The linchpin of this financial crisis has been “super-senior” investments backed by subprime mortgage securities and derivatives. These securities were labelled “super-senior” because they were viewed as ultra-safe and secure, protected by so much extra collateral that it would be an understatement to call them merely “senior”.

With the latest bail-out of Citigroup this week, the US government has embraced the “super-senior” methodology for its own balance sheet. It will now proudly hold a “super-senior” position in Citigroup’s most troubled assets. Commentators have praised the government’s new approach and financial stocks rallied along with expectations of similar deals from other banks.