and Tim Walz in opposition of the bill. For congressional and economics leaders, its back to the drawing board. "Our strategy is to continue to address this economic situation," President Bush said late Monday afternoon. Back in Minneapolis, U of M economist Felix Meschke watched the markets tumble, with his jaw on the floor. "If you watch all this stuff, it's amazing because this? we are in unchartered territory," he said. Meschke says while the record point drop in the Dow draws headlines, he's more concerned with the "VIX." The assistant professor says the Chicago Board of Options Exchange Volatility Index is derived from a complex formula that measures the implied volatility of the S & P 500 over then next 30 days. On Monday, the VIX jumped off the charts, higher than all but 2 other days in the past 50 or so years. "This is fairly unprecedented to have this degree of uncertainty and this amount of fear in the markets," Meschke explained. Like everyone else, Meschke is waiting for the next move, by either the fed or congress. You can put Annette Yarusso of Yarusso Bros. Italian Restaurant in that category. "I don't know if its' going to turn around, I'm just hoping it settles down," she said. "Business has been down some, but costs are going through the roof," she added. Owners at the restaurant, which has been sitting on the same street corner on the Eastside of St. Paul since the great depression, say one day of bad economic news is bad for the dinner business, but tomorrow brings another day. "They're (congressional leaders) going to start from scratch, at least they're going to start," owner Fred Yarusso said.
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