Oops, that didn't come out right .The reason banks everywhere are loath to lend to each other, is that they have no idea where their money will go.

Eventually, through an indirect route of smoke and mirrors called derivatives, a bank is bound to finish up with an unwanted investment - make that, write-off - in some dud US mortgage. It, and I mean either the bank or the mortgage, will then be bought by the US Treasury.

Naturally we won't get much sense from the sharemarket until the $US700billion ($840billion) bailout of Wall Street by buying its dud debt is approved by Congress. We may not get much sense after either.

It will take a lot more to fix the problem of undercapitalised institutions caused by low interest rates that fuelled a debt boom. Prudential standards in the US are clearly slack and liquidity is just getting tighter.

Frankly, the economic fallout hasn't even begun yet.

While the headlines are on the big money firms of Wall Street, which are imploding at a rate that would put the NSW Labor Party to shame, the real problem is the increasing inability of business, especially the job-generating smaller firms, to borrow from banks.