See what you get when you listen to HANK PAULSON, the crook who made $500 million at Goldman (and got away with ALL OF IT, tax free!) while they were creating the precise same toxic sludge that you are now grilling Fuld over?

Yet, Congress, you knelt down and gave both him and Bush a Lewinski when they came to you claiming that their plan would save our 401ks, IRAs, and Main Street.

How's that working out Jackasses?  That's a 10 percent crash in two days, courtesy of YOU, Congress.

I have repeatedly said that Congress needs to lock up the infants in the playpen and allow the adults in the room to work out solutions to this problem that (1) preserve our funding for AMERICANS and (2) restore trust in the markets.  Adults like myself, "Mish" Shedlock and Nouriel Roubini, among others.

I also said that if this was not done, and the $700 (now $850) billion bailout was passed instead, that it would NOT restore confidence, that spreads would NOT come back in, and that in fact we were risking an all-on equity and credit market IMPLOSION.

Well this isn't a crash (yet) but its a hell of a sell-off, and you can thank Congress - directly - for it, because they are responsible. 

Directly responsible.

Please do so - call your Congresscritters (both House and Senate) and thank them LOUDLY for the over $1.5 trillion in market wealth that they have destroyed, some of which undoubtedly is yours along with the $700 billion bailout that is going to go to the Chinese.

Make sure you keep thanking them for the 30% loss in your portfolio since last October.  That, by the way is what one would expect as the full loss during a Bear Market and our government hasn't even admitted we're in a recession yet!

What's worse is that I am seeing increasing indicators of severe instability in the credit and stock markets, and if this continues we are very likely to get that crash that I have hoped and prayed would not come - perhaps as soon as tomorrow.

Let me once again outline how we solve this problem:

• Force disclosure of everything on everyone's balance sheet and their marking models.  No exceptions.  This can be done now, administratively, and must be done right here and now.  Today.
• Force all credit default swaps (CDS) and other OTC derivatives onto a public exchange.  (This, surprisingly, is actually being discussed - but a forced implementation has not yet been announced.)
• Force leverage down to no higher than 12:1; if this forces asset sales, so be it.  Give participants six months to do it, 1/6th of the excess taken off per month until complete.

Once that is done we must then recapitalize the banking system, and the easiest way to do that is through forced "cramdown" debt-to-equity swaps.

The simple fact of the matter is that I have been yelling at Congress on this issue for over a year and we are now at a place where the market is threatening to blow up wholesale, with the real economy going off the cliff as consumer spending capacity simply evaporates. 

All this nonsense about "short selling" being responsible for this mess is an abject lie.  The proof is in the tape - you can't short, so why are the banks and other financial stocks collapsing?

We are here not just because of the excesses and fraud of the last ten years (although that certainly is at the root of it), but also because Congress has refused to do its damn job, even after being told repeatedly of the problem through letters, faxes, petitions and phone calls.

This is not an accident.  It is willful negligence and deserves the harshest form of sanction possible - loss of job - with everyone involved in the matter in the investment and commercial banking community going straight to prison for fraud or worse.

If this crisis is not arrested NOW instead of Congress holding worthless hearings where they point fingers we will have an economic Depression.

This is no longer in the realm of "might", it is now in the realm of "probably will."

Yet both candidates for President were participants in the swantz-blowing of Paulson and President Bush, and neither of them have done a damn thing to actually address the issue.

This is an all-on outrage and it is up to you, the people, to stand up and in one voice say NO MAS or suffer the consequences - imminently.