In April the International Monetary Fund dubbed the growing economic crisis "the largest financial shock since the Great Depression", leading to a one in four chance of a full-blown global recession.
There is little doubt that the US economy is already contracting.
The immediate problem is a pool of bad debt, so-called "toxic waste", clogging up financial markets. The waste is a consequence of the scramble to lend money during the property boom of recent years. Arcane financial innovations, which saw debt parcelled out and gambled on by banks, hedge funds and corporations, ensured that the contagion from dodgy mortgages went global.