NAMA-Why do we take it lying down?

Brussels Sprout

It's painfully obvious to anyone who takes the time to sift through the detail that the debt incurred through the sheer greed of a small group of people is being transferred onto the shoulders of the entire population of taxpayers. Why are we accepting this? If this was in one of many other countries there would be mass strikes, protests and probably riots. Is it our curse are Irish people that we love to complain about things but when it comes to action we're afraid to take that step(we won't even complain in restaurants!).

The public service have had a few marches and strike days but that was over their wages being cut. NAMA is far more disastrous then that yet nobody would consider taking to the streets to protest it apart from the usual fringe left wing groups (who most people ridicule).

It's no wonder the politicians, bankers, developers and top civil servants were able to ride roughshod over us because they knew that we'd take it lying down like the grumbling doormats that we are.

fontanalis

I'd say there are alot of people who think it will increase property prices and that is a sign of a good economy.

Liam Byrne

I don't honestly know. I wish I did.

But apparently - according to the weekend poll - shafting the country in the long-term and committing to an over-inflated future housing price model (the only way NAMA can "recoup" the "discounts" and "work" on some level) is OK by at least 25% of the population, with most of the rest of us too stunned and sickened to know how best to fight against this injustice.

Welease

So what would be your plan to recapitalise the banks and free up credit etc. for the business that need it to survive?

(and I'm not trying to be an arse here.. but I hear everyone complaining about the plan, but I don't see anyone coming up with a watertight suggestion for an alternative... personally I'm undecided )

PeakOutput

Brussels Sprout wrote: »

It's painfully obvious to anyone who takes the time to sift through the detail that the debt incurred through the sheer greed of a small group of people is being transferred onto the shoulders of the entire population of taxpayers. Why are we accepting this?

because its the only course of action that will save the country probably

edit; and we are not the only putting money into the banks we are however the only one i know off getting something for our money that we can then sell in the long term

Liam Byrne

Welease wrote: »

So what would be your plan to recapitalise the banks and free up credit etc. for the business that need it to survive?

(and I'm not trying to be an arse here.. but I hear everyone complaining about the plan, but I don't see anyone coming up with a watertight suggestion for an alternative... personally I'm undecided )

The problem is that the damage has been done with Lenihan's hair-brained guarantee of Anglo.

If he hadn't done that, we could have let the gambling banks fail (as per the rules of capitalism) and start over with new banks.

But having done that, he opened the manhole cover to the bottomless pit, and also was either stupid or corrupt enough to avoid putting in the necessary legal conditions to safeguard our unwanted "investment" from being wasted on bonuses for the shower of idiots that mismanaged in the first place, and no rules on lending, and no rules on completely clean slates with real managers.

fuelinjection

In an ideal world NAMA would not exist. But its is the best of what we can do.

The Irish people, us, now own the Banks. Socialism that would have been laughed at a few years ago. Even President Obama has done it.

The cost of bad loans and the true value of unsold land and houses is the real question. What is an empty housing estate worth in Gorey ?
Will it be knocked down and a farmer turns the land back into a farm ?
Will the gamblers who gambled millions on that land be chased for their savings ?

fontanalis

PeakOutput wrote: »

because its the only course of action that will save the country probably

edit; and we are not the only putting money into the banks we are however the only one i know off getting something for our money that we can then sell in the long term

But is it not trying to re-inflate a bubble that doesn't need ot be inflated? It was touted as being the same as what Sweden done but a politician involved in Swedens process said it was nowhere near the same.

Arnold Layne

fontanalis wrote: »

But is it not trying to re-inflate a bubble that doesn't need ot be inflated? It was touted as being the same as what Sweden done but a politician involved in Swedens process said it was nowhere near the same.

I can't see another bubble happening. Those of us who have been burnt won't get fooled agin, nor will our kids who have seen it all go wrong. As Liam Byrne has said it is the 2 Brians guarantee for Anglo that set the ball rolling; and we all assume (know) why they did this. The Department of Finance had drafted a bill to let Anglo go to the wall but this was overruled by the 3 men in a tub (if you count Mary Coughlan)

Liam Byrne

PeakOutput wrote: »

....and we are not the only putting money into the banks we are however the only one i know off getting something for our money that we can then sell in the long term

We are paying more than they are worth in the "hope" that they will return to the same unrealistic, over-inflated prices that made us uncompetitive as a country.

