After hanging tough through the US default crisis, global financial markets finally lost the plot yesterday as European Union officials admitted the grand Greek debt deal they did last month wasn't going to be enough to ensure the crisis won't spread to Italy and Spain.
The problem with the Greek solution of July 21 was that it was presented as a kind of "shock and awe" bailout that would kill the debt contagion.
It stretched the resources and commitment of the wealthier European nations and creditor banks - so it needed to work or there was going to be some major fallout.
It was predictable that it wouldn't and many commentators were sceptical from the outset. The panic over the last two days has probably been an over-reaction but that is what happens when fear takes hold.
The markets did well to ride out the US default crisis but it was as if the nerves of investors were shot by the end of it.
In the US, markets slumped on Tuesday on bad economic data even as President Barack Obama was signing the compromise solution into law. The US crisis - despite involving staggering sums of money - was first and foremost a political crisis.
US comedian Stephen Colbert summed it up most most succinctly after the deal was done: "We didn't default! I haven't been this excited about averting a voluntary disaster since the time I didn't stick my hand in a paper shredder."
But it was underpinned by more serious stuff and the fact that the US had to raise a US$14.3 trillion debt ceiling isn't particularly funny.
America's solution buys it some time but on current form we should be back across the Atlantic fretting about the US again just as soon as the latest cracks in the European economy have been papered over.
This isn't global financial crisis mark two. This is the same old financial crisis that has never been resolved. It will continue to lurch around the world like a drunken gatecrasher until the Western world unwinds its debt position.
Based on the general reluctance of politicians and the public to tackle that head-on, it is likely to be with us for some years yet.
Whether this latest meltdown will bring with it a double dip into recession for Europe or the US is another matter. That won't be clear for a while yet.
The risk for New Zealand is that the fear and panic hangs around long enough to further dampen global demand for commodities.
There is also a risk that one of these days the panic kicks off on both sides of the Atlantic at once.
If Europe is still fretting about Italy and Spain when the US is hit with a ratings downgrade, for example.
But that might not happen. European leaders may be able to reassure markets again and move the debt problem further on down the line. Already European Central Bank President Jean-Claude Trichet has tried to calm things with a reminder that mechanisms for another round of money printing are still in place and could be used.
That's a doubled-edged sword. For every market player feeling reassured there was probably another two panicking about the fact he had to mention it in the first place.
Each time the financial crisis flares up in the media spotlight it must test the patience of the public who are bombarded with warnings the end is nigh.
But even if these events don't boil over into the worst-case scenario catastrophes, they remind us there is still no evidence of a real recovery in the Western world.
That's the real disaster.
Our expectations of the world have changed so much that it is pointless comparing the miseries of the current economic malaise with the grim days of the Great Depression.
But as we approach the three-year anniversary of the Lehman Brothers crash and see world leaders still relying on solutions involving borrowing, bailing-out and printing more money, other comparisons are starting to look valid.
It is apparent we are still trapped in a vicious cycle with no immediate solution on the horizon.
If there is an upside it is that New Zealand's economy is considered one of the most robust in the world.
The dollar may have slumped yesterday but the traders turned their attention to what they see as the relative safety of New Zealand government bonds which soared.
It's nice to know the world has confidence in us - but it may be cold comfort to the thousands of New Zealanders struggling to make ends meet and waiting patiently for a return to some sort of meaningful economic growth.