There are many ways to measure the extent of the credit crunch.

You can compare interest rates -- current and historical -- on safe Treasury bonds and risky high yield bonds. You can poll senior loan officers at big banks, as the Fed does on a regular basis. If loan officers are tightening up and cutting back, you can bet credit is harder to get. Checking the difference in price between jumbo and regular loans is another important indicator.

My favorite new indicator of credit conditions is the "career decision" metric.

I'm told that, when pitched a new product, buyers are asking Wall Street bond salesmen a new question: "Am I making a career decision here?"

In other words, is this investment something I can defend to my boss if it goes bust. Wrightson ICAP's Lou Crandall says that, after Bear Stearns, events in the market that were thought to be highly improbable are now considered merely unlikely.

In such an environment, buyers are bewaring. They don't want to hold anything remotely risky lest they lose money AND their jobs. Loans with collateral are in. Unsecured loans to anyone, including big banks, are out.

That helps explain why the Libor rate is under pressure. For more on Libor see this link. The Fed announced today it is pumping lots of cash into Europe and the US in a bid to bring down Libor, a key interbank lending rate.

That might help a bit, but not much in a market where any unsecured loan may be a career decision.

As Crandall says, the desire to stay employed "explains an awful lot in almost any part of the economy.”