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Bailout Dead. Markets Plunging.

U.S. lawmakers shot down the proposed bank bailout plan.  The vote was 228-205 against.  Global equity markets are now in freefall, with the Dow Jones Industrials down 669 points (-6.01%) and the TSX down 912 (-7.52%).

Government bonds are rocketing higher as traders rush to safety.  Canada’s 5-year yield is now 2.90%, having dropped almost 1/4% since Friday.

A new bailout plan is not expected soon, but we’ll see.  For now, the markets are on their own.

“Failure was not an option,” says RBC strategist T.J. Marta, who predicts the dead rescue plan will cause a financial markets breakdown. (CEP)