It seems like years ago when government ministers told us that the Northern Rock was a solvent institution and that our financial system was fundamentally sound.
Now, a source "close to the government" is telling the Daily Telegraph that more money is needed for our two state owned banks - NRK and the B&B. The story suggests that the government might need to inject a further "£2 billion pounds to £3 billion." This comes on top of the £3 billion the government has already injected into NRK as additional capital.
It is now painfully obvious that NRK was effectively bankrupt back in the summer of 2007. It had a rotten portfolio of mortgages that are now quickly deteriorating into a pile of bad loans.
Today's story in the Telegraph is a classic "bad news management" trick. The story starts out as a rumour, and then when all our rage has been dissipated on the rumour, the government quietly releases a confirmation.
Before this crisis is over, the government will make liberal use of this tactic. There is a lot more bad news to come for UK taxpayers.