Changes

The Bush administration undertook a "bailout" program in which it took control of several of the largest financial institutions (Fannie Mae, Freddie Mac, and AIG insurance), forced the mergers of others, and purchased $125 billion of ownership in the 9 largest banks in the U.S.  

The Bush administration undertook a "bailout" program in which it took control of several of the largest financial institutions (Fannie Mae, Freddie Mac, and AIG insurance), forced the mergers of others, and purchased $125 billion of ownership in the 9 largest banks in the U.S.  

By late October it appeared the financial crisis was slowing down the economies of all countries of the world, leading perhaps to a serious recession with widespread unemployment and loss of business. The major countries have been taking aggressive steps to dissolve the liquidity freeze and get money flowing again, and to stimulate economies that are headed downward.

Until October the crisis had little impact on the mom-financial sectors of the world economy, but then negative impacts started appearing.  Companies could not borrow money for expansion or in some cases for routine operations, and had to cut back. Consumer spending fell.  By late October it appeared the financial crisis was slowing down the economies of all countries of the world, leading perhaps to a serious recession with widespread unemployment and loss of business. The major countries have been taking aggressive steps to dissolve the liquidity freeze and get money flowing again, and to stimulate economies that are headed downward.

==Causes==

==Causes==

Britain on October 8 announced a gigantic £400 billion ($680 billion) rescue plan for its banks; the government would partially own them.  Prime Minister [[Gordon Brown]] said banks would still be run by their old managers, but that the government would have to be "satisfied" on matters of salaries, [[dividend]]s and lending activities.  The money involved is about a third of Britain's annual [[Gross Domestic Product|GDP]] (comparable to $5 trillion in the U.S. economy.)

Britain on October 8 announced a gigantic £400 billion ($680 billion) rescue plan for its banks; the government would partially own them.  Prime Minister [[Gordon Brown]] said banks would still be run by their old managers, but that the government would have to be "satisfied" on matters of salaries, [[dividend]]s and lending activities.  The money involved is about a third of Britain's annual [[Gross Domestic Product|GDP]] (comparable to $5 trillion in the U.S. economy.)

On October 13, Britain announced it would spend £50 ($85 billion) to nationalize two of the five largest banks, HBOS (Halifax Bank of Scotland) and RBS (Royal Bank of Scotland), while taking partial ownership of a third, Lloyds TSB. A fourth, Barclays will remain private if it can raise an additional £7 billion. The fifth, HSBC is based in Hong Kong and will remain private.<ref>"Financial crisis: HBOS and RBS 'to be nationalised' in £50 billion state intervention," [http://www.telegraph.co.uk/finance/financetopics/financialcrisis/3185120/Financial-crisis-HBOS-and-RBS-to-be-nationalised-in-50-billion-state-intervention.html?source=EMC-new_12102008 London ''Telegraph'' Oct 13, 2008] The existing stockholders were not bought out. They will continue to hold shares in the banks, but they will be outvoted by the new stock owned by the government.</ref>

On October 13, Britain announced it would spend £50 billion ($85 billion) to nationalize two of the five largest banks, HBOS (Halifax Bank of Scotland) and RBS (Royal Bank of Scotland), while taking partial ownership of a third, Lloyds TSB. A fourth, Barclays will remain private if it can raise an additional £7 billion. The fifth, HSBC is based in Hong Kong and will remain private.<ref>"Financial crisis: HBOS and RBS 'to be nationalised' in £50 billion state intervention," [http://www.telegraph.co.uk/finance/financetopics/financialcrisis/3185120/Financial-crisis-HBOS-and-RBS-to-be-nationalised-in-50-billion-state-intervention.html?source=EMC-new_12102008 London ''Telegraph'' Oct 13, 2008] The existing stockholders were not bought out. They will continue to hold shares in the banks, but they will be outvoted by the new stock owned by the government.</ref>

===$800 billion bailout ===

===$800 billion bailout ===