Social historians will record this week as one when unhappy shoppers began discussing the potential collapse of western capitalism in the same breath as butter prices. The credit crunch that began in the US came home to roost in the UK with Lloyds TSB’s government-sanctioned rescue bid for Halifax Bank of Scotland.

The realisation that Britain’s biggest mortgage lender had risked insolvency has shifted the public mood. Before, perplexity predominated. Now many ordinary people are angry with the bankers they regard as having blown national prosperity on the roll of a dice.

Anger erupted from Israel Rainford, a young black man, one of about 50 people interviewed by the FT over the past two days. Mr Rainford, who was visiting a Birmingham job centre, said: “It’s the fault of the bankers that we are where we are. They were stupid. They should have had more reserves.” For two years, he earned £24,000 a year as a painter on building sites. A fortnight ago, he was made redundant. “They said it was the recession.” Now he gets £47 a week Jobseeker’s Allowance. He pointed to a gleaming Mercedes gliding by: “Look at the money that is still around.”

Contrasts were equally stark for Orsi Faludi, an economic migrant trudging through wealthy Hampstead in north London. She lost her waitressing job in May. “If I don’t find work in two weeks I’ll lose my home,” she said.

The Waitrose supermarket in Harborne, a smart Birmingham suburb, was selling char-grilled vegetable pizzas alongside newspapers whose headlines lashed a US hedge fund manager as a “greedy pig”. In the car park, Kate Organ, 53, a freelance arts manager, described her mood as “wretched and disempowered”. She expected her income, currently £30,000 a year, to dwindle. She said: “When I was at university, the Workers’ Revolutionary party harangued me that capitalism would collapse. Now I know what they were on about.”

Outside a Lidl supermarket in Newcastle, George Smith, a local builder, decried the “London banks” that “sold Northern Rock down the river”, accusing them of leaking smears against what had once seemed an impregnable local bastion. “They let us sink so they could swim, but now they’ve been caught out, too,” he said. His wife Linda added: “Too many people at the top have been getting paid too much.”

A former Lehman Brothers banker, interviewed near Canary Wharf in east London, had different villains in mind: the US Treasury and Federal Reserve. In search of the sympathy that has been in scant supply for her industry this week, she said: “People think bankers face no problems, but it’s not like that.” Her equity investments had evaporated, she lamented.

Donna, an HBOS employee writing on an internet message board, accused alarmist journalists as well as traders of driving down bank stocks: “I will probably be out of a job now. Thank you, media and speculators, for ruining my life! How am I going to pay my mortgage?”

In Leicestershire, Penni Harrison, an entrepreneur, fears losing her home. She has £15,000 in debt from two failed businesses and “very little income”. Her troubles are a microcosm of the mess engulfing investment banks, but she said: “We were led to believe that the higher echelons of finance knew what they were doing.”

The mortgage drought has frozen the housing market, with buyers and sellers unable to complete transactions. Tracy Guy, 25, an administrator at Sotheby’s auction house in London, who had hoped to buy a home in the capital with her partner, said she now had “no chance” of securing a big enough mortgage.

She went to university in Newcastle and says: “We might even go back [there].”

In the north-east, however, housing woes were also on the mind of a local woman, Nancy Carrington. She put her flat up for sale six months ago. It has attracted only one offer of £120,000 – £10,000 less than she paid for it two years ago.

Mo Rai, a former mortgage broker from Walsall, who now earns £40,000 a year as an estate planner, shook his head, anxious to distance himself from the excesses of former colleagues. “I never lent more than three times salary – no matter how much a borrower pleaded,” he said. In Newcastle, Mick Dunlavy, a builder, blamed “these estate agents trying to get as much commission as they can”.

Few Britons equated credit woes with irresponsible borrowing, however. Simon Parke, 21, a student at Northumbria University, was an exception. He said: “People who take on credit cards and max them on a night out are stupid.”

But even for the debt-free, the fragile UK economy has exacerbated worries about higher living costs – putting thrift back in fashion and evoking memories of Austerity Britain. “I’m more conscious what I’m putting in the trolley,” said Sue Reay, a PR officer, whose weekly grocery bills have risen by a third to £80.

Yasmin Patel, a lecturer, has traded down from Warburtons bread to Tesco’s own brand. Across the country, people are delaying haircuts, resoling old shoes and making shorter journeys on foot instead of by car. The former Lehman banker confided that she could “no longer buy Gucci”.

Shoppers for whom Gucci was always a distant dream thronged the flea market in Halifax’s Woolshops shopping centre this week, buying cheap clothes.

With jobs at risk at the town’s biggest employer, belts are being tightened even more urgently than elsewhere. Eddie Woodhead, who has sold pushchairs and toys at the market since 1986, said business always picked up in a recession.

“In the early ’90s I bought three new cars,” he said. Speaking with the self-satisfaction of many older people whose sermons on penny pinching have been proved right, he said: “People have been spending what they haven’t got. We were taught to put something away.”

The nearby Piece Hall, a cloth market built in 1779, now contains shops and is often used as a film location. It is a striking symbol of how a building created for a dead industry can live on. The wedge-shaped headquarters of Halifax, the mortgage lender, emblematic today of risky financial strategies that damaged a healthy economy, is unlikely to be similarly cherished.



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