Financial Crisis Timeline: 2008
Timeline of Financial Crisis for the year 2008:
Feb 20: Sharper Image files for bankruptcy
San Francisco based Retailer of high-end electronics and gifts, Sharper Image Inc. filed for bankruptcy protection due to declining sales, three continuous years of losses and litigation. The company operates 184 locations country-wide.
MARCH 16: Bear Sterns bought by JP Morgan Chase & CoBear Stearns is bought by JP Morgan Chase & Co in a deal orchestrated by and backed up by the government following a sharp decline in shares and a collapse in confidence in the company.
JULY 11: IndyMac TakeoverFederal regulators seize IndyMac Bank after it succumbs to the pressures of tighter credit, tumbling home prices and rising foreclosures. IndyMac is the largest thrift ever to fail in the US.
July 30: Mervyns files for bankruptcy protection
Hayward, California based store, Mervyns, has filed for Chapter 11 bankruptcy protection.
Sept. 7: Fannie Mae, Freddie Mac Seized by Government
The U.S. government takes control of mortgage companies Fannie Mae and Freddie Mac, which held about half of the country's mortgages. The move put the liability of more than $5 trillion of mortgages on the taxpayers.
Sept. 14: Bank of America Buys Merrill Lynch
Bank of America, the nation's largest bank, credit card company and mortgage lender, buys Merrill Lynch for $50 billion. The purchase makes Bank of America the largest retail brokerage.
Sept. 15: Lehman Brothers Files for Bankruptcy
After the firm reported $19.3 billion in revenue in 2007, Lehman Brothers was forced to file for bankruptcy after it failed to find a buyer for its $60 billion in failing assets. The company had been in business for 158 years.
Sept. 16: Government Gives AIG Emergency Loan
In exchange for nearly 80 percent equity stake in the company, the government announces it will give insurance giant AIG an $85 billion emergency loan. The government said a failure of AIG could be devastating to the already struggling economy and financial markets.
Sept. 17: Barclays Makes Deal With Lehman
After passing on buying Lehman Brothers before the firm filed for bankruptcy, Barclays -- a British bank -- buys the company's North American investment banking and trading operations.
Sept. 19: Bush Announces Bailout Plan
The Bush administration asks Congress for powers to execute a $700 billion plan to buy bad debt and mortgages.
Sept. 25: JP Morgan Acquires Washington Mutual Bank
JP Morgan Chase announced the acquisition of Washington Mutual Bank, the largest savings and loan in US, from Washington Mutual Inc. JP Morgan will assume assets, deposits and branches for a $1.9 billion payment to FDIC (Federal Deposit Insurance Corporation).
Sept. 21: Goldman Sachs, Morgan Stanley Change Status
Goldman Sachs and Morgan Stanley get approval from the Federal Reserve to transform from investment banks to bank holding companies. The change means the companies will be regulated by the Federal Reserve, and will give them access to its emergency loan program.
Sept. 29: Citigroup Agrees To Buy Wachovia's Banking Operations
Citigroup agrees to buy the majority of Wachovia's banking operations for $2.1 billion in stock.
Sept. 29: House Rejects Bailout Package
The House of Representatives rejects the $700 billion rescue bill by a 228-205 vote.
Sept. 29: Dow Suffers Largest Ever One-Day Drop
The Dow falls 777.68 points to mark its largest one-day point loss in history. The decline is spurred by the House of Representative's rejection of the $700 rescue plan.
Oct. 1: Senate Passes Bailout
The Senate passes an amended proposed bailout bill, putting pressure on the House to do the same.
Oct. 3: Wells Fargo Tries To Acquire Wachovia
Days after Citigroup agrees to buy Wachovia's banking operations, Wells Fargo says it will acquire the company for $14.8 billion in an all-stock deal, without government assistance. This starts a battle between Citigroup and Wells Fargo for the company.
Oct. 3: House Approves Bailout, Bush Signs Bill
After the House voted in favor of the bailout 263-171, President George W. Bush quickly signed it. After the vote Bush said the government "acted boldly" to prevent the Wall Street crisis from spreading, but said "our economy continues to face serious challenges."
Oct. 6: Dow Drops Below 10,000
For the first time since 2004, the Dow Jones industrials dropped below 10,000. At one point during the day, the Dow was down 800 points before it rallied near closing to finish the day down 369 at 9,955.50.
Oct. 8: AIG Gets Another Loan From Feds
The Federal Reserve agrees to provide AIG with a loan of up to $37.8 billion, on top of the $85 billion loan it received in September.
Oct. 8: Motorola to cut 3,000 jobs
Motorola announced it would cut 3,000 or less than 5% of its work force and delay the spin-off of its mobile devices unit as it plans to try production of smart phones to excite the public in 2009.
Oct. 9: Dow Falls Below 9,000
Financial fears caused the Dow to drop to below 9,000 for the first time in five years. The Dow dropped almost 700 points to close at 8,579.19.
Oct. 10: Wells Fargo Wins Battle For Wachovia
Antitrust regulators clear Wells Fargo to acquire Wachovia.
