Meltdown of '07-'08

  • Housing Market Starts to Crash

    By summer '07 the housing market is in trouble. Prices are falling and inventories and foreclosures are rising.
  • Bear Stearns Rumors Start

    Rumors that Bear Stearns is in trouble starts circulating on March 10, 2008.
  • Alan Schwartz Talks

    Bear's CEO, Alan Schwarts, 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.
  • Government comes up with a solution

    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.
  • Too Big to Fail?

    Treasury Secretary Henry Paulson sends a message that "Financial Institutions Must Be Allowed to Fail" Bear Stocks sell for $2 a share.
  • Fannie & Freddie start going down

    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 Over

    Fed takes control of Fannie and Freddie
  • Lehman starts going as well

    Lehman's Stock plunges 45%. They had made billions in the now-toxic, high risk real estate market and couldn't secure extra financing from other banks. They had no success.
  • No Bailout for Lehman

    Concerned about moral hazard, Paulson makes clear that there will be no bailout for Lehman.
  • Lehman goes Under

    After Lehman goes under, the stock market nosedives and global credit markets freeze.
  • Rescue Plan

    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.