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House passage of the EESA was greeted with much skepticism as stocks headed lower. Asian and European stock markets plunged, led by banking and commodities stocks. Across Asia, all markets were also in the red. Tokyo's Nikkei 225 index fell to its lowest level in 4 1/2 years, sinking 4.25 percent to 10,473.09 and Indonesia's key index plummeted 10 percent, it's biggest one-day drop ever. The outlook for the U.S. economy darkened after figures released Friday showed that 159,000 jobs in the U.S. were lost last month, the fastest pace in more than five years. Over $1 trillion in wealth has been wiped out in just five days of stock and bond market declines.

Greed has been replaced by fear; euphoria, by panic; trust, by suspicion and we are already see devastating losses for investors in almost every asset class.

The government's bailout plan is designed to help clean up debts that have gone bad so far. But what about debts that turn sour from this point forward? And how about the US$182 trillion maze of best known as derivatives? Even before these bailouts, the Office of Management and Budget (OMB) projected the 2009 federal deficit would rise to $482 billion.

Besides the great bailout plan was signed by the US President on Friday, the day after, the previously agreed-to bailout of Germany's second biggest property lender, Hypo, fell apart at the seams, sending government officials scurrying to come up with an alternative deal. But the amounts needed are huge: 20 billion euros by the end of next week, 50 billion euros by the end of the year, and as much as 100 billion euros by the end of 2009. UniCredit — the biggest bank in Italy, whose shares have been plunging lately — is trying to raise $9 billion in capital to stay afloat and even the country of Iceland is shopping for bail out.

Recent economic reports point to intensifying recessionary conditions. Employment contracted at a faster pace in September and together with tightening of underwriting standards, it will lead to more defaults. As a result, credit markets are spiraling into a deep freeze, threatening to destabilize the US dollar.