And the financial meltdown continues … Asian and European markets were down this morning, after the Dow Jones industrial average dropped 504 points yesterday. It was the largest single-day decline for the index since the first day the markets opened after 9/11. News of Lehman Brothers filing for bankruptcy and Merrill Lynch’s sale to Bank of America quickly took the back seat to reports that American International Group, better known as A.I.G., one of the world’s largest insurers, needed stabilizing. The Fed declined to give the company a loan of $40 billion, so the state of New York stepped in to allow A.I.G. to borrow $20 billion.

Of course, our two intrepid presidential candidates had something to say about all of this … The New York Times summarized their positions thusly: John McCain said the current troubles on Wall Street were because of greedy investors, while Barack Obama placed blame at the feet of politicians who relaxed regulations during headier times.

There’s a real storm to recover from, too … Residents in Galveston, Texas are being urged to stay away from their island home after rescuers and city officials surveyed the damage yesterday. The west end of the island and the Bolivar Peninsula were hardest hit by Hurricane Ike – the surge from the storm completely washed over the narrow strips of land.

Forget U.S. Central Command, and bring the surge to the financial markets … General David Petraeus handed over command of U.S.-led forces in Iraq to General Raymond Odierno today. Odierno may be an unknown name stateside, but he served as the second-ranking U.S. commander in Iraq for 15 months until February. Petraeus heads to Central Command next month, where he will be in charge of the wars in Iraq and Afghanistan.