Who do you blame for the financial mess we're in?

FreudianSlippers

steddyeddy wrote: »

Hold on how on earth do you think youl be proven right, well never know do you think any of our government have the balls to say to the imf or eu you have to take some of the hit?

In the absense of any potential practice run can you explain how this wont be better than taking any terms we are given? repeating im wrong multiple times and you love being right is leading me to beleive you never made the college debating team!

Firstly, I'm doubting you went to college with that atrocious English.

Secondly, why would the IMF take any of the hit? WTF did they ever do?

Thirdly, why should the EU pay for our poor banking practices - sure they were international practices... but they originated in the US, so should they pay too?

Fourthly, a practice run? lol. Get serious - there is no such thing.

Fifthly, what does "explain how this wont be better than taking any terms we are given" even mean?

Sixthly, I only said you were wrong once.

Seventhly, no I was not a debating team member in college - I had sex with women. But I have enough practice at this point to not waste my time with unfounded opinions put forward like they have any merit.


PS: I'll be proven right when we're not "in the doldrums for 50 years"

tolosenc

The Trade Unions. Actively sought to make the labour market completely uncompetitive, and then claim it's someone else's fault that there are no jobs. Then they go on strike. IDIOTS.

K-9

Wibbs wrote: »

This. I blame our inclusion in the Eurozone.

I hope I'm so very wrong, but I can see the Euro actually failing. We're naturally looking at ourselves as is the world, but lets look elsewhere. Stuff off the front pages for the most part and what may come next. Greeces bailout has hit a few bumps, with Austria recently baulking at how its going.

Look to Portugal http://finance.yahoo.com/news/Portugal-braces-for-market-apf-958639662.html?x=0&sec=topStories&pos=4&asset=&ccode= the euro did them no favours and after we look vaguely like stabilising the markets will round on them and they're very shaky.

If they stumble Spain is next and if Spain goes it's game over. Their economy is just simply too big to bail out in any meaningful way. As it stands they have a near 20% unemployment rate. That's overall. Among the young between 20 and 30, its nearer 30%. That's not good.

They also had a housing bubble on the back of cheap credit in the early naughties(back to the Euro again). House prices ramped up and we're not talking about some taxi driver thinking he was Alan Sugar and buying a half finished pile in Marbella(pronounced with the L's included). We're talking ordinary Spaniards.

If they look shaky and I really really hope they don't and our bailout starts to tighten belts all over the place. If not then there is a real possibility that the EU's finances could be in a very bad state down the line. Plus sooner or later the citizens of Germany and France and any of the other OK eurozone economies are going to start (understanably) getting pissed off with bailing out others.

Unfortunately it stems back to long before the Euro. The Irish Central Bank Governor was warning banks as far back as 1997 about lax lending criteria and probably before it. The property bubble had started about 95/96.

Irish Central Bank declared its impotence before launch of the euro; Why Spain's biggest banks survived huge housing boom

Central bank governor Maurice O'Connell, told the Oireachtas Committee on Finance and the Public Service in early 1997: "There seems to be a perception that the Central Bank can exercise some legal authority in restricting credit. It has no such authority. Any restriction would be inconsistent with European Union practice. Besides, it would be unworkable as demand would probably be met by overseas lenders."
He said the Bank had warned financial institutions repeatedly of the dangers inherent in high rates of credit growth and any relaxation of lending standards.
In the following years, as Finance Minister Charlie McCreevy stoked the property boom with income and capital tax cuts coupled with a massive expansion of property tax incentives, the annual reports of the Central Bank chronicled the letters that were sent by the governor to the financial institutions, pleading for prudence.
In April 1999, the governor had issued a letter stating that an analysis of practices had shown that some lenders had no evidence as to how borrowers came by the balance of their money. The governor criticised what he called, the particularly disturbing practice of allowing large amounts of the borrowers after tax income to go towards paying off a mortgage.
The 1999 annual report notes: "Institutions were...advised that it remains vitally important for them to take a medium term perspective and to reckon with the potential consequences of rising interest rates and a return to lower rates of growth in the economy. All institutions gave assurances that there would be no slackening in prudential lending standards."

LOL at assurances at no slackening in lending standards.


Once the 2.5 times earnings ratio was abandoned it went into free fall from there, 30/40% net income repayments, 35/40 year terms, using rent a room relief earnings as income, 5 year interest only buy to let "investments"


The political will was there to give the regulator teeth last year. Too little, too late.

