The business pages were filled with stories about AIG getting billions from the government to prevent a collapse, even while the company paid for a luxury corporate retreat. By year's end, the insurer announced a $1 salary for its CEO and no pay raises in 2009 for top execs, though some received “retention” payouts.
2 Lehman Brothers folds
Refused government aid, 158-year-old Lehman Brothers filed for Chapter 11 bankruptcy protection in one of Wall Street's most shocking downfalls.
3 Bear Stearns shutters
An omen of awful things to come, Bear Stearns crashed and burned at $2 a share, the purchase price for JPMorgan Chase in March 2008.
4 Bank buyouts
In a deal that came together over a weekend, Bank of America acquired investment banking powerhouse Merrill Lynch. Shortly after, JPMorgan Chase acquired Washington Mutual (with help from the FDIC) and Wells Fargo won its battle with Citigroup to acquire Wachovia.
5 Citigroup nearly collapses
Citigroup stock slipped below $4 on November 21. The government agreed to back more than $300 billion in Citigroup loans and securities and give the bank a $20-billion direct investment. Crisis averted (temporarily at least); Citigroup stock bounced back to more than $6.
6 Microsoft and Yahoo (finally) end talks
After months of back and forth and unaccepted offers, Microsoft's CEO Steve Ballmer announced to stockholders in November that the company was no longer interested in Yahoo.
7 Layoffs galore
The US unemployment rate soared to 6.7% in November, a 34-year high. Every industry was touched as thousands of layoffs were announced at companies across the country.
8 Fannie and Freddie fail
Both mortgage giants were placed in conservatorship after nearly falling prey to the subprime mortgage crisis. At the time, the two groups guaranteed about $6 trillion in outstanding mortgage debt.
9 Morgan, Goldman, and Amex become bank holding companies
We won't see drive-thru ATMs from these three any time soon, but the switch to bank holding companies shows the vast changes occurring on Wall Street. In the case of Morgan Stanley and Goldman Sachs, the greater government oversight portends the end of Wall Street investment banking as we have come to know it.
10 Retail tanks
The sorry state of the economy put the kibosh on the usual end-of-year shopping season, as sales fell in both October and November. Additionally, retailers like Mervyn's, Circuit City, and Steve & Barry's were all forced into bankruptcy.