If FF paid what they are currently worth, maybe even offering the banks an option of 50% of a future profit, then it might be considered a realistic proposition.

But no-one with any sense pays more than something is worth and considers it a "discount".

fontanalis

Arnold Layne wrote: »

I can't see another bubble happening. Those of us who have been burnt won't get fooled agin, nor will our kids who have seen it all go wrong. As Liam Byrne has said it is the 2 Brians guarantee for Anglo that set the ball rolling; and we all assume (know) why they did this. The Department of Finance had drafted a bill to let Anglo go to the wall but this was overruled by the 3 men in a tub (if you count Mary Coughlan)

I do think it could happen again, not on the same level but some people just can't do basic maths. Anglo should have been left to the dogs and any high level person at BOI and AIB or anywhere that contributed to this clusterf**k of epic proportions should be doing a job where they might break a sweat.

Welease

Liam Byrne wrote: »

We are paying more than they are worth in the "hope" that they will return to the same unrealistic, over-inflated prices that made us uncompetitive as a country.

If FF paid what they are currently worth, maybe even offering the banks an option of 50% of a future profit, then it might be considered a realistic proposition.

But no-one with any sense pays more than something is worth and considers it a "discount".

But, on the other hand leaving the banks with billions of negative capital on their books wouldn't free up any capital for credit, which seems to be the short term aim of NAMA.

Liam Byrne

Welease wrote: »

But, on the other hand leaving the banks with billions of negative capital on their books wouldn't free up any capital for credit, which seems to be the short term aim of NAMA.

Who gives a **** ?

If there was a market of people wanting to borrow, then a reputable bank from abroad would have been delighted to come in and take the business.

fontanalis

What about the "NAMA for the people" coming up?

Brussels Sprout

So to answer my original question the consensus so far from the responses appears to be that in general people dislike NAMA but don't see any alternative. Ok I understand that (although I'm definitely not convinced that it's the correct way to go).

What absolutely kills me though is that the same people who steered us into this mess with their 'soft landing' talk are now charged with getting us out of it. I mean they've already shown that they couldn't manage a boom-shouldn't we be looking to an alternative to manage the bust?

Imagine if this had happened in France!

Welease

Liam Byrne wrote: »

Who gives a **** ?

If there was a market of people wanting to borrow, then a reputable bank from abroad would have been delighted to come in and take the business.

No need to take that attitude..

You do realise a lot of the banks around the world were in exactly the same postion due to the sub prime issues in the US? So in all probability, no bank would have had the time, funds or bothered to come to a tiny market like Ireland.. So no, they wouldn't have just popped in to save us. Meanwhile more business's are going to the wall in Ireland because credit has dried up..

So I ask again... if you don't do NAMA, then how do you get credit flowing to those who need it?

MysticalRain

I really despair for this country sometimes. At this point I consider FF to be nothing more than a bunch of traitors to their own country. I am becoming more and more convinced that we will always be a country of losers, except for a handful of well-connected insiders.

fontanalis

Welease wrote: »

No need to take that attitude..

You do realise a lot of the banks around the world were in exactly the same postion due to the sub prime issues in the US? So in all probability, no bank would have had the time, funds or bothered to come to a tiny market like Ireland.. So no, they wouldn't have just popped in to save us. Meanwhile more business's are going to the wall in Ireland because credit has dried up..

So I ask again... if you don't do NAMA, then how do you get credit flowing to those who need it?

Those who had too much in the first place (generalisation I know but too much credit played a big part in this)?

fuelinjection

Brussels Sprout wrote: »

Imagine if this had happened in France!

Well it hapened in Spain, Greece, Iceland, UK and America (USA).
If there is another option then people should bring it up with their political party. In my opinion, it's the best of a bad situation.
In an ideal world we would not be here but ...

Liam Byrne

Brussels Sprout wrote: »

So to answer my original question the consensus so far from the responses appears to be that in general people dislike NAMA but don't see any alternative.

That's not strictly true.

Despite the hole that Ahern, Cowen & Lenihan have led us into, and despite the fact that there's now no choice but to do SOMETHING like NAMA, there are alternatives.