TripleAce

I blame the people.

Nobody was forced to take 100% mortgages.

Nobody was forced to buy 2-3 houses in order to speculate (and making it difficult for first time buyers).

Nobody was complaining back then when they were making tons of money out of it, but as any other investment there is a risk attached to it...hard luck.

Nobody was forced to borrow money to buy flashing 50k cars rather than saving them wisely.

And I could go on and on.....

Of course banks and politicians have their fair share of blame, but it is really too easy to always put blame on others....

Wibbs

K-9 wrote: »

Unfortunately it stems back to long before the Euro. The Irish Central Bank Governor was warning banks as far back as 1997 about lax lending criteria and probably before it. The property bubble had started about 95/96.

Irish Central Bank declared its impotence before launch of the euro; Why Spain's biggest banks survived huge housing boom

OK but whatabout this part from that quote; "There seems to be a perception that the Central Bank can exercise some legal authority in restricting credit. It has no such authority. Any restriction would be inconsistent with European Union practice."So even at that stage the authority on that score was within Brussels remit?

As for Spain, yes they did keep a check on the housing bubble by comparison to us, but at the same time their savings banks were not being well run at all, so they still have a banking crisis and a big one. http://www.creditwritedowns.com/2010/05/cajasur-nationalization-makes-fragility-of-spains-banks-topical.html Their government spending and daft employment laws have crippled them pretty badly too.

Once the 2.5 times earnings ratio was abandoned it went into free fall from there, 30/40% net income repayments, 35/40 year terms, using rent a room relief earnings as income, 5 year interest only buy to let "investments"

Oh I agree. Don't get me wrong, this bastard problem has many fathers, most dead beat or absent ones. I just find it interesting that the notion that EU fiscal policy and the Euro played no part has such currency, whereas we're quick enough to blame all the other fathers of this crisis.

The political will was there to give the regulator teeth last year. Too little, too late.

I agree. I would say there is a particular problem in this country with whistle blowers. As a nation we historically don't like the idea of informers and snitches so maybe that's part of it? Regardless, sticking your head above the parapet in this country is not liked or supported one little bit. Best case scenario they're seen as moaning minnies, worse as traitors to their peers and the nation. Add that to a small population of people in control and parish pump I'm all right Jackism and it's not a good recipe for dealing with impending issues. Add in brassneckism and it's a very bad one.

K-9

Wibbs wrote: »

OK but whatabout this part from that quote; "There seems to be a perception that the Central Bank can exercise some legal authority in restricting credit. It has no such authority. Any restriction would be inconsistent with European Union practice."So even at that stage the authority on that score was within Brussels remit?

Apparently so.

Yet we were able to introduce extra capital requirements last year for the banks. The horse had bolted at that stage though.

The Govt. had other tools like restricting the substantial tax allowances for developers, hotels, nursing homes etc.

They also, when the market stalled in 06 and this is very telling, doubled Mortgage Interest Relief in 2006 and increased it substantially before that. Remember the whole controversy over McDowell wanting Stamp Duty cut and the opposition too? That was at the same time. The Government chose to put the money in the people's pockets instead.

So, they had the tools to try and inflate the market when it cooled, they had those same tools to cool it as well, such as taking away the FTB grant of £3,000.

They could also have increased the Capital Gains Tax rate that McCreevey halved in the 90's, from 40 to 20%.

Wibbs wrote:

As for Spain, yes they did keep a check on the housing bubble by comparison to us, but at the same time their savings banks were not being well run at all, so they still have a banking crisis and a big one. http://www.creditwritedowns.com/2010/05/cajasur-nationalization-makes-fragility-of-spains-banks-topical.html Their government spending and daft employment laws have crippled them pretty badly too.

Yes, but is shows that the Govt. had tools there, they again chose not to use them.

Wibbs wrote:

Oh I agree. Don't get me wrong, this bastard problem has many fathers, most dead beat or absent ones. I just find it interesting that the notion that EU fiscal policy and the Euro played no part has such currency, whereas we're quick enough to blame all the other fathers of this crisis.

It did play a role but blaming it lets us away with our share of the blame, like the cases I outlined above. It also assumes that we, somehow, would have avoided the property bubbles in other, non Euro or non EU countries, like Latvia, Britain, Iceland or the US, simply by not being in the Euro. Iceland had high interest rates and still managed their own bubble.

Really, if the will isn't there to stop a bubble, it doesn't matter what currency or interest rates you have.

