They’re curtailing credit, exactly as they ought to. Stop the crazed borrowing! Spend less, save more. That is a downturn’s message, and it is the right one for consumers and producers. Note this story, meant to tug at your heartstrings, from the NY Times:

Drew Greenblatt, president of Marlin Steel Wire Products, figured it would be easy to get a $300,000 bank loan to finance a new robot for his factory in Baltimore. His company, which makes parts for makers of home appliances, is growing and profitable, he said. His expansion would add three new jobs to an economy hungry for work.
But when Mr. Greenblatt called the local branch of Wachovia — the same bank that had been aggressively marketing loans to him for years — he was distressed by the response.
“The exact words were, ‘We’re saying no to almost everybody,’” Mr. Greenblatt recalled. “This is why God made banks, for this kind of transaction. This is going to slow down the American economy.”

Godly banks do not inflate; they are not based on fractional reserves, But in a crisis, even our banks start to act more responsibly. (Via Campaign for Liberty)