This is unheard of, the money markets should be the engine driving the financial system but they have broken down. Any institution that hasn’t completed its 2008 funding needs by now is going to be in very serious trouble. More banks are going to need to be bailed out.

—Kornelius Purps, a fixed-income strategist in Munich for UniCredit

Counterparty fear in the banking sector is at a new extreme. Credit conditions are as tight as a drum. Unless this settles down, central banks would need to cut rates globally to bring funding costs down.

—Greg Gibbs, director of currency strategy at ABN Amro Holding Bank NV in Sydney

The fact that house prices quickened their slide before the worst point in credit markets hit this month does not bode well

—Derek Holt, an economist at Scotia Capital Inc. in Toronto.

US to face Recession, regardless