The Dow Jones opened low and continued on a downward trajectory, finally closing at a dismal 6,763 points. As stocks swung intra-day between down to really down, Treasuries rose as investors looked for reliability amid the deepening recession. "There's a real panic in the markets, with some people wanting to buy long-term insurance at any price," said one fund manager. "People have lost hope." After announcing last year was its worst ever, Berkshire Hathaway dropped 7.8 percent. Bank of America and Citigroup, meanwhile, each lost more than 14 percent. GE slipped below $8 for the first time since 1994. The S&P 500 was also off 4 percent.

As if A.I.G needed a subplot right now, the insurance giant’s former CEO, Maurice “Hank” Greenberg, has sued the company that he led for 40 years, alleging he was sold A.I.G. stock at inflated prices. Greenberg led A.I.G. from 1967 until 2005, when he resigned amid fraud charges during the reign of New York Attorney General Eliot Spitzer. He says he acquired the stock as part of his deferred compensation plan, and is now seeking to put several of the company’s former leaders before a jury, as well as recover the difference in value between the price he paid for the stock and what he says is its “true and fair” value. The lawsuit, filed on Friday in New York federal court, came just three days before A.I.G. declared a record $64 billion quarterly loss, and announced it will break apart and turn its largest divisions over the U.S. government.

Just as President Obama begins preparations to shift military forces from Iraq to Afghanistan, three rival Pakistani Taliban groups have reached an agreement to unite for the purpose of a single full-throttled insurgency against U.S. troops there. The new group, calling itself the Council of United Holy Warriors, has NATO officers worried that the partnership will significantly increase the flow of Taliban fighters across the Pakistan-Afghanistan border. Mullah Omar, the cleric who leads the Afghan Taliban, called for the unity pact so that insurgents could refocus and “liberate Afghanistan from the occupation forces.” Violence in Afghanistan shot upward in 2008, with 5,000 people killed—a 40% increase from the year before. The Obama administration plans to send an additional 17,000 troops to the area.

After a punishing day on Wall Street, markets on the other side of the globe followed suit when they opened with quick losses Tuesday morning. The Nikkei Average fell 2.2%, South Korea’s Kospi dropped by 2.3%, and Australia’s S&P/ASX 200 was down by 2.1%. Regional financials and exporters led the fall, and energy producers plummeted along with crude oil prices.

Is Treasury Secretary Tim Geithner equipped to turn around the economic recession and give Wall Street hope for a rebound? Bloomberg profiles the "rookie secretary" whose honeymoon period is fast running out. Two years ago, Geithner made waves by asking firms to "voluntarily clear a backlog of swap trades" but one longtime observer said it wasn't enough: "Maybe he’ll be more forceful now that he’s in a position with real power. But I’m not so sure." Experts are now questing whether Geithner's push to pump up struggling banks is the right move. "We’re giving them money, which is not going to solve anything," said one former regulator. "We’re repeating the mistakes of Japan, which wasted a decade by not moving decisively against its zombie banks." And is he even up to the task of reassuring investors? "He’s the guy who is more likely to steer a conversation with the occasional interjection but not try to dazzle or suck the oxygen out of things," said one former colleague. As Nobel Prize winner Joseph Stiglitz sums it up: "There have been many mistakes made. The big question is to what extent will the mistakes help Geithner figure out the right things to do in his new job... Let’s hope he can use those to come up with better solutions."

Here’s the definition of a last laugh: Beleaguered former Illinois governor and poetry quoting machine Rod Blagojevich has received a six-figure book deal to publish his side of the story. The deal was made with Phoenix Books, a large independent company chosen, his publicist said, because the disgraced pol does "not want to accept constraints or conditions on what he could say in this book.” The number of literary allusions the volume will contain remains to be seen.

It's the most perfect snow day the north east has had in a long time, coming on a Monday, and with plenty of warning. The New York Times reports that the storm, which dumped up to 14 inches on New York and up to 18 inches on Boston, shattered the record for March snowfall in dozens of cities. New York City canceled school for 1.1 million students—its first snow day in five years. The storm paralyzed transit on the northeastern seaboard. By 10 a.m., about one thousand flights had been scrapped in the New York tri-state area alone, with Greyhound and Peter Pan canceling bus service after midnight, delays on New York City buses, and delays on commuter trains. Maine's government shut down for the day, while government offices in New Jersey and Washington delayed openings for two hours, and Philadelphia took extraordinary measures to protect its homeless population by forcing people inside. The storm was blamed for at least four deaths on roadways in Rhode Island, Massachusetts and Long Island.

