Why mortgage rates won't fall
As credit has become more difficult to obtain and more expensive for most of us, two issues have become confused.
One is the shortage of cash in the coffers of some banks - which has been addressed to some extent by the Bank of England's new scheme to allow banks to swap their mortgages for the equivalent of cash.
But there is a second reason why banks haven't cut mortgage rates in line with recent falls in the Bank of England's official lending rate: in a slowing economy and with house prices dropping, banks believe the risks of lending have increased.
Banks are deliberately widening the difference between what they charge for money and what it costs them.
And in doing so they have the explicit support of the Governor of the Bank of England, Mervyn King.
Here are what the banks see as the killer facts that explain why consumers are wrong to moan about the cost of credit.
In 1998, the difference or spread between average mortgage rates and the Bank base rate was just under 1 ½ percentage points.
Last year that had narrowed to almost nothing, 0.27 percentage points, which meant that most mortgage loans were barely profitable.
Banks have since attempted to rebuild the profitability of mortgage lending and have doubled the difference between what they charge and the base rate.
They believe this is prudent, not extortionate. And some would argue that the insanity was when they lent too much too cheaply in the previous few years.
Which is why the banks will resist the urgings for cheaper money coming from borrowers and the Chancellor. And it's also why the bonhomie between ministers and bankers that broke out at 11 Downing Street this afternoon will probably last about as long as it takes for them all to return to their offices.