United States economic growth fell sharply in the last three months of 2007 as the credit crunch took effect, according to the latest figures from the Department of Commerce. Overall growth rate in 2007 was 2.2%, the weakest since 2002.
The FBI is investigating at least fourteen companies embroiled in the sub-prime mortgage crisis as part of a crackdown on improper lending and inside information according to The Wall Street Journal.
The Federal Reserve has cut interest rates for the second time in nine days in a further attempt to keep the United States economy from entering a recession. However a barrage of negative data on US growth, housing and employment seems to have watered the reaction from markets.
United States President George W Bush urged his fellow citizens on Monday to have confidence in their economy in the long-term as he gave his seventh and final State of the Union address in Capitol Hill.
Wall Street banking giant Merrill Lynch unveiled on Thursday a huge net loss of 7.8 billion US dollars for 2007, compared to a net profit of 7.5 billion in 2006. The loss includes a massive 14.1 billion write-down on failed investments related to sub-prime mortgages.
Federal Reserve chairman Ben Bernanke on Thursday backed the introduction of emergency economic measures aimed at helping the US economy avoid recession.
Inflation in United States for all of 2007 hit the highest rate for 17 years as surging energy and food costs pushed up prices according to the US Labor Department latest release.
The US largest banking organization Citigroup has reported record 9.83 billion US dollars net loss for the last three months of 2007. Chief executive Vikram Pandit said Tuesday the loss had been caused by 18.1 billion US dollars exposure to bad mortgage debt and was clearly unacceptable.
United States is probably in or about to enter a recession, former Federal Reserve Chairman Alan Greenspan said in an interview with The Wall Street Journal. The odds are not overwhelming but they are marginally in that direction of recession.
One of the leading banks in United States, Bank of America is to take over the country's biggest mortgage lender Countrywide Financial, in a 4 billion US dollars deal.