Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

6 of 8
Sep. 15 - Lehman collapses, credit crisis begins
Sep. 15 - Lehman collapses, credit crisis begins
Dow closed at: 10,917.51
Change in points: -504.48
Percentage change: -4.42%

On a now infamous day, traders sold off stocks on the dour news that Lehman Brothers had declared bankruptcy. The 158-year old investment bank collapsed that Monday after it failed in its attempt to secure a buyer over the weekend.

Stocks fell even further as rumors began to circulate that American International Group, the world's largest insurer, was struggling to raise enough capital to fend off a downgrade. Later that week, the government would bail out the company for $85 billion.

Also scaring off investors was the news that iconic Wall Street investment bank Merrill Lynch sold itself to Bank of America for $50 billion over the weekend.

Adding more fuel to the fire, word spread that the nation's largest savings bank, Washington Mutual, was in search of a white knight. A month later, the company collapsed in the biggest bank failure in history.

Sept. 15 became the day that would mark the beginning of the credit crisis, as lending effectively froze across the financial sector. The day's dark news sparked quick action by the Federal Reserve, FDIC, Treasury and lawmakers to launch trillions of dollars in federal rescue programs.

NEXT: June 6 - Oil, unemployment soar
Last updated December 29 2008: 2:39 PM ET
More Galleries
Ralph Lauren's many looks A look at his brands and iconic creations More
8 biggest job killing companies of 2015 Whole Foods became the latest corporate giant to lay off workers. Here's a look at the companies that have announced the most jobs cuts this year. More
America's best beer towns Here are the best cities to crack open a cold one and celebrate Oktoberfest, according to Trulia. More

Special Offer