You might think events in the American money markets are not a priority after the week that the UK has been through with the collapse of Thomas Cook, the Supreme Court judgement and disorderly scenes in the Commons.

But if we think back 12 years, the first signal of the financial crisis to come was the shortage of liquidity (cash) in the money markets, where banks and financial institutions lend to each other.

The distrust and distress led to a credit crunch which forced central banks to intervene. The European Central Bank stepped up first after a big scare around the safety of some funds run by BNP Paribas.

Plumbing failure? In the days since September 16, the US Federal Reserve has been pumping hundreds of billions of dollars into the US money markets on a daily basis

But this was rapidly followed by the Federal Reserve in the US, and a similar operation by the Bank of England, when Barclays was subsequently outed for being short of cash.

In the days since September 16 we have seen something similar on Wall Street, with the Fed pumping hundreds of billions of dollars into the US money markets on a daily basis.

Its actions have been attributed to a plumbing failure, and the message is that nothing serious is wrong.

Much the same was said at the time of the credit crunch before the full horror of mis-selling of US mortgages and their conversion into dodgy high yielding securities emerged.

Post the crisis, the capital of the banks was fixed, tougher capital rules imposed and 'resolution' regimes devised to wind-up bad banks.

None of this has eased the appetite for risky debt. Corporate borrowing stands at 150 per cent of the US's total output.

Syndicated business loans have soared, and at the end of 2018 stood at $1trillion. Much of this highly leveraged debt is of junk quality but attractive to investors because of high yields.

We saw an example of this in the UK this week when Aston Martin launched a do-or-die £120million bond with a 12 per cent coupon to pay for investment in a sports utility vehicle.

Debt from the corporate-lending bonanza has been securitised and parcelled out to investment and pension funds.

Japan and Korea have been big buyers of these securities and have hedged the exchange rate risk. In a crisis it is not just the underlying securities which could go wrong, but the insurance too.

No two crises are the same. But the pattern is similar, as the late JK Galbraith observed.

'All crisis have involved debt that, in one fashion or another, has become dangerously out of scale in relation to the underlying means of payment,' said the Canadian-born economist.

The current imbroglio in the US money markets may be no more than a storm in a teacup. But there are suggestions that the extra Fed operations are necessary to avoid a major financial failure.

If that is the case it is to be hoped that Jay Powell and his colleagues at the Fed are as alert as a previous incumbent Ben Bernanke at the onset of the great crisis.

Losing patience

By now, dear reader, you will know that I have more than a passing interest in Neil Woodford's quoted Patient Capital Investment Trust.

When buying the shares, I was under no illusions that gains might take some time. The clue is in the name, and Woodford's interest in bio-tech, fintech and other breakthrough technologies looked very exciting.

What I didn't know was that Patient Capital would be run as the poor relation of his flagship Equity Income Fund, and was a dumping ground for holdings surplus to requirements.

Crisis: Woodford's Patient Capital has seen its share price fall this week

Nor was it obvious that chairman Susan Searle and much of the board were conflicted because they were also directors in companies in which Patient Capital had invested.

The result has been a startling collapse in Patient Capital's share price and a huge 35.5 per cent discount to net asset value.

Shareholders should insist he is fired as fund manager at next Monday's annual general meeting.

Poor value

The September edition of Hargreaves Lansdown's Investment Times magazine has just come tumbling through my letterbox.

HL's formerly favourite fund manager, the aforementioned Woodford – a quarter of Hargreaves investors have money in his funds – doesn't get a mention.

There is an encomium from the head of analysis, Emma Wall, to value investing, described as the art of finding stocks that the rest of the market overlooked.

Wasn't that Woodford's core skill?