2007

February–March: Subprime market in trouble with several subprime lenders declaring bankruptcy, announcing significant losses, or putting themselves up for sale.

March 6: Ben Bernanke, quoting Alan Greenspan, warns that the Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac, were a source of "systemic risk" and suggest legislation to head off a possible crisis

April 18: Freddie Mac fined $3.8 million by the Federal Election Commission as a result of illegal campaign contributions, much of it to members of the United States House Committee on Financial Services which oversees Freddie Mac.

June 20: Merrill Lynch seized $800 million in assets from two Bear Stearns hedge funds that were involved in securities backed by subprime loans.

July 19: Dow Jones Industrial Average closes above 14,000 for the first time in its history.          

August 6:American Home Mortgage Investment Corporation (AHMI) files Chapter 11 bankruptcy.

August 9: French investment bank BNP Paribas suspends three investment funds that invested in subprime mortgage debt. This would be followed by many credit-loss and write-down announcements by banks, mortgage lenders and other institutional investors.  The European Central Bank pumps 95 billion euros into the European banking market.

August 10: Central banks coordinate efforts to increase liquidity for first time since the aftermath of the September 11, 2001 terrorist attacks. The United States Federal Reserve (Fed) injects a combined 43 billion USD, the European Central Bank (ECB) 156 billion euros (214.6 billion USD), and the Bank of Japan 1 trillion Yen (8.4 billion USD).

August 14: Sentinel Management Group suspends redemptions for investors and sells off $312 million worth of assets; three days later Sentinel files for Chapter 11 bankruptcy protection. US and European stock indices continue to fall.          

August 16: Countrywide Financial Corporation, the biggest U.S. mortgage lender, narrowly avoids bankruptcy by taking out an emergency loan of $11 billion from a group of banks.

August 31: President Bush announces a limited bailout of U.S. homeowners unable to pay the rising costs of their debts. Ameriquest, once the largest subprime lender in the U.S., goes out of business.

September 17: Former Fed Chairman Alan Greenspan says "we had a bubble in housing" and warns of "large double digit declines" in home values "larger than most people expect."

September 30: Affected by the spiraling mortgage and credit crises, Internet banking pioneer NetBank goes bankrupt and the Swiss bank UBS announces that it lost US$690 million in the third quarter.

October 10: Hope Now Alliance is created by the US Government and private industry to help some sub-prime borrowers.

October 15–17: A consortium of U.S. banks backed by the U.S. government announces a "super fund" of $100 billion to purchase mortgage-backed securities whose mark-to-market value plummeted in the subprime collapse. Both Fed chairman Ben Bernanke and Treasury Secretary Hank Paulson express alarm about the dangers posed by the bursting housing bubble.

November 1: Federal Reserve injects $41B into the money supply for banks to borrow at a low rate.

2008

January 2–21: January 2008 stock market downturn.

January 24: The National Association of Realtors (NAR) announces that 2007 had the largest drop in existing home sales in 25 years.

March 1–June 18: 406 people arrested for mortgage fraud in an FBI sting across the U.S., including buyers, sellers and others across the wide-ranging mortgage industry.

March 10: Dow Jones Industrial Average at the lowest level since October 2006, falling more than 20% from its peak just five months earlier.

March 14- 16: Bear Stearns gets Fed funding as shares plummet and then gets acquired for $2 a share by JPMorgan Chase in a fire sale avoiding bankruptcy. The deal is backed by Federal Reserve providing up to $30B to cover possible Bear Stearn losses.

May 6: UBS AG Swiss bank announces plans to cut 5,500 jobs by the middle of 2009

June 19: Ex-Bear Stearns fund managers arrested by the FBI for their allegedly fraudulent role in the subprime mortgage collapse. The managers purportedly misrepresented the fiscal health of their funds to investors publicly while privately withdrawing their own money.

July 11: Failure of Indymac Bank, the fourth largest bank failure in United States history

July 30: President Bush signs into law the Housing and Economic Recovery Act of 2008 which authorizes the Federal Housing Administration to guarantee up to $300 billion in new 30-year fixed rate mortgages for subprime borrowers under certain conditions.

