Commentary: They just can't let Halifax go down in Britain

It is that last phrase that gives a clue as to why AIG was in so much trouble - the firm has long ceased to be a straightforward insurer, using its customers' premiums to ape many of the biggest Wall Street banks.

But because of its links to households across America and the world - and the shocks it would send throughout the insurance markets - the idea of letting it go down was too horrific. AIG could not be allowed to fail.

For that reason as well, it is inconceivable in this country that HBOS can go down. It's a bank, not an insurer, but through the Halifax, the UK's largest mortgage lender, it touches the lives of millions.

As with AIG, its troubles stem from a management overreaching themselves: instead of sticking to the time-honoured system of collecting savings with one hand and paying out loans with the other, they decided to speed up the process and borrow on the international money markets - something that Northern Rock also did.

In the Bank of Scotland part of the group, too, they had a bank that was aggressively backing buyouts and takeovers, many of which involved the property industry. That industry has bombed and suddenly, BoS does not look so clever.

Some sort of rescue package, possibly involving other high street banks - the much more cautious HSBC and Lloyds TSB are obvious candidates - is almost certainly being prepared should HBOS continue to be hammered by speculators short-selling or betting on its share price falling.

A clear theme is beginning to emerge. Those City institutions which enjoyed huge profits and bonuses from expanding rapidly - usually by diversifying into other areas - are in serious trouble. The market is all too aware of who they are and confidence in them is draining away. They are having to turn to politicians and officials to bail them out. The City slickers are getting their comeuppance.