I remember in December 2007 bumping into Peter Meinertzhagen, the veteran broker, when he was offering some timely advice to a small huddle of City figures: “The market is looking cheap,” he said “but if you are thinking of buying, bite your lip, it’s going to get cheaper.”

How right he was. I referred to his advice in last year’s new year column. I have no intention in going back and reviewing the predictions I made last January. Point scoring is a futile exercise, particularly when I missed the Big One — the global collapse of the financial system of such immense proportions that it bought down institutions we thought were impregnable.

I knew the warning signs were flashing, but had no idea about the enormity of what was to unfold — and I was not alone. The ramifications of that financial tsunami are still in full swing, but this year what the world has to do is fix it. Governments have already attempted to with a series of fiscal stimuli. But now it is down to companies, and this is where I will make one prediction.

There is one word that will define the events of the coming year — pragmatism. Thousands of companies in Britain will need help and the way it is meted out by government, banks, shareholders, suppliers, boardrooms and landlords will determine how this country rides out what promises to be a severe downturn.

The government must continue to do everything to keep our big companies in Britain. That means maintaining a competitive tax regime and promoting an environment where manufacturing can prosper. And, as importantly, avoiding a temptation to over-regulate at a time when business needs flexibility.

We must return to market fundamentals and realise how valuable certain sectors — such as the car industry — are to the wider UK economy. We must also turn the page on cheap debt and leverage that fuelled an uncontrollable boom that blew up spectacularly.

There must be a sense of collective responsibility, of helping companies to weather the crisis and a recognition that everybody must share the financial pain.

One of the first problems to address is for the government to support additional fundraising for the banks in which it has large stakes. Lloyds/HBOS and Royal Bank of Scotland — and Barclays though it is not government-controlled — still don’t have enough capital and they will require more. The cash they raised at the end of last year pales into insignificance against the problems they will face this year. If these banks marked all their investments to today’s values there is a strong likelihood they would still be technically insolvent. Which is why there is a strong likelihood RBS could be nationalised before the end of the year.

That is not a good backdrop, particularly when banks will start having to make the decisions they have ducked for the past six months. The problems their customers face have not gone away, they have got worse. Banks will have to accept that they will have to swap loans for equity in many of these indebted companies and be prepared to hold the stakes for a long time.

Others they will have to let go, which will involve taking big write-offs onto their balance sheets.

Shareholders are also going to have to step up and take their share of the pain. Dozens of quoted companies, like Premier Foods, are now in talks with investors to support rescue rights issues and placings.

In many situations share prices have fallen so low that a cash call will have to be accompanied by an injection of capital from external investors. There are swathes of companies like Travis Perkins, the DIY group, and builder Taylor Wimpey, which have fundamentally sound businesses but are weighed down by too much debt.

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