The Nationwide Building Society says house prices fell 2.5% in December to make 2008 the worst year on record.

Almost £30,000 was lopped off the price of an average home, making the annual drop 15.9%.

The Bank of England is expected to cut borrowing costs by slashing interest rates again later this week.

Millions of hard working people are worried about paying their mortgages and losing their jobs.

The problem is traditional tools for controlling the economy are not working. For 50 years, the Government has manipulated interest rates and controlled the amount of money sloshing about in the economy to keep unemployment and inflation low and standards of living high.

That trick no longer works, so the Governments here and, to be fair, in the US and many other countries have doled out cash to shore up the banking system and big employers like the motor industry.

The billions the Governments have pumped in to the banking system have not freed up the world economy. Instead banks and companies are stashing the cash to protect their own interests.

Treasury officials seem to be exacting little or no due diligence on whether the money is going on a good investment with the speed the money is handed over.

Perhaps a better idea would be not to give any cash to the banks and big businesses and let them stand or fall according to market conditions.

Instead, divvy up the billions the governments are giving away between the rest of us. In the UK, that would give us about £300 each to spend or save how we liked.

Either way that gives billions that can go to the banks in savings or to retailers as cash flow. The banks and shops offering the best deals to savers and spenders will prosper and the rest will wither and die.