In its quarterly report the CBI, the official Voice of British Business , has forecast that the UK's Financial Sector will shed 10,000 jobs over the next 3 months as the sector struggles to readjust to the credit crunch, the global instability triggered by huge losses on investments backed by US mortgages.

CBI Chief Economist Ian McCafferty said "This is a very serious crisis - some have suggested it's the worst financial crisis since the Second World War".

The employers organisations quarterly survey of the financial sector found that most companies believed  the credit squeeze would get worse in the next six months.

The CBI report held back from saying  that the UK economy is freefalling into recession but acknowledged  that finance jobs are already being cut.

In Hong Kong, Asian shares plunged  Monday posting their worst quarterly performance in over five years as the region struggles with the same credit crunch problems and the impact of weakening U.S. consumer demand on Asian exports.

In the U.S. the Federal Highway Administration  confirmed that Americans had responded to record gasoline prices in 2007 by cutting back on driving with ( effectively ) travel journeys falling 3.9 % , the largest reduction in 20 years.  

With gasoline prices still rising, other data shows Americans are responding by changing their gasoline consumption habits in other ways. Not only are they driving less, they are buying more fuel-efficient vehicles and utilizing more public transportation. Daily commuting  on U.S. subways and public buses is at the highest level in more than 50 years.

Hit hardest by rising gasoline prices are businesses forced to rely on road transport , particularly small businesses that are not so able to pass on rising transportation costs to customers.  

Over the weekend oil prices looked  set  to stabilise some with news of a negotiated end to or at least postponement of the Shiah rebellion in oil producing Iraq but the failure of Iraqi Prime Minister Nouri al-Maliki's  last ditch attempt to impose order on Shiah militias loyal to Shia cleric Moqtada al-Sadr doesn't bode well and  reminds us of the link between failed US foriegn policy and global recession and the extent to which so many of our current economic woes have been  self inflicted .

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