The Financial Crisis: This Day—One Year Ago, Sept. 5

It's a pretty black Friday.

Another bleak unemployment report.

Government data show the August joblessness rate is the highest since the summer of 2003, and the glum news seems to rattle every spoke of the financial hub.

The financial crisis and the economic one may be melding into one.

Bond market strategist and frequent CNBC blogger Tony Crescenzi of Miller Tabak says the jobs report "reinforces the idea...that the U.S. economy is about to enter a dark period, with economic activity slipping substantially from the second quarter's 3.3% pace and perhaps set to contract in the fourth quarter."

Nigel Gault, chief U.S. economist at Global Insight, sees housing as the next domino—but not the last:

“If people are worried about losing their jobs—or are losing their jobs—housing is the kind of purchase you can easily postpone,” he tells CNBC, adding, “The broader economy couldn’t hold up indefinitely as housing was plunging."

Meanwhile, the Treasury is cementing plans to backstop mortgage giants Fannie Mae

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[FNM  Loading...      ()   ] and Freddie Mac

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[FRE  Loading...      ()   ], as they cope with billions of dollars of losses from bad loans, the Wall Street Journal reports. Pimco's Bill Gross tells CNBC that such government intervention is a "needed step." (See the entire Gross interview, below.)

Merrill Lynch shares tumble some 4 percent, after Goldman Sachs cuts its rating on the brokerage to "sell," predicting a fresh wave of writedowns are coming.

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• How China's Bet on US Paper Went Wrong
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Despite a stronger U.S. dollar and lower oil prices, traders are in a "sour mood," reports CNBC.com's Trader Talk blogger Bob Pisani. He quotes one stock-jobber as complaining that "What I buy on Monday, goes down on Tuesday...what I short on Tuesday, goes up on Wednesday."

Pisani says that in this bear market, even the bears get mauled.

Former Fed Chairman Alan Greenspan — a self-described libertarian Republican — declares that unique conditions demand that Congress give the government unprecedented new powers to handle troubled firms. He fears that repeats of the Bear Stearns slide (and subsequent takeover by a Fed-backed JPMorgan

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[JPM  Loading...      ()   ]) may cost taxpayers far too much.

Sen. John McCain accepted the Republican party's nomination for the presidency, promising to “fight for what’s right for America.” Now, some are wondering: is VP candidate Sarah Palin's self-avowed "pitbull in lipstick" style overshadowing McCain's famed aisle-crossing centricity? (Watch John Harwood's analysis, below.)

Despite a stronger U.S. dollar and lower oil prices, traders are in a "sour mood," reports Trader Talk blogger Bob Pisani. He quotes one stock-jobber as complaining that "What I buy on Monday, goes down on Tuesday...what I short on Tuesday, goes up on Wednesday."

Pisani says that in this bear market, even the bears get mauled.

The Dow and the S&P 500 eke out gains by the closing bell, but all three indexes still finish off sharply for the week: The Dow loses 2.8 percent, the S&P slips 3.2 percent and the tech-heavy Nasdaq skids 4.7 percent.

Analysts say techs have heavier exposure to the global economy — and thus the global slowdown that has worried the market this week. Indeed, the CBOE Volatility Index, a well-regarded measure of fear in the market, jumped 12 percent this week.

What the Experts Were Saying:

Fannie and Freddie shares soar on news the Treasury is close to finalizing a backstop plan. Pimco's Bill Gross likes what he hears.

Mad Money's Jim Cramer on Friday's market moves: “You saw a lot of the names bottom today because the margining is done. But it doesn’t mean that we aren’t fundamentally in trouble.”

John McCain accept the nomination, but Palin galvanizes the voters — pro and con. John Harwood reports.