Borrowing

Some five years ago Ms T and I bought a house together. We both owned flats with some equity and had reasonably secure jobs, so I expected no difficulties securing a mortgage. But I was taken aback with the way our financial adviser virtually jumped over the desk when he looked at our figures.

What seemed to me to be astronomic sums were offered; four and five times our income, literally hundreds of thousands of pounds. It was all very tempting, but we're stingy northerners and didn't stretch ourselves to the extent we might easily have done. Hence we've an affordable mortgage on the edge of Herne Hill rather than something bonkers in Battersea. These are the modern urban choices.

I listened to the Today programme this morning in which the man who runs a hedge fund explained how the wheels were now falling off the elaborate system of borrowing founded on the value of people's homes in the US. (You can find it on the listen again page at 0810) And the spectre was raised of the government having to take over more banks and print money to shore up the system. Last night I heard the BBC's Economics Editor Robert Peston explain how powerful forces in the market were now moving against our currency - which last night hit its lowest ever point against the Euro.

The borrowing party is over. Who'll be left with the hangover?