Financial Turmoil Timeline (June 2007 - November 2007)

17-Aug
Fed Policy Actions

Spread between
the primary
credit rate and
the target fed
funds rate is
10-Aug reduced to 50 bp
Fed issues 31-Oct
17-Jul statement FOMC lowers
Fed, OTS, FTC, that is stands target fed funds
28-Jun and state ready to pro- rate 25 bp to
FOMC main- agencies vide liquidity 4.5%
tains the target launch new via the discount
fed funds rate program to window
at 5.25% supervise
subprime 7-Aug 18-Sep
mortgage FOMC main- FOMC lowers
lenders tains the target target fed funds 2-Nov
fed funds rate rate 50 bp to Fed approves
at 5.25% 4.75% Basel II

Jun 5 10 15 20 25 30 Jul 5 10 15 20 25 30 Aug 5 10 15 20 25 30 Sep 5 10 15 20 25 30 Oct 5 10 15 20 25 30 Nov 5 10 15 20 25 30

27-Nov
Market Events

13-Sep Citigroup
Northern Rock 16-Oct raises $7.5
receives emerg- Citigroup billion from
9-Aug ency loan from begins a the Abu
BNP Paribas the Bank of string of Dhabi
freezes three England major bank Investment
funds after writedowns Authority
an inability based on
to value sub- subprime
prime mortgage mortgage
based assets losses

Jun 5 10 15 20 25 30 Jul 5 10 15 20 25 30 Aug 5 10 15 20 25 30 Sep 5 10 15 20 25 30 Oct 5 10 15 20 25 30 Nov 5 10 15 20 25 30

Other Policy Actions

26-Jun
SEC begins
investigation
of 12 CDO 10-Oct
issuers Paulson makes
statement on
“private sector
alliance” to
prevent mort-
gage default

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 Financial Turmoil Timeline (December 2007 - February 2008)
Fed Policy Actions

17-Dec
The first TAF
auction takes 1-Feb
place for $20b TAF auction
of 28-day credit size increased
12-Dec to $30b every
Term Auction two weeks
Facility (TAF) is
announced and 21-Dec
swap lines are 30-Jan
Fed extends FOMC lowers
established with TAF auctions
the ECB and SNB target fed funds
“for as long as rate 50 bp to
for $20b and $4b necessary to
respectively 22-Jan 3%
11-Dec address elev-
FOMC lowers ated pressures FOMC lowers
target fed funds in short-term target fed funds
rate 25 bp to funding rate 75 bp to
4.25% markets” 3.5%

Dec 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jan 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Feb 2 4 6 8 10 12 14 16 18 20 22 24 26 28

Market Events

29-Jan
Rating agencies
threaten to
downgrade
Ambac Financial
and MBIA, two
major bond
insurers

Dec 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jan 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Feb 2 4 6 8 10 12 14 16 18 20 22 24 26 28

28-Jan
Other Policy Actions

Economic
28-Jan Stimulus Act
Economic of 2008
Stimulus Act signed into
of 2008 law
proposed

17-Feb
Britain nation-
alizes Northern
Rock

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 Financial Turmoil Timeline (March 2008-May 2008)

16-Mar
The spread
Fed Policy Actions

between 16-Mar
the primary Primary
11-Mar Dealer
Term Securities credit rate Credit
Lending Facility and target Facility 2-May
(TSLF) is fed funds
rate is cut (PDCF) is TSLF eligible
introduced created collateral
and swap to 25 bp
expands to
lines with the include AAA
ECB and SNB rated ABS
are increased
18-Mar
Target fed
14-Mar funds rate 2-May
Fed approv- is lowered TAF and
es purchase 75 bp to swap lines
of Bear 2.25% increase
Stearns by 30-Apr
JPMorgan Target fed
funds rate
is lowered
25 bp to 2%

Mar 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Apr 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 May 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

14-Mar
Market Events

Bear Stearns
receives 24-Mar
emergency JPMorgan’s
lending from purchase price
the Fed via for Bear Stearns
JPMorgan increases to
16-Mar $10/share
13-Mar JPMorgan
Bear Stearns announces
reports a it will purchase
$15b (88%) Bear Stearns for
drop in $2 per share
liquid assets

Mar 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Apr 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 May 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

Other Policy Actions

7-Mar
SEC proposes
a ban on
naked short
selling 19-Mar
Fannie Mae
and Freddie
Mac capital
requirements
are eased to
allow for
increases in
lending

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 Financial Turmoil Timeline (June 2008-August 2008)
Fed Policy Actions

5-Jun
Bank of
America’s
purchase of
Countrywide
is approved
13-Jul
Lending to
Fannie Mae
and Freddie 30-Jul
Mac at the 84-day TAF
primary auctions are
credit rate introduced
is authorized and the ECB
swap line is
increased

Jun 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jul 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Aug 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

