Hollywood Zenith

The first few cracks appeared when in June, Bear Stearns, a global investment bank, stopped redemptions in two of its hedge funds, prompting Merrill Lynch, an investment fund, to seize $800 million in assets from the funds.

Even these were small matters compared to what was to happen in the months ahead.

In August 2007, the Dominoes started to fall.

It became apparent by August 2007 that the financial markets could not solve the subprime crisis and that the problems were reverberating well beyond the U.S. borders.

The interbank market that keeps money moving around the globe froze utterly, primarily due to fear of the unknown. A well-known Swiss bank was the first to report its losses due to subprime mortgage investment. It was over three billion dollars!

In the coming months, the Federal Reserve and other central banks would take coordinated action to provide billions of dollars in loans to the global credit markets, which were grinding to a halt as asset prices fell.

Meanwhile, financial institutions struggled to assess the value of the trillions of dollars worth of now-toxic mortgage-backed securities sitting on their books.

By winter of 2008, the U.S. economy was in a full-blown recession. As financial institutions\' liquidity struggles continued, stock markets worldwide were tumbling the most since the September 11 terrorist attacks.

In January 2008, the Fed cut its benchmark rate by three-quarters of a percentage point—its most significant cut in a quarter-century, as it sought to slow the economic slide.

The bad news continued to pour in from all sides. In February, the British government was forced to nationalize Northern Rock.

In March, the global investment bank Bear Stearns, a Wall Street pillar that dated 1923, collapsed. Now there were talks that the bank was on sale.

By the summer of 2008, the carnage was spreading across the financial sector. IndyMac Bank became one of the largest banks ever to fail in the U.S.

Yet the collapse of the venerable Wall Street bank Lehman Brothers in September marked the largest bankruptcy in U.S. history and, for many, became a symbol of the devastation caused by the global financial crisis.

That same month, financial markets were in free fall, with the major U.S. indexes suffering some of their worst losses on record. The Fed, the Treasury Department, the White House, and Congress struggled to implement a comprehensive plan to stop the bleeding and restore economic confidence.

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" Big Brother! I am here!" the little girl yelled as soon as she entered the building.

The people working at their stations were surprised at first, but seeing the \'culprit\', they returned to their desks while smiling.

" Is it one of those days?"

" Yeah, It has become a ritual over the years."

" Leah is still cute! I really want to pinch her cheeks~."

" Dream on! The president would kill you if she heard about it."

" You are right."

Among the sea of gossip, the little girl made her way toward her usual spot.

" Wow, Princess Leah is here. What an honour!"

" Ehehe." She jumped on the young man\'s lap and hugged him.

" Why are you spoiling her so much? if this goes on, She will become pampered." The little girl\'s mother was frustrated.

" Come on, Abigail, Don\'t be mean! Leah, mommy is being mean to me!" the young man said with a sad face.

" Mom," Leah said with a sad face copying the young man.

" See, this is what I am worried about."

The young man and Leah stared at each other and came to an understanding.

*puppy face* They made their signature move.

" Ughh, fine, but just for today," Abigail said countless times but would always come around to see their faces.

" It was a success!"

" Yay~" They celebrated, as usual, again putting Abigail in a bad mood.

" Sami, here are the recent developments." She completely ignored the little girl and proceeded with her business.

" Leah, Aunt Marilyn is in another room. Won\'t you go say hi to her? She is also very lonely." Samuel made up an excuse.

" Ok, brother, I want to eat something delicious after that."

" As you wish, your highness!" Leah left, after which Samuel started to check the records.

" Seriously, she is already twelve. How much longer are you going to keep it up?" Abigail asked.

" I am not pretending. Besides, it\'s good to see her happy."

" You are talking like a grown-up again. I hate to admit it, but where did our cute little boss go?" Abigail sighed. It only felt like yesterday when Samuel first visited the firm; now, she could only see a handsome young man that behaved like a saint.

" Just to clarify, I am not giving you my daughter! Leo and I had a heated discussion about it, and as much as I like you, there are too many girls around you, young man!"

" Pff, hahaha!"

" Hey, it\'s not a laughing matter; I am serious."

" I am sorry, but now you are talking like an old woman. haha."

" Permission to hit you, boss!"

" Denied!"

" Fuck!"

....

....

....

" The Wall Street bailout package is being approved this week. The package included many measures, such as a huge government purchase of "toxic assets," an enormous investment in bank stock shares, and financial lifelines to Fannie Mae and Freddie Mac." Abigail reported.

" I see. How much is the total package? and Will it get approved?" Samuel asked.

" The amount spent by the government through the Troubled Asset Relief Program is around $400 billion. If we count the bailing price for other sectors, it is around a trillion dollars. Whether it will get approved or not is another matter.

Public indignation is widespread. To them, It appeared that bankers were being rewarded for recklessly tanking the economy. Because of this, there is an excellent polarization among different classes of people."

" Well, their worries are valid. Who says everything would revert back to normal if they did this? It will go in the national debt, and ultimately the public had to pay it."

" But I think it is the best solution after looking at a current market overview. The bailout is needed to stabilize the stock market." Abigail said with resolution. No matter how unethical it was, people\'s livelihood was at stake.

The banking sector\'s most prominent investors were pension funds. If they went under, the whole life saving would be lost. Due to the instability, unemployment had reached record levels, and millions of people had already lost their homes due to foreclosure.

In the early 2000s, loan originators encouraged millions to borrow beyond their means to buy homes they couldn\'t afford. The loans were then sent on to investors as mortgage-backed securities.

Inevitably, the homeowners who had borrowed beyond their means began to default. Housing prices fell, and millions walked away from mortgages that cost more than the house was worth.

" We should wait for the results. How are our fund managers doing? Are they still concerned?"

" Anyone would be concerned. Investors emptied a total of hundred billion dollars from our firm. Only you are cool; others are freaking out, saying the firm will go bankrupt in a year."

" Don\'t worry; those still with us are reaping the rewards. We made a killing in this bear market!"

" That is true."

They talked for a few more minutes. There was not much to be done now; they had to wait for the market to stabilize.

" Right! Have you done what I asked for earlier?"

" Yes. We have scheduled a meeting; it is difficult to get a hold of them because of the recent turmoils."

" That is fine. Just keep me posted. I will leave for LA tonight; you can contact me through my cell. "

" Is it the charity dinner you mentioned a few weeks ago?"

" Yes."

" Have a safe trip. I will bring good news by the time you are back.