THE headlines say it all. ‘The Nightmare on Wall Street’, ‘Meltdown Monday’, ‘Crash, bang, wallop’.

A chilling reality has dawned after the fall of two of the world’s biggest banking superpowers in the most disastrous 48 hours the financial world has endured since the Wall Street Crash.

Financial markets are braced for more turmoil as the shockwaves from the Lehman Brothers collapse continue to be felt around the world. Those elements of the shipping industry lucky enough not to be already directly affected are unlikely to escape inevitable aftershocks that are already rippling across the markets.

But as the financial analysts start to pontificate over the death of Wall Street as we know it there seems to be a sliver of hope amid the panic that this could finally mark a return of realism.

The era of big risk taking could well be at an end and that is not necessarily all bad new for shipping. With banks likely to be heading towards a ‘back-to-basics’ mentality, the foundations of a more pragmatic culture of financing is being laid.

Assuming the markets can survive such a violent correction this could be a positive force for change, and not before time.

The credit crunch is taking its toll on the shipping industry but sensible well constructed deals are still getting through. Margins are up of course and deals taking longer to bring to market, but we are not in meltdown yet.

When the dust settles and the big risks, heavy borrowings and ludicrously complex securities of the recent past are abandoned, we can only hope that the core avenues of judicious banking are left open to the shipping industry.