-
By summer '07 the housing market is in trouble. prices are falling and inventories and foreclosures are rising.
-
Rumors that Bear Stearns is in trouble starts circulating on March 10, 2008.
-
Bear's CEO, Alan Schwartz, goes on CNBC and is confronted with the question of whether or not Bear's most important client Goldman Sachs is beginning to desert the firm.
-
The Race to find a buyer. Prohibited from directly lending to Bear, The Fed works out a plan to loan money to JP Morgan who in turn will loan the money to Bear.
-
Treasury Secretary Henry Paulson sends a message that "Financial Institutions Must Be Allowed to Fail" Bear Stocks sell for $2 a share.
-
Fannie and Freddie the world's largest mortgage lenders are hammered by losses related to the housing crisis. In mid-July their stocks fall more than 60 percent.
-
Fed takes control of Fannie and Freddie.
-
Legman's Stock Plunges 45%. They had made billions in the new-toxic, high-risk real estate market and couldn't secure extra financing from other banks. They had no success.
-
Concerned about moral hazard, Paulson makes clear that there will be no bailout for Lehman.
-
After Lehman goes under, the stock market nosedives and global credit markets freeze.
-
Paulson and Bernanke go to Congress to present a rescue plan to congressional leadership. "If we don't do this, we may not have an economy on Monday," warns Bernanke.