Wibbs wrote:

I agree. I would say there is a particular problem in this country with whistle blowers. As a nation we historically don't like the idea of informers and snitches so maybe that's part of it? Regardless, sticking your head above the parapet in this country is not liked or supported one little bit. Best case scenario they're seen as moaning minnies, worse as traitors to their peers and the nation. Add that to a small population of people in control and parish pump I'm all right Jackism and it's not a good recipe for dealing with impending issues. Add in brassneckism and it's a very bad one.

Nail on head and excellent point. Touts aren't liked in this country and will face huge personal attacks. I remember a member of the benchmarking body who resigned from the sham it was and he was treated like a pariah.

That is something we can all take on a personal level from this mess.

Fighting Irish

lol

OisinT wrote: »

Firstly, I'm doubting you went to college with that atrocious English.

Secondly, why would the IMF take any of the hit? WTF did they ever do?

Thirdly, why should the EU pay for our poor banking practices - sure they were international practices... but they originated in the US, so should they pay too?

Fourthly, a practice run? lol. Get serious - there is no such thing.

Fifthly, what does "explain how this wont be better than taking any terms we are given" even mean?

Sixthly, I only said you were wrong once.

Seventhly, no I was not a debating team member in college - I had sex with women. But I have enough practice at this point to not waste my time with unfounded opinions put forward like they have any merit.


PS: I'll be proven right when we're not "in the doldrums for 50 years"

Monty Burnz

OisinT wrote: »

This is just wrong and misguided.

I actually think that is right. We're borrowing so much as a state (because Fianna Failure made the bank debts into state debts) that the repayments will be crippling. Instead of spending our taxes on education/health/services etc, a third of our taxes will go straight out the door to pay these debts. That's the best case scenario!

More likely, the currebt bail-out will not be enough when the mortgage defaults that have not been allowed for start to add up, and when the NAMA losses hit home. My analysis is that the state is finished - completely and irredeemably bankrupt due to the crazy bank guarantee.

As usual, I'll point interested readers towards www.thepropertypin.com - a website set up by folks exiled from AskAboutMoney in 2006 for daring to suggest that we were living in a property bubble that would eventually burst with terrible consequences.

Fighting Irish

TripleAce wrote: »

I blame the people.

Nobody was forced to take 100% mortgages.

Nobody was forced to buy 2-3 houses in order to speculate (and making it difficult for first time buyers).

Nobody was complaining back then when they were making tons of money out of it, but as any other investment there is a risk attached to it...hard luck.

Nobody was forced to borrow money to buy flashing 50k cars rather than saving them wisely.

And I could go on and on.....

Of course banks and politicians have their fair share of blame, but it is really too easy to always put blame on others....

True

I have no mortgage, no loans and money in the bank. And i couldn't care less about this IMF crack

Fighting Irish

Fighting Irish wrote: »

I have no mortgage, no loans and money in the bank. And i couldn't care less about this IMF crack

What pisses me off is that I'm being forced to give away my money to repent for everyone else's retarded decisions. I am exactly 0% responsible.

It's like the crucifixion, except this isn't a horror story told to kids and aul' wans to turn them into mindless zombies. :pac:

Morlar

Fighting Irish wrote: »

True

I have no mortgage, no loans and money in the bank. And i couldn't care less about this IMF crack

Did you ever see good fellas ? remember the line 'fcuk you payme!'

It doesn't matter if you don't care or not if you work for a living then you are paying for it. It's possible so will your kids and grandkids.

Morlar

Deleted User wrote: »

What pisses me off is that I'm being forced to give away my money to repent for everyone else's retarded decisions. I am exactly 0% responsible.

It's like the crucifixion, except this isn't a horror story told to kids and aul' wans to turn them into mindless zombies. :pac:

It kind of reminds me of World War reparations only . . . without the world war. Acc TV3 last night (whose figures are questionable) this is heading for one third of a Trillion. That is without any potential mortgages meltdown or credit union meltdown.

Luxie

stepbar wrote: »

And to add to that I was advising people to sell out of bank shares in early 2007 because I could see no value in same.

I sold in 2007.

bonzos

Patrick Neary...over paid public servant who like many didnt do his job and still got rewarded!!!!

Zebra3

Current %ages in the poll are adding up to >250%. Wtf?

cleremy jarkson

TripleAce wrote: »

I blame the people.

Nobody was forced to take 100% mortgages.

