London Briefing/Chris Johns: British consumers are awash with debt. At least, that's the tabloid way of putting it. And when you put it like that, it's hard to avoid the conclusion that there is an accident waiting to happen.

With each new set of statistics on mortgage borrowing and consumer credit, it seems that the borrowing binge is continuing, and the longer it continues, the more ugly the likely ending.

It is always interesting to see financial commentators try to occupy the moral high ground. The argument appears to be that debt is always and everywhere a bad thing and that the more people borrow the more stupid - or irresponsible - they are.

If you think about it, it is quite something to lecture hundreds of thousands of people that their personal finance decisions are wickedly irrational. You really need to be sure of your ground to level that kind of accusation; the high ground that you occupy is probably oxygen-starved.

What are the facts? It is certainly true that borrowing, in all its forms, is on the rise and has been for some time. Of course, most of that borrowing comes in the form of mortgage and other lending secured on property.

Figures released this week, for example, showed that lending for mortgages rose to a new monthly record of £22.5 billion sterling (€32.20 billion) in July, with more than a hint that a lot of that cash was being used for anything but buying a house (mortgage equity withdrawal in the jargon).

Separately, we observe that property-related debt has risen from around 80 per cent of disposable household income for much of the 1990s to around 100 per cent currently. Draw a chart of any of these numbers, indeed most numbers related to borrowing, and they go in the exact opposite to Tony Blair's trustworthiness ratings (no correlation implied).

House price affordability measures (prices to incomes) are also heading north, leading some to conclude that there is a bubble in the making.

All of this proves nothing. Debt, contrary to many people's instincts is morally neutral. There are times when there is too much of it and times when there is too little. As a matter of fact, economic growth only really got going (around 200 years ago) when financial types found ways of efficiently channelling cash from those who had it to those who could do something useful with it. Economies cannot function without debt. And debt is only ever a problem when you can't pay it back.

The fretting over a debt binge does contain a kernel of substance. Because there is so much more borrowing than in the past it is undoubtedly true that the economy is much more vulnerable to a "shock" than in the past. If interest rates go up and/or unemployment rises there will be a lot of debt suddenly not being serviced. And that's when we have a problem. All those loans go bad and the economy hits a wall. The British economy's exposure to variable interest rates is the government's biggest euro-related worry.

But there is one chart that does not go up. Interest payments as a proportion of household disposable income have remained virtually flat for the past decade. Households, on this measure, have merely borrowed more as interest rates have come down. Their actual cash interest payments have barely budged. And this is where the smart analysts think that ordinary people have been spectacularly stupid.

Keeping your cash interest payments constant might sound terribly rational - the amount of pounds sterling leaving your bank account every month doesn't change, so where is the problem? The answer lies with the actual repayment of the debt, not just the interest payments. The debt will have to be repaid somehow and, say the clever analysts, in a way that hasn't happened for a long time.

Through much of the last 30 years, an awful lot of the real value of housing debt has been eaten up by inflation. Time and rising prices have done much of the heavy lifting of debt repayment. Today, in an era of low inflation, you are going to have to cough up. Trouble is, say the gloom merchants, we just don't realise it yet.

I'm not so sure. I don't see how I could be. The coming crash in the UK housing market has been a constant refrain of the UK media for at least the past year. Bad things happen when bad things happen. When I can see interest rates rising or a recession on the horizon I will get worried about property. But, the biggest economic surprises of the year are now under way - the global economic recovery is here and UK house prices are rising again.