GFC: a timeline

It was a year ago that the crisis entered its most dangerous phase. A meltdown in the U.S. mortgage market sparked a worldwide crisis that led to rapid, sweeping changes in the financial system.

April 2007- one of the biggest lenders into the sub-prime end of the housing market, New Century Financial, runs for the shelter of bankruptcy protection law.

March 2008- Investment bank Bear Stearns is acquired by rival JP Morgan Chase for $240m in a deal back by $30bn of central bank loans. A year earlier it would have been worth £18bn.

September 7, 2009- Mortgage lenders Fannie Mae and Freddie Mac, which account for nearly half of the outstanding mortgages in the US are rescued by the US government in one of the largest bailouts in US history.

September 15- Investment banking giant Lehman Brothers files for bankruptcy, after US officials decided not to bail it out. It would be the largest and highest-profile casualty of the global credit crisis.

September 15-
Bank of America takes over rival Merrill Lynch. AIG, once the world's top insurer, was on the brink. Wall Street suffers its worst day since the 2001 September 11 attacks.

September 19- US Treasury Secretary Henry Paulson attempts to restore financial stability with a plan to take toxic mortgage assets off the books of struggling financial companies.

October- Following House and Senate approval, President Bush signs a revised version of the $700 billion financial recue plan. The plan allows the Treasury Department to buy assets from Wall Street financial institutions.

October 13- International Monetary Fund, famous for its fiscal and monetary conservatism, effectively encourages governments to cut interest rates as far as possible and spend as much as they can afford, and to do it now, there is clearly no time to be lost.

November 3- Barack Obama is elected the 44th president to the United States.

February 13, 2009- The Rudd Government's $42 billion economic stimulus package is passed in the Senate, paving the way for promised cash bonuses for workers around the country.

February 17- President Obama signs the $787 billion stimulus plan into law. The plan aims to spur job creation and industry growth, particularly in health care and green energy.

March 4- Australia's economy slumps 0.5 per cent, its first quarter of negative growth in 8 years.

March 16- President Obama instructs Treasury Secretary Timothy Geithner to block AIG from spending $165 million on executive bonuses. Taxpayers have thus far given AIG $165 in aid.

April 30- US car giant Chrysler files for bankruptcy in an effort to clear the final hurdles before its alliance with Fiat.

June 3- Australia avoids a recession after the Australian Bureau of Statistics reveals the economy for the March quarter grew by a 0.4 per cent from the final quarter of 2008.

Junes 1- General Motors Corp. files for bankruptcy.

July 10- Citing insufficient regulation as a cause of the current economic crisis, President Obama proposes increasing the government's authority over financial institutions. The plan would give more power to the Federal Reserve, create a Consumer Financial Protection Agency and take measures to discourage risky lending.

Source: SBS

Stay up to date with SBS NEWS

  • App
  • Subscribe
  • Follow
  • Listen
  • Watch