Nearly 800 points.

Today the market got a knife in the gut. To most of us this is relevant to our 401(k) funds. But the truth is, the market's reaction is a much bigger indicator of a much, much bigger problem: Credit is about to become more scarce than a jackalope.

Credit is the grease on which the economy's engine functions. Without it, any economic engine quickly grinds to a halt.

A figure to keep in mind: 700 billion. That is the amount of cash that is in circulation at any given moment. That is the size the U.S. economy will plummet toward if the credit markets do not get liquid. To give you an idea, the U.S. economy is currently estimated to be 13.84 trillion. 700 billion is not a very big percentage of that. This is an oversimplification but, the point is valid. Unless someone with enough resources (i.e. the Treasury, the only group with enough resources) injects some liquidity into the credit market, we are in a world of hurt.

Without credit, we move fast toward becoming a cash economy. We simply can't do that. Imagine living out the next 3 or so years on the money in your savings account.

So, for a bit more reading, I offer up this economists take: http://www.dailykos.com/storyonly/2008/9/29/143536/436/784/614495

She's a bit condescending and drops the f-bomb more than I'd like but I guess desperate times call for desperate language.