Do Bailout Plan Fails - What's next for the Suffering Economy?

Is it the end of wall street?

Wall Street's transformation also means that private equity companies and hedge funds will be the new financial innovators and move further onto investment banking's traditional arena.

Both hedge funds and private equity have intrinsic limitations on their ability to raise money and fund their activities,

so neither is a perfect substitute for the former role of the investment banks.

The new system will have more capital and less direct lending through such vehicles as asset-backed securities.

Will the Bill it pass the second time around?

The New York Times reported that U.S. House leaders were planning a second attempt to pass the bill.

The defeat is a massive setback for the Bush administration, specifically the Treasury Department,

as well as lawmakers who have been working throughout the last week on the legislation in the wake of the collapse of Lehman Brothers Holdings Inc.

(LEH) as well as the government's bailout of American International Group Inc. (AIG) and its takeover of Fannie Mae (FNM) and Freddie Mac (FRE).

With the falling stock market what happened to the financial rescue?

This left the Dow Jones industrials down as investors feared that the failure of the government's financial rescue plan in the House will force the country into a worsening credit and economic crisis.

Emergency Economic Stabilization Act FAILS to receive enough votes to pass in the House of Representatives. What happened? A majority of Democrats voted for the bill. A majority of Republicans voted against it. The Republican vote was more than 2-1 against the bill.

Wall Street is also worried about overall sluggishness in the world's economy. In the U.S., unemployment sits at a five-year high of 6.1 percent. With this rate expecting to increase further pressure is put on consumer spending accounting for more than two-thirds of the nation's economic activity.

After the House rejected the government's proposed financial bailout plan - investors rushed for the safety of Treasury bills, while banks charged more to lend to one another. This year's market turmoil had called into question the viability of the investment-banking business model.