NEXT PLAN WON'T BE MADE IN USA

(Compiler's note: This scary story may just help explain why some very high ranking politicians are bent on ignoring the loud demands of the American people. What else are we NOT being told. rca)

NOW what? Congress and the White House did their best - I guess - to come up with a way to rescue the teetering banking system and Wall Street reacted with a big, wet Bronx cheer.

In case you aren't from The Bronx, that means the financial markets didn't approve - either when the bailout looked like a sure thing in the morning (Dow down 350) or when the plan later seemed dead (Dow down more than 700).

So what's going wrong with the $700 billion experiment in bailout capitalism?

Well, Wall Street is running the show, which automatically engenders suspicion and skepticism.

To me, Treasury Secretary Hank Paulson, a former chairman of Goldman Sachs, seems more interested in taking toxic securities off the books of Wall Street firms than in providing the banking system with the lifeblood it needs - capital.

Here's the problem.

Even if Paulson manages to use the $700 billion to acquire billions in bad mortgage securities from banks, it doesn't mean the banks are going to be willing to increase loans.

In fact, banks might be so scared - and grateful that Paulson got them off the hook - that they might just sit back and watch the disaster unfold.

Lost in the panic of a nearly 800-point drop in the Dow is a scary back story. And it's the reason why Washington yesterday had to pump $330 billion in liquidity into the frozen financial system - not only to the US banking system but also to Europe.

Put simply, it's that we are no longer in control of our own financial markets.

Japanese and Chinese investors, including the governments of both countries, are said to have pressed for our government's takeover of Fannie Mae and Freddie Mac several weeks ago.

The threat, it has been reported, was that foreign government money from so-called sovereign wealth funds would no longer buy Fannie and Freddie's bonds if the feds didn't stand firmly behind them.

Foreign investments have enabled the US to expand its economy over the years, even though Americans have been saving and investing less.

These sovereign funds came to the aid of several US institutions early this year, but not lately.

Given the number of emergency bank deals that have just been accomplished through private transactions, it raises a question that was likely brought up by congressional members: Why did Washington need to kick in another $700 billion when private sources of finance seem to be stepping forward?

Are that many more banks in trouble? Was the Treasury secretary merely looking for an insurance policy if these private deals fail? Or was it, as I suspect, that the White House was being strong-armed by foreign interests?