Oct 21: IMF to rescue Iceland
Iceland, teetering on the verge of national bankruptcy due to global financial meltdown, is likely to receive a $6 billion (€4.5 billion) rescue package tailored by the International Monetary Fund (IMF), Nordic countries and Japan.
Oct. 22: Ukraine to get more than $20 billion in international loans
Ukraine will receive more than $20 billion in international loans, out of which around $16 billion would be provided by IMF.
Oct. 28: Dow Has Second-Largest Point Gain Ever
The Dow soars 889 points to reach the 9,065 level.
Oct. 30: Economy Shrinks In Third Quarter, Signaling Recession
The government says consumers cut back on their spending in the third quarter by the biggest amount in 28 years.
Nov. 5: Economy Stumbles After Election
The Dow falls more than 400 points on renewed fears of a recession.
Nov. 10: AIG Gets Bigger Bailout
The government provides new financial assistance to troubled insurance giant American International Group, including pouring $40 billion into the company in return for partial ownership.
Nov. 10: DHL Cuts 9,500 Jobs
Mail and logistics company Deutsche Post AG says it will cut 9,500 jobs and close all of its DHL express service centers in the U.S. amid heavy losses in the market there.
Nov 10: Circuit City Files for bankruptcy protection
Virginia based Circuit City filed for Chapter 11 Bankruptcy despite closing down 155 stores and cutting 17% of its 43,000 work force.
Nov. 13: Jobless Claims Soar
The government says that the number of newly laid-off individuals seeking unemployment benefits jumped more than expected last week to a seven-year high. The Labor Department says jobless claims increased by 32,000 to a seasonally adjusted 516,000.
Nov. 13: Budget Deficit Reaches Record $237.2 Billion
The federal government begins the new budget year with a record deficit of $237.2 billion, reflecting the billions of dollars the government has started to pay out to rescue the financial system. The Treasury Department says the deficit for the first month in the new budget year was the highest monthly imbalance on record.
Nov. 14: Bush Wants to Give $25 Billion In Loans To Carmakers
The White House is throwing support behind a plan to speed release of $25 billion in loans to troubled automakers but is rejecting a Democratic proposal to use money from a financial bailout for car companies. Spokeswoman Dana Perino said the Democratic proposal would lead to partisan gridlock because the $700 billion rescue package was never intended to help automakers and shouldn't be now.
Nov. 15: World Leaders Seek To Prevent Future Economic Crisis
World leaders are agreeing to flag risky investing and regulatory weak spots in hopes of avoiding future financial meltdowns. President George W. Bush and leaders from nearly two dozen countries endorse broad goals to fend off any future crisis and revive the economy. They are pledging to lay the foundation for reform so that the kind of global crisis now dragging down the economy does not happen again.
Nov. 15: Pakistan to get IMF bailout
Pakistan announced today that the country will receive $7.6 billion from IMF. This would be the first IMF rescue in Asia since the global financial crisis began.
Nov. 17: Citigroup to cut 53,000 Jobs
Citigroup, the second biggest bank in US will slash 53,000 jobs in the coming quarters after suffering heavy losses in the current financial crisis. The job cut announced is in addition to the 22,000 job cut the company announced in last October.
Nov. 19: Dow drops below 8,000 for the first time since 2003
Wall Street hit its lowest level since 2003. The Dow Jones industrial average fell below the 8,000 mark. It dropped nearly 430 points to 7,997. The news came as major automakers await a decision from Congress about a bailout for their industry.
Nov. 20: Jobless Claims Rise
Labor Department reports that claims for unemployment benefits hit their highest level since 1992. The Labor Department said new applications for jobless benefits rose to a seasonally adjusted 542,000 from a downwardly revised figure of 515,000 in the previous week.
Nov. 22: UK unveils stimulus plan
British Finance Minister Alistair Darling has unveiled a $430 billion package of measures intended to stimulate the flagging U.K. economy, suspending rules that have kept government borrowing in check since the ruling Labor Party came to power in 1997.
Nov. 24: Citigroup Rescue
US Government takes $20 billion stake in Citigroup, guarantees $306 billion in risky loans and securities
Nov 26. European Commission launches stimulus planThe European Commission unveiled a Recovery Plan worth about EUR200 billion or 1.5% of European Union's gross domestic product. The plan envisages timely, targeted and temporary fiscal stimulus for the economy. Nearly EUR170 billion will be in national budgets and around EUR30 billion will be in the EU and European Investment Bank budgets.
Dec. 2: US Recession Official
The National Bureau of Economic Research (NBER) declared that he US economy is in recession and the economic slump infact started in December 2007. It is expected to last till the middle of 2009 and will be the most severe slump since the 1981-82 recessions.
Dec 2: JP Morgan to Axe 9,200 Washington Mutual Jobs
JP Morgan Chase announced it will cut 9,200 jobs at former Washington Mutual, which on 25th Sep. became the largest US bank to fail. The cut amounts to more than 21% of the work force.
Dec 2: Oil Falls to 3 Year Low
Crude oil fell to the lowest in more than three years on signs the U.S., the world’s largest energy consumer, may be in the longest slump since World War II.
