Why the record-breaking falls
Today's fall in stock markets across the world puts us on track to set new records for monthly declines in share prices.
So far this month, share prices in the US and Europe have fallen on average by more than a quarter, those in Asia by a bit more.
Unless there's a sudden bounce, the cumulative monthly falls in October for most major markets will be as big as has been by anyone alive.
In the case of the US, the monthly drop is likely to be the biggest for 70 years. For other markets, where serious measurement of stock-market movements is a younger pursuit, the drops are as bad as any seen since records began some 40 years go.
Why the rout?
Well three things are going on.
First, we're seeing the end of the carry trade, the investment of cheap, low-interest loans raised in yen and dollars for investment in higher yielding financial markets, such as those of the emerging economies, Iceland and - to an extent - the UK.
Investors are liquidating assets everywhere from South Korea, to Argentina, to Hungary, and holding the proceeds in the Japanese and US currencies.
And since so much of the carry trade came out of Japan, the yen has surged to an astonishing extent.
Sterling has been punished, in part because when the carry trade was booming, the UK received a disproportionate amount of this hot money, because our interest rates were always a bit higher than the developed economy norm.
A second phenomenon is the one I described in my note of earlier this morning ("Hungary, Goldman and Regulators"), namely that the conversion of Morgan Stanley and Goldman Sachs into banks is sucking the juice out of hedge funds.
That's forcing those hedge funds to dump assets such as shares, corporate bonds and commodities - which in turn is precipitating further asset sales , as the fall in their prices causes lenders to demand that those who've invested on credit (such as hedge funds) put up more collateral.
Finally, the global economic slowdown has prompted a re-evaluation and re-pricing of risk, in the jargon.
Or, to translate, investors have in the course of 14 months gone from the mad conviction that busts had been abolished to the fear that everything's going bust.
Neither view was rational. But reason doesn't hold much sway at market peaks, when the prevailing emotion is greed, and troughs - when it's sauve qui peut.