Stock markets around the world slumped Thursday after the Federal Reserve offered a gloomy assessment of the economy which raised anxiety that a global recession was coming.

Just before midday, the Dow Jones industrial average was down almost 350 points, or more than 3 percent. The broader S&P 500 and the Nasdaq also were down more than 2 percent.

The rout began on Wall Street Wednesday after the Fed announced it would be attempting to boost the economy by migrating its Treasury holdings to longer-term securities from shorter-term debt, a move dubbed “Operation Twist” that was first used, to mixed results, 50 years ago.

NEW YORK — Traders are eagerly awaiting indications from Federal Reserve chairman Ben Bernanke that interest rate hikes aren’t likely anytime soon.

The hope that Bernanke will make that clear in remarks scheduled for Tuesday afternoon is keeping stocks afloat. Stocks recovered some of their losses Tuesday after sliding for four straight days.

NEW YORK (Fortune) — Donald Kohn, vice chairman of the Federal Reserve, learned this week about blackmail, Senate style, when he refused to disclose the names of financial institutions benefiting from the bailout of American International Group.

Testifying about AIG (AIG, Fortune 500) before the Senate Banking committee, Kohn respectfully resisted all of its attempts to extract the names. Several committee members grew frustrated and finally got to the point of threatening Kohn with no more dollars for the credit crisis – ever – if he didn’t spill the information.

CHARLOTTE, N.C. – Struggling insurer American International Group Inc. will receive up to $30 billion in additional federal assistance in the fourth government rescue of the company, a person familiar with the matter told The Associated Press on Sunday.

The new infusion is intended to prop up AIG — once the world’s largest insurer — as it is expected to announce $60 billion in quarterly losses early Monday, the source said on the condition of anonymity because the discussions are still ongoing.

WASHINGTON – The Federal Reserve is letting banks know they need to be careful when they decide to pay dividends to shareholders.

The central bank, which regulates the nation’s large bank holding companies, said in a guidance letter on Tuesday that banks need to consult with the Fed if they plan to pay any dividends that could raise “safety and soundness concerns.”