This is a rush transcript of "Special Report With Brit Hume" from October 9, 2008. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

DANA PERINO, WHITE HOUSE SPOKESWOMAN: The president recognizes that each individual country is going to address their individual needs as they see fit, but that coordinating is the responsible thing to do.

DOMINIQUE STRAUSS-KHAN, INTERNATIONAL MONETARY FUND: So I urge you as a country to work together. There is no domestic solution to a crisis like this one.

(END VIDEO CLIP)

BRIT HUME, HOST: So everybody agrees, between the U.S. and Europe, anyway, that we're all going to work together to try to stem this credit crisis, which has caused such havoc in financial markets in recent weeks.

Some thoughts on all this now from Jeff Birnbaum, managing editor digital of The Washington Times, Michael Barone, senior writer of U.S. News and World Report, and Mort Kondracke, the executive editor of Roll Call, FOX News contributors all.

On a day when the Dow Jones Industrial Average plunged to its lowest level in five years or more, finishing below 900, down nearly -- down below 9,000, excuse me -- and it's 679 points almost down, I suppose we can get to the subject of whether the international response is sufficiently coordinated enough.

But I guess the question on everybody's mind tonight, are we at our near a bottom? Jeff, this has been an interest to you in finance and markets over the years. Your thoughts?

JEFF BIRNBAUM, COLUMNIST, THE WASHINGTON POST: Well, the average decline in a bear market, which clearly we're in now, is about 30 percent if you look at the bear markets since after World War II.

This is down more than 30 percent at the moment, but the decline has sometimes been --

HUME: It's 40 percent below the high it reached a year ago today.

BIRNBAUM: Actually, one year today.

But there have been a couple of times when more than 40 percent decline was the bottom of the bear market, as low as 49 percent.

So we have to think that we're, at least historically speaking, relatively near the bottom. But history doesn't always repeat itself. The best I can say is that there is -- there may be some further decline to go.

There is -- clearly we're now in a global market with all sorts of credit troubles. And this weekend, when a number of the foreign finance ministers will be meeting and discussing what to do, maybe there will be some action taken to try to calm the markets.

HUME: We have seen -- see if I'm wrong about this. I have never seen so much action taken, on top of actions that were already in effect before this crisis even hit, I have never seen a government respond more aggressively with more liquidity and more cash being made available or pumped into the financial system than I have seen in this one.

And yet we are where we are.

MORT KONDRAKE, EXECUTIVE EDITOR, ROLL CALL: That's because -- and you're right. This is unprecedented, and sometimes -- for the Fed to be buying up commercial paper, which is to say making short-term loans to companies when its responsibility is the banks, is really unprecedented.

So we have been taking -- the United States has been taking aggressive action. The Europeans can't get it together. The E.U. is not a coordinated body from a financial standpoint. So we're way ahead of them.

But this is a global credit confidence crisis. It's a panic. It's like those panics that you read about in history books and never quite understood when you were in high school. Remember? This is it, and it's global.

And so what has to be done is there has to be some sort of global response. And Dave Schmidt, my favorite international economics expert, says that what they needed to put together is some sort of a super central bank, or at least a clearing facility.

HUME: So we will need a whole new facility even bigger than the ones we've got?

KONDRACKE: No -- an international one that contains the central banks and the biggest private banks in the world to get the -- liquidity is not the problem. It is panic. You have to get the pipes open again.

HUME: When you have a panic, though, Michael, isn't what you really need is for all the people who want to sell to go ahead and sell until there are no sellers left?

MICHAEL BARONE, FOX NEWS CONTRIBUTOR: And you want to provide lots of credit. Walter Bagehot, the founder of the Economists in the 19th century in Britain, said when you've got a panic, just flood the market with credit.

And, in effect, that's what Ben Bernanke, the chairman of the Fed has been trying to do. Bernanke is our greatest economic scholar on the Great Depression. And the problems then is that the Fed tightened credit and President Hoover raised taxes. They enacted protectionist measures, and we had a downturn that lasted --

HUME: But we're not having any of that.

BARONE: We're not having any of that, but he's trying to prevent this coagulation of credit from having a strangling effect on the wider economy.

Now, it looks like we still have some ways to go. And in Britain, Gordon Brown, the prime minister announced that their government is going to buy up capital stock, preferred stock and for the banks to provide more capital in the banking system.

Bernanke has authority to do that under the bill that Congress passed last week. And as you pointed out, he's got authority -- he was doing things like providing -- buying up credit paper. He has authority to do that under depression-era statutes passed that give the Federal Reserve wide powers to buy things.

BIRNBAUM: We're likely to see both the Federal Reserve and Treasury take extraordinary action relatively soon, including buying up positions in major banks.

But I think there was also a very bad mistake made yesterday that needs to be pointed out. The Securities and Exchange Commission allowed a ban on short selling to expire. Short selling is people betting on a decline in the market and individual stocks, which accelerates a downward movement in the markets.