President Obama officially tapped Kansas Gov. Kathleen Sebelius to head the Department of Health and Human Services today, a Washington outsider who will lead the charge to reform the nation's health care system. Sebelius will be working with Nancy-Ann DeParle, a Clinton White House staffer to head up the new White House Office of Health Reform. For years, Sebelius worked against Republican opposition to expand health coverage of the uninsured in Kansas, to arguable degrees of success. In addition to overseeing the strained Medicare and Medicaid programs and a number of other agencies, Sebelius will inherit the tarnished Food and Drug Administration, which has seen recent controversy over food-borne illness outbreaks and its drug approval process. She is Obama's second choice after Tom Daschle's nomination went down in flames about back taxes.

Four people, including NFL players Marquis Cooper and Corey Smith, disappeared on a boating trip in Florida on Saturday morning. Today, former University of South Florida football player Nick Schuyler was found clinging to the hull of the overturned boat, but the other three men remain missing. According to MSNBC, Schuyler "told rescuers that the 21-foot boat was anchored when it flipped Saturday evening in rough seas and that the others got separated from the boat." He had been clinging to the boat since then. 

Here is an example of Americans' short memory: many of the GOP's rising stars are U.S. attorneys. It was only two years ago that the Justice Department, under "I don't recall" Alberto Gonzales, was accused of rampant partisanship and ties to the Bush White House. Now, with the public wary of politicians, the title of "U.S. Attorney" carries a connotation of fair, nonpartisan and ethical. Across the country, attorneys appointed by Republicans are quickly climbing the party ranks, imbued with the air of a modern day Elliot Ness.

The CIA destroyed 92 interrogation tapes of suspected terrorists, revealing a cover-up much larger in scope than was previously suspected, it was revealed as part of a lawsuit put forward by the ACLU. Prior to the revelation, the CIA had not given a specific number of destroyed tapes, though the New York Times reported in late 2007 that the CIA had made "at least two videotapes" of interrogations disappear. Since the existence of the tapes was revealed, the CIA has stonewalled investigators' efforts to examine them, saying it would be a threat to national security as well as the operatives involved in the interrogations. John Durham, a prosecutor from Connecticut, is wrapping up an investigation into the interrogations. The results are expected to be released soon.

Collector Cai Mingchao identified himself as the winning bidder in last week's Paris auction of two bronze sculptures, but he says that as a patriot, he won't pay, The Independent reports. Cai won the items from the late Yves Saint Laurent's art collection with a bid of $18.9 million dollars, but Cai is also an adviser to a private foundation in China that seeks to recover looted national treasures. He says the bronze heads of rat and rabbit were stolen from Beijing's Summer Palace when French and British forces razed it in 1860 during the Second Opium War. For its part, Christie's says it does not release items that have not been paid for.

In a stunning reorganization of the 90-year-old global insurance conglomerate, American International Group will announce today that it is breaking into parts and handing over control of its two largest divisions to the U.S. government in exchange for $30 billion. This brings the government's ownership to nearly 80 percent in a holding company that, once its restructuring is complete, will have as its main task the selling off and listing of its own businesses. There was speculation about the breakup last week, but the announcement, will end any hope that the company might survive as a stand-alone entity. "Given the systemic risk AIG continues to pose and the fragility of markets today, the potential cost to the economy and the taxpayer of government inaction would be extremely high," a Treasury Department official said in a statement defending the plan.

Achieving a third Michelin star is the holy grail for many chefs, but Marc Veyrat, 58, has given his up. The day after the 100th edition of the famed Michelin guide was released, Veyrat announced he'd be closing his alpine restaurant Auberge de l'Eridan for "health reasons." In November, Olivier Roellinger, 53, handed back his three stars and closed Maisons de Bricourt, explaining, "Physically, I can no longer continue cooking. My legs no longer hold me." While both chefs cited health concerns, the pressure to maintain their thrice-starred status was said to be an important factor in their decisions, and one that has had serious consequences in the past—in 2003 Bernard Loiseau killed himself after it was rumored that he was to lose one of his three stars. Francois Simon, Le Figaro's food critic, likened holding onto the stars to doing a "London to Los Angeles flight as a pilot" each day. Both men intend to produce simpler fare, the kind the Michelin guide has recently been criticized for snubbing.

