I've read an analysis on 60 different currencies that stated : The average time for a currency to collapse after having the gold standard removed was 33 years - us fools in the states are right on schedule.

dave, Ft. Lauderdale, US

Yes, the B of E did say it was not their job to control house prices, but to control inflation. But funnily enough, the heinous house price rises WERE INFLATION, and what's more they still are and still need correcting.

Its very serious and very skewed, and inevitably has knock on effects for the rest of the economy as everyone needs more money to cope.

"The B of E always said it was not their job to control house prices. It is a truly disgusting case of double standards."

- Yes, good point; it's disgusting indeed.

Joe, Manchester,

What is wrong with people in this country?

People spend beyond their means, and when the inevitable happens and they no longer can make their ends meet, guess what happens? Right, the BOE steps in and cuts the rates so that people can keep their illusion of wealth and keep spending...

Am I the only one who thinks this is totally unfair to those responsible people like my self who don't go on a spending spree ??

yuki, london,

So the reasoning is that mortgage rates HAVE to come down, people saving carefully HAVE to be paid less interest, the pound HAS to collapse, all so that all the blind idiots spending like crazy this week all the money they really don't have can carry on fooling themselves that THE HOUSE is worth ever more in our ever more worthless money. It's taken ten years for Brown's debt conjuring trick to come adrift but they're still trying to deny the obvious. Get real!

Jane, Brighton,

Yawn, property market down, interest rates down, property market will recover, interest rates will go up. If you buy property, to live or invest, its a medium term investment. The short term angst of the analysts ignore inevitable population and wealth growth in the UK. Over time it wil, be fine. Relax

Mark Chalmers, Manningtree, Essex

Our economic illusion has been built on credit and it is inevitable that it has to correct at some point unless external investors are willing to pour money into UK Plc. The only reason for doing that is if interest on deposits and returns from investment are at attractive rates. Unfortunately the BoE have succumbed to a rate cut at the very time external investors are losing confidence in sterling. Any further cuts could cause a collapse in the value of sterling and serious importation of inflation that could decimate savings, pensions and cause a flight of capital abroad. Unemployment would also be worse than it might otherwise be.

Steve Marchant, Torquay, Devon

why is this seen as a housing crisis?? I see it as a correction. The bank of england have done nothing wrong. If people wanted house prices to keep rising, then the only solution would be to get employers to pay double your salary, so that income matches the inflation on house prices. Clearly this is not going to happen.

even if the bank of england cuts rates, it won't solve the housing crisis. the era of cheap credit died in august when the subprime crisis hit. do you really believe even if the BOE cut rates, it would be passed on to borrowers? banks need to recover their losses from subprime - and they will do this by getting more money out of their customers - i.e. us normal people.

the uk needs some recession to bring us down to earth... the government also need to review the taxing, as there is no difference in tax between middle and upper class, surely not right. foreign domiciles should also be taxed much more so the UK is not seen as a soft touch.

Simon, London, UK

For heavens sake why was there not the same newspaper pressure to raise rates when prices were rising,as there is now to cut rates when prices are dropping. The present situation would have been avoided.
The B of E always said it was not their job to control house prices.
It is a truly disgusting case of double standards. Make your mind up Mr King/colleagues.Tell us clearly what your remit really is! We have a right to know.

nic, royan, france

Cutting the intrest rate will not help. The crisis in housing is due to people being greedy and I agree with Gareth prices have risen close to 300% in the last decade and they are due for a major correction.
The BOE has to be concerned about inflation and lowering the inrtest artes or making money more available could break the UK economy, the USA is reconizing that by lowering the rates will not cure the housing slump it needs to correct itself and a good leveling of these high prices will prove to be the coorect thing let the markets take care of thenselfs.

Gerald, New York , NY USA

House prices are too high. People should not expect the market to rise for ever and market booms are typically followed by a crash.

Gaz, Aberdeen,

Alan from France.

Your comments are completely accurate. The BOEs primary responsibility MUST be the control of inflation. Cutting base rates at this time will do nothing to protect the majority of the working population, including home owners, against rampant price rises. Anyone who lived through the late 80s and early 90s will know that inflation is the biggest threat to the economy, and more importantly to any individuals financial well being.

pip, Sutton, Surrey

Lowering interest rates is the WRONG thing to do, as
a) inflation will just take off again and
b) as mentioned by AndrewS and others, people will be encouraged once again to get themselves ever deeper into DEBT.

