The Financial Crisis

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Texas Gets Passing Mark on Failures
More than 800 banks and thrifts in Texas went bust in the 1980s and 1990s, but banks in the state have been surprisingly resilient during the current crisis.

Write-Offs Would Help Hard-Hit Firms
The main business tax cuts proposed by Obama are likely to be a windfall for Wall Street investment banks and home builders.
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Securities Lawsuits Leapt in '08
Securities-fraud lawsuits increased in 2008 due largely to a rash of filings against financial firms by investors who sustained losses from the mortgage meltdown.
Treasury Gives $15 Billion to Banks
The government supplied another $15 billion to seven banks in the latest round of payments from the $700 billion rescue fund.
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Rebound Wrinkle: Recession
Some investors have put aside standard models and are considering what to do if markets and the economy remain troubled for a sustained period.
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Wall Streeters Flock to IndyMac
A lot of Wall Street's "smartest money" has invested in the latest iteration of IndyMac Bank.
- Heard on the Street: Is the IndyMac Deal a Little Too Sweet?
Why We Keep Falling for Financial Scams
Psychologist Stephen Greenspan explores why investors continue to be swindled -- and how he came to lose part of his savings to Bernard Madoff.
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Treasury Unveils Rescue Guidelines
The Treasury Department released guidelines of the program it used under a $700 billion bailout package to justify its $20 billion rescue of Citigroup and guidelines for a new insurance program for troubled assets.
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High-Profile Investors to Buy IndyMac
A team of private investors including affiliates of Christopher Flowers, George Soros and Michael Dell reached a preliminary deal to buy the remains of IndyMac and will contribute $1.3 billion in capital toward a purchase.
- What Does IndyMac Owe Fannie?
- Deal Journal: Profile of CEO Mnuchin
After the Collapse,
Guarded Hope
After one of the U.S. stock market's worst years in more than a century, many investors are hoping for a turnaround in 2009. But considering the pain they just went through, they are reluctant to bet on it.
- Where Do We Go From Here?
- 2008 Investment Scoreboard
- Join the Discussion: Markets in 2009
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Bank-Failure Central? Alpharetta, Ga.
Alpharetta, Ga., is a suburb of wide boulevards, sleepy cul-de-sacs and bustling red-brick shopping centers. It also is the bank-failure capital of the U.S.
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Banks Complete Deals
Bank of America, Wells Fargo and PNC have completed acquisitions of three rivals.
GMAC Revs Up Car Loans
GMAC rolled out low-rate loans on GM vehicles after it received Treasury funding, including 0% financing on certain 2008 models.
Treasury Exceeds Rescue-Fund Limits
Treasury has committed nearly $10 billion more than the $350 billion Congress has authorized to date for the financial-sector rescue package.
- See a List of TARP Participants
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AIG Seeks Change on Loan Terms
AIG is seeking permission to change certain terms of its $60 billion government loan.
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Banks to Post a Rare Quarterly Loss
Banks and savings institutions in the U.S. appear headed for their first overall quarterly loss since 1990 as troubled loans pile up.
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Lehman's Chaotic Filing Destroyed Billions in Value
As much as $75 billion of Lehman Brothers value was destroyed by the chaotic form of its bankruptcy filing in September, according to an internal analysis.
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Banks Told: Lend More, Save More
Bankers are complaining about mixed signals from U.S. regulators, who want them to lend more but build up capital to protect against losses.
- Deal Journal: Citigroup's M&A Curse or Losing Streak
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AIG Sells $16 Billion in CDOs
AIG said that a financing entity has purchased an additional $16 billion in collateralized debt obligations insured by the insurance giant through credit-default swap contracts.
FHA Copes With Insuring Mortgages
As Obama considers how much risk the government should take as one of the nation's largest insurers of home mortgages, a more immediate question is this: Can the FHA handle the responsibility it has already been given?
The Crisis Abroad
German Leaders Agree to Stimulus
Germany's ruling coalition agreed to the broad outlines of a fiscal-stimulus program valued at as much as $69 billion this year and next.
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U.K. Market Regulator Toughens Approach
Britain's markets regulator is becoming more demanding and may impose costlier rules on banks, abandoning its previous light touch.
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European Banks Gird
for 'The Year of Reckoning'
European banks are bracing for a difficult 2009 as a rising tide of corporate bankruptcies adds to their problems with bad mortgage and credit-card loans.
Iceland's Fall: The Isle That Rattled the World
Iceland is an extreme casualty of an era in which it was easy to borrow money. The tiny isle became so leveraged that its collapse has rattled the world.
- Photos: Voices of Anger, Shame in Iceland
- Video: How Iceland Collapsed
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Global Crisis Resists Central-Bank Moves
Central banks around the world cut rates a day after the Fed's move, and Japan, the U.K. and euro-zone economies may follow suit.
China Marks 30 Years of Reform
China's Communist Party leaders, meeting to celebrate 30 years of market-driven economic strategy, promised more liberalization but warned that an economic slowdown threatened gains.
- Slideshow: Thirty Years Later | Video
Group Urges Global Answer to Crisis
Global leaders need to urgently step up their coordinated response to the global financial crisis, the managing director of the Institute of International Finance said.