Dec 3: Bank of America Could Cut 30,000 Jobs as it Absorbs Merrill LynchBank of America could end up cutting 30,000 jobs as it moves to absorb Merrill Lynch. The majority of layoffs are likely to come from Merrill’s side of business.
Dec 3: US Automakers Want Up to $34 Billion in Aid
General Motors, Ford and Chrysler submitted requests to Congress for what could amount to $34 billion in Federal assistance to save the struggling industry from collapse.
Dec 4: Dupont to cut 2,500 jobs
Dupont says it will cut 2,500 jobs, mostly serving the U.S. and European automotive and construction markets, because of lower demand linked to the steep global decline in home building, auto sales and consumer spending.
Dec 5: AT&T to cut jobs by 12,000
AT&T said Thursday that it would cut jobs by 12,000 or 4% of its workforce – the job cuts will take place in December and throughout 2009.
Dec 5: Viacom to cut 850 positions
Responding to the economic downturn and weaker revenue, Viacom Inc. is slashing more than 850 jobs (7% of its workforce) and freezing salary increases next year. Deepest cuts will come at its division MTV Networks, which includes MTV, Nickelodeon, VH1 and Comedy Central.
Dec 8: Dow Chemical to cut 11,000 jobs
Dow Chemical announced it was slashing 5,000 full time jobs, or 11% of its global staff, and an additional 6,000 contract workers, as it cuts 30% of its total production.
Dec 8: 3M Slashes 1,800 jobs, cuts 2008 outlook
Diversified manufacturer 3M Co said on Monday it would cut 1,800 jobs and lowered its 2008 outlook due to the global economic downturn, sending its shares down as much as 7.4 percent.
Dec 9: NYC Comptroller says city may lose 165,000 jobs
NYC Comptroller William C. Thompson Jr. said over the next two years about 165,000 jobs may be lost, of that around 35,000 on Wall Street. He said the city will not see the bottom of economic downturn until the beginning of 2010.
Dec 9: Sony to cut 16,000 jobs
Japan’s Sony said it would cut its global work force by 4% or 16,000 jobs. This would include half of the regular and half of contractual employees.
Dec 9: Oil falls 4% on forecast for shrinking demand
US crude oil fell to $42 a barrel after hitting a session low of $41.95 after US government forecast the world economic slowdown would shrink global oil consumption this year for the first time since the early 80s.
Dec 9: Rio Tinto to cut 14,000 jobs
Global miner Rio Tinto, faced with $40 billion in net debt, said it could cut 13% of its global workforce or 14,000 jobs, slash capital spending by more than half and sell more assets.
Dec 9: Anheuser-Busch to cut 1,400 jobs
World’s largest brewer, Anheuser-Busch announced it would cut some 1,400 US jobs – or another 6% of its workforce to help save atleast $15 billion a year.
Dec 10: US House passes $14 billion Auto Bailout – Chances grim in Senate
US House of Representatives passed the $14 billion Auto Bailout package for the “Big Three”, GM, Ford and Chrysler. However, it would be an uphill task to get it approved by the Senate. The loans are intended to carry the companies through March 31 2008, after which more help would be determined according to the quality of restructuring implemented by the “Detroit Three”.
Dec 10: Yahoo to cut 1,500 jobs
Yahoo announced it would cut 1,500 jobs which that would include 3% of its workforce in India.
Dec 10: Office Depot to cut 2,200 jobsFaced with shrinking profits and ever-increasing operating costs, Office Depot has decided to cut 2,200 jobs across North America and close 112 stores in the next 3 months.
Dec 11: US Retail Sales post biggest drop in 5 years
SpendingPlus, a subsidiary of Master Card reported US retail sales excluding autos posted their biggest monthly drop (3.8%) in 5 years November, despite a sales spurt over the crucial “Black Friday” weekend – the three days after the Thanksgiving Holiday in November.
Dec 11: KB Toys files for bankruptcy protection
KB Toys filed for bankruptcy protection just 14 days before Christmas despite offering heavy discounts to generate sales. The company operates 277 mall-based stores, 40 KB Toy Works stores which are mainly in strip malls, 114 outlet stores and 30 short-term holiday stores. It has 4,400 full-time employees and 6,515 seasonal employees
Dec 11: BlackRock to cut 500 jobs
BlackRock Inc., the largest publicly traded asset manager, has cut 500 jobs worldwide as it grapples with a surge in outflows during the global credit crisis.
Dec 11: Stanley Works to cut 2,000 jobs and close 3 plantsTool maker Stanley Works said today it will cut 2,000 jobs, close 3 manufacturing facilities and revise future outlook, citing weakness in its construction and industrial segments and the effect of a stronger dollar.
Dec 12: Investors facing billions in potential losses due to Madoff FraudBernard Madoff, 70-year old former chairman of NASDAQ Stock Exchange, was arrested Thursday for allegedly masterminding a Ponzi scheme through a hedge fund he ran. Potential losses from the fraud are said to be around $50 billion and the affected may include rich investors from New York and Florida, banks, funds of funds, corporations, endowments, universities and foundations. The full extent of damage will only be known with time.
