"Gordon Does Good,” read a headline in yesterday's New York Times. “Has Gordon Brown saved the world financial system?” asked the author, Paul Krugman - hours before he was awarded the Nobel Prize for economics.

For years it was Tony Blair who won plaudits around the world. Now Gordon has gone from zero to hero on the international stage. Nicholas Sarkozy and Angela Merkel jostled to hear what he had to say at the Élysée Palace this weekend. In France, he was praised as a “magician”, in Germany, he was described as a sage.

Like Mr Incredible, the superhero who comes out of retirement at times of emergency, Mr Brown has rediscovered his strength to heavy-lift some of Britain's biggest banks. “GB in his element - mustn't look like he's enjoying it though,” said a text message from a friend in Downing Street last week. But it is the meltdown that has made the Prime Minister relax, disaster that has finally given him a natural smile. Instead of dithering, he has become decisive; rather than cautious he has turned bold. “Gordon's suddenly got a core purpose,” one of his harshest Labour critics admits.

Mr Brown's strategists are already considering how the tactics used to deal with the banking crisis could be applied to other parts of the economy: a government-backed mortgage company to get the housing market moving has been discussed. There is talk in No10 of creating an “ethical banking system” - an interesting parallel with the ethical foreign policy once touted by Mr Blair. “Markets need morals to function properly,” according to one minister involved. For once, the puritanical Scot's desire to impose austerity on others chimes with the voters' desire to see the fat cats starved.

There is no need for Mr Brown to force through plans to hold terrorist suspects without trial for 42 days: instead of a phoney political war on terrorism he has a real economic battle on his hands. With a “crisis Cabinet”, a “war room” and financial fighter planes heading for Iceland, he is striking a deliberately Churchillian pose. He evokes the “calm determined British spirit” of the Blitz. “I have nothing to offer but blood, toil, tears and sweat,” the Prime Minister might say - although in the Battle of the Banks rather than the Battle of Britain. it's “never was so much owed by so few to so many”.

The problem for Mr Brown is this. Churchill lost the 1945 election. Even if Mr Brown wins his war, he may not win the peace.

The Democratic Speaker of the US Congress, Nancy Pelosi, memorably declared “the party is over” - but we are still clearing up the debris of the night before; the hangover has not yet arrived. By the time Britain next goes to the polls, recession will be like a dull throbbing headache, with people losing their homes, their savings, their pensions and their jobs.

The Government will have had to impose tax rises or spending cuts - or both. Blood, toil, tears and sweat are fine as rhetoric, they are not so good once they become reality. It's not just City slickers who are suffering, it's their newsagents and their children's teachers. One minister told me recently that voters would cling to Mr Brown in these difficult times - “even my cleaner has started saying: ‘please make sure your Gordon looks after my money',” she said. But once the immediate crisis is over they may adopt a different attitude to the man who has been in charge of the economy for the past ten years.

At the moment experience is Mr Brown's strongest card but it could quickly turn into his weakest. The seeds of the crisis were arguably sown by what has always been seen as his greatest triumph - granting independence to the Bank of England. By simultaneously introducing a weaker, tripartite regulatory system and stripping the Bank of its power to control the amount of debt in the economy, the Prime Minister's critics say that he created a Trojan Horse that allowed hordes of marauding bankers to run riot through the City of London.

There have been repeated warnings about the lack of transparency in financial services, which were ignored by Mr Brown. As long ago as 2002 the Bank of England raised concerns that the way in which banks sell their risks on to other institutions “makes it more difficult to track where risks are ending up” - precisely the problem that allowed the US sub-prime market to infect the rest of the world.

Time and again Vince Cable, the Liberal Democrats' wise economics spokesman, raised concerns about Britain's overdependence on debt - on each occasion he was accused of being a doom-monger spreading “alarm without substance” by the man in charge. Meanwhile, the Prime Minister continued to spend - and encouraged others to do so.

Mr Brown listened consistently to Alan Greenspan. As soon as the man known as the Oracle retired as Chairman of the Federal Reserve, he was appointed as a British government adviser - a position that he still holds. The Prime Minister once described this libertarian Republican as “the greatest economist of his generation” and ensured, when he was knighted, that the Queen recognised his “outstanding contribution to global economic stability”.

But there is growing consensus in the US that the Greenspan years at least helped to create the credit crunch. Mr Greenspan fuelled the asset boom, and failed to support more regulation. Although the investor Warren Buffett described derivatives as “financial weapons of mass destruction”, the former man at the Fed took the view that “it was superfluous to constrain trading”. Even last week he argued that Wall Street needed more trust rather than greater controls.

Just as Mr Blair was wowed by wealth, so Mr Brown was overawed by the intellectual riches of a free-market economist. He will pay the price. The latest Brown boom will almost certainly turn into another Brown bust.

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