MELTDOWN FLASHBACK: Friday, Sept. 26, 2008

• By The Associated Press
• On 3:42 pm EDT, Friday September 25, 2009

The Bush administration's original three-page, $700 billion proposal to bail out the financial system has grown to 102 pages. And the congressional negotiations continue Friday without an agreement that would bring the plan to a vote in the House and Senate.

House Republicans are set on an alternative plan that would have the government insure the bad assets of banks instead of buying them. President George W. Bush and Vice President Dick Cheney urge them to fall in line with their plan, which Democrats have grudgingly endorsed.

Democrats and Republicans are making concessions. House Speaker Nancy Pelosi nixes a Democrat proposal to let judges rewrite mortgages in bankruptcy court to help homeowners avoid foreclosures. The administration, meanwhile, accepts congressional authority over bailout appropriations and reluctantly adds language limiting executive compensation.

The tension stretches into the presidential campaign. Republican contender John McCain decides at the last minute to attend a debate with Democratic nominee Barack Obama in Oxford, Miss. The two senators refuse to commit to supporting the bailout legislation, but say lawmakers must make a move to help Americans.

The Dow Jones industrial average rises 121 points, or 1.1 percent, to 11,143. Volume is light as traders wait for an agreement on the bank bailout plan.

But shares of regional banks tumble after Thursday night's failure of Washington Mutual Inc. Wachovia Corp. slumps 27 percent; National City Corp. loses 26 percent. Big banks' shares rise: JPMorgan Chase & Co., which has just taken over WaMu, adds 11 percent, while Bank of America Corp. gains 6.8 percent.

OTHER MARKETS: The Standard & Poor's 500 index adds less than 1 percent, and the technology-heavy Nasdaq composite index dips 0.2 percent to 2,183.34 after BlackBerry maker Research in Motion Ltd.'s outlook disappoints. RIM stock drops 27 percent.

Buzz up!