Just over a year ago, Bob Hullinghorst, treasurer of Boulder county, Colorado, put a chunk of the local government's cash into an American money market fund. A financial industry veteran himself, Mr Hullinghorst assumed that was a safe place: the fund had a top-notch credit rating and, unlike the obscure structured derivative products that had been troubling Wall Street since the previous August, it was an entirely mainstream type of investment.

But then Lehman Brothers collapsed. The fund he had chosen turned out to be holding Lehman paper – and Boulder lost almost $700,000.

“It was shocking – $700,000 could have funded lots of primary healthcare,” Mr Hullinghorst laments, adding that the experience has shaken his faith in the whole “system of finance and investment”.