There is a striking closing scene in the 1961 sci-fi thriller The Day The Earth Caught Fire, much of which is set in the old Fleet Street offices of the Daily Express. As the world waits to see if the scientists’ efforts to prevent disaster are successful, the paper is forced to print two separate editions for the next morning. One is headlined “World Saved”, the other “World Doomed”.

Trying to keep track, on a daily basis, of events in Washington offers the journalist a similar dilemma. Just at present, the headline is “World Saved”. Some sort of plan is going to be hammered out that will allow the banks to unload their toxic debt in an orderly fashion, to be placed on the market in due course. What it will look like, we don’t know.

Whether this will be enough, at what price the toxic assets will be acquired, how saleable they will prove, whether the US economy will be crippled by the resulting debt or, miracle of miracles, taxpayers will even turn an eventual profit . . . all are again the subject of future headlines.

But a deal will take place because one must. One day we may know whether John McCain’s eleventh-hour spanner in the works was a cynical bid to allow him to emerge, at the eleventh hour and three quarters, as the hero. If it is true, and he genuinely did manage the previously unheard-of achievement by any presidential candidate of screwing things up even before he takes office, then it probably doesn’t matter. The package will be put in place, and it may serve.

But it is going to be a horrible road ahead. We may or may not yet be in recession, technically speaking. But in the last two days alone we have seen bad news, profit warnings or profit reverses from, deep breath, Rosebys, Moss Bros, John Lewis and JJB Sports, four companies in four entirely different sectors of retail, from Hardy Amies, from MFI, Lloyd’s of London, the publishers of the Mail newspaper titles, nightclub operator Luminar, the global shipping industry, the firm that owns Canary Wharf . . . Bradford & Bingley shares are sinking fast and HSBC is adding to the lay-offs at Canary Wharf. Small firms cannot access the necessary loans they need to keep going. All this gloom is spread across all sectors of the economy.

There has been much written in recent days about an energy crisis this winter that will force regular power cuts. The knock-on effects of a collapse of a significant number of banks would threaten a similar sclerosis of the world banking system. Imagine the lights going out. Then imagine, and it is not unfeasible, going to your local ATM and being told, no, you can’t have any cash. We haven’t got any.

It really is that serious. This is why arguments about moral hazard, banking bonuses, rewards for failure, are at this point irrelevant. This has to work.

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