The orchestrator of this mess has now 'gone upstairs', as you do when you are failure in government. He has left the poisoned chalice in the hands of someone who was doin. railways last month or something (who cares) The so called 'independent' BOE (MPC) have failed the country badly (NB: Darling's slip of the tongue yesterday when he said he allowed the BOE loan) they should have switched the emphasis from borrowers to savers long long ago when they had a chance, now the chickens are roosting and they are surprised that the 'boom' they encouraged wants to be bailed out -no way, stew in your own juice. You have created the perfect recipe for recession - enjoy. Incidentally, who is Prudence?

Victor Cowen, Malaga, Spain

Mervyn King spoke excellently as usual and then a few hours later he was told by the Treasury to do the complete opposite. Banks you should continue to lend lend lend, as the British tax payer is more than happy to underwrite for you.

Caroline, London,

It's ironic to have the Chancellor berating banks for imprudent lending, given his predecessor's continuing to vaunt his "masterstroke" of granting "independence" to the Bank of England. Mr Brown's concommitant stripping the Bank of it's regulatory authority /responsibility to ensure the soundness of financial institutions, but leaving intact the Bank's role of lender of last resort to those same institutions, is a fatal flaw in the UK's Brownian financial system.

Michael, Chigwell,

Such a difference one day makes. Should this article be retracted now that the Bank of England has bailed out Northern Rock?

Rich, London,

Helping the stricken banks who got into this mess, knowing very well the risks, will be a moral hazard. this will only further embolden them to take more risks in future with others' money, knowing that some one else will help them again out of their self created mess. BoE is to be complimented on its tough stand.

G.Sreedhar, Bangalore, India

Mervyn King has called the situation correctly. After all, when banks take enormous risks, on and off balance sheet, and make large profits the investment bankers, management and shareholders take all the profits home.
When they lose their 'bets', why should the taxpayers, via the Bank of England, ride to their rescue ?

Rick, London, England

Hear hear to Mr King (and his fans). What a relief to see a major central banker turning his back so firmly against the irresponsible antics which characterised Alan Greenspan's reign. We can only hope that Ben Bernanke takes heed.

SM, Christchurch, New Zealand

Perhaps some of the bank workers would like to re-pay their bonuses now? Why are we paying for their mistakes (again) whilst they rack up huge profits? Sick world.

Martyn, Brighton, UK

I wish everyone in America would read this to get some idea of how a central bank should be run. It's time for the speculators to pay the piper for their risky bets. We, the prudent minority, need to stand up and scream as loud as the Wall Street crybabies who are trying every trick in the book to force a bailout. NO! We say NO BAILOUTS FOR YOU!

Kurt, St Paul, USA / MN

No Mr King it is not the time to cut interest rates.
Inflation is going to increase.Oil price is now over $80 and food is rocketing in price. Ask any housewife.
Also face the fact that true inflation is a lot higher than official numbers,-just take your shopping bag around the shops! Past interest rates have been based on false numbers. Terribly dangerous.
Low interest rates have largely contributed to the disgraceful lending levels of the UK.bTo cut would be irresponsable in the extreme,and build up greater problems in the future.

Nic, Royan, France

No-one seemed to mind when all this cheap bank lending was propping up the UK economy for the last 10 years. Perhaps the likes of King and Darling should have been a little more vocal when there was something the banks could have done about it.

Rod Munch, Northampton, UK

Americans and Europeans make strange bedfellows indeed! Their actions are similar at the extremes. Europe cannot resist its interventionist and 'dirigiste' default mode. In the US, the extreme capitalism has politicians and the so-called independent central bank defending and riding to the rescue of reckless private investors with the dubious excuse of preventing a recession, showing how they are all incestuously linked. Once again, hats off to the Bank of England for its mmagnificent stand and poise!

Fouad Diouman, London, UK

its about time that the banks had their umbrellas taken back.
as its about to pour down financially

neil roberts, coutances , france

congratulations to Mr. King. finally a central banker we can all respect unlike Mr. Bernanke/Greenspan here in the US. moral hazard is their name. NO bailouts for risky behavior.

marc lowe, santa barbara, california

A stitch in time can save nine, but banks must reap what they sow. Those who were sensible will be fine. Those who called the current situation right, will making a ton of money right now. Only the imprudent and the ones that came late to the party and are left holding the hot potato when the music stopped have egg on their faces.

G, London,