The speedy manoeuvres by the Dutch/Belgian/Luxembourg authorities to rescue Fortis bank were, says Willem Buiter writing on the FT site, a "great day for Europe":

The ability of the euro area fiscal authorities to co-ordinate on a bail-out for a bank with not-only strong cross-boundary operations, but indeed with a strong multi-national (almost supranational) identity was untested until today. 

They passed the test.  Everyone who mattered, the national monetary authorities, the President of the ECB, the national regulatory authorities, the three national ministers of finance and the President of the Eurogroup chipped in and played their part.

More:

Especially remarkable is the fact that it took much less time and effort to put together the multi-country fiscal rescue effort of the three EU member states than it took to cobble together the son-of-TARP in the US.  Incipient federalism triumphs over disfunctional established federalism.

Yet the problems just keep growing, as Ambrose Evans-Pritchard describes:

The euro plunged on Monday as the wave of bank failures hit the newswires, dropping 2pc to $1.43 against the dollar. It recovered slightly as the US Federal Reserve flooded the markets with $630bn of dollar funding with fellow central banks in the biggest liquidity blitz in history.

Analysts say German finance minister Peer Steinbrueck may have spoken too soon when he crowed last week that the US would lose its status as a superpower as a result of this crisis. He told Der Spiegel yesterday that we are "all staring into the abyss".

Oh lordy:

Mr Redeker said the latest alarming twist is a move by banks to deposit €28bn in funds at the European Central Bank in a panic flight to safety. This has jammed the mechanism used by the authorities to shore up the financial system in a crisis.

"The ECB is no longer able to inject liquidity because the money is just coming back to them again. This is extremely serious. If monetary policy is no longer working, there is a risk that the whole system will blow up in days," he said.

Hard to keep enthusiasm for blogging as the roof crashes down on one’s head…