"New" Submenu missing!?

When I right click the "new" submenu is missing. Therefor I can't create new folders/word documents and it's really ticking me off, can anyone help me, I don't recall doing anything recently that could have messed this up.

Running Windows 98. I would prefer to not have to do a system restore from my backup HD if possible, thanks guys.

Ended up system restoring, oh well.