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Some believable people have begun to forecast astonishingly low interest rates for Britain. Jonathan Loynes, of Capital Economics, reveals that base rate will decline from the current 4.5 per cent to just 1 per cent. Stuart Thomson, of Resolution Asset Management, was yesterday plumping for 0.5 per cent.Even the hawks indicated that base rate will come down to 3 per cent, whereas some of the doves reckon zero is now a possibility. This would be totally uncharted territory for Britain. Base rate has not been anywhere near those levels since 1952, when it was 2 per cent.

The last low point was a slash to 3.5 per cent in 2003, which, as it was turned out an awful mistake that helped to fuel the final bubble phase of the 15-year house-price boom.

For most of the past few decades, base rate has been much higher, fluctuating in the range of 5 to 15 per cent.

Any serious loosening of financial policy here generally ends in tears - with a damaging burst of inflation or a run on the pound, and generally both.

Banks are going to be calling in loans at a massive rate as they looking to minimize their balance sheets to conserve their flimsy capital cushions.

The $5trillion of emergency facilities and fresh capital on offer from the world’s central banks may diminish the speed of that deliberating, but it is still continue, and it needs to restore the faith in the banking system.

Unless Alistair Darling can make clear how on earth he proposes to measure the accessibility of lending and so hold banks to this promise, he should stop going on about it. All it does is give bogus expectation to prospective borrowers.

It is no at all perfect to slash down the interest rates in order to boost up the economy.

According to Mr. Darling, Government spending, if carefully executed would turned out to be more effective. It would be perverse to uphold the discipline of normal spending rules in such desperate times.

However, what policymakers decline to identify is that the country’s current predicament is in part because of the lax fiscal, monetary and supervisory policies of the past.

It is disappointing that Mr. Darling was last night still boasting of presiding over “the longest period of continuous growth in living memory”. It was precisely the careless nature of that credit-fuelled growth that cultivates and fed the imbalances that have since brought us to the brink.

If talk about the base rate at 1 per cent is not a cause for celebration or even relief, but rather appreciation of how awful the economic scenario are now appearing.