Joseph Stiglitz on Nama and similar schemes

ei.sdraob

asdasd wrote: »

There is a different scenario with Ireland and the US. In ireland I would have left the banks go bankrupt and let HSBC buy the assets for a dollar, if they wanted it. Something like that.

In the US no one bank could have taken that on. The US is too big to fail. Thats why the government came in. The depression was caused by Free market economics in extraordinary circumstances. By letting the banks fail, they exacerbated the depression. If we didnt know that history, and had acted the same, we would have had a worldwide depression which would have made the (mostly US based) depression of the 30's look like a day out at the beach.

if they fail

they just print more money (which they have to do either way now) to cover deposit guarantees (not shareholders or bondholders now! regular savings and current accounts which dont amount to much)

we nor the rest of the world are no longer on gold standard like happened during great depression

by handing money to the banks we show the that its ok to be irresponsible and theres no risks

Liam Byrne

creeper1 wrote: »

In fairness I think Mr Cowen is doing the best he can with the bad hand that has been dealt to him.

Creeper1 is right, folks! Cowen is only the Taoiseach and was dealt a bad hand by the former Taoiseach and Minister for Finance.......not his fault at all. :rolleyes:

creeper1 wrote: »

I expect the NAMA bill to be passed in the middle of this month. It's time for the country to get behind it and let recovery have a chance.

You cannot coerce people into getting behind a bad idea and crap leadership.

If there was proper leadership and the proposed solution protected the economy and the taxpayer and made sense (rather than being a massive, foolish, ill-conceived gamble) then they might get behind it.

creeper1

ei.sdraob wrote: »

a fianna failer i see

about the highlighted bit

please remind us who dealt Mr Cowen this hand? :mad:

As has already been answered, this hand was dealt to him by international events beyond his control. It really is hypocrisy on the part of his critics.

In previous budgets during the celtic tiger opposition leaders were screaming at him "Scrooge". Now those same people are saying that he overspent.:rolleyes:

IF you look at the property bubble it could have been contained had a property tax been introduced say 2002 - 2004. How much support would there have been for that? None!

Hindsight is always 20 20. Whoever called Cowen a criminal is a DISGRACE. He also did not "associate with criminals". Nor is NAMA criminal.

We get that people are angry. After all if you lost your job or seen your income decline then you are looking for someone to blame. I'm afraid you should be looking elsewhere.

ei.sdraob

creeper1 wrote: »

As has already been answered, this hand was dealt to him by international events beyond his control. It really is hypocrisy on the part of his critics.

In previous budgets during the celtic tiger opposition leaders were screaming at him "Scrooge". Now those same people are saying that he overspent.:rolleyes:

IF you look at the property bubble it could have been contained had a property tax been introduced say 2002 - 2004. How much support would there have been for that? None!

Hindsight is always 20 20. Whoever called Cowen a criminal is a DISGRACE. He also did not "associate with criminals". Nor is NAMA criminal.

We get that people are angry. After all if you lost your job or seen your income decline then you are looking for someone to blame. I'm afraid you should be looking elsewhere.

excuse me! hindsight?

but was it not the bellowed Bertie Ahern

who told people to go and "commit suicide"

for talking down the boom

:rolleyes:

Zynks

creeper1 wrote: »

IF you look at the property bubble it could have been contained had a property tax been introduced say 2002 - 2004. How much support would there have been for that? None!

Absolutely right there. They should have introduced property tax and abolished stamp duty, which artificially inflated state coffers making the government machine addicted to unsustainable levels of income and expenditure.

They didn't have the balls to make the decisions then, now they have to make much worse decisions. They are paying the price of their own incompetence, and so are we, on the double.

We are now facing lower employment, higher taxes, possibly higher interest rates soon and NAMA, which if is not robbery it is at least a very cynical way to pass the bucket.

BUT, it is our fault ultimately. We kept voting these guys in over and over... the writing was on the wall and we chose to ignore it.

AlekSmart

Absolutely right there. They should have introduced property tax and abolished stamp duty, which artificially inflated state coffers making the government machine addicted to unsustainable levels of income and expenditure.