Allowing that ban to expire, I think, was one of the main factors we will find, looking back in the more than 600-point decline in the day. I think the SEC reinstating that ban and other restrictions in short selling will probably reduce the volatility.

HUME: Let me understand this-the level to which the DOW has now fallen, and it is a proxy for all the markets. All the markets are way down. If you were sitting short tonight in a big way, as some people are, would you be worried that we were getting near the bottom and you would get caught?

BIRNBAUM: I'm not-

HUME: I know, but I'm just saying, look at the level of this decline.

KONDRACKE: I would not.

HUME: You think it has further to go?

KONDRACKE: Yes. I think it has further to go.

BARONE: I think I would be nervous. If Warren Buffett is spending $8 billion to buy up assets --

HUME: What did IBM say? That they're not changing their guidance, that their situation looks good?

BARONE: We basically know that there's a lot of toxic waste, financial instruments in the hands of financial institutions. There is no market for them right now.

At the point at which there becomes a market, that stuff is going to be worth something more than zero. We don't know what it is. I know people who have gotten very rich at buying resolution trust company assets at 11 cents on the dollar. They were worth 18, cents and they made a lot of money.

BIRNBAUM: Warren Buffet never times the market. He sees a bottom coming, and a bottom probably is coming, but we don't know where it s.

HUME: We know a bottom is coming, all righ. The question is how soon, and, OK, we don't know. That's the answer to this.

Can Democrats get a filibuster proof majority in the Senate this fall? We'll talk about that next.

(COMMERCIAL BREAK)

HUME: OK, folks. Take a look at this chart. This represents the thinking of some of the best political forecasters around about gains or losses in the Senate seats.

This is gains. Charlie Cook thinks it's up three, Democrats, with six more toss-ups could go their way. Stew Rothenberg, his political report says he thinks Democrats are going to gain six. "The Congressional Quarterly" estimates plus five.

The question is, of course, can you get to 60? Not with those numbers you probably can't get to 60-60 is an absolute, filibuster-proof majority, you have 60 votes in your party.

But if you talk to the Republican leader Mitch McConnell, whose own seat, by the way, now appears to be in jeopardy, he will tell you that -- he at 49 now. If he gets down -- if he loses five seats and he is down to 44 mark, he thinks on many a vote he won't be able to pull together and hold everybody -- won't be able to hold 40 senators.

And so what do we think we are looking at in the Senate after this fall -- Mort?

KONDRACKE: Something bad for the Republicans.

By the way, the Democrats really have to pick up 10 seats in order to get to 60, because --

HUME: Do they need to get to 60 to have a working --

KONDRACKE: They don't need to get to 60. But on stuff like, perhaps, something that would benefit the unions, like card check, I don't know what they would need -- probably card check there is enough liberal Republicans around to help the Democrats out.

But 60 is the magic number for difficult -- any kind of difficult legislation.

HUME: But do you need to have 60 votes in your own caucus.

KONDRACKE: You do you not have to have 60. You probably need 57, 58, something like that, because the moderate Republicans are going to get wiped out in this one, and they are usually the ones who come over.

BARONE: I think, Brit, it depends on the issue and it depends on where we are with this financial meltdown showing us that things can be very different from what they seem.

On the card check bill, I'm not sure that the Democrats, even if they have --

HUME: Quickly the card check means --

BARONE: The card check would abolish secret ballots at union elections. The union guy comes around and you sign a card. If majority of workers sign a card the union is the bargaining agent.

HUME: And, of course, the card signed right in front of some union guy with another union guy behind him maybe --

BARONE: And they know where you live. So this is an attempt to try to unionize a large part of the economy.

I wonder whether Democratic senators from states like South Dakota and North Dakota and Nebraska are necessarily going to be counted on to vote if that's the crunch.

George McGovern voted against repeal of section 14-B, a bill in 1965 where Lyndon Johnson and the Democrats were beat when they had a bigger majority.

The other thing is unexpected things can happen. The last time Democrats had 61 votes in the Senate, they passed capital gains tax cut in 1978. There was a two to one Democratic House. They passed Section 401K which changed benefits.

And so sometimes a combination of financial unrest can produce unlikely results.

HUME: Last word, Jeff.

BIRNBAUM: I think the way this is going, especially because of the economic problems, that a wave election may be about to happen again.

HUME: Not just a change election, a wave.

BIRNBAUM: Right, a wave election that will bring in a filibuster- proof majority for the Democrats in the Senate. That's the way it's going.

And a larger number of net Republican gains in the House as well.

HUME: Democrat.

BIRNBAUM: -- Democratic gains in the House as well, maybe as many as 30. That's what the experts in downtown in Washington are now saying.

HUME: That is it for the panel.

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