In direct reply to Frankie- I am in a similar position as you. I've been feeling confused: I really don't think the PhD is for me, but have no idea how my other options will play out in the current economic situation. I've been thinking about becoming a teacher in a private school, working in a library or entering HE admin. However, I'm not sure how easy it will be to enter these professions at the mo. My parents are supportive, and like yours they think I should stick it out, and go into those professions after my PhD when things will have hopefully brightened up. If it's any consolation, I know two recently finished PhD students who have completely fallen out of love with academia and landed excellent jobs (one of my friends was offered a job work almost £40,000p.a. in HE sector!)

I think the economic storm is psychologically difficult for everyone (even for those in the so-called ivory tower): we've been bought up in a world of vast employment opportunities! Now those prospects are shrinking and it is devastating. In some ways, I think it is harder for us in the pressure cooker of academic life, where you are constantly reminded of your lack of knowledge. So, our confidence knocked, the economy in shock, it's not surprising that we feel trapped!!

Like you I've been feeling anxious and fed-up quite a lot of the time, but I'm going to stick it out. I think I'm capable.

However, I think if your health is starting to suffer then maybe you should consider your other options. Maybe talk to a counsellor and a careers adviser.
Or, maybe ask your doctor to issue a certificate for a few months off. Maybe you just need a break?!