Once you run current-account deficits, you depend on the kindness of strangers. This might be the beginning of the end of the American empire.

If you worry about financial Armageddon, it is indeed metaphorically the time to stock your bunker with guns, ammunition, canned food and gold bars.

Once you run current-account deficits, you depend on the kindness of strangers. This might be the beginning of the end of the American empire.

I believe in market economics. But to paraphrase Churchill - who said this about democracy and political regimes - a market economy might be the worst economic regime available, apart from the alternatives. I believe that people react to incentives, that incentives matter, and that prices reflect the way things should be allocated. But I also believe that market economies sometimes have market failures, and when these occur, there's a role for prudential - not excessive - regulation of the financial system.

The gains from technology must be channeled to a broader base of the population than has benefited so far.

You have to eventually nationalize US banks, you have to take the problem by the horns. In my view actually most of the US banking system is insolvent.

The Treasury plan is a disgrace: a bailout of reckless bankers, lenders and investors that provides little direct debt relief to borrowers and financially stressed households and that will come at a very high cost to the US taxpayer. And the plan does nothing to resolve the severe stress in money markets and interbank markets that are now close to a systemic meltdown.