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It is tempting to believe when the credit markets are in turmoil and the banking world is coming apart at the seams that this is the only thing happening in the world.
But as the head of Capital Economics, Roger Bootle, pointed out at his firm's annual conference in London this week, the world economy has been subjected to not one but two shocks.
The first is indeed the credit crunch and everything that goes with it. But the second is the price of oil, which doubled in a matter of months from $70 to $140.
It is premature to be cheerful about any early resolution of the credit crunch, born as it is of a complete collapse of trust between the banks. That trust will be thin on the ground until they can put a value on their toxic assets so outsiders can judge how healthy they are.
Unfortunately, this is something they cannot do. It is not that they are seeking to avoid the issue — they have gone past the denial phase.
It is simply that these assets are so complex in the way that they have been sliced and diced and put together with a little bit of each of 10,000 or more mortgages that it is impossible to trace a path back through the paperwork to its underlying origin as a loan on a house in Memphis and thousands of similar places.
Homer in Memphis may still be paying up on that mortgage, but the asset-backed security is so opaque that it takes forever to work out how much the holder has of Homer, who is good for the money, and how much he is exposed to the hundreds of others who have long ceased paying.
Contrasted with this, the oil price is delightfully simple and, according to Capital Economics, unalloyed good news.
It attributes the $80 surge in the price of oil earlier this year to three distinct and separate things — the weakness of the US dollar, which was worth $20, the excess of demand over supply, worth $40, and the impact of financial speculation, also worth $20.
Now everything has turned the other way. Western demand has fallen so the supply gap has closed, the dollar has strengthened and the bulls have become bears.
As a result, oil has fallen sharply and will continue to do so. Capital Economics says it should go to $80 but there is an outside chance of it going right down to $50, or even $30. Transformational stuff indeed.
I have said before that Jim O'Neil of Goldman Sachs reckons what happens to oil matters more to the global economy than the credit crunch does.
If Bootle's gutsy forecasts are even half right, the economic outlook is a lot better than the bleating, beleaguered bankers would have us believe.
Realism at last for the City folk
It is some weeks now since the first estimates appeared that the current financial crisis would lead in time to the loss of perhaps 100,000 city jobs as employment levels and activity basically fall back to where they were about 10 years ago.
We have no way of knowing how accurate this is, but clearly the pinch is being felt most obviously with firms such as Lehman that have collapsed, but also with the likes of UBS, which announced this week the cutting of 2000 jobs on top of 4000 that have already been shed since the bank first got into difficulties.
In fact, most organisations have been quietly trimming activities and letting people go, not in large enough numbers to attract a headline, but in dribs and drabs which collectively quite quickly add up to quite large numbers.
We can expect similar quiet attrition in the next few weeks and months from fund management groups, hedge funds and private-equity management companies. Business has dried up for all of them and if management has to cut costs, the employee pool is really the only place to go.
Though it has been a long time coming, the financial shock has at last changed the attitude of employees. Surprising though it may seem to those who don't work in the banking or securities industries, the first year of the credit crunch made very little difference to people's attitudes to pay.
They still expected a handsome bonus at the end of the year if their own area of activity had continued to do well. They refused to countenance a move to another firm unless their still-to-be-paid bonus came too.
But, headhunters and employers tell me, the mood has changed dramatically in the past month, since the pyrotechnics began in earnest.
Now employees may be disgruntled that their own share incentive schemes are under water but instead of using it as an excuse to move elsewhere, many have come to realise that they are lucky still to be employed.
For the first time in years, having a job matters more than having a bonus.
It is a shame that it has taken a near-meltdown of the banking system to bring about this change in attitudes but City folk are at last getting realistic about how much they are worth and how much (or how little) they should be paid.
