In a surprise move early this morning, the Federal Reserve cut interest rates by a half a point, even as stocks continued to slide for the third straight day.
The rate cut followed a coordinated worldwide rate cut. Canada, England, the European Central Bank and Switzerland also cut rates by a half a point.
What to expect from the ongoing economic turmoil? Watch more from Financial Advisor Robin Tull, following this report.
Today, Treasury Secretary Henry Paulson urged calm and patience to allow the government's sweeping actions to work.
"Although we are facing particularly difficult circumstances, I remain confident we will work through this challenge as we have always successfully worked through every economic challenge in hte history of the United States," Paulson said.
It's the latest in series sweeping steps the government is taking to stabilize the markets. The fed's coordinated interest rate cut ahead of its scheduled meeting later this month underscores the urgency of the economic situation.
The tightening market for credit has put a stranglehold on the global financial markets and once again sent stocks all across Asia spiraling.
In Japan, the benchmark Nikkei plummeted 9.4 percent -- the biggest one-day fall since 1987.
"If major banks aren't safe then this is really, nothing is safe so that's why, despite all the efforts by the European governments and the U.S. governments, the market is still in a state of shock and everybody is running for cover, everybody wants safety," said Francis Lun, general manager of Fulbright Securities.
Trading in Europe is also down, prompting governments to move in quickly to save banks strapped for cash.
The dark financial clouds hovering over Britain spurred the government to announce a nearly $90 billion plan that would partly nationalize major banks in an effort to restore confidence.
"These are extraordinary times," said Alistair Darling, Britains Minister of Finance. "You just have to look at what's happening in markets all over the world at the moment."
It's far worse in Iceland, where the prime minister says the country is staring down the barrel of bankruptcy.
Here at home, more losses are expected with the Dow down 13 percent in the last five days and nearly 30 percent year to date.
Even as Americans learned that their retirement accounts have lost $2 trillion, President Bush tried to offer encouragement.
"We have been through times before and we're going to come through this again," Bush said.
*Original broadcast October 8, 2008.