This is a habit we must rid ourselves of.

Currently, we're exhibiting the classic signs of a gambler - we had some good years in the past, currently see that things are getting worse, so decide to carry on betting (spending) money we just don't have th capacity to repay.

Better to take the pain now, rather than a lot more pain later.

clive, surry,

The BOE should have waited to see how the market responded to the first three rate increases instead of continuing on with the next two increases. Too much too soon.

There are many ingredients in the Econmonic mix and a little more backbone by the BOE instead of jumping to the tune of media frenzy. "House Prices Rocket" or "House Prices Slump"

John, Inverness, Scotland

I'm a 27 year old professional on well above the average wage for the area I live. A 15% deposit, plus the absolute maximum I can borrow for a mortage will barely get the most modest of ex-council houses.

It's obvious that there's a reason why mortgage figures have plunged. Houses are now priced such that it's currently impossible for anyone on an honest wage entering the property market to buy. The fact is, without first time buyers, there is no 'ladder' as such. A correction would be no bad thing -- aside for speculators maybe -- and is inevitable anyway, regardless of a cut on interest rates.

Brian, Belfast, Northern Ireland

The only way an interest rate cut will save the UK economy is by encouraging people to get even further into DEBT. Our economy is based on debt - £1,400,000,000,000 of it. More than our GDP.

As the next few months will show, the collateral against which most of that debt is secured (property) is suddenly going to be worth a lot less. But guess what - the debt is not one iota smaller.

AndrewS, Brampton, Cumbria

why is it a crisis if people stop paying ludicrous prices for houses. It may be a crisis for an estate agent but no one else. If agents were concerned they would slash their fees but I don't suppose they will.

john sutcliffe, myrrmaki, finland

Thats a great plan David, except the reason we are in such a mess (this is just the very start) is because of cheap credit that has been lent irresponsibly lent. This all needs to be repaid. Encouraging further lending will just make the problem worse in the long run. In any case lower interest rates in the US is not preventing the housing crash there, it won't here. Inflation is not low - RPI 4.3% CPI 2.1%. Inflation is high, and likely to increase in the short term rather than decrease.

James, London,

BOE need more proactive and aggressive cuts like the US Treasury.

0.25% wow!, thats a real deal breaker and likely to provide immediate confidence to the markets. They should take advantage whilst inflation is low.

On the other hand NAV's for property cannot always be one way, but more confident and effective rate movement would certainly minimize the damage

david connor, bognor regis,

I don't remember the bank coming under pressure to raise rates while the market was booming, why step in now?

John, Miami, FL

House prices dropping .... good, although a 3% fall is insignificant considering prices have risen 300% over the past decade.
Record employment, shoppers still spending like crazy (not a sign of a sharp consumer slowdown as claimed in your article) - can anyone see any effect of the credit crunch, except a reducion of rich bankers bonuses?

Gareth Jones, Dusseldorf, Germany

The BOE do not care about house prices as such. They couldn't care less if they fell through the floor. The BOE is not there to reserve asset values. What the BOE does care about is the relationship between house prices and consumer confidence.

When house prices go up, we feel richer so we spend. When house prices go down, we feel poorer, so we don't. It is this that the BOE is watching, and it is a very difficult thing to monitor.

It is hard enough to get people to agree on which direction house prices are going, never mind what effect this is having. Houses are individual, and comparisons are difficult. The BOE moves slowly and carefully. The comparison to steering an oil tanker is very apt.

jeremy, brighton, sussex

The Bank of England's responsibility is inflation, not to protect the property market nor the jobs of estate agents. Cutting the lending rate will not solve this liquidity problem:indeed it may well aggravate it. The cost of providing liquidity has been too cheap in the past hence our current problems so cutting the official cost now appears foolish. There is no reason why the spreads on libor and other financial products should fall just because the bank of england cuts is lending rate. After all its just another bank.

alan morgan, Merifons, France

For once the word 'SLUMP' has been correctly used. (Recently, is has been used with reports on declines of a few percent.) But 44% is a slump for sure.

MarkS, Leeds,

The same applies to reducing the base-rate to control house prices, it is like giving alcohol to an alcoholic. Instead of bringing house prices under control, it will precipitate another escalation. What are these so-called experts thinking?

Richard, Alicante, Spain

We need to cut interest rates to 3% NOW to save the UK economy from crashing

Avi Cohen, Tel Aviv, Israel