Comment 10 for bug 542543

I have a very similar problem. I'm running Ubuntu 10.04 LTS with mysql 5.1.
I have not created any users other than the defaults.
Server version: 5.1.41-3ubuntu12.1 (Ubuntu)

I can do this:
mysql
mysql> create database foobar;

I can't do this:
mysql> grant create temporary tables on *.* to public;
ERROR 1045 (28000): Access denied for user ''@'localhost' (using password: NO)

Here are all grants:

mysql> show grants;
+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| Grants for @localhost |
+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| GRANT SELECT, INSERT, UPDATE, DELETE, CREATE, DROP, RELOAD, SHUTDOWN, PROCESS, FILE, REFERENCES, INDEX, ALTER, CREATE VIEW, SHOW VIEW, CREATE ROUTINE, ALTER ROUTINE, CREATE USER ON *.* TO ''@'localhost' WITH GRANT OPTION |
+------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
1 row in set (0.00 sec)

Something seems to be somewhat off in the packet setup, though:

# grep -C2 mysql /var/log/daemon.log:

Jul 7 16:37:18 jwatte-hello-ubuntu init: apport post-stop process (883) terminated with status 1
Jul 7 16:37:18 jwatte-hello-ubuntu acpid: waiting for events: event logging is off
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[917]: Upgrading MySQL tables if necessary.
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[920]: /usr/bin/mysql_upgrade: the '--basedir' option is always ignored
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[920]: Looking for 'mysql' as: /usr/bin/mysql
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[920]: Looking for 'mysqlcheck' as: /usr/bin/mysqlcheck
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[920]: Running 'mysqlcheck' with connection arguments: '--port=3306' '--socket=/var/run/mysqld/mysqld.sock' '--host=localhost' '--socket=/var/run/mysqld/mysqld.sock' '--host=localhost' '--socket=/var/run/mysqld/mysqld.sock'
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[920]: /usr/bin/mysqlcheck: Got error: 1045: Access denied for user 'debian-sys-maint'@'localhost' (using password: YES) when trying to connect
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[920]: FATAL ERROR: Upgrade failed
Jul 7 16:37:18 jwatte-hello-ubuntu /etc/mysql/debian-start[929]: Checking for insecure root accounts.
Jul 7 16:37:18 jwatte-hello-ubuntu acpid: client connected from 934[0:0]
Jul 7 16:37:18 jwatte-hello-ubuntu acpid: 1 client rule loaded