Slowly but surely, a growing number of people -- except equity investors and Wall Street "strategists," many of whom appear to lack the brainpower necessary to figure such things out -- are coming around to the idea that there is something highly unusual about what is happening on Wall Street and Main Street.

Instead of another brief crisis that quickly blows over -- aided, perhaps, by the supposedly all-powerful Federal Reserve -- and a garden-variety downturn that rumbles by without causing too much damage, we have a lingering and contagious disaster in the financial sector that is wreaking widespread havoc in an already unraveling economy.

Such circumstances bring to mind an earlier, more dangerous time. In fact, according to a report in the Scotsman, "Slowdown Echoes Great Depression, Says Bank's Deputy Chief," even central bankers are beginning to acknowledge that the once unimaginable is now a very realistic possibility.

The severity of the current economic downturn has been likened to the Great Depression of the 1930s by the new deputy governor of the Bank of England.

The slowdown, which has threatened to plunge the world's major economies into recession, was likely to drag on for "some time", according to Charles Bean, Britain's second most senior banker.

And he raised the spectre cited by other economists that the combination of market upheavals and soaring oil prices could trigger conditions similar to the depression that started in the late 1920s and dragged on for a decade.

His warning came amid reports that the International Monetary Fund (IMF) has scaled back forecasts for global growth made just a month ago.

The IMF is predicting world growth of 3.9 per cent in 2008, compared to the 4.1 per cent estimated in its July World Economic Outlook. It also forecasts growth next year of 3.7 per cent instead of 3.9 per cent.

"It's fair to say that if you look at the shocks impinging on us this is at least as challenging a time as back in the 1970s," Mr Bean said at the annual conference of the world's top central bankers in Jackson Hole, Wyoming.

"Some people have said it's as big a financial shock as the Great Depression and as far as the oil shock goes the rise in oil prices is in the same order of magnitude that we had to deal with in the 1970s."

"Last year this was a financial crisis that we thought with a bit of luck would be over by the time of Christmas, but it has dragged on for a year and looks like it will drag on for some considerable time further yet," he said.

He and his colleagues are facing the biggest financial challenge of the last 40 years, with the threat of a slowing market and rampant inflation conspiring against the Bank to immediately cut interest rates.