Trader Bradley Silverman watches the numbers as he works on the New York Stock Exchange floor, Oct. 1. (Richard Drew/Associated Press) Trader Bradley Silverman watches the numbers as he works on the New York Stock Exchange floor, Oct. 1. (Richard Drew/Associated Press)

March 16, 2008: Bear Stearns falters

JPMorgan Chase & Co. says it will buy rival Bear Stearns at the bargain price of $2 US. The Fed agrees to provide JPMorgan Chase with up to $30 billion in special financing to fund Bear Stearns's less-liquid assets.

Mortgage giant Freddie Mac is based in McLean, Va. Mortgage giant Freddie Mac is based in McLean, Va. (Pablo Martinez Monsivais/Associated Press)

Sept. 7, 2008: Freddie and Fannie rescued

The U.S. government confirms it's taking over struggling mortgage giants Fannie Mae and Freddie Mac, which together control half the $12-trillion US housing market.

The Treasury Department announces plans to put fresh capital of as much as $100 billion into each institution to help ease mortgage rates and spur real estate demand.

Sept. 15, 2008: Wall Street titans fall

Lehman Brothers, burdened by $60 billion in soured real-estate holdings, says it is filing for Chapter 11 bankruptcy after attempts to rescue the 158-year-old firm fail. Bank of America Corp. says it is snapping up the Merrill Lynch investment bank in a $50 billion all-stock transaction.

On the news, the Dow Jones industrial index falls 4.4 per cent, or 500 points, and, in Canada, the TSX slides by more than four per cent, or 515 points.

Sept. 16, 2008: Government props up AIG

The U.S. government agrees to provide an $85-billion US emergency loan to rescue the huge insurer AIG, in a move designed to prevent further fallout in financial markets and the overall economy. The Federal Reserve says that in return for the loan, the government will receive a 79.9 per cent equity stake in American International Group.

Sept. 18: Short selling curbed

British regulators ban short selling on the shares of 29 U.K. financial firms until January and subsequently add four more companies' stocks to the list. The U.S. Securities and Exchange Commission follows suit the next day, suspending short sales for 10 trading days in the equities of 799 financial service institutions.

Sept. 19: Bailout plan unveiled

U.S. Treasury Secretary Henry Paulson introduces the outlines of a plan to relieve banks of their bad debts in attempts to revive financial market health, while also warning the government action would cost hundreds of billions of dollars. Prime Minister Stephen Harper says he sees no need for similar action for Canada's banks.

A $700-billion price tag is eventually attached to the proposal as Paulson takes to the airwaves to support it two days later.

Sept. 24: Bush raises the stakes

U.S. President George W. Bush urged swift passage of his administration's proposed $700-billion US bailout plan during a televised speech Wednesday night. (APTN/Associated Press)U.S. President George W. Bush urged swift passage of his administration's proposed $700-billion US bailout plan during a televised speech Wednesday night. (APTN/Associated Press)

President George W. Bush invites presidential contenders John McCain and Barack Obama to the White House for crisis talks with congressional leadership to forge a compromise. Bush later takes to the airwaves, warning Americans of dire consequences if no deal is reached on the $700-billion package.

Sept. 25: White House talks stall

Bush meets with McCain and Obama, as well as Democratic and Republican leaders from the U.S. House of Representatives and the Senate at the White House to discuss the faltering financial sector. Members of Congress say they have reached a deal, but any compromise is in limbo just hours later.

Sept. 25: Washington Mutual collapses

With $307 billion in assets, Washington Mutual becomes the largest bank to fail in U.S. history. Seattle-based WaMu, which was founded in 1889, collapsed under the weight of its enormous bad bets on the mortgage market. The Federal Deposit Insurance Corp. seizes WaMu, then sells the banking assets to JPMorgan for $1.9 billion US.

Sept. 28: $700-billion deal reached

U.S. congressional leaders and the White House agree to a $700-billion US rescue of the ailing financial industry. The biggest U.S. bailout in history wins the tentative support of both presidential candidates before heading to the House of Representatives for a vote a day later.

Sept. 29: Congress votes no

Despite personal pleas from Bush — who was phoning undecided legislators minutes before the roll call — and congressional leaders, a vote on the bailout bill fails by a margin of 228-205. Financial markets nosedive. The Dow Jones industrial average falls 777.68 points, its biggest single-day drop, while the TSX plummets 840.93 points.

Sept. 29: Wachovia sale

Citigroup is acquiring the banking operations of Wachovia Corp. in a deal backstopped by the government, the FDIC says. Under the agreement, Citigroup will absorb up to $42 billion US of losses on a $312-billion pool of loans. The FDIC will take on losses beyond that.