Year 2000:

u  J.P. Morgan merged with Chase Manhattan Bank and formed JP Morgan Chase.

 Year 2001:

u  From January 2001, the Federal Reserve started cutting the discount rate. The 13 consecutive rate cuts afterwards helped to loosen the financial environment and boost the real estate market in the US.

u  The US economy was hit hard by the September 11 attacks. After the attacks, the New York Stock Exchange (NYSE) and the NASDAQ closed for four days, the longest break since 1914.

u  The Enron scandal was revealed in late 2001.

u  The dot-com bubbles started to burst.

 Year 2002:

u  In response to a series of financial scandals including those involving Enron, WorldCom, and Tyco International, the US Congress passed the Sarbanes-Oxley Act to tighten the supervision of listed companies.

 Year 2004:

u  JP Morgan Chase and Bank One’s merger completed in July.

u  The Fed changed its low-rate policy and made 17 consecutive increases in the discount rate, putting an end to the prosperity of the housing market and bringing the subprime crisis closer.

 Year 2007:

u  The subprime crisis finally burst out and started to spread globally. Wall Street witnessed one round after another of write-downs, financial losses, layoffs and top management dismissals.

u  Goldman Sachs and JPMorgan Chase suffered less than some competitors.

u  The Wall Street Journal was bought by News Corp, a corporation owned by Rupert Murdoch.

u  On June 22, 2007, Blackstone Group went public.

 Year 2008:

u  A new round of financial crises hit Wall Street. Bear Stearns was bought by JPMorgan Chase earlier this year. Lehman Brothers went into bankruptcy and Merrill Lynch was also acquired by Bank of America. Even the two largest investment banks, Goldman Sachs and Morgan Stanley were not able to dodge the crisis bullet and became bank holding companies. Fannie Mae, Freddie Mac and AIG were taken over by the U.S. government. Washington Mutual was also hit seriously and taken over by the Federal Deposit Insurance Corporation, which later sold most of Washington Mutual’s banking assets to JPMorgan Chase.

u  The U.S. government proposed a US$700 billion bailout plan, which later won the approval of the U.S. House of Representatives. This financial bailout package marked the largest financial intervention of the U.S. government since the Great Depression in the 1930s.

(Source: Global Entrepreneur)

(China.org.cn translated by Yan Pei, November 12, 2008)