Market Events

6-Jun
S&P down- 11-July
grades the After FDIC
two largest take-over,
16-Jun IndyMac
monoline Lehman
bond insurers experiences
reports a a run on
from AAA loss of
to AA deposits
$2.8b in
the second
quarter

Jun 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jul 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Aug 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

Other Policy Actions

15-July
Treasury Secretary
Paulson requests
government funds
to potentially
support Fannie
Mae and
Freddie Mac
11-July
The FDIC
takes over
IndyMac

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 Financial Turmoil Timeline (September 2008 - November 2008)
26-Sep 8-Oct
18-Sep ECB and SNB 29-Sep In conjunction
Swap lines swap lines 84-day TAF with cuts by
increased are increased allotments other central
by $180b by $10b and increased to banks, target
$3b, bringing $75b, two rate lowered 13-Oct
Fed Policy Actions

total swap forward TAF to 1.5 % Fed uncaps 14-Oct

16-Sep line to $290b auctions ECB, BoE, 25-Nov
$85b loan totalling Bank of
and SNB Japan swap TALF established
given to $150b intro- swap lines line is to provide loans
AIG duced, and 5-Nov
uncapped 29-Oct Interest on collateralized by
24-Sep total swap 7-Oct ABS
line doubled Commercial 12-Oct Fed Funds reserve rate
New swap rate cut 50 increases
16-Sep 21-Sep lines to $620b Wells 21-Oct
Paper Fargo’s bp to 1 % 25-Nov
Fed funds GS and MS opened Funding Money Market
rate approved with purchase of Fed purchase of
29-Sep Facility Investor Fund- GSE direct
maintained as bank Bank of Wachovia ing Facility
Fed agrees (CPFF) is approved 29-Oct obligations begins
at 2% holding Australia, established (MMIFF) is
companies Sveriges to provide USD Swap lines
Citigroup established established with
Riksbank, 9-Oct 16-Oct 22-Oct
Danmarks with liq- 6-Oct Brazil, Mexico, 10-Nov
14-Sep 19-Sep TAF increased Payment Tier I capital Rate paid Korea, and 23-Nov
Eligible collateral AMLF National- uidity to of inter- definition on excess AIG loan is Fed agrees to
established bank, and aid in to provide changed to Singapore for restructured
for TSLF and PDCF Wachovia $900b of est on reserves $30b each extend non-
Norges reserves include stock in coordination
expanded purchase funding over purchased by increases recourse loan
Bank begins Treasury by 40 bp with US Treasury to Citigroup
year-end

Sep 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Oct 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Nov 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

15-Sep
12-Sep Bank of
Moody’s America
purchases 16-Sep 29-Sep 30-Oct 23-Nov
Market Events

and S&P 23-Oct

Merrill RMC Systemic risk Alan Greenspan Government Citigroup receives
threaten money 14-Oct
to down- Lynch exception testifies before data shows a government
market 25-Sep allows open 9 Large 0.3% decline assistance from
grade 15-Sep banks the House
fund WaMu bank assistance Committee of in real US GDP Fed, FDIC, and
Lehman Lehman “breaks agree to
10-Sep closed to Wachovia Government for Q3 2008 Treasury
files for the buck” by OTS capital
Lehman bankruptcy injection Oversight and
announces 14-Sep 3-Oct
from the Reform
$3.9b loss 10 banks 15-Sep 17-Sep Wells Fargo
Treasury 28-Oct
in third create AIG debt More money makes
$70b Consumer
quarter downgraded market funds counter- confidence
liquidity by all three come under offer for
fund hits lowest
major ratings pressure Wachovia point on
agencies record

Sep 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Oct 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Nov 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

19-Sep 25-Sep
OTS and FDIC 3-Oct 14-Oct 10-Nov
Other Policy Actions

Treasury
establishes acquire Revised Treasury Chinese government
the money Wachovia 29-Sep Treasury announces announces a 4 trillion
7-Sep market plan passes $250b capital yuan ($586b) fiscal
Treasury 8-Oct stimulus package
Fannie Mae guarantee bailout plan the House Central injection
and Freddie program is voted along with banks in plan 6-Nov
Mac are new clauses 12-Nov
down in England, 14-Oct European Treasury
placed in 19-Sep 19-Sep the House raising FDIC China, Can- central
insurance FDIC insures statement on
Federal Paulson SEC bans ada, Sweden, all senior banks make
conserv- calls for short-selling limits to assistance to
Switzerland, debt of coordinated consumer ABS
atorship government on 799 30-Sep $250,000 and the ECB regulated rate cuts
plan to financial Ireland join the Fed institutions
purchase stocks guarantees in cutting
troubled the deposits interest
assets from of the 6 rates
financial largest
institutions Irish banks
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 Financial Turmoil Timeline (December 2008 - February 2009)

