Banks going down like ninepins, fortunes being wiped off the stock market, inflation haywire, loans unobtainable – the market's messed up, hasn't it? The newspapers tell us that even the most ardent defenders of the free market are calling for government action.
Well I'm not. It's perfectly obvious to me that it's governments and regulations that have messed up, not free markets – because in the financial wonderland that our regulators have created, free markets do not exist.
Much of the problem comes down to US government 'anti-redlining' legislation, which forced institutions to lend to people in parts of town where the local property market was bad collateral. Lenders knew they'd have to comply or face regulator's retribution. True, the rules meant that a lot of people were able to own their own home for the first time. Unfortunately they also meant a lot of 'sub-prime' debts on the institutions' books.
That was no problem when everything was booming. But the 'prudence' of Gordon Brown, and Alan Greenspan's confident mastery of the markets now turn out to have been prolonged, stealthy, credit binges. It was great for politicians and business, at the time. The trouble is that after every binge, there's a hangover. In the cold light of day, nothing quite looks so clever.
Like Northern Rock. The Bank of England thought it was taking too many risks months before it collapsed – but the Financial Services Authority did nothing. When it failed, three regulators – the Treasury as well – were all stepping on each other's feet.
This week's turmoil owes its origin not to the free market, but to politicians engineering booms in which everything seemed to succeed, and in reassuring investors that their money was completely safe. Financial markets are better regulated by their customers looking carefully before parting with their cash, not by distant regulators.