Dec 15: Toyota to cut sales goal and costs
World’s top automaker Toyota is expected to cut its 2009 global sales forecast by atleast 1 million vehicles to 8-8.7 million (as opposed to planned 9.7 million before), down from the record sales of 9.37 million in 2007. Toyota is also expected to announce cost cutting measures.
Dec 17: Federal Reserve cuts key interest rate to historic low
In a move to stimulate the ever-weakening US economy, Federal Reserve slashed the key interest rate (target fed-funds rate) from 1% to a range of 0 to 0.25% - the lowest since it began publishing the target in 1990. The move was met by an overnight rally in US stock markets.
Dec 17: Woolworth’s to close 807 stores
Woolworths, the 99-year old bastion of the British high street that sold everything from sweets to toasters, will close by Jan. 5 2009 with the loss of 27,000 jobs.
Dec 17: France’s Valeo to cut 5,000 jobs
The second biggest auto parts maker of France Valeo announced it would cut 5,000 jobs or 9.3% of its workforce due to sharp drop in vehicle production. Around 1,600 positions would go in French plants while 1,800 jobs will be cut in other European countries.
Dec 17: Rio Tinto cancels $10 billion Saudi Joint VentureMining giant Rio Tinto will not participate in the Saudi 700,000 tons per year Aluminum joint venture as it will not be able to finance its 49% of the share or $10 billion because of financial crisis. Saudi group Maaden owns the rest of 51% share.
Dec 19: US Government announces $17 billion Auto Bailout
The US government will give $17.4 billion to GM and Chrysler in short term loans in return for deep concessions, including giving the government the option to take stakes in the companies and them to show their viability by March. $13.4 billion will be made available immediately and further $4 billion will be given in February contingent upon drawing down the remaining $350 billion TARP fund. Ford is not included in the package but seeks $9 billion line of credit.
Dec 19: Polaroid files for bankruptcy
Instant photo inventor Polaroid filed for Chapter 11 bankruptcy in order to facilitate the company’s financial restructuring due to the alleged fraud investigation its founder Petters Group is going through.
Dec 19: Oil falls below $37
Oil prices fell to $36.22 a barrel (4.5 year low) due to slowing global economy despite announcement by OPEC that it would be cutting oil production by 2.2 million barrels a day.
Dec 19: Caterpillar to layoff 814 workers
Caterpillar Inc. hit by a drop-off in demand for diesel engines said it plans to layoff 814 production workers at its engine assembly plant in Mossville, Illinois
Dec 19: Citizens Financial Group to lay off 900 workersCitizens Financial Group announced it would be cutting 900 jobs in 13 different states across the commercial, retail and global transactions sectors.
Dec 22: Electronic Arts to cut 1,000 jobsCalifornia based company, Electronic Arts, the second biggest video games publisher boosted planned job cuts by 1,000 or 10% of its work force. And will consolidate or close atleast 9 studio or publishing locations.
Dec 23: US economy shrank 0.5%
Government data has shown that the US economy shrank 0.5% in the third quarter of 2008, after growing at 2.8% in the previous three months. The fourth quarter is expected to be worse.
Dec 23: Unisys to cut 1,300 jobsIT solutions and services provider Unisys announced it would cut 1,300 jobs across the world, freeze salary raises, slash retirement plan contributions and consolidate facilities in order to cut costs and return back to profits.
Dec 24. Jobless claims rise to a 26 year high
According to the Labor Department, unemployment insurance last week rose by 30,000, to a 26 year high of 586,000, seasonally adjusted, and the four week average of new claims rose by 13,750 to 558,000.
Dec. 24: GMAC to get a life line
GMAC which is 49% owned by GM and provides auto-financing to GM customers and dealerships has been approved by Federal Reserve to become a holding company from a financial services firm, which will allow it to get funds from the government’s $700 billion bailout package.
Dec. 29: Kuwait cancels $17 billion deal with Dow Chemical
Kuwait has cancelled a $17 billion petr-chemical joint venture deal with the US company Dow Chemical. The company had planned to use the proceeds of this deal to repay large part of $13 billion in debt on its acquisition of rival company Rohm and Hass. Kuwaiti parliamentarians were against the deal as they did not deem it viable in the face of current financial crisis.
Dec 29: UK could lose 600,000 jobs in 2009
According to The Chartered Institute of Personnel and Development, UK unemployment could reach close to 3 million in 2009 while 600,000 jobs could be lost in the same year.
Dec 29: Russian professor predicts US will disintegrate due to debt collapse
A Russian professor, Igor Panarin, has predicted that the United States will break-up into 6 parts by 2010 due to the mounting debt crisis that he called a pyramid bound to collapse.
Dec 30: Home prices fall a record 18%According to Standard & Poors/Case-Shiller Home Price Indices, the prices of US single family homes have plunged to a record 18% from a year earlier. The composite index of 21 metropolitan areas fell 2.2% in October from September 2008.
Dec 30: 73,000 retail stores could close in the first half of 2009
A recent report by International Council of shopping Centers (ICSC), 73,000 stores could close in the first half of 2009. The Council had predicted that 148,000 stores would shut down in 2008.
Dec 30: GMAC gets $6 billion relief
GMAC received a $6 billion injection from the U.S. government late Monday night as part of the Troubled Asset Relief Program.
