As we approach the one year anniversary of the ugliest and scariest financial days in a generation, it's worth taking stock of where we are now, and the progress (or lack thereof) made in the past year. September 2008 shocked the world, with the collapse of Lehman Brothers, Fannie Mae, Freddie Mac and AIG making headlines on a daily basis. The investment banking system as we know it evaporated in a matter of weeks. Major stock indexes began a steep decline, ending the year down nearly 40%. (Learn more in The Fall Of The Market In The Fall Of 2008 and Fannie Mae, Freddie Mac And The Credit Crisis Of 2008.)

Today, grades will be handed out to the major players in charge of fixing this mess and setting us back on the path to stability and prosperity.

Congress
Our elected leaders faced the unenviable task of being the janitors-in-chief once the financial mess spread from Wall Street to homes and portfolio statements around the world. Congress has had to dole out hundreds of billions to frail banks, and contend with the government takeover of Fannie Mae, Freddie Mac, AIG and auto makers.

These companies were deemed "too big to fail", and have received tens of billions in emergency loans. These takeovers were necessary considering the abyss we were staring into last year, and reminded a whole new generation of investors about a basic tenet of crisis. When all hell breaks loose, it's the government's job to be the buyer (or savior) of last resort. (Learn more in Is The U.S. Government Too Big To Fail?)

But the same Congress has spent way too much time searching for scapegoats and villains, a task not unimportant, but not to be done before putting out the fire. The TARP bailout funds for financial institutions failed passage its first time around in Congress, wasting precious time when time was at a premium. Meanwhile, partisan politics continue to dominate the daily proceedings, mucking up the wheels of reform and progress.

Grade: C-

Ben Bernanke
This grade is really for the Federal Reserve as a whole, but Mr. Bernanke is the leader of this institution with far-reaching powers. The Fed has the power to set short-term interest rates, which have been set at essentially "free money" to stimulate lending.

The Fed has also been stepping into the credit markets to buy Treasuries, mortgage-backed securities (MBSs) and other assets in an effort to provide liquidity and keep long-term interest rates low.

Mr. Bernanke has also stepped outside the typical role of Fed Chairman and has been speaking directly to the people, doing a 60 Minutes interview, holding town hall meetings, and appearing in public more times in just 1 year than we could expect from Alan Greenspan in a decade.

Grade: B+

Bank CEOs
These guys are going to get a mixed grade, because results have been mixed.

Most large banks still aren't lending enough, as many are hoarding their TARP funds rather than lending them out to businesses and consumers. Efforts to assist homeowners avoid foreclosure have been put in place, but anecdotal reports on their success are spotty at best, and many moratoriums are set to expire soon. (Check out our slide-show: Top 7 Biggest Bank Failures.)

We've seen a wave of consolidation as weak institutions were gobbled up, such as Bank of America's $50 billion purchase of Merrill Lynch, Wells Fargo's purchase of Wachovia, and JPMorgan Chase's purchase of Washington Mutual. These buys prevented more bankruptcies, but further concentrated the financial power among the few – a dangerous proposition for the future.

Some bank executives have performed admirably, being vocal about reforming executive compensation, and repaying their TARP loans. Others have been rather mum, deciding to just weather the storm any way they can.

Grade: Incomplete

Obama Administration
One can only imagine President Obama's perception of his own luck on Inauguration Day. He walks into office amidst the most damaging recession in 30 years, a scared and distrusting populace and nosebleed unemployment.

For better or worse, the Administration has stuck to its guns on the core campaign platform of healthcare and energy reform. Legislative efforts have inevitably diverted valuable attention away from the struggling economy.

The Administration also hasn't made many friends on Wall Street - although this may be a good thing. Obama's stimulus and recovery plan has been generally praised, with leading economists estimating it will add 2-3% to GDP this year. That is desperately needed growth, as it will raise tax revenues to help our rising budget deficit. But the majority of the stimulus funds have yet to hit the ground and do any real good for the economy, the result of a weighed-down bill with several layers of red tape on every corner. (Learn more in Liquidity And Toxicity: Will TARP Fix The Financial System?)

Grade: B-

Media
One might not think of the financial media as a major player, but it serves a vital role in educating a largely confused investor public while fairly reporting on news events as they unfold. To be sure, all of us that report on the markets have been playing catch-up for the majority of the year, trying to process a myriad of storylines and data flows.

Some outlets have been focused on reporting just the facts and giving reasoned commentary and advice. Others have devoted an outsized portion of their medium to personalizing scandal makers and espousing conspiracy theories. The latter may be entertaining from time to time, but won't do anything to help investors make money.

This is a time for reasoned analysis, because we're not out of the woods yet. We should be sure to understand what this economy needs to find its footing before worrying about the next big book deal or Doomsday prophecy.

Grade: C+

Parting Thoughts
Even though grades are being given out today, nobody has graduated yet. The fallout - and the repair – of this crisis are still at the beginning. Investors should hope to see meaningful financial regulations and reform, not just restore our faith in the economy and banking system, but to ensure that such a colossal failure never occurs again. (Read more about the financial crisis in Bailout Acronyms 101 and Top 6 U.S. Government Financial Bailouts.)

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