Last week Sir Howard Stringer, the head of Sony, changed up the company's senior management in order to fight the global consumer slump. According to the London Times, the changes included a demotion for Sony's president, Ryoji Chubachi, and concentrated more power in Stringer's hands. Fierce competition in LCD televisions and digital cameras combined with plunging consumer spending had damaged the company, one of many Japanese groups hit particularly hard by the downturn. The shake up is intended to unify the company structurally rather than vertically, eliminate supply-chain redundancies, and create a "networked" division responsible for Playstation games, Vaio laptop and Walkman products.

Elijah Muhammad had Malcolm X as a disciple, now Farrakhan has... Snoop Dogg? The constantly red-eyed rapper appeared—wearing sunglasses—at the Nation of Islam's Saviours' Day convention and spoke to the attendees, praising Minister Farrakhan and promising to spread a positive message to his fellow artists. When questioned by reporters, Snoop Dogg said he was a member of the Nation of Islam and "an advocate for peace." Other big names from the world of hip-hop at the convention included T.I., who appeared via video and old-schooler Doug E. Fresh, who did not address the audience.

200 pages from an unfinished novel with the working title The Pale King were found on the desk of literary icon David Foster Wallace two months after he killed himself last September. Today’s New Yorker publishes a short excerpt from that manuscript, along with a lengthy article that tells the story of the unfinished work, which Wallace had apparently been writing for years. The characters in the story are IRS agents working in the Midwest, struggling to transcend boredom and apathy – a favorite theme of the author of the highly acclaimed Infinite Jest. "It was different from what he had written before," says the magazine’s fiction editor of the pared-down style of the discovered prose.

Like a moth to a flame... Jennifer Aniston is once again in the spotlight, this time wearing more than just a strategically placed tie on the cover of Elle. The actress, who just turned 40, told the magazine her desire to branch out of being typecast: “I get offered funny, quirky, pretty roles. I'd love to do an action movie. James Bond. Glamour. Daniel Craig. S**t-loads of fun.” She refused (for once) to discuss anything Brad and Angelina related, saying, “There are no villains and there is no heroine in this story,” and that’s she is also “at peace” with her birthday milestone.

Nations around the world are reporting recessions the likes of which have not been seen in decades, but India's fast-developing economy has shown little signs of slowing down. The country recently reported economic growth of 5.3% for the fourth quarter of last year, a stark contrast to annualized declines of 6.2% in the U.S. and 12.7% in Japan, and Indian officials are setting goals of 7% growth for this year. The local press has taken special pride in its financial sector's surprise robustness thus far -- the market cap for the State Bank of India recently surpassed Citigrup. Some economists are warning that the good times may not last, however, as India's strong outsourcing and information technology industries could suffer from depressed global demand. The government isn't waiting for things to sour before taking action, however, enacting tax cuts and stimulus spending to keep the economy moving.

Vikram Pandit, the CEO of Citibank, earned flack from California Rep. Maxine Waters for accepting bailout money and then raising credit card rates on the very taxpayers who funded him. A fascinating new profile in New York magazine reveals how Pandit went from captain of industry to captain of a sinking ship. Among the revelations: Pandit wasn't a natural leader, so he relied on loyal henchman to dress-down employees who screwed up, to handle complaints, and to rally the troops, allowing him time to spend his famously prodigious brain-power on the problem at hand, but also earning allegations of cronyism. As CEO of Citigroup his biggest failure was reliance on a handshake deal during the company's bid to take over Wachovia just before the collapse, which allowed Wells Fargo to snatch the company at the last second. This week, the humbled Pandit cut his salary to $1 and was back before the federal government, desperate for money, able to keep his job only because no one else wanted it.

Obama may have run the most web-savvy presidential campaign to date, but his new WhiteHouse.gov site is pedestrian at best, the Washington Post reports. The site lacks the technology to send out mass emails and text messages, one of Obama's staple campaign tactics, and for a long time, thanks to bureaucratic red tape, it could only link to sites ending in .gov or .mil. While Obama's first presidential speech garnered 1 million views on his YouTube channel, a subsequent speech by Attorney General Eric Holder only nabbed 25,000 views. The site has already broken its own promise of posting legislation for public comment five days before Obama signs it into law, one of only two campaign promises that Obama has broken outright, according to Politifact.com.

