The Wall Street meltdown has finally shifted the race for White House from lipstick and farm animals to the number one issue among the American people – the economy.

And, the repetition of “The fundamentals of the American economy are strong,” has become an albatross around the neck of Republican presidential candidate John McCain. It has become fodder for the news and also ammunition for Democratic presidential candidate Barack Obama who is using that to bolster his point that John McCain is out of touch with what is happening in the economy.

Following the government’s gigantic American International Group (AIG) bailout, the two battled over who is better prepared to tackle and repair America’s economy which seems to be free falling.

The Obama campaign seized the Wall Street crisis as an opportunity to hit McCain where it hurts,  ahead of the first Presidential Debate set for Friday, September 26. Pointing to his 'strong economy' argument in a television ad on Tuesday asking: "How can John McCain fix our economy if he doesn't understand it's broken?"

"Senator, what economy are you talking about?" Obama asked in the ad.

Referring to the US government $85-billion bailout to insurance giant AIG, Obama called it "the final verdict on the failed economic philosophy of the last eight years."

In fact, the Illinois senator has been speaking forcefully against McCain who has always been an advocate for deregulation of the insurance and finance sectors – a factor which Obama believes lies at the very root of this economic crisis.

Since February of 2006 Obama has been pushing for more government regulation of the financial markets.  Earlier this year he said, "The American economy does not stand still, and neither should the rules that govern it."

Obama blasted the government for not regulating these financial institutions. He said, "Our free market was never meant to be a free license to take whatever you can get, however you can get it. That is why we have put in place rules of the road to make competition fair and open and honest. 

"We have done this not to stifle, but rather to advance, prosperity and liberty," he added.
 
On Tuesday Obama said while McCain is now touting himself as a reformer he has “subscribed to this philosophy for 26 years in Washington and the events of this week have rendered it a colossal failure.”

The democratic presidential hopeful said, "It is time for a new economic strategy, guided by the principle that America prospers when all Americans prosper, where common-sense rules of the road ensure that competition is fair, open, and honest."

McCain fingered US regulatory agencies for creating the circumstances leading to AIG’s bailout on Tuesday, following bailouts for Fannie Mae and Freddie Mac.

The Republican presidential hopeful issued a statement blasting the agencies saying, "These actions stem from failed regulation, reckless management, and a casino culture on Wall Street that has crippled one of the most important companies in America."

McCain also reiterated a call to bring in a 9/11 type commission to investigate the crisis – a call which several pundits, and the Obama camp have criticized for being short-sighted or just blind.

While campaigning in Colorado Obama retorted, "Senator McCain offered up the oldest Washington stunt in the book: you pass the buck to a commission to study the problem. But here's the thing: this isn't 9-11. We know how we got into this mess. What we need now is leadership that gets us out."

In a recent TV spot, the Illinois senator addressed his audience saying, "In the past few weeks, Wall Street's been rocked as banks closed and markets tumbled, but for many of you -- the people I've met in town halls, backyards and diners across America -- our troubled economy isn't news.”

In the ad Obama pointed out that it “isn’t just a string of bad luck” that 600,000 Americans have lost their jobs this year alone, prices have risen, the real estate market has crashed, and incomes remain stagnant.

"The truth is that while you've been living up to your responsibilities, Washington has not. That's why we need change. Real change," Obama said.