1) Buy the bank shares off the scheisters that are running them - AT CURRENT OR PRE-GUARANTEE PRICES; if they don't agree, tell them to f**k off and rot

2) Buy the loans at CURRENT PRICES - like I said, by all means put in a proviso that the bank gets some share of the "profit", but the current one - paying more than they're worth and charging the bank later if they make a loss - is a joke, considering that the banks don't have any money

I mean, no-one would conduct ANY business the way the Government have; bailing out without looking and "trusting" the corrupt shower of ***ks to do the right thing, with no legal obligations to do so, and no comeback if the developers and/or the banks go bust

There should be 3 million* people marching on Dail Eireann to object to this; those working in there are OUR EMPLOYEES; not our "masters".

* The 25% that answered a certain way to last Sunday's poll wouldn't march on Dail Eireann if FF fired a nuke dead straight upwards into the sky

fontanalis

fuelinjection wrote: »

Well it hapened in Spain, Greece, Iceland, UK and America (USA).
If there is another option then people should bring it up with their political party. In my opinion, it's the best of a bad situation.
In an ideal world we would not be here but ...

Other countries don't have the top three people in power there because they inherited a seat to gain entry into politics, or had Bertie in power.
Why not give the money to credit unions, so they can lend to people. i'd rather see money oging to small businesses than the galway races tent cowboys.

Liam Byrne

Welease wrote: »

So I ask again... if you don't do NAMA, then how do you get credit flowing to those who need it?

Well I'll ask this : how much credit have you seen flowing since the guarantee and NAMA were imposed on us ?

And since we apparently have €64 BILLION to throw into a black hole, not to mention the additional €20 BILLION or so already thrown at the banks themselves, why not give it to the Credit Unions and let them operate as a co-operative bank ?

It'd end up being cheaper and fairer, and those who gambled would be where they deserve to be.

Welease

fontanalis wrote: »

Those who had too much in the first place (generalisation I know but too much credit played a big part in this)?

Well I'm not talking specifically about those, but yes they did.. I am talking about the average business around the country that need credit lines to purchase raw materials, services, capital costs, generate credit lines themselves for their suppliers/customers etc.. Business's need credit lines available in order to function, without those many healthy viable business's go bust.. Someone somewhere has to provide that credit so our economy can function.. NAMA is apparantly that solution (again, i don't know if i agree or disagree with it, but while so many condemn it they don't seem to offer a viable alternative, so in the absence of that we need to do NAMA)

Liam Byrne

Welease wrote: »

No need to take that attitude..

But the whole point of the thread is that there IS a need to take that attitude.

Otherwise FF and their Galway Tent buddies get to sell us all down the swanee on a massive gamble which...

a) if it fails, means we're bankrupt
b) if it succeeds, means we're back in the overpriced bubble and uncompetitive due to the need for everyone to earn €1,000 per month solely to have a roof over their heads

Lose-lose for the public; win-win for the Galway Tent.

So yes, there is a need for "that attitude", and if enough people had it maybe we wouldn't be taking it up the arse from the incompetent shower of ****s that some people voted for despite the evidence.

Arnold Layne

fuelinjection wrote: »

Well it hapened in Spain, Greece, Iceland, UK and America (USA).
If there is another option then people should bring it up with their political party. In my opinion, it's the best of a bad situation.
In an ideal world we would not be here but ...

"Its the the only show in town"

"We are where we are"

Does the NAMA Bill force banks to lend to small businesses to keep them afloat? The answer is NO! NAMA protects the banks and its' investors, who encouragèd them (the banks) to lend recklessly.

Welease

Liam Byrne wrote: »

Well I'll ask this : how much credit have you seen flowing since the guarantee and NAMA were imposed on us ?

And since we apparently have €64 BILLION to throw into a black hole, not to mention the additional €20 BILLION or so already thrown at the banks themselves, why not give it to the Credit Unions and let them operate as a co-operative bank ?

It'd end up being cheaper and fairer, and those who gambled would be where they deserve to be.

ok thats an option, so lets explore it..

What would the credit unions do any differently than the banks?..

NAMA
With NAMA the country ends up with assets that may be worth more than we paid for them (the price for most will rise, its just whether it rises more than inflation so we make a profit).

CREDIT UNIONS
If we gave the Credit unions 54 billion..
Are they setup to handle the amount of customers, with no background of financial records for those companies..
Do they have the staff available to manage the increase in accounts (probably not).. so they have to hire in and train staff
Do they have the complex systems and trained staff to cope with the flexible business credit needed? probably not

And the big question... what do we get back for our 54 billion? How do we reclaim that expenditure..

