Leo offers to sell his apartment to NAMA for Long-term Economic Value

The_Minister

murfie wrote: »

Have you read the FG alternative to NAMA it appears to be a good alternative.

http://www.finegael.org/upload/FG_Banking_Policy_Sept_21.doc

Set up a good bank, promote lending through the banks to the people that really need it. let the banks and their investors keep the risk they decided to take on, with the bad developer loans.

Except that two Fine Gael former Ministers for Finance have come out and said it is a bad idea.
As well as most people who understand economics.

It's much better than Labour's suggestion, but NAMA has a better chance of actually working.

Also, how the hell to Fine Gael say assets have fallen by up to 95%?
Where have they fallen by 95%?
That would mean a house costing €1,000,000 would now cost €50,000.

P. Breathnach

The_Minister wrote: »

... Also, how the hell to Fine Gael say assets have fallen by up to 95%?
Where have they fallen by 95%?
That would mean a house costing €1,000,000 would now cost €50,000.

I imagine that a few assets (just a few) might have fallen by that much. The sort of thing I would think of is the scrubby farmland 60 miles from Dublin which some optimist bought at development prices with a view to sticking 150 densely-packed houses on it to service Dublin commuters. Now it can revert to the lower end of the agricultural land price range.

In general, however, the fall in asset values would not be nearly so severe. My opening guess would be an average fall of the order of 50%, of which 10% might be borne by builders/developers and 40% borne by banks.

Diarmuid

The_Minister wrote: »

It's much better than Labour's suggestion, but NAMA has a better chance of actually working.

Most agree that it will work. The problem is at what cost to the taxpayer.

Kidchameleon

look at the end of the day, the banks are gettin out of the **** at the expense of the tax payer, while the average joe is not being given a helping hand at all, thats the whole point of the letter imho.

Call Me Jimmy

murfie wrote: »

I can only hope the greens vote to not support it.

You mean vote... against it?

SkepticOne

P. Breathnach wrote: »

I think the answer is that there is in some cases, and not in others.

I don't think it is as straightforward as that. Private investors need funds, and the banks aren't lending. I expect that there are currently bankable projects that have been stalled because of this, and I am hopeful that in the short to medium term economic recovery will start and projects that are not immediately viable will become better propositions.

But that low-lying field two miles outside town will probably never be worth what some over-optimistic developer paid for it, and we we will never need that hotel in the middle of nowhere, and the office block being built speculatively to house a decentralised unit of the civil service will probably remain empty. And as for those urban housing estates in rural parts of Cavan...

It is fairly easy to see why all of what you are saying is wrong. First of all, there is money out there. If there was not then the NAMA developer bailout could not proceed in the first place. Money is being raised by the government through the issue of bonds. But these bonds are not being issued by NAMA but by the State.

It would be far better if NAMA itself were able to issue bonds so that if NAMA failed only investors who thought it was a good deal would take a hit. The tax payer would not be forced to take the risk.

But who would invest in NAMA? Would you? I certainly wouldn't. That is why the bonds are being issued by the State. If NAMA fails, it is the taxpayer who picks up the bill, not NAMA or its bondholders.

So the money is there, just no one wants to invest in the NAMA proposition and I don't blame them!

The second point is the issue of the field outside some midland town. As someone pointed out, it is not just this sort of thing that developers were over-optimistic about but also developments in prime locations. Dublin is full of developments that have ground to a halt and there are completed sites full of unsold units. We, the taxpayer, are going to be forced, via NAMA, to buy into these things by taking on the loans of these developers, that the banks, quite rightly want to be rid of.

It is pretty much a no-brainer if you just put yourself in the position of someone looking to invest his own money rather than forcing others to invest.

The main point here is that if it was a remotely good proposition you would not need to force people to invest in it.

P. Breathnach

SkepticOne wrote: »

It is fairly easy to see why all of what you are saying is wrong...

