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The government is to blame for the crisis at Northern Rock, Conservative leader David Cameron has said.
Writing in the Sunday Telegraph, he accuses Prime Minister Gordon Brown of presiding over a huge expansion of public and private debt.
The government should explain what led to Northern Rock needing support from the Bank of England, he says.
Customers have rushed to take money out of Northern Rock, amid concerns over their savings.
Mr Cameron said the situation raises issues that affect "every one of us" and the lines of savers queuing to withdraw their savings from the bank "serve to remind us just how fragile the stability of the economy can be".
"The credit crunch, previously restricted to the City, has burst onto the high streets," he said.
"Under Labour our economic growth has been built on a mountain of debt.
"For all its past talk of prudence, the government has been on a spending and borrowing spree of gigantic proportions."
The government had to learn that "an economy built on debt puts economic stability at risk", Mr Cameron added.
He also called for changes to fiscal rules including greater transparency between lenders about borrowers' credit histories.
"It is not enough for the chancellor simply to talk about common sense in banking," he said.
Writing in the Sunday Telegraph, he accuses Prime Minister Gordon Brown of presiding over a huge expansion of public and private debt.
The government should explain what led to Northern Rock needing support from the Bank of England, he says.
Customers have rushed to take money out of Northern Rock, amid concerns over their savings.
Mr Cameron said the situation raises issues that affect "every one of us" and the lines of savers queuing to withdraw their savings from the bank "serve to remind us just how fragile the stability of the economy can be".
"The credit crunch, previously restricted to the City, has burst onto the high streets," he said.
"Under Labour our economic growth has been built on a mountain of debt.
"For all its past talk of prudence, the government has been on a spending and borrowing spree of gigantic proportions."
The government had to learn that "an economy built on debt puts economic stability at risk", Mr Cameron added.
He also called for changes to fiscal rules including greater transparency between lenders about borrowers' credit histories.
"It is not enough for the chancellor simply to talk about common sense in banking," he said.
HBOS (Britain's biggest lender) screwed up their mortgage pricing strategy in the first half of the year. This created an unprecedented chance for other lenders to seize market share, and Northern Rock dived in hard. Normally they'd cover their operational costs through the international money markets, but the credit squeeze caused by the US sub-prime collapse has closed that route. That means, as you'd expect, the Bank of England bridged the gap. However the press whipped up a panic, and the public got jittery.
Anyone see the government in there? Me neither. Next news- Cameron blames Gordon Brown for the St Brice's Day Massacre and the mass extinctions at the end of the Permian era.
Anyway, Northern Rock are left with a big chunk of mortgage business (good quality stuff too- not the sub-prime crap that's dragged down the US sector) and a plummeting share price. Nothing is guaranteed in stock market investment, but my money is on that share price either recovering over the next few years or them getting bought out (which will send the share prices up too).
Nothing is guaranteed in stack market speculation, and the one potential risk is a collapse of the UK property market in a recession. However it's tempting enough to get me putting money where my mouth is- I've bought some. If anyone has some funds they can lock up for a few years, there are few more enticing opportunities on the London stock exchange right now.
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