President Bush Scrambles to Save $700B Bailout Plan

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House Republicans to join bailout talks

WASHINGTON (AP) -House Republicans say they're sending a top leader to renewed negotiations on President Bush's $700 billion plan to bail out the financial industry.

Rep. Roy Blunt of Missouri will attend the talks with key lawmakers. That's after the House GOP boycotted negotiations on an emerging bipartisan agreement, calling it unacceptable. Blunt is the number two House Republican.

Rep. John Boehner, R-Ohio, the minority leader, released a letter to House Speaker Nancy Pelosi, demanding that "serious consideration" be given to a radically different proposal that provides no government money up front for a financial rescue.

Bush scrambles to save $700B bailout plan

WASHINGTON (AP) - President Bush is trying to round up members of his own party and get them behind a proposed 700-billion-dollar government bailout of Wall Street.

Bush has called again for lawmakers to back the plan in an effort to avoid an economic meltdown. The administration is putting pressure on Congress with Treasury Secretary Henry Paulson and Vice President Dick Cheney talking to lawmakers.

John McCain has also been on Capitol Hill today to meet with Republican leaders.

Democratic House Financial Services Chairman Barney Frank says the fate of the proposal is in the hands of House Republicans, who he says need to drop their "revolt" against the measure.

The ongoing talks mean Congress will likely have to put off a scheduled adjournment next week and stay in Washington to address the issue.

Stocks open lower on bailout clash, WaMu failure

NEW YORK (AP) - Stocks are sharply lower in early trading as efforts to finalize a $700 billion financial bailout deal have unraveled. The seizure of Washington Mutual Inc. by federal regulators is also serving as a sobering reminder of the widespread problems in the banking industry.

Meanwhile, credit markets are tightening further as fears of a deepening economic crisis are driving investors to buy safe-haven Treasury bills.

The Dow Jones industrial average is down 126 at the 10,895 level.

JPMorgan Chase buys WaMu assets after FDIC seizure

NEW YORK (AP) - For the second time in six months, JPMorgan Chase is taking over a major financial institution crippled by bad bets in the mortgage market.

JPMorgan Chase came to the rescue of Washington Mutual Incorporated Thursday, buying the thrift's banking assets. The move came after WaMu was seized by the Federal Deposit Insurance Corporation in the largest failure ever of a U.S. bank.

The deal will cost JPMorgan Chase 1.9 billion dollars. The bank says in a statement it plans to write down WaMu's loan portfolio by approximately 31 billion dollars.

JPMorgan Chase, which acquired Bear Stearns last March, also says it will sell 8 billion dollars in common stock to raise its capital position.

The FDIC, which insures bank deposits, says it won't have to dip into the insurance fund as a result of the seizure.

Frank blames House GOP for breakdown of deal

WASHINGTON (AP) - Congressman Barney Frank has declared that an agreement on legislation to relieve a financial crisis depends on the willingness of House Republicans to drop what he calls "this revolt against President Bush."

Frank, chairman of the House Financial Services Committee, also suggested that unexpected late resistance to the administration's plan by many House conservatives, may amount to Republicans carrying water for John McCain.

Frank said he did not think that Democrats were going to have to "referee" an internal Republican ideological war over the 700 billion-dollar proposal that the administration has been trying to sell to lawmakers. Negotiations are scheduled to resume later this morning.

(Copyright 2008 by The Associated Press. All Rights Reserved.)