The Dow Jones Industrial index has suffered its worst one-day drop since 2001, falling around 500 points following the collapse of US investment bank Lehman Brothers.
Large losses were also felt on Asian and European Markets after last ditch talks failed to find a buyer for Lehman, and the firm declared itself bankrupt. US President George W. Bush said the US economy was healthy enough to withstand the impact of the "painful" events of the financial markets. Bush said that his administration was working to reduce broader economic disruptions. In another big market shake-up, the Bank of America has agreed to buy Merrill Lynch for 50 billion dollars. It is effectively a forced sale due to that bank's exposure to the sub-prime mortgage crisis. The transaction creates the world's largest financial services company.
(Deutsche Welle)
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