Turbulence or meltdown?
*** For full coverage of the financial crisis click here***
The events of the last five days have been traumatic for the world of high finance and banking — and may yet become so for the man in the street if confidence in banks fails to hold.
Venerable finance houses are falling like cards, all manner of exotic and unsound practices are being revealed and many of the old rules — like the competition reugulations that stopped Lloyds buying Abbey National in 2001 — have gone out of the window.
Money markets have all but dried up. “I’m not lending money to you — you might not be here next week,” seems to be predominant mood.
Some commentators say this is the financial world’s Particle Collider moment and we’re all doomed, others that this is merely a painful but long overdue shake-out: a reality check that in the end will bring about a greater degree of prudence and sanity.
What do you think we are seeing here? And what do you think the result will be?