The financial crisis struck the US harder and faster than it did Europe. The freezing of credit markets required immediate, overwhelming intervention – and the US authorities delivered it, arranging around $13,000bn of credit support for financial institutions in late 2008 and 2009. There was no alternative, and it worked. US credit markets are now healthy, and the recapitalised banking system stable. History will look favourably on the boldness of America’s response.

In contrast, the European Union has had more time to strengthen its financial institutions but has developed none of the necessary tools. Not a powerful and flexible central bank. Not an effective central banking regulator. Not a sufficient political consensus. As a result, a deepening sovereign debt problem is now a fullblown banking crisis.

The Franco-German commitment to produce a bank rescue plan by November 3 is a golden chance for Europe’s leaders to redeem their fading credibility – especially if they learn from America’s intervention.