Key Points:

When exactly did New Zealand become a nation of whingers? When it comes to climbing mountains, chasing a rugby ball or fighting in the trenches we pride ourselves on being as tough as they come.

Why then, when it comes to financial matters, do we start whining and making excuses. The idea that banks have any legal or moral obligation to cut mortgage holders a break on fixed-term contracts is absurd.

Those complaining about the level of the break fee are missing the point. You are not supposed to break the contract at all. When you sign up for a fixed term you have made a deal. The default position is that you must honour that deal for the term of the agreement. To break it simply because it is no longer working in your favour is - literally - dishonourable.

Nothing about the fixed nature of the deal is buried in fine print. They call the things fixed-term mortgages - the length of the term is also in the title and the risk involved in the transaction is naturally shared by both parties.

For the best part of a decade mortgage holders have done extremely well out of fixed rates. Much to the annoyance of the Reserve Bank we have been buffered from the most immediate impacts of rising interest rates. New Zealand's obsession with fixing effectively blunted Governor Alan Bollard's axe as he attempted to chop the top off inflation by raising rates and restricting the cash supply.

Now as we go through the next part of the economic cycle - the bit where rates come down - we hear borrowers bleating that they are being overcharged for the privilege of reneging on a deal.

Deputy Prime Minister Bill English this week made comments which came dangerously close to indulging the whingers.

He should say no more.

New Zealand is up to its neck in debt and already precariously positioned when it comes to finding the international funds to service its obligations.

What kind of message would it send to the world if our Government was seen to endorse the actions of those who seek to worm out of banking contracts?

Shall we risk scaring lenders off and pushing wholesale borrowing rates for our banks even higher? The net result would be all of us paying higher rates than we need to.

The idea that the Government - in particular a National Government - might actually intervene and put pressure on banks to cut borrowers a break is crazy. Surely English understands what is at stake.

It is not just about defending banks - who can all too easily be made to look like the devil in some kind of Faustian pact. It is about defending the legal institution of a binding contract. That has to mean something for business to function.

Ignorance is never a good defence - in fact it is an embarrassing one.

Even if the detail about the level of break fees is in the fine print, what are people doing signing the biggest deal of their lives without reading the fine print?

More often than not the fine print reveals that the break fee is determined by the current cost the banks face in recouping lost earnings on the wholesale market. Right now the banks have to pay more than ever for that overseas cash. Of course that flows through to the break fee.

A similar lack of logic is being applied by those expressing outrage that the full extent of Bollard's OCR cuts is not flowing directly through to borrowers.

Those expecting respective rates of decline to match are ignoring a little thing called the credit crunch.

The financial crisis wasn't dubbed a credit crunch because it was the snappiest title.

It was called that because the root cause of the problem was the meltdown of credit markets.

The people that used to lend all the money - namely the giant US and European financial institutions - suddenly discovered they didn't have nearly as much money as they thought they did. Some of them collapsed completely.

Those left behind are cowering under their blankets and reluctant to lend their precious cash - so they are charging a higher premium for the risk involved.

You can call them all the names under the sun for the mess they've made of the world but it is not going to make it any easier for our banks to get their hands on the funding that they need to source just to service existing debt levels.

The credit crunch means Bollard has to drop the official cash rate harder and faster than has been done before just to offset this rise in offshore lending rates. The good news is that he has had room to move and his cuts are effecting some genuine downward shifts in retail rates.

The Governor's intent is to stimulate the economy by putting cash in to the pockets of New Zealanders. That means that once he has rates down they will most likely stay down until the bulk of fixed-rate borrowers have had a chance to lock in on better terms. Those on fixed rates simply have to wait their turn to enjoy the benefits of lower rates. When the time comes some may choose to think a bit more carefully about the terms they sign up for.