Potentially closing the book on this decade’s definitive medical ethical quandary, British and Canadian scientists have discovered a way to produce stem cells without destroying an embryo. The breakthrough allows scientists to effectively “wind back the clock” on skin cells taken from adults until those cells are back in embryonic form, allowing them to make as many as they need – perhaps enough to build “spare human parts” for people with damaged organs. The research was completed at an Edinburgh University lab run by the researcher who cloned Dolly the Sheep, Sir Ian Wilmut. “There is hope that the promise of regenerative medicine could soon be met,” he said.

And now Milan is taking her turn. Fashion Week raged on this weekend with Roberto Cavalli and Miuccia Prada debuting new collections for the masses. Thigh high boots and draped furs took center stage and were far cries from the flimsy fabrics of last season. Prada was described as “utilitarian” and “practical,” with simple leather belts and oversized bags. Even the designer says the collection was “for the outside, for the countryside... for being in the fresh air, not being in a nightclub.” Roberto Cavalli, meanwhile, toughened up the catwalk with a biker chic look, aggressive, studded accessories and tiny, daring leather skirts. Fashionistas have two more days of fashion-gazing ahead.

Happy Monday, east coasters. Forecasters are predicting 5 to 15 inches of snow for the region today, as a heavy storm makes it way across the Eastern Seaboard. Heavy snowfall and gusty winds up to 35 miles per hour are expected to batter the Carolinas up through Boston, and the morning commute for those in Philadelphia, New York, and Boston will prove especially difficult. Boston and Washington, D.C. declared snow emergencies, and South Carolina and Virginia airports were closed yesterday due to the weather.

It looks like there's a real live dolphin form of a My Little Pony toy. The world's only pink bottlenose dolphin is a stunning pale rose color from tip to tail, with glossy skin and red eyes. It swims in a pod with four other dolphins, one of which is probably its mother, the London Telegraph reports. The unusual specimen is an albino, and has been sited in Lake Calcasieu, an inland saltwater estuary north of the Gulf of Mexico. A senior biologist with the Whale and Dolphin Conservation Society said, "I have never seen a dolphin colored in this way in all my career." He also warned that people should be careful "to respect it—observe from a distance, limit their time watching, don't chase or harass it."

You can add another prominent Republican to the list of those advocating bank nationalization. In today’s Financial Times, James Baker writes, “As president Ronald Reagan’s secretary of the Treasury, I abhor the idea of government ownership – either partial or full – even if only temporary. Unfortunately, we may have no choice.” Baker’s prescription: “We should divide the banks into three groups: the healthy, the hopeless and the needy. Leave the healthy alone and quickly close the hopeless. The needy should be reorganized and recapitalized, preferably through private investment or debt-to-equity swaps but, if necessary, through public funds. It is time for triage.”

After years of movement towards a more close-knit European Union, sharp divisions over how to deal with the economy are pushing member states into opposing camps. Calls for a bailout package from hard-hit Eastern members, the group's newest, were rejected over the weekend, with Germany's Chancellor Angela Merkel calling for countries to be dealt with on a case by case basis rather than through bold collective action. Countries have also been split over how to reboot the economy, with Merkel being notably stingier in crafting stimulus plans than in places like Britain, which has taken a more active response. U.S. officials are watching with interest, as a more divided Europe may prove more difficult to seek help from on issues ranging from Afghanistan to stabilizing financial markets. “All of that is in doubt if the cornerstone of the EU — its internal market, economic union and solidarity — is in question,” a former State Department official said.

President Obama better hope that his new pick for Health and Human Services Secretary, Kathleen Sebelius, has better luck in the White House with health care reform than she did as governor of Kansas. The New York Times reports that despite the governor's interest in health policy, gridlock in the state legislature derailed her health agenda there while the number of uninsured rose rapidly, growing seven times as fast in Kansas than in the nation during her tenure. Sebelius says her biggest disappointment as governor has been her inability to enact a longtime plan to tax tobacco to pay for expanded Medicaid coverage, which would have covered close to one quarter of the state's uninsured. She will be in more friendly territory in Washington, D.C., however, with solid Democrat majorities in both the House and Senate to mine for votes.

March came in with a roar this morning as the Dow Jones average slipped below 7,000 following a global selloff overnight that saw Tokyo's Nikkei down 3.8 percent and London's FTSE 100 off 4.2 percent. At the opening bell on Wall Street, the Dow immediately sank over 140 points. Earlier this morning, the government reported that personal incomes unexpectedly rose but personal savings climbed to a 14-year high as recession worries weighed on the American consumer. Last month was the worst performance for the Dow since 1933, with the S&P losing 10 percent of its value. HSBC bank, which announced further job cuts this morning, was trading down 20 percent.