3-Feb
All Fed facilities
set to expire in
Fed Policy Actions

April are extended

through October 23-Feb
Joint statement
with other US
28-Jan government
19-Dec FOMC announces organizations
Operational willingness to begin discusses stress-
details of the purchase of long- test related
TALF released term Treasury 10-Feb capital injections
securities Fed states
16-Dec willingness
Fed Funds 28-Jan to expand
2-Dec rate lowered 16-Jan Fed Funds rate TALF to $1
PDCF, AMLF, to a range Fed, Treasury, maintained at trillion and
and TSLF are of 0-0.25% and FDIC jointly 0-25 bp to accept
all extended aid Bank of a wider set
through April America. Fed of acceptable
30th agrees to provide collateral
non-recourse
loan

Dec 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jan 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Feb 2 4 6 8 10 12 14 16 18 20 22 24 26 28

24-Jan
17-Dec Citigroup
Market Events

16-Jan sells $12

1-Dec November Citigroup
NBER declares data show billion of
announces government
that a recession a decline in plan to
began in US consumer guaranteed 10-Feb
split into bonds
December 2007 prices of Markets decline
20-Dec two units
1.7% after Geithner’s
Eleven of 10-Jan after Q4 speech due to
the world’s US unemploy- loss a lack of specifics
largest banks ment rises to
are down- 7.2%
graded by
S&P

Dec 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jan 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Feb 2 4 6 8 10 12 14 16 18 20 22 24 26 28

15-Jan 4-Feb 23-Feb
ECB cuts
Other Policy Actions

19-Jan Treasury Bank reg-

29-Dec policy rate announces ulators issue
Treasury by 50 bp UK announces
a comprehensive restrictions statement on
injects $5b on executive new round
in GMAC 16-Jan bank rescue plan
pay for of capital
Remaining injections
26-Jan banks getting 18-Feb
TARP funds
Fannie and assistance Obama
released by
Freddie say from the announces
Senate
they need government plan to aid
homeowners 25-Feb
16-Jan $51 billion Treasury
10-Feb with mort-
Fed, Treasury, from the announces
Geithner gage payment
and FDIC jointly government terms of the
launches
aid Bank of to continue Capital
Financial
America with operations Assistance
Stability
package similar Program
Plan
to Citigroup’s
in November
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 Financial Turmoil Timeline (March 2009 - May 2009)
18-Mar
Announcement
of program to
buy $300b worth
Fed Policy Actions

of Treasuries and
to increase the
purchase of 19-Mar
agency debt TALF eligible
securities
18-Mar expanded 7-May
Fed funds rate Stress test
maintained at 6-Apr results released
0-25bp Fed creates
foreign 1-May
2-Mar currency TALF eligible
Fed and Treasury 23-Mar swap ag- collateral
announce joint Fed and expanded 19-May
reements
restructuring Treasury TALF announces
15-Mar with the
plan for AIG release joint acceptance of
In his 60 Minutes ECB, BoJ, 29-Apr
statement legacy CMBS
interview, BoE, and FOMC keeps
3-Mar Bernanke makes clarifying SNB
the roles target rate
TALF first public use at 0-25 bp
launch of the term of the two
“green shoots” organizations

Mar 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Apr 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 May 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

2-Apr 5-May
Financial
13-Apr Evidence of
Accounting
Market Events

Goldman Sachs easing term 12-May

Standards Bank of America
moves to raise funding
Board (FASB) sells its stake in
$5 billion to conditions 29-May
2-Mar relaxes mark- China Construction
pay back TARP comes as Government
AIG announces to-market Bank for $7.3 billion
funding Libor falls statistics
$61.7b fourth accounting below 1% show an
quarter loss, the rules
11-May annualized
largest in US drop in GDP
corporate history 9-Apr Following
Wells Fargo stress test of 5.7% for
reports record results, bank Q1 2009
profit in Q1 raise $7.5
2009 billion in
new capital

Mar 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Apr 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 May 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

8-May
Fannie Mae
Other Policy Actions

1-Mar 23-Mar requests $19

AIG receives 3-Mar Treasury 29-Apr billion from 13-May
$30b in capital Treasury releases $3.4 trillion the Treasury US Treasury
in exchange releases details of budget is after $23.2 releases
for government TALF the Public- 2-Apr approved billion quarterly proposal to
control of two details Private G20 meets by Congress 7-May loss regulate OTC
divisions of the Investment in London ECB cuts derivatives
company Program policy rate
2-Apr by 25bp to
2-Mar ECB cuts 1%
Fed and Treasury policy rate 7-May
announce joint to 1.25% Joint statement
restructuring released ahead
plan for AIG of Capital Assess-
ment Program
results

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 Financial Turmoil Timeline (June 2009 - August 2009)
Fed Policy Actions

10-Jun
First issue
of new monthly
report on the
credit and
liquidity facilities
is released

1-Jun
Fed outlines
guidelines for
SCAP participants
to return Treasury
capital

Jun 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jul 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Aug 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

1-Jun
General
Market Events

Motors
declares
bankruptcy

8-Jun
Ireland’s credit
rating is cut for
the second time
in three months

Jun 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Jul 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 Aug 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30

Other Policy Actions

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