Market Beat

Deal Journal

IndyMac: Private Equity Gets Smart About Banks
Private equity firms are getting clever again. After paying out billions of dollars on overvalued, debt-laden companies in 2006 and 2007, private equity firms are now confronted with a giant feast of cheap assets that could be acquired, rolled together, and eventually sold for big profits.
Many Deals Collapsed in '08, Not Always Quickly
Here Are Some M&A Stalwarts With Something to Prove in 2009
More

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The Year in Photos: Financial Crash
From Wall Street to Main Street, 2008 was unkind to the American economy -- and to markets world-wide. From failed banks to foreclosures, see photos of financial pain. (More year-end photos)
Page One
Small House, Big Loan Spells Trouble
A small shack in Arizona with a $103,000 mortgage helps explain how a series of bad decisions can add up.
- Photos: Ms. Halterman's Home
- Video: In Arizona, a $103,000 Shack
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Doomsayers Who Got It Right
For years, they were the party poopers: financial prognosticators who warned of trouble. In hindsight, they're the ones who got it right.
- Mr. Rajan Was Unpopular at Greenspan Party
- Graphic: Einhorn, Faber, Grant
Wall Street's Hard Times, in Rhymes
From property-themed haiku to TARP limericks, this year's Wall Street crisis inspired a crop of financial poetry.
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GMAC to Get $6 Billion Aid Deal
The federal government upped the ante in its rescue efforts by committing $6 billion to stabilize GMAC, a financing company vital to the future of General Motors.
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The Weekend That Wall Street Died
The financial crisis that led to Lehman's collapse and sent Merrill scrambling marked a shift on Wall Street. Instead of CEOs banding together, it was every man for himself.
- Discuss: When will the crisis end?
- Graphic: Implosion of an Industry
Slump Batters Small Business
The downturn is threatening the survival of a major driver of the U.S. economy: small business.
A Small Bank
Juggles Its Roles
Community bankers across the country are making daily decisions that affect how the U.S. will make it through this recession and credit crunch.
Houses of Worship Turn to Chapter 11
During these hard times, not even houses of God have been spared. Lenders believe more churches than ever have fallen behind and some have filed for bankruptcy.
- Discuss: How has your giving changed?
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Derivatives Losses Spread Globally
A vast superstructure of credit derivatives such as synthetic CDOs has spread the risk of lending to U.S. companies around the globe.
- Voices: Trouble in One Australian Town
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Developers Ask U.S. for Bailout
Big property developers are asking to be included in a new $200 billion loan program as a surge in commercial mortgages comes due.
- Report: Commercial Real Estate Outlook
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U.S. Ratchets Up Citi Oversight
U.S. regulators have toughened scrutiny of Citigroup, including involving the government in internal talks on the firm's strategic direction.
Rescue Bid for Detroit Collapses in Senate
A frantic, last-ditch attempt to forge an auto-relief package collapsed in the Senate over wages, dealing a giant blow to the Big Three. GM hired experts to help it explore bankruptcy protection.
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AIG Faces $10 Billion in Losses on Bad Bets
AIG owes Wall Street's biggest firms more than $10 billion in speculative trades that have soured, raising questions about how the insurer will be able to raise funds to pay off the debts.
The Stock Picker's Defeat
Bill Miller spent nearly two decades building his reputation as the era's greatest mutual-fund manager. Then, in the past year, he destroyed it.
- Chart: Miller's Legg Mason vs. S&P
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Companies Accelerate Layoffs
Companies are shedding workers at an accelerating rate, pushing jobless claims to a 26-year high.
Harvard Hit by Loss as Crisis Spreads
Harvard University's endowment has suffered investment losses of 22%, or about $8 billion, since the end of the school's fiscal year. Harvard's president, in a letter, blamed "severe turmoil in the world's financial markets." (Letter)

Heard on the Street

“There were plenty of poorly handled bailouts in 2008, but the GMAC rescue might go down as the year's most haphazard.”
—Peter Eavis in "Rescue of GMAC Is All Over the Lot "
Graphics
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Credit Crisis Probes
The Justice Department has stepped up criminal securities-fraud investigations of financial firms and lenders.
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Credit Markets: Freeze or Thaw?
Here's a look at key interest rates since Sept. 1.

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The Crisis Abroad

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