Congressional leaders, President Bush and the two men who hope to succeed him all sought to assure the markets on Tuesday that a $700 billion rescue plan may be stalled, but is not yet dead.
Bush and other administration officials said they were disappointed in the measure's rejection by the
, but that some type of plan will be hatched in the near term to avert further damage to America's financial system.
"I assure our citizens and citizens around the world that this is not the end of the legislative process," Bush said at a White House press conference, adding that "Congress must act."
The U.S. stock market plunged on Monday following the House vote of 228-205 against the plan. On Tuesday, the
Dow Jones Industrial Average
recouped some of its 7% drop from the previous session, gaining about 230 points in late-morning trading. Markets overseas, in Asia and Europe alike, also plunged in their early trading but recouped some losses on reassuring words from the U.S. leaders regarding the plan.
While it is unclear what needs to be changed or added to the bill to gather enough votes for passage, House Majority Leader Steny Hoyer (D., Md.) said "doing nothing is not an option." Legislators began a two-day break for the Jewish holiday of Rosh Hashanah on Tuesday but will return to the Capitol on Wednesday, when a Senate vote may take place.
Republican presidential nominee John McCain (R., Ariz.) noted that the bill would help not just the banks that are struggling under bad loans, but also Americans whose pensions and investment portfolios have been severely hit.
We're going to have to resolve it, and we're going to have to act," McCain said Tuesday on
Democratic presidential nominee Barrack Obama (D., Ill.) also noted that jobs and retirement funds "hang in the balance," saying in a statement that "it is imperative that all of us -- Democrats and Republicans alike -- come together to meet this crisis."
, who formulated the original proposal to purchase banks' toxic assets with public funds, said Monday that he and other administration officials would continue to work with Congress to reach an acceptable plan.
The plan was the product of several compromises between Congress and the Bush administration, which first proposed it Sept. 18 after the bankruptcy of
and the federal government's bailouts of
American International Group
( FNM) and
Paulson also noted the collapse of
, which was acquired by
last week, and
said it would buy on Monday, as well as two European institutions. He said reaching an immediate solution is imperative to prevent further market turmoil.
"We need it as soon as possible," Paulson said Monday, "and we're just committed to working with Congressional leaders to get it done."