Feb 20: Sharper Image files for bankruptcy
San Francisco based Retailer of high-end electronics and gifts, Sharper Image Inc. filed for bankruptcy protection due to declining sales, three continuous years of losses and litigation. The company operates 184 locations country-wide.
MARCH 16: Bear Sterns bought by JP Morgan Chase & CoBear Stearns is bought by JP Morgan Chase & Co in a deal orchestrated by and backed up by the government following a sharp decline in shares and a collapse in confidence in the company.
JULY 11: IndyMac TakeoverFederal regulators seize IndyMac Bank after it succumbs to the pressures of tighter credit, tumbling home prices and rising foreclosures. IndyMac is the largest thrift ever to fail in the US.
July 30: Mervyns files for bankruptcy protection
Hayward, California based store, Mervyns, has filed for Chapter 11 bankruptcy protection.
Sept. 7: Fannie Mae, Freddie Mac Seized by Government
The U.S. government takes control of mortgage companies Fannie Mae and Freddie Mac, which held about half of the country's mortgages. The move put the liability of more than $5 trillion of mortgages on the taxpayers.
Sept. 14: Bank of America Buys Merrill Lynch
Bank of America, the nation's largest bank, credit card company and mortgage lender, buys Merrill Lynch for $50 billion. The purchase makes Bank of America the largest retail brokerage.
Sept. 15: Lehman Brothers Files for Bankruptcy
After the firm reported $19.3 billion in revenue in 2007, Lehman Brothers was forced to file for bankruptcy after it failed to find a buyer for its $60 billion in failing assets. The company had been in business for 158 years.
Sept. 16: Government Gives AIG Emergency Loan
In exchange for nearly 80 percent equity stake in the company, the government announces it will give insurance giant AIG an $85 billion emergency loan. The government said a failure of AIG could be devastating to the already struggling economy and financial markets.
Sept. 17: Barclays Makes Deal With Lehman
After passing on buying Lehman Brothers before the firm filed for bankruptcy, Barclays -- a British bank -- buys the company's North American investment banking and trading operations.
Sept. 19: Bush Announces Bailout Plan
The Bush administration asks Congress for powers to execute a $700 billion plan to buy bad debt and mortgages.
Sept. 25: JP Morgan Acquires Washington Mutual Bank
JP Morgan Chase announced the acquisition of Washington Mutual Bank, the largest savings and loan in US, from Washington Mutual Inc. JP Morgan will assume assets, deposits and branches for a $1.9 billion payment to FDIC (Federal Deposit Insurance Corporation).
Sept. 21: Goldman Sachs, Morgan Stanley Change Status
Goldman Sachs and Morgan Stanley get approval from the Federal Reserve to transform from investment banks to bank holding companies. The change means the companies will be regulated by the Federal Reserve, and will give them access to its emergency loan program.
Sept. 29: Citigroup Agrees To Buy Wachovia's Banking Operations
Citigroup agrees to buy the majority of Wachovia's banking operations for $2.1 billion in stock.
Sept. 29: House Rejects Bailout Package
The House of Representatives rejects the $700 billion rescue bill by a 228-205 vote.
Sept. 29: Dow Suffers Largest Ever One-Day Drop
The Dow falls 777.68 points to mark its largest one-day point loss in history. The decline is spurred by the House of Representative's rejection of the $700 rescue plan.
Oct. 1: Senate Passes Bailout
The Senate passes an amended proposed bailout bill, putting pressure on the House to do the same.
Oct. 3: Wells Fargo Tries To Acquire Wachovia
Days after Citigroup agrees to buy Wachovia's banking operations, Wells Fargo says it will acquire the company for $14.8 billion in an all-stock deal, without government assistance. This starts a battle between Citigroup and Wells Fargo for the company.
Oct. 3: House Approves Bailout, Bush Signs Bill
After the House voted in favor of the bailout 263-171, President George W. Bush quickly signed it. After the vote Bush said the government "acted boldly" to prevent the Wall Street crisis from spreading, but said "our economy continues to face serious challenges."
Oct. 6: Dow Drops Below 10,000
For the first time since 2004, the Dow Jones industrials dropped below 10,000. At one point during the day, the Dow was down 800 points before it rallied near closing to finish the day down 369 at 9,955.50.
Oct. 8: AIG Gets Another Loan From Feds
The Federal Reserve agrees to provide AIG with a loan of up to $37.8 billion, on top of the $85 billion loan it received in September.
Oct. 8: Motorola to cut 3,000 jobs
Motorola announced it would cut 3,000 or less than 5% of its work force and delay the spin-off of its mobile devices unit as it plans to try production of smart phones to excite the public in 2009.
Oct. 9: Dow Falls Below 9,000
Financial fears caused the Dow to drop to below 9,000 for the first time in five years. The Dow dropped almost 700 points to close at 8,579.19.
Oct. 10: Wells Fargo Wins Battle For Wachovia
Antitrust regulators clear Wells Fargo to acquire Wachovia.
