Not a single day has gone by this week without some large European company announcing a significant scaling down of earlier investment plans, the shelving of an important acquisition or all sorts of other cost-cutting and restructuring measures. Governments too are suspending proposed privatisations, while industrial companies are postponing capital increases.

The writing thus seems to be well and truly on the wall. The global financial crisis is now biting into the industrial sector and spreading fast into the real economy. The stock markets have been quick to pick up this grim evidence. They briefly rallied at the beginning of this week after European governments announced a massive rescue of their respective banking systems, but they have been plunging steadily ever since.