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One of the sources of 2008’s economic troubles was the housing bubble pop, which sent home prices plunging and made foreclosures soar.

In a dramatic attempt to shore up the housing market, federal officials in September seized Fannie Mae and Freddie Mac, placing them in a conservatorship amid concerns that steep mortgage losses were hurting their ability to remain viable and thus backstop the mortgage market.

The two companies own or guarantee almost half of the country's $12 trillion in outstanding home mortgage debt.

A week later, the government also stepped in to rescue insurance giant American International Group Inc. with an $85 billion loan in exchange for an 80 percent stake in the firm. It was the largest bailout of a private company in US history. AIG's stock had plunged 95 percent on the day after its debt was downgraded.

AIG quickly burned through the $85 billion and borrowed another $38 billion from the government in early October to avoid default.

On October 3, after a bruising debate on Capital Hill, lawmakers passed a $700 billion bailout, called Troubled Assets Relief Program, or TARP, aimed at buying up soured mortgage assets and encouraging banks to resume lending in order to ease an escalating credit crisis.

About $250 billion of that money was used to infuse equity into banks and another $40 billion went to prop up AIG.

The “Big Three” automakers, teetering on the verge of collapse, also pressed for some of those funds to be used to bailout their struggling industry.

November brought more bad news, with 533,000 jobs lost over the month - the highest level in 34 years. The unemployment rate reached 6.7 percent, its highest level in 15 years.

In total, more than 1.9 million jobs were lost over the year.

Then in December, the National Bureau of Economic Research confirmed what many suspected, that the United States - the world's largest economy - had been in a recession for a year.

In an effort to climb out of the quicksand, the Federal Reserve drastically lowered interest rates, slashing its benchmark short term rate from 4.25 percent in January to a target range of 0 percent to 0.25 percent. It was at the lowest rate on record by year's end.

However, drivers got a break as the recession pulled oil prices sharply lower. Crude oil peaked above $147 a barrel in July before tumbling to $40 in December as global demand weakened.

At the end of a year dominated by negative business headlines and the holidays approached, authorities arrested money manager Bernard Madoff, a onetime Wall Street legend. He was charged with running the largest Ponzi scheme in financial history - a $50 billion fraud that wiped out many investors.

Over the last 12 months that were ruled by negative economic indicators and widespread fear, the S&P Index decreased about 40 percent, for a loss of more than $6 trillion.