The spigott is now gushing at full spate. Yesterday's announcement shows central banks preparing to flood the Western money markets with fresh dollops of liquidity in an effort to get banks lending again and passing on interest rate cuts to borrowers.

The timing is a little odd. Most measures suggest the credit crunch has already been easing in recent days. The Bank of England, which was not party to yesterday's ministrations, said this week that the worst was probably over.

Perhaps US and European policymakers, having thrown so much already at the problem, feel there is no point in half measures. A more worrying interpretation is that a particular institution is in trouble.

But if this doesn't fend off financial Armageddon, it's hard to see what will. Meanwhile, the focus has moved on to the effect the crunch is already having on the rest of the economy. Banks may have been floated off the rocks but the wider world still has to grapple with the consequences of their former recklessness.

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