No-bailout crowd gets help from perfect storm on Wall St.

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Maybe Wall Street should have taken that hate mail more seriously.

The obvious disgust that a large segment of the public felt about the financial-system bailout plan, and how that translated into phone calls and e-mails to congressional offices over the weekend, helped deliver today’s shocker: the House’s ‘no’ vote on the plan.

The stock market might not have rallied even if the House had approved the bailout, but it seems unlikely that an OK would have led to a 777.68-point, 7% drop in the Dow industrials, which is what we got.

But there was a lot more weighing on Wall Street today than the bailout, as dominant a factor as that was.

One depressant was the wave of government rescues of banks in Europe over the weekend, from Germany to Iceland. That reminded U.S. investors that the financial system’s woes transcend borders, which nobody should find encouraging.

‘The news out of Europe was horrendous,’ said T.J. Marta, fixed-income strategist at RBC Capital Markets.

European stock markets ended their session with severe losses, though Wall Street managed to outdo them. The German market sank 4.2%, Italian stocks lost 5% and the tiny Icelandic market gave up 4.5%.

Back in the U.S., credit markets remained in crisis mode as stressed banks and big investors continued to hoard cash rather than lend or invest it. The rush into Treasury securities accelerated as the bailout bill appeared likely to fail, sending another dire signal to the stock market.

The calendar also was working against the equity market today: At the end of a dismal quarter for stocks, there’s always more incentive for many money managers to keep raising cash than to try to be a hero. Better that clients see a more defensive posture on those Sept. 30 statements.

Finally, since the Securities and Exchange Commission temporarily banned ‘short selling’ in more than 900 financial stocks beginning Sept. 19, it removed the possibility of short-covering rallies in those stocks -- buying by shorts to close out their bets and book their profits.

Without the ban, ‘we might at least have had those buyers of last resort in the market, the short-coverers,’ to come in late in the day, said Art Hogan, market strategist at Jefferies & Co.

Instead, the market closed at its lows for the session.

Now what?

People who oppose the bailout plan, and who want financial companies to pay for their sins in the housing debacle, will see today as a victory.

The question is, will it still be a victory a week from now if the stock market is 25% lower, the economy is skidding into a deep recession, and Main Street, like Wall Street, finds credit nowhere to be had?