Oct 21: IMF to rescue Iceland
Iceland, teetering on the verge of national bankruptcy due to global financial meltdown, is likely to receive a $6 billion (€4.5 billion) rescue package tailored by the International Monetary Fund (IMF), Nordic countries and Japan.
Oct. 22: Ukraine to get more than $20 billion in international loans
Ukraine will receive more than $20 billion in international loans, out of which around $16 billion would be provided by IMF.
Oct. 28: Dow Has Second-Largest Point Gain Ever
The Dow soars 889 points to reach the 9,065 level.
Oct. 30: Economy Shrinks In Third Quarter, Signaling Recession
The government says consumers cut back on their spending in the third quarter by the biggest amount in 28 years.
Nov. 5: Economy Stumbles After Election
The Dow falls more than 400 points on renewed fears of a recession.
Nov. 10: AIG Gets Bigger Bailout
The government provides new financial assistance to troubled insurance giant American International Group, including pouring $40 billion into the company in return for partial ownership.
Nov. 10: DHL Cuts 9,500 Jobs
Mail and logistics company Deutsche Post AG says it will cut 9,500 jobs and close all of its DHL express service centers in the U.S. amid heavy losses in the market there.
Nov 10: Circuit City Files for bankruptcy protection
Virginia based Circuit City filed for Chapter 11 Bankruptcy despite closing down 155 stores and cutting 17% of its 43,000 work force.
Nov. 13: Jobless Claims Soar
The government says that the number of newly laid-off individuals seeking unemployment benefits jumped more than expected last week to a seven-year high. The Labor Department says jobless claims increased by 32,000 to a seasonally adjusted 516,000.
Nov. 13: Budget Deficit Reaches Record $237.2 Billion
The federal government begins the new budget year with a record deficit of $237.2 billion, reflecting the billions of dollars the government has started to pay out to rescue the financial system. The Treasury Department says the deficit for the first month in the new budget year was the highest monthly imbalance on record.
Nov. 14: Bush Wants to Give $25 Billion In Loans To Carmakers
The White House is throwing support behind a plan to speed release of $25 billion in loans to troubled automakers but is rejecting a Democratic proposal to use money from a financial bailout for car companies. Spokeswoman Dana Perino said the Democratic proposal would lead to partisan gridlock because the $700 billion rescue package was never intended to help automakers and shouldn't be now.
Nov. 15: World Leaders Seek To Prevent Future Economic Crisis
World leaders are agreeing to flag risky investing and regulatory weak spots in hopes of avoiding future financial meltdowns. President George W. Bush and leaders from nearly two dozen countries endorse broad goals to fend off any future crisis and revive the economy. They are pledging to lay the foundation for reform so that the kind of global crisis now dragging down the economy does not happen again.
Nov. 15: Pakistan to get IMF bailout
Pakistan announced today that the country will receive $7.6 billion from IMF. This would be the first IMF rescue in Asia since the global financial crisis began.
Nov. 17: Citigroup to cut 53,000 Jobs
Citigroup, the second biggest bank in US will slash 53,000 jobs in the coming quarters after suffering heavy losses in the current financial crisis. The job cut announced is in addition to the 22,000 job cut the company announced in last October.
Nov. 19: Dow drops below 8,000 for the first time since 2003
Wall Street hit its lowest level since 2003. The Dow Jones industrial average fell below the 8,000 mark. It dropped nearly 430 points to 7,997. The news came as major automakers await a decision from Congress about a bailout for their industry.
Nov. 20: Jobless Claims Rise
Labor Department reports that claims for unemployment benefits hit their highest level since 1992. The Labor Department said new applications for jobless benefits rose to a seasonally adjusted 542,000 from a downwardly revised figure of 515,000 in the previous week.
Nov. 22: UK unveils stimulus plan
British Finance Minister Alistair Darling has unveiled a $430 billion package of measures intended to stimulate the flagging U.K. economy, suspending rules that have kept government borrowing in check since the ruling Labor Party came to power in 1997.
Nov. 24: Citigroup Rescue
US Government takes $20 billion stake in Citigroup, guarantees $306 billion in risky loans and securities
Nov 26. European Commission launches stimulus planThe European Commission unveiled a Recovery Plan worth about EUR200 billion or 1.5% of European Union's gross domestic product. The plan envisages timely, targeted and temporary fiscal stimulus for the economy. Nearly EUR170 billion will be in national budgets and around EUR30 billion will be in the EU and European Investment Bank budgets.
Dec. 2: US Recession Official
The National Bureau of Economic Research (NBER) declared that he US economy is in recession and the economic slump infact started in December 2007. It is expected to last till the middle of 2009 and will be the most severe slump since the 1981-82 recessions.
Dec 2: JP Morgan to Axe 9,200 Washington Mutual Jobs
JP Morgan Chase announced it will cut 9,200 jobs at former Washington Mutual, which on 25th Sep. became the largest US bank to fail. The cut amounts to more than 21% of the work force.
Dec 2: Oil Falls to 3 Year Low
Crude oil fell to the lowest in more than three years on signs the U.S., the world’s largest energy consumer, may be in the longest slump since World War II.
Dec 3: Bank of America Could Cut 30,000 Jobs as it Absorbs Merrill LynchBank of America could end up cutting 30,000 jobs as it moves to absorb Merrill Lynch. The majority of layoffs are likely to come from Merrill’s side of business.
