Regarding the credit crunch and the rapid rise in prices of food, are the supermarkets profiteering from this?  The price of a tin of Napolina tomatoes has this week risen from 82p to £1.15    Combine that with the rise in pasta prices and a simple puttanesca will soon be out of my reach!! 

Thanks for helping me waste a morning following the demise of Ian Pace (I am not being sarcastic).

Wow! Gripping stuff!

Perhaps the surviving members of the Monty Python team could be persuaded to make one last feature film "The Life of Ian".

I grew tired of hearing the phrase "credit crunch" back in May.

What I fail to understand is how someone who brings a company to the brink of ruin not only keeps his job, but also receives a £2,000,000 bonus.

I opened an account with super-bank Lloyds TSB HBOS Halifax etc. this morning.

I've just received this from some friends in America.  Patrick J. Buchanan for all those who don't know, is an Irish political commentator.

Day of Reckoning
by Patrick J. Buchanan

How did the United States of America, the richest nation on earth, whose economy represents 30 percent of the Global Economy, arrive at the precipice of a financial panic and collapse?

The answer lies in the abject failure of both America's financial elite and the political elite of both parties -- the same elites now working together to determine how much of our wealth will be needed to bail the nation out of the crisis of their own creation.

Big Government is riding to the rescue -- saddlebags full of our tax dollars -- to save us from the consequences of the stupidity and folly of Big Government. New York and Washington, the twin cities responsible for the crisis, are now being hailed by the media as the 7th Cavalry, coming to rescue a beleaguered nation.

Had there not been a steady and constant infusion of easy money and credit into the U.S. economy by the Fed, for years on end, a housing bubble of the magnitude of the one that has just exploded could never have been created.

Had the politicians of both parties not coerced and pressured banks, S&Ls, Fannie Mae and Freddie Mac to make all those sub-prime mortgages, then to tie this rotten paper to good paper, convert it into securities and sell to banks all over the world, there would have been no global financial crisis.

Had they seen this coming and acted sooner, the Federal Reserve and U.S. Treasury would not today, like Henny Penny, be crying, "The sky is falling!" and the end times are at hand, unless we give them 5 percent of our gross domestic product to buy up suspect securities backed by sub-prime mortgages.

Consider what the "Paulson Plan" of Treasury Secretary Hank Paulson, against which Sen. Richard Shelby and the House Republicans rebelled, entails.

Since Americans save nothing and have to borrow from abroad to finance our trade and budget deficits, wars and foreign aid, what the secretary proposes is this: that Congress authorize the Treasury to spend $700 billion to buy up the toxic paper on the books not only of U.S. banks, but of foreign banks operating in the United States. According to The Washington Times, the Treasury would also be authorized to buy up securities backed by rotten auto loans, student loans and credit card debts.

Thus America would be borrowing from China, Japan and the Middle East to tidy up the balance sheets of the banks of China, Japan and the Middle East. And all the rotten paper will be offloaded onto U.S. taxpayers, who hopefully will be able to recoup some of their losses, because some of the paper will be good.

Why should we do this? Because otherwise there will be a financial panic, followed by a market collapse, wiping out pensions, 401Ks, portfolios and defined benefit plans of Middle America, forcing millions into bankruptcy and millions more to put off retirement and continue working until they drop.

In a democracy, it is said, you get the kind of government you deserve. But what did the American people do to deserve this? What did they do to deserve the quality of financial, corporate and political leadership that marched them into this mess -- and that today postures as their rescuers?

Consider what this mess has already cost taxpayers: $29 billion to buy the rotten paper of Bear Stearns so J.P. Morgan would buy the investment bank; $85 billion for 80 percent of AIG to nationalize it; $150 billion in a stimulus package to flood the nation with cash; perhaps $300 billion to bail out Fannie Mae and Freddie Mac; and now $700 billion to begin taking the toxic paper off the hands of America's big banks.

And even if this is passed, say Paulson and Fed Chairman Ben Bernanke, there is no guarantee this will resolve the crisis. If the $700 billion is not provided and the toxic paper is not pulled off the books of the world's banks by U.S. taxpayers, however, we face an almost certain collapse, surging bankruptcies, rising unemployment, a shrinkage of GDP and a recession, if not worse.

Yet, the fellows who tell us we face a financial mushroom cloud over every American city if we do not act at once to provide the $700 billion did not see this coming and can make no guarantee that this will succeed and end the crisis.

Nevertheless, it must be done, and done now, as collapse is imminent.

Looking at all the money being ladled out by the U.S. government to prevent a collapse, and the diminished revenue coming in, it is hard to see how America avoids future deficits that reach $1 trillion a year. These will imperil both the dollar itself and the ability of the United States, which saves nothing, to borrow from the rest of the world. The downsizing of America is at hand.

Yes, indeed, we have arrived at the Day of Reckoning for Uncle Sam.

They can't say they weren't warned:

"In a system...where the entire continuity of the...process rests upon credit, a crisis must obviously occur -- a tremendous rush for means of payment -- when credit suddenly ceases and only cash payments have validity. At first glance, therefore, the whole crisis seems to be merely a credit and money crisis. And in fact it is only a question of the convertibility of bills of exchange into money. But the majority of these bills represent actual sales and purchases, whose extension far beyond the needs of society is, after all, the basis of the whole crisis. At the same time, an enormous quantity of these bills of exchange represents plain swindle, which now reaches the light of day and collapses; furthermore, unsuccessful speculation with the capital of other people; finally, commodity-capital which has depreciated or is completely unsaleable, or returns that can never more be realized again. The entire artificial system of forced expansion of the [economy] cannot, of course, be remedied by having some bank, like the Bank of England [or the Federal Reserve], give to all the swindlers the deficient capital by means of its paper and having it buy up all the depreciated commodities at their old nominal values. Incidentally, everything here appears distorted, since in this paper world, the real price and its real basis appear nowhere, but only bullion, metal coin, notes, bills of exchange, securities. Particularly in centers where the entire money business of the country is concentrated, like London [or New York]...the entire process becomes incomprehensible."

Marx, Capital, vol.3 (1894)
(found here)

I'm sorry to say I have a feeling that their rebuttal would basically be a version of 'nya nya nya'.

I wouldn't say my reading comes close to being exhaustive but pretty well everything I know of Marx writing about capitalism has that effect. 

Hegel remarks somewhere that all great, world-historical facts and personages occur, as it were, twice. He has forgotten to add: the first time as tragedy, the second as farce.

My confession: no I didn't watch it.

My excuse: it was your use of the word 'rebuttal' that made me think: if that's how it is I don't want to. 

...but once this Brahms is over I'll give it a look.

Thanks for posting that, Turf. Well worth ploughing through to get an idea of what the view (principally) from US academic economists is to all this. As you say, very informative and usefully clearly expressed by all the participants. Quite apart from anything else I was amazed at how much common ground there was between the panellists in identifying what had gone wrong, although there were clear differences in emphasis about what now to do about it (the former, I suppose in a general sense, not actually a million miles away from Marx's analysis that Richard quoted, but the latter, staying within a capitalist context, obviously so).

FWIW (very little, as a non-economist) I found the contributions of Elizabeth Warren and Kenneth Rogoff as the ones which were most illuminating in connecting diagnosis with possible remedial policies. Incidentally, the teach-in we had here earlier, or maybe it was on the Music and Society Board, about how the term 'middle class' means quite different things in the US and the UK, was a useful primer. The second speaker's contribution would have had me barking up the wrong tree without it.