Meanwhile, at a presentation before the US Senate's Banking Panel, Bernanke said, “We do have some concerns that the combination of losses by banks which reduce their capital and the expansion of their balance sheets as they take on, they are unable to securitise their loans, have made these banks extend less credit than they would under normal circumstances. We think that this is going to be a drag on the economy.”

Steve Liesman of CNBC said, “If you read Bernanke’s testimony and think where we are in the economy; and he said things could get worse - the next step from 1% growth is negative growth. He downgrades more concern about banks and their effect on the economy. Congress seems to be getting impatient with Ben (Bernanke) and Paulson (Treasury Secretary, Henry Paulson). We are tired of coming in every day and getting surprised by a new derivative with a new abbreviation we've never heard of”.

Ron Insana, Insana Capital Partners said, “Credit crisis is so virile and it is spreading so quickly to all corners of the credit markets and as we talked of the auction rate municipal bonds - where we talked of the failure of some of the bonds banks failing to take the overflow when the investors don’t buy; let’s say the NY port authority bonds. We will have another credit crisis. I think when this is all said and done, the Fed will have to be the Bank of Japan and go to zero interest rate policy to re-inflate our way out of this thing. I think this is far bigger, far more misunderstood than anybody knows. This is a real crisis of historic proportions and still no one is paying full attention and no one knows how to play this game.”