Posted on 10/01/2008 5:31:25 AM PDT by TigerLikesRooster
September: A month of crisis
by The Oregonian
Tuesday September 30, 2008, 9:53 PM
On Sept. 1, the news worrying most folks was a hurricane swallowing the Gulf Coast. By Sept. 30, the news had delivered the words "$25 billion" and "$85 billion" and "$700 billion" so often, they seemed to lose their meaning.
The ninth month of 2008 brought a gigantic surge of words that, when said over and over and over, reshaped the U.S. economic landscape: Auction-rate securities. Bailout. Credit derivatives. Default swap. Housing bubble.
All in just 30 short days. Here's a review of a September to remember.
1 Stock markets are closed for Labor Day. Dow Jones industrials on Aug. 29 closed at 11,543.55, down 171.63, or 1.47 percent. Hurricane Gustav hits the Gulf Coast.
2 Report: Construction spending is at a seven-year low.
3 Two ex-Credit Suisse brokers are charged with selling more than $1 billion of mortgage-backed securities while hiding subprime connection.
4 Sen. John McCain of Arizona accepts GOP presidential nomination.
5 Government takes over teetering mortgage giants Fannie Mae and Freddie Mac. Report: National jobless rate hits highest level since 2003. Columbia River Bank, The Dalles, closes its home mortgage operation.
6 Fannie Mae, Freddie Mac agree to rescue plan.
7 Standard & Poor's: People's Bank of China holds $340 billion of Fannie-Freddie securities.
8 Treasury Secretary Henry Paulson, ex-boss of Goldman Sachs, says of Fannie-Freddie rescue: "We had no choice." Washington Mutual sacks its CEO, says it's plenty liquid but agrees to provide regulators with an updated plan.
9 Stock of 157-year-old investment bank Lehman Brothers is hit with waves of selling; some analysts predict the government will step in as it did for Bear Stearns in March.
10 Lehman Brothers reports $4 billion third-quarter loss, hangs a "for sale" sign on itself.
11 Federal budget deficit: $483.4 billion, up 76.2 percent from the same time in 2007; much of the increase is due to the $168 billion economic stimulus plan enacted in February.
12 Legend Homes, one of Oregon's major builders, announces a plan to get out of bankruptcy three months after its filing.
13 U.S. officials and representatives of major U.S. and foreign banks work through the weekend to save Lehman. They fail.
14 World's 10 biggest banks pool $70 billion to stabilize markets. Potential Lehman buyers walk away. American International Group, the world's largest insurer, quakes under debt from insuring bonds. In other news, Bank of America buys Merrill Lynch for $50 billion.
15 Lehman files for bankruptcy. AIG taps a subsidiary to stay afloat. Paulson: "Never once" considered bailing out Lehman and Merrill. Oregon's jobless rate hits its worst level in five years. Portland-area home prices fall 7.3 percent, the biggest drop on record. McCain: "The fundamentals of our economy are strong."
16 Fed puts up $85 billion bailout for AIG. Rep. Barney Frank, chairman of the House Financial Services Committee: "The private market screwed itself up and they need the government to come help them unscrew it." Clark County home sales are down 30 percent from 2007. WaMu says it can ride out problems.
17 WaMu in talks with potential buyers.
18 Fed pours $300 billion into global credit markets, which are not soothed. McCain: I'll fire the chairman of the Securities and Exchange Commission -- forgetting that a president can't fire an SEC chaiman.
19 President Bush, in his first major remarks on the crisis: "Confidence in our financial system and its institutions is essential to the smooth operation of our economy, and recently that confidence has been shaken." McCain offers a bailout plan. Sen. Barack Obama, says a bailout "must also help Main Street as well."
20 The Three-Page Plan, drawn up by Paulson, asks Congress for $700 billion to buy bad assets from banks to relax credit. Talks to rescue WaMu stall.
21 Democrats: Bailed-out banks must cap CEO salaries. House Speaker Nancy Pelosi: "We will not simply hand over a $700 billion blank check." Paulson: "If we design it so that it's punitive and so institutions aren't going to participate, this won't work the way we need it to work."
22 Oregon Rep. Peter DeFazio: What's the hurry? "If it takes a week, two weeks or three weeks or a month, the world will wait."
23 Polls: Americans are against giving Wall Street $700 billion. Paulson, Fed Chairman Ben Bernanke and others warn of recession, layoffs, foreclosures without a bailout.
24 McCain cancels a Letterman appearance and other campaign events to fly to Washington to join bailout talks. His running mate, Alaska Sen. Sarah Palin, tells Katie Couric: The country faces another Great Depression if the bailout is not enacted.
25 Basics of deal reached, but House Republicans balk. Regulators seize WaMu, peddle assets to JPMorgan Chase for a fire-sale price of $1.9 billion. Renaissance Homes of Lake Oswego, one of the state's biggest homebuilders, files for bankruptcy.
26 In the first presidential debate, Obama blames McCain for jumping aboard deregulation of the financial industry. McCain points to earmarks from Obama and says Washington has to get spending under control.
27 Deal struck for a $700 billion Wall Street bailout. In other action, Congress tosses $25 billion to the nation's automakers to retool since American consumers have realized that SUVs don't have good gas mileage.
28 Citigroup, Wells Fargo are in a dance to win Wachovia.
29 Citigroup wins most of Wachovia assets. House decides that 35 days before presidential election not optimum time to take $700 billion from taxpayers. Wall Street responds: Here's 777.68 points of mud in your eye.
30 Market grabs back nearly 500 points. FDIC head asks Congress for authority to raise the deposit insurance limit by an unspecified amount from $100,000; says that while most banks are sound, increasing the limit would ease jitters, encourage lending.
-- Anne Saker
Ping!
the Dems WANT a crisis. FreddieMae/FannieMac is a Democrat invention, a Democrat child, and a Democrat problem.
Cheers!
(Or a picture...)
Cheers!
The stoner state and proud of it.
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