A week after the collapse of Lehman Brothers and the sale of Merrill Lynch put the cogs in motion, Secretary Paulson was on the Sunday morning talk shows pitching
his $700 billion bailout proposal.
"The biggest help we can give the American people is to stabilize our financial system right now and to prevent the system from clogging up, because if it does clog up, this is going to have an adverse effect on people's abilities to get jobs, on their budgets, on their retirement savings, on lending for small businesses," Paulson said on ABC's "This Week."
Still, the Democrats said the plan lacked
necessary safeguards for taxpayers and homeowners.
"We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome," Speaker Pelosi said.
But even as the details of the bailout were being hammered out, there were yet more staggering developments in the crisis, effectively ending an era on Wall Street.
Late in the day came the news
that Goldman Sachs and Morgan Stanley, the two remaining independent Wall Street investment banks, would be converted into traditional bank holding companies, which will increase their regulation by the federal government.
The move was designed to prevent the storied brokerage firms from suffering the same fate as Lehman and Bear Stearns, by giving them access to cheaper, and more stable sources of funding from the retail banking business and from the Federal Reserve.NEXT: Monday, Sept. 22 - Second thoughts