Jeremiad

1. And it came to pass that on his day day of rest, his mate Flit phoned Stan and asked what he thought about the Credit Crunch that had brought low the mighty Bear Stearns and the less mighty and always slightly-dodgy Northern Rock.

2. For Flit, despite being abundantly wise in the Arts and Sciences, had not a Scooby about the ways of Mammon. A bit of a blooming liability on Sports Trivia too, but we'll let that pass.

3. Stan told her to wait a while, put on a flowing robe, grabbed a wooden staff, grew a long beard and went up into hills, from where he addressed her (and anyone else within earshot) during an electrical storm from high atop the mountain.

4. Vanity ! All is vanity ! A wave is coming that will sweep all before it and not even the worthy will escape unscathed. As the mighty Scottish prophet, Private Frazer said "We're all doooooo-med. Doomed I tell you."

5. For the world we live in is held together by money and for the last fifteen years or so the greatest pyramid scheme ever has held sway.

6. Debt has been bought and sold, sliced and diced, rebranded and exported to the point where no-one knows who will end up holding the baby when a credit card debt or a mortgage goes into default.

7. Imagine sub-prime debt as contaminated meat that has been sent forth into the world to all the pie makers in the world. Some pie-makers use only the cheapest nastiest meat available and they are going to fold almost immediately in a sea of vomit and legal action.

8. But even the fancy pie makers will get hurt. For there is no way to reassure the public that there is no bad meat in their pies.

9. Just like the fancy pie makers, so the ordinary boring banks who didn't get involved too much in Commoditised Debt Obligations will be dragged onto the rocks by the coming storm.

10. And when banks are weak, there is no lending. And without lending, many companies will fall. And most companies are leveraged to the hilt, for if they were not, then the Private Equity companies would Dawn Raid them and make sure they blooming well were.

11. And when companies cannot borrow they tend to shrink and so fewer people are in work and more people can't pay their mortgages. And so it goes forth, begetting misery unto the fourth generation.

12. Flit was sore afraid by this and asked whether she would be affected because she worked for the government. And Stan held up his wooden staff to the storm and shouted "When the economy suffers, government revenues fall. And when even governments find it hard to borrow they need to slash costs. And when a government has a choice between Health and Entertainment, they are likely to choose Health no matter whether you think they have committed funds to your organisation for the next five years or so."

13. And before Stan took himself off to dry out his gown and rest his voice and eat chocolate cake, he conjured up the nightmare scenario.

14. "Imagine one of the really big banks getting into trouble - one that's so big that bailing it out would bankrupt a country. It's been a while since we've been up-close to a bankrupt country. Starving people, extreme politics, militarism. Think pre-war Germany, think Zimbabwe. And now you've got a whole set of domino effects to consider.

15. And that's not the worst of it. Imagine one of the biggest banks falling - some of these banks, if they were countries would be part of the G8. Not even Stan has the wit to predict what would happen if one of those bad boys were to go down.

16. But that's more a historian like Flit's territory than that of an enthusiastic amateur Financial Doomsayer. In much wisdom is much grief: and he that increaseth knowledge increaseth sorrow. Thank goodness for chocolate cake.