Dec 3: US Automakers Want Up to $34 Billion in Aid
General Motors, Ford and Chrysler submitted requests to Congress for what could amount to $34 billion in Federal assistance to save the struggling industry from collapse.
Dec 4: Dupont to cut 2,500 jobs
Dupont says it will cut 2,500 jobs, mostly serving the U.S. and European automotive and construction markets, because of lower demand linked to the steep global decline in home building, auto sales and consumer spending.
Dec 5: AT&T to cut jobs by 12,000
AT&T said Thursday that it would cut jobs by 12,000 or 4% of its workforce – the job cuts will take place in December and throughout 2009.
Dec 5: Viacom to cut 850 positions
Responding to the economic downturn and weaker revenue, Viacom Inc. is slashing more than 850 jobs (7% of its workforce) and freezing salary increases next year. Deepest cuts will come at its division MTV Networks, which includes MTV, Nickelodeon, VH1 and Comedy Central.
Dec 8: Dow Chemical to cut 11,000 jobs
Dow Chemical announced it was slashing 5,000 full time jobs, or 11% of its global staff, and an additional 6,000 contract workers, as it cuts 30% of its total production.
Dec 8: 3M Slashes 1,800 jobs, cuts 2008 outlook
Diversified manufacturer 3M Co said on Monday it would cut 1,800 jobs and lowered its 2008 outlook due to the global economic downturn, sending its shares down as much as 7.4 percent.
Dec 9: NYC Comptroller says city may lose 165,000 jobs
NYC Comptroller William C. Thompson Jr. said over the next two years about 165,000 jobs may be lost, of that around 35,000 on Wall Street. He said the city will not see the bottom of economic downturn until the beginning of 2010.
Dec 9: Sony to cut 16,000 jobs
Japan’s Sony said it would cut its global work force by 4% or 16,000 jobs. This would include half of the regular and half of contractual employees.
Dec 9: Oil falls 4% on forecast for shrinking demand
US crude oil fell to $42 a barrel after hitting a session low of $41.95 after US government forecast the world economic slowdown would shrink global oil consumption this year for the first time since the early 80s.
Dec 9: Rio Tinto to cut 14,000 jobs
Global miner Rio Tinto, faced with $40 billion in net debt, said it could cut 13% of its global workforce or 14,000 jobs, slash capital spending by more than half and sell more assets.
Dec 9: Anheuser-Busch to cut 1,400 jobs
World’s largest brewer, Anheuser-Busch announced it would cut some 1,400 US jobs – or another 6% of its workforce to help save atleast $15 billion a year.
Dec 10: US House passes $14 billion Auto Bailout – Chances grim in Senate
US House of Representatives passed the $14 billion Auto Bailout package for the “Big Three”, GM, Ford and Chrysler. However, it would be an uphill task to get it approved by the Senate. The loans are intended to carry the companies through March 31 2008, after which more help would be determined according to the quality of restructuring implemented by the “Detroit Three”.
Dec 10: Yahoo to cut 1,500 jobs
Yahoo announced it would cut 1,500 jobs which that would include 3% of its workforce in India.
Dec 10: Office Depot to cut 2,200 jobsFaced with shrinking profits and ever-increasing operating costs, Office Depot has decided to cut 2,200 jobs across North America and close 112 stores in the next 3 months.
Dec 11: US Retail Sales post biggest drop in 5 years
SpendingPlus, a subsidiary of Master Card reported US retail sales excluding autos posted their biggest monthly drop (3.8%) in 5 years November, despite a sales spurt over the crucial “Black Friday” weekend – the three days after the Thanksgiving Holiday in November.
Dec 11: KB Toys files for bankruptcy protection
KB Toys filed for bankruptcy protection just 14 days before Christmas despite offering heavy discounts to generate sales. The company operates 277 mall-based stores, 40 KB Toy Works stores which are mainly in strip malls, 114 outlet stores and 30 short-term holiday stores. It has 4,400 full-time employees and 6,515 seasonal employees
Dec 11: BlackRock to cut 500 jobs
BlackRock Inc., the largest publicly traded asset manager, has cut 500 jobs worldwide as it grapples with a surge in outflows during the global credit crisis.
Dec 11: Stanley Works to cut 2,000 jobs and close 3 plantsTool maker Stanley Works said today it will cut 2,000 jobs, close 3 manufacturing facilities and revise future outlook, citing weakness in its construction and industrial segments and the effect of a stronger dollar.
Dec 12: Investors facing billions in potential losses due to Madoff FraudBernard Madoff, 70-year old former chairman of NASDAQ Stock Exchange, was arrested Thursday for allegedly masterminding a Ponzi scheme through a hedge fund he ran. Potential losses from the fraud are said to be around $50 billion and the affected may include rich investors from New York and Florida, banks, funds of funds, corporations, endowments, universities and foundations. The full extent of damage will only be known with time.
Dec 15: Toyota to cut sales goal and costs
World’s top automaker Toyota is expected to cut its 2009 global sales forecast by atleast 1 million vehicles to 8-8.7 million (as opposed to planned 9.7 million before), down from the record sales of 9.37 million in 2007. Toyota is also expected to announce cost cutting measures.