Perhaps if an earlier generation of Fianna Fáil had not abolished Domestic Rates back in 1978/9 then we might not be where we are now ?

Not content with that the same fellow`s also abolished Road Tax and replaced it with a £5 registration fee.......gosh what larks

Oh by golly but THOSE Politicians had Balls...by the bucket load !!

Step forward Dr Martin O Donoghue and take your bow :eek:

ifconfig

The recent selective quoting of Prof Nouriel Roubini in saying that NAMA was
"the right approach" will see from Mark Little's interview on Prime Time last night that by any measure we have taken the wrong approach. Focus particularly on what he says from about 2:20mins in to the clip about the right approach being that the shareholders first take a hit and if needs be, be wiped out and next the unsecured creditors.

This along with Willem Buiter's contribution on News at one [URL="javascript:showRadioPlayer(%22/news/news1pm/player.html?20091105,2642928,2642928,real,209%22)"]yesterday[/URL]
confirms that the biggest mistake was to extend the bank guarantee to include unsecured creditors. That sowed the seeds for the albatross around the neck of the Irish state and the soon to leave the station trainwreck that is NAMA as conceived by the property religion Fianna Fail and there incompetent and spineless cohorts the Greens.

So much for the cheapest bailout in the world.

Amhran Nua

• Nama is a criminal robbery of taxpayers

Language like that coming from a respected figure like Stiglitz is the most damning indictment imaginable of a major government policy. Criminal, no less.

Hydrosylator wrote: »

it's going to get worse, and then stay that way until the property market comes back to where it was, which might never happen.

Lets hope it never does, it was no good for the economy at any stage.

creeper1 wrote: »

As has already been answered, this hand was dealt to him by international events beyond his control. It really is hypocrisy on the part of his critics.

So the lax financial regulation, the attempts to legislatively inflate an already gigantically overheated property bubble, the pouring of record once off tax returns into persistent costs, setting up a financial two card shuffle that one of the premier economic minds on earth has damned as "criminal", these were all international events?

creeper1 wrote: »

In previous budgets during the celtic tiger opposition leaders were screaming at him "Scrooge". Now those same people are saying that he overspent.:rolleyes:

True enough.

creeper1 wrote: »

How much support would there have been for that? None!

Lack of support hasn't stopped them implementing NAMA.

creeper1 wrote: »

Whoever called Cowen a criminal is a DISGRACE.

The Nobel laureate you have idly branded a disgrace is less so than a minister for finance whose sole knowledge of economics was received by cramming Greenspan's biography after he got the job.

creeper1 wrote: »

We get that people are angry. After all if you lost your job or seen your income decline then you are looking for someone to blame. I'm afraid you should be looking elsewhere.

We should be looking directly at FF and the greens, to make sure they don't get us into any more trouble. Blame will be dealt with later.

old boy

the 1st thing i noticed was our clown cowen being called mr cowen, now if that is not groveling ?

Slozer

skearon wrote: »

What they often forget to mention is that NAMA has the full support of the IMF, EU Commission and most importantly the ECB, the people who are providing the 50+ billion euro. Is it credible that the ECB would risk this money if they though NAMA was not the best plan to fix the Irish economy??

(Taking the case of Anglo Irish Bank as an example).

1. ECB has backed this bank. ECB has given Anglo the money to fund the developers.
2. As we all know of the toxic loans Anglo has this bank had no way of survival without the
the intervention of the Irish government.
3. The collapse of this bank would have meant that the ECB didnt get their money back
(void of the government's intervention).
4. Upon the mergence of the banking crisis the government then go to the ECB and ask them what can they do.
5. The ECB on realising the diastourous financial outcome to them of seeing this bank go under decide that they can transfer this bad debt from the Anglo Irish bank to the Irish people by pretending that they are helping out the Irish governemnt by giving them the billions that they need to fund NAMA. Thus insuring that a. they will directly get their money back and b. have their loans secured by the Irish government.

Developers can default on their loans so too can banks, they can go bankrupt, its all part of business and when they do the Irish people will be left with massive debt, unable to default, unable to go bankrupt, forever in the debt of the ECB.

Damn right the ECB see no risk in this!