In the Middle Ages, the financial crisis that has devastated Wall Street would no doubt have been likened to the wrath of God that destroyed Sodom and Gomorrah. One of America's biggest banks, Lehman Brothers, has filed for bankruptcy, throwing thousands out of work (including up to 5,000 at its London subsidiaries) and threatening a dangerous chain reaction throughout the global financial system. As in the story in Genesis, so in the twenty-first century, the root cause of this sudden reversal of fortune was pride, arrogance the sense of being able to act like Masters of the Universe. Indeed this is the title used, only half ironically, to describe the self-regarding financial dealers whose excesses lie at the core of what has gone wrong now. The retribution they face, if not explicitly divine in origin, is providential, for the financial system they had manipulated for their own ends had become unstable. A corrective, however painful, was overdue.

The fate of Lehmans was a dramatic demonstration of the principle of moral hazard in financial markets. Those who take large risks should have to face proportionately large consequences if things go wrong; it is moral hazard to remove risk by removing those consequences, for instance by Government intervention, thus encouraging irresponsible behaviour. That has been one of the major arguments against interfering to alter the natural outcome of market forces. But another principle has had to be given even higher priority: that governments have to ensure that financial systems do not collapse altogether. The American authorities calculated that the meltdown of Lehman Brothers, notwithstanding the colossal scale of the sums involved, was not worth preventing, and turned off the tap. But the British authorities, faced with a similar dilemma when Northern Rock defaulted last year, decided the effect on public confidence in the banking system would be too severe if events were left to take their course, and took it into public ownership. ...

Stephen Hawking's bestseller, A Brief History of Time, concludes with the passage that made the book famous. If a complete theory of subatomic physics were ever reached, he wrote, people would then be able "to take part in the discussion of the question of why it is that we and the universe exist. If we find the answer to that, it would be the ultimate triumph of human reason - for then we should know the ...

It may not decide who is to become the next President of the United States, but abortion is once again a hot issue as the 2008 election campaign is launched at the conclusion of the two party conventions. As during the campaign between John Kerry and George W. Bush four years ago, so attention has again focused on the Catholic vote - approximately a quarter of the whole - and how it will be affected by the strongly ...

It is refreshing to have a bishop who unburdens his mind as candidly and comprehensively as Bishop Patrick O'Donoghue has done in his latest contribution to a series of papers he has been publishing on the state of his diocese, Lancaster. Most of the bishops play their cards so close to their chests that it is hard to know what they think. Indeed, this is one of his points. He says individual bishops should feel ...

From Chris Hoy to Bradley Wiggins, from Rebecca Adlington to Christine Ohuruogu, British athletes have adorned the winners' rostra at the Olympic Games in Beijing, accumulating an almost unimaginable tally of gold medals. By the time The Tablet went to press, the Olympic medal table showed that Great Britain had won more medals than its chief sporting rival, Australia. It is the largest haul of medals for Great ...