The financial crisis - like a bad movie

That bad movie went on for a long time, and became public as the subprime crisis more than a year ago. If the financial and political systems had worked as the good citizens expected, there would have been ample time to fix the problems in the background and to avoid the panic that we do see now.

Unfortunately those systems did not work as their  leaders cowardly preferred to keep their eyes closed and their fingers crossed, rather than working seriously on cleaning up that mess.

The result is the demise of investment banking as we knew it before, and hopefully some corrections that lead to financial markets getting down to earth and nearer to the real world. And by the way, economy is to serve the people - not the other way round.

Strongly agree with Gerhard.

Stanley, you seem to be talking as if the panic is inappropriate and everything would be ok if people would only calm down. Unfortuntely the problem is not one of sentiment: we are in the middle of a fundamental and inescapable economic disaster. It is almost certain to keep getting worse (yes, worse) for a while to come, and the bad times are going to last for years, not months. Panic may not be such an inappropriate reaction.

Paul, I certainly did not intend to convey the sentiment the "... the panic is inappropriate and everything would be ok if people would only calm down".

Panic is a normal part of this situation. My "bad movie" comparison relates to watching events unfold. The extent of the panic, how it spreads in unforeseeable directions and the speed of events has me mesmerized. The events that we are witness to cannot be wished away or reversed by simply calming down.

While I agree with you that worse lies ahead, there still will come a time when confidence will be restored and some sort of "sort of normalcy" will return.