US treasury Secretary Hank Paulson is working this weekend. Should we be worried?

At first glance yes, because he will be talking about the mother of all bailouts, the big one: removing all those dodgy loans from the balance sheets of American banks and other financial groups.

It’s the news that saved Wall Street and life as we know it: Bermuda tax havens, trips to Snowmass or Whistler this winter, winter in Jamaica, you know, all those things that needy investment bankers and their crowd really need preserved.

And yet it is serious, and a sensible move.

The Treasury Secretary and Federal Reserve Chairman “pledged to work through the weekend on a plan requiring legislation aimed at alleviating the credit crisis,” according to Bloomberg. Sounds dramatic, perhaps they are going to develop a 12 step plan for bankers on avoiding debt! Debtors Anonymous

They are going to be starting the political sell for the idea of a super fund along the lines it seems of the RTC in the Savings and Loan debacle in the early 90s. It was called the Resolution trust Corp and it bought up bad assets and sold them off to raise cash.

The plan is to help financial institutions remove illiquid mortgage-related assets from their balance sheets. Let’s hope there is some sort of punishment for the financial groups, their management and boards if they are bailed out, and not just financial punishments either.

Two bankers went to jail in the Depression as high profile lesson to generations of other bankers who followed. That message needs repeating.

Earlier, the Fed gave central banks in Japan, the eurozone, the UK, Switzerland and Canada billions to lend on to local banks that cannot access its onshore dollar lending facilities. Some of those foreign central banks said they would establish term auction facilities like the one developed by the Fed to the value of $US110 billion to roll cash into their financial systems until late January at the earliest.

The Fed’s statement was made at 3am Washington time Thursday, right as European markets had started trading, and as some in Asia were finishing, but not Australia, Japan or China.

The central banks said they were taking “co-ordinated measures designed to address the continued elevated pressures in US dollar short-term funding markets”. They promised to “continue to work together closely” and to take “appropriate steps to address the ongoing problems”.

It was a way of ending the shortage of US dollars in Europe, Japan and the UK which has led to the sharp rise in short term funding rates and the drying up of all lending.

But we should look at all of this another way:

While Hank, Ben and the others are spending the weekend in Washington, the US baseball season is drawing to a close, the American football season is underway at College and professional levels, basketball is about to start, while in Europe, soccer and Rugby Union is in full blast and here Australia we are in finals fever for the AFL and Rugby League.

For all intents and purposes its “what credit crisis” from the majority of the populace around the world. For those interested in ruining a good walk on a grassy knoll or in a bunker or three (Macquarie Bank perhaps), the Ryder Cup gold bloodbath is on this weekend in a competition whose intensity rivals a world cup final.

The dichotomy between the worst financial crisis for the world since the depression (exempting the dislocation of the Second World War which were special) and the wider societies of the US, Europe, the UK and Australia and Asia remains stunning.

In the UK there’s of course the cursory worry about the fate of the markets as we know them, but there then the question about whether AIG’s failure and takeover will imperil the 56.5 million pound sponsorship of Manchester United by AIG, and whether a failed UK travel company will continue to sponsor West Ham (no) and will Northern Rock continue to appear as a main sponsor of Newcastle (yes, but Newcastle is imploding for other reasons. Quick, call a central bank, the Fed preferably!).

Russia’s stockmarket freeze and credit crunch raises questions about just how rich are Russian sporting club owners, such as the bloke who owns Chelsea, and the one who owns Toulon, the French Rugby side where Sonny Bill Williams ran away to joint.

But the are all stories for another day. Is it true that Man United has a new sponsor in place to replace AIG?