The Big Picture

Vincent Boland: Who should lose when banks fail?

With the next meltdown in the banking sector most likely in the offing, the handling of the last one has left lingering questions about whether, and how far, deposit guarantees should be extended

Credit Suisse: the emergency takeover of the Swiss giant by rival UBS last month was a traumatic event, but it had little impact on markets. Picture: Michael Nagle/Bloomberg

At the height of the banking sector’s mini-meltdown last month, when two sort-of-important US banks collapsed and there was an emergency rescue of a really rather big and important European one, there was a lot of talk about whether the doomsday scenario that was surely ahead represented a Minsky Moment.

A Minsky Moment is defined as the sudden collapse of the stock market after a long period of unsustainable speculative activity fuelled by high levels ...