Last week was one of the most happening week in the history of US economy and Wall Street. Collapse of 158 year old investment bank Lehman Brothers, news about failing insurance major AIG and 85 billion bailout by US government in return of 80% stake, takeover of Merrill Lynch by Bank of America, earning drops in Goldman Sachs and Morgan Stanley, taking over of HBOS plc, UKs premier banking and isurance group by Lloyds TSB and 700 billion dollar bailout plan by US government are the major events created waves in wall street and world economy.

Collapse of Lehman Brothers was unexpected and hard to digest by financial world because the 158 year old banking major which survived two world wars, many recessions and great depression finally collapsed on September 15th and filed for chapter 11 bankruptcy protection.

Lehman bankruptcy created panic in Indian equity markets and financial sector because many Indian private and public banks hold investment in Lehman assets. Apart from that Lehman invested in some top realty projects, sub contracted development works to top IT companies.

AIG's financial trouble was another unbelievable news to investment community because it is world's 16th largest company as per Forbes list with offices in 130 countries and 1.16 lakh employees worldwide. Finally United States government helped AIG with a $85 billion loan in return of 80% of stake because collapse of a company like AIG could create serious impact in American economy.

Now president George Bush teamed up with Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke and working on a financial aid package to save the financial sectors and troubled banks. Bush seeks $700 billion (around 31.5 lakh crore rupees) for the package. With the new package US government is planning to create a new entity to take over the bad bank assets. Once the bad assets are moved to the government entity then bank can start issuing fresh loans and this will help to boost the economy and troubled home segment.

Bush needs US congress approval for the plan. Some analysts are against spending huge amount of tax players money for saving troubled banks.