THE events of the weekend begin the greatest intervention in the US economy by the Federal Government since the Great Depression, with the Bear Stearns rescue but a splutter on this road we must now travel.

If you were wondering what all the flag-waving at the Republican convention has been about, it is now clear. Americans are waving goodbye to the prosperity the nation has enjoyed since the Great Depression and a final goodbye to democracy. But while preparation for the most important decision made in the nation's post-depression financial history towered above the conventions, I don't think the fate of Freddie and Fannie and the remaining government-sponsored enterprises (GSEs) was mentioned during either convention.

And the politicians. President Bush has long authorised the Treasury to open its purse strings and, naturally, Treasury Secretary Henry Paulson said he did not expect the line of endless taxpayer credit to be used. This is like signing an authority to go to war and saying we don't expect to go to war. Once the authority is given, it will happen. It was always laughable to expect otherwise. Paulson "briefed" John McCain and Barack Obama on the "plan". The fact is that while America, and the world, wait to see who will govern, Mr Paulson has decided to take matters out of the politicians' hands.

They willingly agreed. The ultimate political power, to spend taxpayers' money, has been tossed away. Obviously the economy is too important to be left to the politicians. Instead it is to be put into "conservatorship". It has come to this.

We don't know exactly what "this" is, but all will be revealed before the Asian markets open today. Like all things Paulson has done lately, it is aired in rarefied circles during the week, decided on by Friday, announced on Saturday, the details hammered out on Sunday and a final deal revealed for the Asian markets, which will judge the matter on the Monday morning.