Are you trying to fix the credit problem, or are you trying to punish those who caused the problem?

Only a few high level people caused the problems, so why go though all of that change when we could recapitalise the banks through NAMA, and ensure the senior decision makers of the bank were removed from office?

Liam Byrne

Welease wrote: »

With NAMA the country ends up with assets that may be worth more than we paid for them (the price for most will rise, its just whether it rises more than inflation so we make a profit).

I honestly cannot believe that you left out the fact that they could rise by 30% and still only be worth what we're paying for them!!! :eek: And the fact that the remainder needs to be recouped from developers who are effectively bankrupt!

Welease wrote: »

Are they setup to handle the amount of customers, with no background of financial records for those companies..

The banks were, and they didn't bother.

Welease wrote: »

Do they have the staff available to manage the increase in accounts (probably not).. so they have to hire in and train staff

Thereby creating much-needed employment.

Welease wrote: »

Do they have the complex systems and trained staff to cope with the flexible business credit needed? probably not

Compared to the "trained staff" that offered me a loan that would have involved me paying them 50% more than I could afford ?

Again, training would solve this.

Welease wrote: »

And the big question... what do we get back for our 54 billion? How do we reclaim that expenditure..

What are we going to get back anyway ?

Welease wrote: »

Are you trying to fix the credit problem, or are you trying to punish those who caused the problem?

Ideally, both.

Welease wrote: »

Only a few high level people caused the problems, so why go though all of that change when we could recapitalise the banks through NAMA, and ensure the senior decision makers of the bank were removed from office?

Because
(a) it's too much of a gamble
(b) it's rewarding those who got us into the mess
(c) there is no legal obligation to do the bit in bold, as shown by the interior appointment to AIB
(d) it's "success" relies on future uncompetitiveness

Welease

But your solution fixes neither...

You sack staff from one bank, who get hired into the credit union to perform similar work (so no employment actually gets generated).
You throw 54 Billion at the credit unions and you get 0 back.. NAMA immediately has 54 Billion - 30% return by your numbers... Why is getting 0 back better?

How is that a solution?

Liam Byrne

Welease wrote: »

But your solution fixes neither...

You sack staff from one bank, who get hired into the credit union to perform similar work (so no employment actually gets generated).
You throw 54 Billion at the credit unions and you get 0 back.. NAMA immediately has 54 Billion - 30% return by your numbers

How is that a solution?

I did not say that there would be a 30% return from NAMA!!! :mad:

I'll repeat the question :

I honestly cannot believe that you left out the fact that they could rise by 30% and still only be worth what we're paying for them!!! And the fact that the remainder needs to be recouped from developers who are effectively bankrupt!

You claimed that they only had to rise by a small amount; my point was that they would have to rise at least 30% in order for it to break even

How is that a solution ?

Welease

Liam Byrne wrote: »

I did not say that there would be a 30% return from NAMA!!!

I'll repeat the question :



How is that a solution ?

I said 54 billion - (minus) 30% .... (which are your figures not mine)

NAMA transfers ownership of those properties effectively to the state.. which can be sold at a future date.
Your solution hands out 54 billion and we get nothing in return..

Explain why you think that is a better solution.

Liam Byrne

Welease wrote: »

Your solution hands out 54 billion and we get nothing in return..

Explain why you think that is a better solution.

Quit back-tracking and avoiding the question!

You claimed (incorrectly) earlier that :

Welease wrote: »

NAMA
With NAMA the country ends up with assets that may be worth more than we paid for them (the price for most will rise, its just whether it rises more than inflation so we make a profit).

Given the 30% difference that you're now acknowledging, will you now admit that that was 100% misleading and incorrect ?

Anyway, to answer your question, the FF spin machine has repeatedly denied that it's a bailout for the banks, and that "it's required to get credit moving".

Given that the banks have already given the two-fingers to FF (who stupidly had no real conditions on the bailout), there is no guarantee that it will do this.

If that was FF's criteria, then my solution achieves that.

It also puts money back into the economy, thereby encouraging commerce, and thereby keeping jobs and businesses afloat.

And bear in mind that I quoted figures of €74 BILLION, when you take into account the recapitalisation.....and €20 BILLION of that is already GONE.

So putting €54 BILLION (or, if you prefer, €54 BILLION minus the 30%, so that we don't lose more than NAMA) into the Credit Unions is fairer, more just, and achieves the stated aim.