Greek banks are desperately in need of a lender of last resort to save them, and the Greek economy.

And - sad to say - no banker or central banker to whom I have spoken believes the European Central Bank can fulfill that function - because it is struggling to prove to itself that Greek banks have adequate assets to pledge to it as security for new loans.

There are only two options. The Bank of Greece could make unsecured loans to Greek banks without the ECB's permission - which would provoke a furious reaction from Eurozone leaders and would be seen by most of them as tantamount to leaving the euro.

Or it can explicitly create a new currency, a new drachma, which it could then use to provide vital finance to Greek banks and the Greek economy. This huge risk, of Greek exit from the euro, is tonight preoccupying governments, central banks and investors all over the world. Tomorrow will be a very hairy day on markets.

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