September 7: Federal takeover of Fannie Mae and Freddie Mac which at that point owned or guaranteed about half of the U.S.'s $12 trillion mortgage market, effectively nationalizing them. This causes panic because almost every home mortgage lender and Wall Street bank relied on them to facilitate the mortgage market and investors worldwide owned $5.2 trillion of debt securities backed by them.

September 14: Merrill Lynch sold to Bank of America amidst fears of a liquidity crisis and Lehman Brothers collapse[138]

September 17: The Fed acquires 80 percent of AIG in exchange for lending it $85 billion. As NYU economics professor Nouriel Roubini (aka “Dr. Doom”) puts it, “The U.S. government is now the largest insurance company in the world.”

September 19: Paulson financial rescue plan unveiled after a volatile week in stock and debt markets.

September 23: Federal Bureau of Investigation reported to be looking into the possibility of fraud by mortgage financing companies Fannie Mae and Freddie Mac, Lehman Brothers, and insurer American International Group, bringing to 26 the number of corporate lenders under investigation.

September 25: Washington Mutual seized by the Federal Deposit Insurance Corporation, and its banking assets sold to JP MorganChase for $1.9bn.

September 29: Emergency Economic Stabilization Act defeated 228-205 in the United States House of Representatives; Federal Deposit Insurance Corporation announces that Citigroup Inc. would acquire banking operations of Wachovia.

September 30: US Treasury changes tax law to allow a bank acquiring another write off all of the acquired bank's losses for tax purposes.

October 1: The U.S. Senate passes HR1424, their version of the $700 billion bailout bill.

October 3: President George W. Bush signs it into law the Emergency Economic Stabilization Act creating a $700 billion Troubled Assets Relief Program to purchase failing bank assets. The Act also eases accounting rules.

October 6-10: Worst week for the stock market in 75 years. The Dow Jones lost 22.1 percent, its worst week on record, down 40.3 percent since reaching a record high of 14,164.53 October 9, 2007. The Standard & Poor's 500 index lost 18.2 percent, its worst week since 1933, down 42.5 percent in since its own high October 9, 2007.[152]

October 6: Fed promises to provide $900 billion in short-term cash loans to banks.[153]

October 7: Fed makes emergency move to lend around $1.3 trillion directly to companies outside the financial sector.

October 7: The Internal Revenue Service (IRS) relaxes rules on US corporations repatriating money held oversees in an attempt to inject liquidity into the US financial market. The new ruling allows the companies to receive loans from their foreign subsidiaries for longer periods and more times a year without triggering the 35% corporate income tax.

October 8: Central banks in USA (Fed), England, China, Canada, Sweden, Switzerland and the European Central Bank cut rates in a coordinated effort to aid world economy. Fed also reduces its emergency lending rate to banks.

October 11: The Dow Jones Industrial Average caps its worst week ever with its highest volatility day ever recorded in its 112 year history. Over the last eight trading days, the DJIA has dropped 22% amid worries of worsening credit crisis and global recession. Paper losses now on US stocks now total $8.4 trillion from the market highs last year.

October 11: Central bankers and finance ministers from the Group of Seven meet in Washington but cannot agree on any concrete plan.

October 14: The US announces the injection of $250 billion of public money out of the $700 billion available from the EESA into the US banking system. The rescue package includes the US government taking an equity position in banks that choose to participate in the program in exchange for certain restrictions such as executive compensation. Nine banks agree to participate in the program and will receive half of the total funds: 1) Bank of America, 2) JPMorgan Chase, 3) Wells Fargo, 4) Citigroup, 5) Merrill Lynch, 6) Goldman Sachs, 7) Morgan Stanley, 8) Bank of New York Mellon and 9) State Street.

October 21: The US Federal Reserve announces it will spend $540 billion to purchase short-term debt from money market mutual funds.

November 12: Treasury Secretary Paulson abandons plan to buy toxic assets under the $700 billion Troubled Asset Relief Program (TARP) and says the remaining $410 billion in the fund would be better spent on recapitalizing financial companies.

November 15: The group of 20 meets in Washington DC.

November 24: The US government agrees to rescue Citigroup after an attack by investors caused the stock price to plummet 60% over the last week.

November 25: The US Federal Reserve pledges $800 billion more to help revive the financial system. $600 billion will be used to buy mortgage bonds issued or guaranteed by Fannie Mae, Freddie Mac, and Ginnie Mae, and the Federal Home Loan Banks.