Watching financial markets these days is akin to rubbernecking at a multi vehicle car crash; the initial rush of excitement and adrenaline gives way to sick sensations of horror and helplessness.

Here are five more signs that the credit crisis is far from over.



Feeling lucky, punk?



Fannie Mae and Freddie Mac should be "credibly and demonstrably privatised,'' Federal Reserve Bank of Richmond president Jeffrey Lacker said this week. Such a move would signal a capitulation on the part of the US government.



"If you have a squirt gun in your pocket you may have to take it out,'' US Treasury Secretary Henry Paulson said in July, when requesting the power to grant unlimited credit to the companies. "If you have a bazooka in your pocket, and people know you have a bazooka, you may never have to take it out.''



Fannie and Freddie's share prices suggest Paulson's attempt to bluff his way out of trouble has failed. The Bank of England, Long-Term Capital Management and Bear Stearns have all learned a variant of John Maynard Keynes's lesson - financial markets can keep pounding you in the head longer than you can stay solvent or irrational.



You know the credit crisis isn't over when the US government may have to turn its sponsorship of the mortgage companies into ownership.



More banks will go bust



"The worst is yet to come in the US,'' Kenneth Rogoff, former chief economist at the International Monetary Fund and Harvard University professor of economics, said this week. "I don't think simply having a couple of medium-sized banks and a couple of small banks going under is going to do the job.''



Rightly or wrongly, Lehman Brothers tops many people's endangered lists. Goldman Sachs this week chopped its third-quarter earnings estimate for Lehman to a loss of $US2.75 a share from a prior 68-cent profit prediction. JPMorgan Chase sees Lehman writing down an additional $US4 billion ($4.6 billion) for the period, leading to a loss of $US3.30 a share.



Lehman is trying to find a buyer for investment-management unit Neuberger Berman, three people familiar with the matter told Bloomberg News. You know the credit crisis isn't over when a bank that has seen its share price plummet 80% this year starts selling the family silver to stay afloat.



Price insensitive



UBS is paying through the nose for its cash. The Swiss bank this week sold 2 billion euros ($3.4 billion) of two-year floating-rate notes, offering investors 95 basis points more than three-month money-market rates. At current rates, UBS is paying about 5.91% for the first three months of money.



Back in November, UBS borrowed $US1 billion for one year, paying just 6 basis points more than money-market rates. In April 2007, the bank sold 1.5 billion euros of five-year notes, paying a premium of just 4 basis points.



You know the credit crunch isn't over when UBS, which Moody's rates just two levels below its top credit grade, with an assessment of Aa2, regards two-year money at almost a full percentage point over money-market levels as worth grabbing.



Suckling on the central bank teat



When UK mortgage lender Northern Rock went bang, it said it was hobbled by not being able to borrow from the European Central Bank. This week, Nationwide Building Society said it will open an office in Ireland to ``further diversify its geographical operations and funding opportunities.''



In other words, the building society will rent a room in Dublin to qualify for ECB funds.



Picture that new Dublin office. There's a single employee, let's call him Harry, persuaded to transfer across the Irish Sea by the promise of endless pints of Guinness. Harry's desk is bare, save for a red telephone with a single number programmed on speed dial that calls the ECB's repurchase agreement desk.



A steaming pile of British mortgages sits in the corner, composting down nicely in preparation for being repackaged as asset-backed bonds and shipped to the ECB in exchange for crisp, freshly minted euros. Harry knows that the ECB is currently lending banks with operations in a euro country about 476 billion euros a week.



You know the credit crisis isn't over when Harry joins the long, long line of funding officers dependent on central bank finance to keep their balls in the air.



'And the loser is ...'



General Motors is scrapping its sponsorship of the Academy Awards this year, said an unidentified GM spokeswoman cited in the Wall Street Journal. Lehman analysts said yesterday that the automaker may need $US7.3 billion of new capital to keep the factory lights on through 2009.



You know the credit crisis isn't over when GM can't afford a measly $US13.5 million to ferry Oscar to and from the red carpet.

Bloomberg