At times of crisis, discriminating between a liquidity and a solvency problem is notoriously tricky. Indeed it is impossible so long as investors' fears cloud their ability to judge the value of things.

To an extent, value is as value does. An object's value is based on the amount at which the buyer agrees to buy and the seller agrees to sell.

But what if the seller thinks he is buying a Picasso, when it's really a dud? This is, of course, the market for lemons problem, which George Akerlof made