Dec 17: Federal Reserve cuts key interest rate to historic low
In a move to stimulate the ever-weakening US economy, Federal Reserve slashed the key interest rate (target fed-funds rate) from 1% to a range of 0 to 0.25% - the lowest since it began publishing the target in 1990. The move was met by an overnight rally in US stock markets.
Dec 17: Woolworth’s to close 807 stores
Woolworths, the 99-year old bastion of the British high street that sold everything from sweets to toasters, will close by Jan. 5 2009 with the loss of 27,000 jobs.
Dec 17: France’s Valeo to cut 5,000 jobs
The second biggest auto parts maker of France Valeo announced it would cut 5,000 jobs or 9.3% of its workforce due to sharp drop in vehicle production. Around 1,600 positions would go in French plants while 1,800 jobs will be cut in other European countries.
Dec 17: Rio Tinto cancels $10 billion Saudi Joint VentureMining giant Rio Tinto will not participate in the Saudi 700,000 tons per year Aluminum joint venture as it will not be able to finance its 49% of the share or $10 billion because of financial crisis. Saudi group Maaden owns the rest of 51% share.
Dec 19: US Government announces $17 billion Auto Bailout
The US government will give $17.4 billion to GM and Chrysler in short term loans in return for deep concessions, including giving the government the option to take stakes in the companies and them to show their viability by March. $13.4 billion will be made available immediately and further $4 billion will be given in February contingent upon drawing down the remaining $350 billion TARP fund. Ford is not included in the package but seeks $9 billion line of credit.
Dec 19: Polaroid files for bankruptcy
Instant photo inventor Polaroid filed for Chapter 11 bankruptcy in order to facilitate the company’s financial restructuring due to the alleged fraud investigation its founder Petters Group is going through.
Dec 19: Oil falls below $37
Oil prices fell to $36.22 a barrel (4.5 year low) due to slowing global economy despite announcement by OPEC that it would be cutting oil production by 2.2 million barrels a day.
Dec 19: Caterpillar to layoff 814 workers
Caterpillar Inc. hit by a drop-off in demand for diesel engines said it plans to layoff 814 production workers at its engine assembly plant in Mossville, Illinois
Dec 19: Citizens Financial Group to lay off 900 workersCitizens Financial Group announced it would be cutting 900 jobs in 13 different states across the commercial, retail and global transactions sectors.
Dec 22: Electronic Arts to cut 1,000 jobsCalifornia based company, Electronic Arts, the second biggest video games publisher boosted planned job cuts by 1,000 or 10% of its work force. And will consolidate or close atleast 9 studio or publishing locations.
Dec 23: US economy shrank 0.5%
Government data has shown that the US economy shrank 0.5% in the third quarter of 2008, after growing at 2.8% in the previous three months. The fourth quarter is expected to be worse.
Dec 23: Unisys to cut 1,300 jobsIT solutions and services provider Unisys announced it would cut 1,300 jobs across the world, freeze salary raises, slash retirement plan contributions and consolidate facilities in order to cut costs and return back to profits.
Dec 24. Jobless claims rise to a 26 year high
According to the Labor Department, unemployment insurance last week rose by 30,000, to a 26 year high of 586,000, seasonally adjusted, and the four week average of new claims rose by 13,750 to 558,000.
Dec. 24: GMAC to get a life line
GMAC which is 49% owned by GM and provides auto-financing to GM customers and dealerships has been approved by Federal Reserve to become a holding company from a financial services firm, which will allow it to get funds from the government’s $700 billion bailout package.
Dec. 29: Kuwait cancels $17 billion deal with Dow Chemical
Kuwait has cancelled a $17 billion petr-chemical joint venture deal with the US company Dow Chemical. The company had planned to use the proceeds of this deal to repay large part of $13 billion in debt on its acquisition of rival company Rohm and Hass. Kuwaiti parliamentarians were against the deal as they did not deem it viable in the face of current financial crisis.
Dec 29: UK could lose 600,000 jobs in 2009
According to The Chartered Institute of Personnel and Development, UK unemployment could reach close to 3 million in 2009 while 600,000 jobs could be lost in the same year.
Dec 29: Russian professor predicts US will disintegrate due to debt collapse
A Russian professor, Igor Panarin, has predicted that the United States will break-up into 6 parts by 2010 due to the mounting debt crisis that he called a pyramid bound to collapse.
Dec 30: Home prices fall a record 18%According to Standard & Poors/Case-Shiller Home Price Indices, the prices of US single family homes have plunged to a record 18% from a year earlier. The composite index of 21 metropolitan areas fell 2.2% in October from September 2008.
Dec 30: 73,000 retail stores could close in the first half of 2009
A recent report by International Council of shopping Centers (ICSC), 73,000 stores could close in the first half of 2009. The Council had predicted that 148,000 stores would shut down in 2008.
Dec 30: GMAC gets $6 billion relief
GMAC received a $6 billion injection from the U.S. government late Monday night as part of the Troubled Asset Relief Program.
