Europe’s leaders have at last acknowledged that their banking system is in trouble. What should they do? It is easier to say what they should not do. They should not airily float rescue plans and then abandon them at the first whiff of controversy. They should not convene ad hoc get-togethers, omitting many of the important players, profess a united front and then abandon it within hours. They should not lurch hastily into guaranteeing the liabilities of their banks, policies which not only threaten to “beggar-thy-neighbour” but, conceivably, beggar the taxpayer too. Admittedly, there has been some nimble footwork to save individual banks, but overall it is perhaps best to draw a veil across the European response over the past seven days.

Unfortunately, it is less easy to turn the page on the crisis itself. Few are now willing to lend to European banks, not least other European banks. The situation cannot be allowed to continue. At risk is the prosperity of millions of blameless European citizens who rely on banks for mortgages or business loans.