Nothing in your response shows how anything I said, let alone all of it, is wrong.

dublin.caucus

Darsad wrote: »

Varadkar is great at stirring things he would be better placed writing to the Minister for Finance requesting ways be implemented to stop the unvouched expenses claimed by TDs of which he will claim over 100K this year nice cushion to help with his negative equity !!

and

and this is the same pr**k that claimed over 73,000 euro in expenses

Not sure where the €100k or the €73k figures come from, but Leo is probably one of the most open TDs with regards to his expenses.

According to his website, he claimed €34k last year and provides a detailed breakdown of where it went. He claims to have been the first TD to publish their expenses.

You can check it out here:

http://www.leovaradkar.ie/?p=259

dublin.caucus

The_Minister wrote: »

Except that two Fine Gael former Ministers for Finance have come out and said it is a bad idea.

One Fine Gael former Ministers of Finance have come out and said it is a bad idea. The same guy who is legally required to represent the interests of Anglo-Irish Bank.

Garrett Fitzgerald was never a Minister of Finance, and made no comment that I am aware of as to the positives or negatives of FGs proposals.

Darsad

[quote=dublin.caucus;62340906

Not sure where the €100k or the €73k figures come from, but Leo is probably one of the most open TDs with regards to his expenses.]

Your right that should been since elected but still my sentiments remain the same

The_Minister

dublin.caucus wrote: »

One Fine Gael former Ministers of Finance have come out and said it is a bad idea. The same guy who is legally required to represent the interests of Anglo-Irish Bank.

Garrett Fitzgerald was never a Minister of Finance, and made no comment that I am aware of as to the positives or negatives of FGs proposals.

Actually Alan Dukes was not under any obligation to come out and rubbish the Fine Gael plan.
You are of course correct that Garratt Fitzgerald neve became Minister for Finance, although he did his best to get it during his first term as minister (got foreign affairs instead).
He has however backed NAMA and effectively rubbished FG's plan, calling for them to accept NAMA and amend it, rather than pursue their own plan.

dublin.caucus

The_Minister wrote: »

Actually Alan Dukes was not under any obligation to come out and rubbish the Fine Gael plan.
You are of course correct that Garratt Fitzgerald neve became Minister for Finance, although he did his best to get it during his first term as minister (got foreign affairs instead).
He has however backed NAMA and effectively rubbished FG's plan, calling for them to accept NAMA and amend it, rather than pursue their own plan.

Company Directors have obligations in terms of representing the best interests of the company on whose board they serve. NAMA is in the best interests of Anglo, not of tax-payers and citizens. Hence the differing views between Dukes and Fine Gael.

Fitzgerald said that we were too far down the road of NAMA to change it at this stage. He actually didn't endorse NAMA - just said that to change from it now would cause the country's international reputation to suffer. Which isn't exactly backing, but sure make stuff up why don't you.

kippy

dublin.caucus wrote: »

Company Directors have obligations in terms of representing the best interests of the company on whose board they serve. NAMA is in the best interests of Anglo, not of tax-payers and citizens. Hence the differing views between Dukes and Fine Gael.

Fitzgerald said that we were too far down the road of NAMA to change it at this stage. He actually didn't endorse NAMA - just said that to change from it now would cause the country's international reputation to suffer. Which isn't exactly backing, but sure make stuff up why don't you.

I think you are incorrect in relation to company directors and their obligations.
There are a number of state appointed directors to many companies, union reps etc etc, whos obligations differ from what you speak off.

dublin.caucus

kippy wrote: »

I think you are incorrect in relation to company directors and their obligations.
There are a number of state appointed directors to many companies, union reps etc etc, whos obligations differ from what you speak off.

Company directors have a fiduciary duty towards the company on whose board they serve. As such, if Dukes was going to make any statement on NAMA it would have to reflect the best interests of Anglo-Irish.

