Think about the current and potential future pressure on our largest banks like this.  The underlying problems are deep, but the “run” comes from the credit default swap market, and presumably from experienced professional investors – many of whom used to work in the largest banks. 

The big banks helped set up these markets.  They trained many of the people who are now engaged in speculative attacks on these banks.  And the excessive bonuses of yesterday form the capital base for many hedge funds that now lead the attack.

In my Economix column at NYT.com this morning, I explore the ironies and emphasize the dangers.  The system may have a tendency to self-destruct, but don’t think that the costs to the rest of us will be anything less than huge.