Today's economic woes - which began in the financial sector - bear an uncanny resemblance to the conditions that led to the Great Depression of the 1930s. A long debt-fuelled boom, after consumers borrowed heavily to afford the trappings of a new consumer era - and all against the backdrop of soaring stock market. Yet it all came to an abrupt end with a financial sector crisis - characterised by bank collapses, a shift towards bear market conditions at bourses around the world and a severe global slump. This may sound like a description of the current difficulties facing the global economy but, worryingly, it also seems to describe the background to the Great Depression of the 1930s.
The fact that today's problems seem overly focused on the financial sector looks like an especially alarming parallel. Unlike any other post-war economic crisis, which tended to have their roots in more traditional issues like the need to fight inflation, today's problems were triggered by events in the financial sector in the form of the sub-prime mortgage crisis. Securities backed by sub-prime US mortgage assets have lost so much value that the banks are wary of lending to each other and have had to write-off billions of pounds against these securities. That's uncomfortably similar to the conditions following the 1929 Wall Street crash when it was the financials where the crisis looked the most acute - in the US alone some 9,000 banks, representing about half of America's banking capital, failed.
BOX The current crisis and how we're dealing with it