Now, I have to no brief to support Dukes - he was responsible for prolonging FF role in the late 80s with the Tallaght strategy and deserves little praise for it, but it is worth placing his remarks in context. He spoke as a Director of Anglo Irish, not as a former Fine Gael leader.

dublin.caucus

Anyway, as the point was made elsewhere; why don't Daft have a long term economic value indiciator on their website?

It would mean that when you were looking at a house for €250k, you could easily quantify that the LEV was €320k (or whatever it would be) and as such you would be making a huge saving in buying now.

dresden8

dublin.caucus wrote: »

Anyway, as the point was made elsewhere; why don't Daft have a long term economic value indiciator on their website?

It would mean that when you were looking at a house for €250k, you could easily quantify that the LEV was €320k (or whatever it would be) and as such you would be making a huge saving in buying now.

Because it would be a lie and they would leave themselves open to being sued for publishing that blatant lie.

PJW

I think this thread deserves a bump.

The_Minister wrote: »

Ok.
1. We have half-finished developments
2. We can get more money if those developments are finished.
3. We have builders who owe us money.

Our options are:
We can pay those builders to finish those projects, and then get them to pay us the money we paid them, to pay off some of their loans. *Smart option*
Or
We leave the buildings unfinished and sell them for less money. *Not-so-smart option*
Or
We get pissy with the builders and to punish them, hire companies who don't owe us money. Those companies finish the building, then walk off with that money, as opposed to paying most of it back to us. *Thick option*

How about we get Nama backed construction companies to finish the semi constructed developments....i.e all the trade persons from Architects to Brickies that are sitting on the dole now (pay them 50% on top of their social welfare) and you'd have a skilled cheap labour force, people off the dole with a spendable income.



Unfortunetly the main problem will still remain in the current global and national recession NOBODY WANTS TO BUY A HOUSE.

Also NAMA should not bail out any developer loans on green field sites, pure greed lead to the high costs of "future protential development land" argi lands that did'nt even have planning permission, lol (50k per arce now selling at 5k on the outskirts of Athlone etc.) So will the banks lend to develop these site? answer no they wont, why? because NOBODY WANTS TO BUY A HOUSE.

How on earth will NAMA get their investment back on these sites, answer they wont, why? because NOBODY WANTS TO BUY A HOUSE.

The property bubble has well and truly burst (developers building homes for their migrant working staff to live in, crazy stuff) and a line should be drawn under it, the Goverment should forget about property as some super righter for the past wrongs, its not going to happen and the current banks and developers should be left to pasture in these green field site like cows waiting on the slauther house.

A good bank is a far better option (FG option) as linked to earlier in this thread.

meathstevie

Darsad wrote: »

Varadkar is great at stirring things he would be better placed writing to the Minister for Finance requesting ways be implemented to stop the unvouched expenses claimed by TDs of which he will claim over 100K this year nice cushion to help with his negative equity !!

I don't support FG nor Dr Varadkar but that's not at the higher end of the expenses claims in the Dail.

Sand

@The Minister

Ok.
1. We have half-finished developments
2. We can get more money if those developments are finished.
3. We have builders who owe us money.

No, *We* dont. The banks and the developers do. Last time I checked I was a citizen of Ireland, a democratic state, where I paid my taxes to support the public interest - that being an aggregation of all citizens interests.

Its news to me that all along I was a shareholder in a property speculator consortium. Or that I pay my taxes to support the AIB/BoI balance sheet.

Also, jesus the logic underlying 1, 2 and 3 is staggering.

If there was a demand for the developments, in any state, then the private sector would invest and finish and gain the profit on them, without any state incentives. There is no demand for the developments. The private sector has coped this. Hence collapse of the ponzi scheme.

Finished or unfinished theres no demand. "Investing" to make a loss is retarded.

Paying builders so they can pay us? To sell to a market that has collapsed? Where commerical court judges are citing falls in commerical property values of up to 80% as being common?

Wonderful. That is the sort of out of the box thinking we need to really return this country to the stone ages.

Oh and thanks to PJW for citing this. As noted, it was a truly remarkable post worthy of great attention.