Just when you thought it was safe to go back and put in new share orders… comes a report from that wascally bunch of wadicals the IMF that the private equity market is at much at risk of a meltdown as the sub-prime mortgage market, with potentially greater consequences for global investment.

They say there’ll be a further tightening of credit, that the sub-prime fall is by no means over, and they conclude that a squeeze on credit is going to expose a whole lot of half-completed LBOs with: “In the near term, financial institutions are exposed to potential syndication risks, with unsold bridge commitments contributing to an overhang in the market.”

What the – ? Amazing really that the right attacks cultural studies for meaningless jargon. The upshot is that ovesposed private equity won’t be able to get the money to complete the purchase which will mean an asset sale and then a yet higher rate of credit resulting from the resulting fall in confidence – or “haircut contagion” as the IMF calls it, stealing a band name I was going to use.

But what’s really going on? There’s no point asking bourgeois economists – their ideas are to reality what a Mazda engine manual is to quantum mechanics. A great way to run very specific parts of the world, while actually understanding none of it.

The huge amounts of money sloshing around the West – private equity at one end, house price inflation at the other – is not a result of prosperity, but of sluggishness. As Robert Brenner has demonstrated, real Western economic growth has been no more than 2% per annum for decades now, and that is effectively going backwards.

You can count pet shampooing and wedding planners in GDP if you want to – it doesn’t mean that $1 billion of them is real compared to $1 billion worth of steel mills in China.

Yes, there’s the multiplier effect etc etc, but sooner or later the bill comes in and it’s revealed that large sections of the economy are guaranteed against nothing.

That doesn’t mean a capitalism-ending crisis anytime soon – as the post-marxian economist Phil Shannon has noted it’s the mildness of recent reversals which are interesting, not their crisis nature.

But it does mean that the abiding illusion – that because you invest in something physically solid like a house it will retain and grown in value – is over. Or should be.

But what greater more cherished illusion has there been for millions of Westerners that they have somehow got out of the trap of work without accumulation? And how will they cope with its demise?