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No one has ever doubted the swift ascent of the Jaringan Islam Liberal (JIL) in Indonesia, and how it has impacted recent discourse on the future of Islam in the world’s largest Muslim nation. Indeed, much of the hype and triumphalism that escorted JIL’s rise to prominence has contributed immensely to the intense contestation over the proper place and role of Islam in an increasingly democratic Indonesia post-reformasi and post- September 11. Yet, questions still abound as to how liberal JIL is, and how receptive can Indonesian Muslims be as far as JIL’s ideology is concerned. Perhaps, the ultimate question to pose is: can JIL replace the century old predominance and preeminence of NU and Muhammadiyah as the vanguard of traditionalist and modernist Islam in Indonesia?

This paper seeks to explain the causes and consequences of the U.S. subprime mortgage crisis and how this has led to a generalized credit crunch in other financial sectors that ultimately affects the real economy. It postulates that despite the recent financial innovations, the financial strategies that led to the present crisis are similar to those found in the U.S. savings and loans debacle of the late 80s and in the Asian financial crisis of late 90s. They are as the title implies: old wine in new bottle – financial leveraging and funding mismatch. Going beyond these financial practices, the underlying structural causes of the crisis are located in the loose monetary policies of central banks, financial deregulation, and excess liquidity in financial markets that is a consequence of the kind of economic growth that produces various imbalances – global current account imbalance, financial sector imbalance, and wealth and income imbalance.The consequences on risks, moral hazards and rolling bubbles are discussed. Comparison of similarities and differences with banking crises in Asia and Japan will be discussed.