Prime minister Gordon Brown may be tempted to offer wholesale public support for Britain’s inflated housing market and for the banks and lenders that pumped it up, but he must not do so. What Mr Brown and the Bank of England should do is act to ease the coagulation of liquidity in the banking system.

Mr Brown has indicated, at a meeting with big banks in Downing Street, that he is willing to intervene in the markets. But the goal of such an intervention must be to make existing mortgage-backed securities more liquid and so ease commercial banks’ access to cash. It is not to make it easier to issue new mortgages, to fix the stock of mortgages at a particular size, or to keep house prices steadily rising.