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The Global Economic & Financial Crisis: A Timeline Mauro F. Guillén Director of the Lauder Institute

Wednesday, February 7, 2007: HSBC announces losses linked to US subprime mortgages. Tuesday, April 3, 2007: New Century Financial, which specializes in sub-prime mortgages, files for Chapter 11 bankruptcy protection and cuts half of its workforce. Thursday, May 17, 2007: Federal Reserve Chairman Ben Bernanke says growing number of mortgage defaults will not seriously harm the US economy. Wednesday, June 2007: Two Bear Stearns-run hedge funds with large holdings of subprime mortgages run into large losses and are forced to dump assets. The trouble spreads to major Wall Street firms such as Merrill Lynch, JPMorgan Chase, Citigroup and Goldman Sachs which had loaned the firms money. July 2007: Investment bank Bear Stearns tells investors they will get little, if any, of the money invested in two of its hedge funds after rival banks refuse to help it bail them out. Thursday, August 9, 2007: Investment bank BNP Paribas tells investors they will not be able to take money out of two of its funds because it cannot value the assets in them, owing to a "complete evaporation of liquidity" in the market. The European Central Bank pumps €95bn (£63bn) into the banking market to try to improve liquidity. It adds a further €108.7bn over the next few days. The US Federal Reserve, the Bank of Canada and the Bank of Japan also begin to intervene. Friday, August 17, 2007: The Fed cuts the rate at which it lends to banks by half of a percentage point to 5.75%, warning the credit crunch could be a risk to economic growth. Tuesday, August 28, 2007: German Sachsen Landesbank faces collapse after investing in the sub-prime market. The bank is rescued by its competitor Baden-Wuerttemberg Landesbank. Monday, September 3, 2007: German corporate lender IKB announces a $1bn loss on investments linked to the US sub-prime market.


Tuesday, September 4,...