November 10, 2008
The Obama Administration's transition from the Bush Administration comes amid economic chaos, a series of difficult policy decisions to rectify it, and wars on two fronts.
AIG front and center... Public ire grows and becomes a security concern.
AIG needed more than their initial $123 billion and rescue aid from the government. On this day the ante was upped to $150 billion in order to save the insurance giant. The request draws protests from both a taxpaying public and lawmakers who have grown weary over the level of bailout money given to one company.
However, many industry insiders and government officials felt AIG is “too big to fail”; meaning a bankruptcy of AIG would have serious consequences for the economy in general. The move to assist AIG at this level raises questions about the Government's lack of intervention on behalf of Lehman Brothers.
In the following months, media reports of bailout money being used to fund massive Wall Street executive bonuses and corporate junkets draws the ire of the media and the public. The outrage brings protesters to Wall Street itself and AIG offices around the country. Although protests receive little media coverage, they grow larger and angrier in the following weeks.
AIG’s Downtown New York headquarters has growing concerns about the safety and security of employees working around the country. Memos circulate about ways employees can protect themselves from angry mobs that await them outside.
November 12, 2008
Oil’s bubble burst continues. Oil retreats to $56 a barrel, down more than 60% from August highs of around $140 a barrel as speculators took it on the chin. The stock market drops a massive 4.7%. Standard & Poor's follows with a decline of 5.19% the NASDAQ drops 5.17%.
The erosion on Wall Street continues to show there's a massive retraction of spending on Main Street, as major retailers like Macy's are reporting multi-billion-dollar losses heading into a holiday season that typically sees a rise in spending. Main St. America’s spending at this point is in full retreat.
November 13, 2008
According to Realty Trac, home foreclosures accelerate 25% nationwide from a year ago.
November 18-20, 2008
The auto industry confirms their existence is in jeopardy without the assistance of financial aid from the Federal Government. The heads of all three major automakers in United States, GM, Ford and Chrysler, make their requests known to lawmakers by asking for $25 billion in financial assistance. Their visit to Washington a day later came under media scrutiny, as all three auto industry chiefs arrive on corporate funded private jets, sparking public outrage.
The move likely costs the auto industry some time and aggravation in rounding up assistance money, as lawmakers are sure not to upset an already frazzled constituency. However, President-elect Obama raises concerns over the consequences of not assisting, which may result in 3 million jobs being lost.
New housing starts plunge to levels not seen in a half century according to Commerce Department data, down 38% percent from a year prior. The Consumer Price Index has its biggest drop in history, sparking fears of a deflationary cycle in the economy.
November 19th 2008
The Dow Jones Industrial Average falls more than 5% and heads below 8000 the first time since 2002.
November 20th 2008
Crude oil falls below $50 a barrel on the New York Mercantile Exchange.
November 21st 2008
Another one of several financial industry titans, Citigroup, loses over 60% of its value in just one week. President-elect Obama selects Timothy Geithner as Treasury Secretary. At the time, Geithner was serving as president of New York's Federal Reserve.
November 25, 2008
The Federal Reserve announces a plan to purchase a half trillion dollars in mortgage-backed securities held by Freddie Mac and Fannie Mae. That announcement came along with a host of other government related investment purchases.
November 26, 2008
Consumer spending continues to freefall, breaking the prior month’s record.
November's Staten Island real estate market
The Case Shiller Index shows home prices across the country have dropped a record 16.5% from their highs. On Staten Island, total home sales of both one and two family homes dip a whopping 18% from the prior month according to MLS data. This would be first month of the seven straight that will see sub-200 home sales on Staten Island. However, home prices see only a 7% decline from the prior year.