To put it very simply: It's the confirmation of diminishing disposable incomes in the developed world. Banks understandibly want to increase profits BUT their customer base sees decreasing disposable income driven by the reduction of industrial output. We increase the sale of services promote expenditure and facilitate credit because goods are actually cheaper now because John Doe was fired and the goods are imported more cheaply from overseas. John Doe still needs to live though and needs to buy a house. We buy overseas products with our credit card the money pays for the overseas factory and workers and the service providers (the seller and the bank) With the money we save from not having to pay for John Doe's work for the products we invest in the stockmarket in companies that fund sub prime rates i.e. loan money to John Doe so that he may buy his house. Eventually John Doe runs out of money. Just think of the Argentina crisis only that "Argentina" is a growing part of the populat

george, London, UK

Everyone google Financial Sense University and all shall be revealed. The Americans are in complete denial of the fracus that has been caused by the exuberant mortgage derivative market. The UK seems to think it is immune from the contagion effect. The Europeans seem to think that given its distance from the US markets it is not contagious. The Japanese are about to demolish the carry trade. Money supply is in double digits in all countries, the central banks are trying to control the stock markets via this regime i.e, they want expotential returns on the stock market to counter act the debacle in the mortgage markets. The Bank of England is peddling lies after lies, the underlying cost to the standard of living has reason so much that it equates an inflation rise from 2.4% to 3.1% as significant in order for it to control inflation. But how much is an increase of that much in £ - negligble. So why increase interest rates? because its the only way to control Government Expense.

Jay, Harrow,

Mr Greenspan, what have you got to say?

cww, Ipswich,

Now let the harvest begin.

ADScott, Bangkok, Thailand

Hope the ECB's not lending to er... more bad risks...

cww, Ipswich,

What if this cash injection is not sufficient?

There is not even one single person who can say with any degree of certainty the level of bad debt due to the global property boom.

We could be in for a period of stagnation!

Costas Papadopulos, London,

I am sorry to be incredibly stupid but could someone explain in simple terms why so much short-term money is suddenly needed by the European banks today and how these loans will be repaid on Monday.

Gerry Lynch, Chichester,

The financial world, in recent history, has been awash with liquidity. And NOW an urgent infusion of additional liquidity to stabilize a fomenting financial cauldron brewing a soup of monetary inflation. Price of goods will next be infected with greater escalation of consumer cost. A unknowing time of financial fall-out we live in today!

L P VALLUZZO, EAST HAMPTON, USA Connecticut

Frustratingly, the stockmarket dealers in the City and elsewhere will still come out of this catastrophic drop in stock values, filthilly rich and stinking with our money!

Maxadolf, Epsom, UK

The indigestion after the party. So what is new?

Kara Swart, London, UK

So the banks have lent money to bad risks (to make another buck), they haven't paid up, and you're suprised?

Should be your ass that's stinging...

Tighten up your debt recovery, take less risks in the name of extra profit.

Bill Bird, Wallasey, Wirral