Nobody was forced to buy 2-3 houses in order to speculate (and making it difficult for first time buyers).

Nobody was complaining back then when they were making tons of money out of it, but as any other investment there is a risk attached to it...hard luck.

Nobody was forced to borrow money to buy flashing 50k cars rather than saving them wisely.

And I could go on and on.....

Of course banks and politicians have their fair share of blame, but it is really too easy to always put blame on others....

One of the only posts so far in this thread whose opinion matches mine.

It doesn't matter how often banks pushed loans on people or how big the loans being offered were. Nobody had to accept them. People are supposedly free agents who should be responsible for their own lives. And very often they were used for buying holiday homes for pleasure purposes in Spain and Bulgaria etc. Disgusting self-indulgence on the part of others that we all ultimately have to pay for.

Having money is a luxury, and taking a loan out should be a massive decision for somebody. How is an economy supposed to function if people just borrow money and end up not having to pay it back because they are in the majority? Where's the justice for those who maintained what was always the quintessential Irish mentality of prudency with money and saving for when you want something? Holiday homes, 400 grand houses, new cars every 2 years etc are and always were always ludicrous financial decisions, and anyone who enjoyed the luxury of having any of those things shouldn't be bailed out now by people who didn't, it's just not fair.

AckwelFoley

Old_-_School wrote: »

I think it's fair to say that the blame for the current financial crisis is shared amongst most of those mentioned in the poll, but who do you attribute the majority of the blame to?

You forgot the obvious option "none of the above" on their own


There is no one single factor, but a number of them.


Blame the builders? Well, they operated of crazy credit given to them by the financial institutions / banks

Blame the banks? Yea, but they should have been regulated

Blame the regulator? No, they were toothless, the government should have gave them teeth

Blame the government? Well, the electorate voted for them

Blame the electorate?

^ i think you see where im going with this - not to mention the small matter of a global recession we're in -we were always going to be in a recession now - the only difference is if the economy and fiscal policy were more prudent we wouldnt have such a deficit right now

Nolanger

Department of Finance - for employing too many people with basic or no finance qualifications.

Princess Consuela Bananahammock

snyper wrote: »

You forgot the obvious option "none of the above" on their own


There is no one single factor, but a number of them.


Blame the builders? Well, they operated of crazy credit given to them by the financial institutions / banks

Blame the banks? Yea, but they should have been regulated

Blame the regulator? No, they were toothless, the government should have gave them teeth

Blame the government? Well, the electorate voted for them

Blame the electorate?

^ i think you see where im going with this - not to mention the small matter of a global recession we're in -we were always going to be in a recession now - the only difference is if the economy and fiscal policy were more prudent we wouldnt have such a deficit right now

You can tick all the noxes if you want...

Anchises

Clearly it all started with the governments policy of encouraging construction with capital allowances /tax breaks for Hotels, Urban Redevelopment, Car Parks, Seaside town redevelopment, holiday homes etc.....

All the others lined up at the trough to get a piece of the action.

The Banks loaned too much money
The regulator was looking the other way
The developers pushed prices up
etc, etc ,,,,,
The population joined in the celebrations..

The tiger growled quietly in the corner, waiting to pounce

A bubble has to explode sometime if it continually inflated !

A.

CamperMan

everyone that got credit!

limklad

OP: You left out a few other options in the Poll
EU
Euro
UK
Margaret Thatcher
IRA
Unionists
Telly Tubbies
The Deviiiilllll
Aliens 1 ,2 & 3
George Bush 1 & 2
Zig & Zag, but not Dustin

If Dustin was Taoiseach we be constantly in a Job Building crap buildings but we still be employed.

limklad

CamperMan wrote: »

everyone that got credit!

Yea I did the same, There was many more missing from the list

stepbar

Zebra3 wrote: »

Current %ages in the poll are adding up to >250%. Wtf?

It's starting to look like the % of the national debt vs GNP....

OPENROAD

Anchises wrote: »

Clearly it all started with the governments policy of encouraging construction with capital allowances /tax breaks for Hotels, Urban Redevelopment, Car Parks, Seaside town redevelopment, holiday homes etc.....

All the others lined up at the trough to get a piece of the action.

The Banks loaned too much money
The regulator was looking the other way
The developers pushed prices up
etc, etc ,,,,,
The population joined in the celebrations..

The tiger growled quietly in the corner, waiting to pounce

A bubble has to explode sometime if it continually inflated !

A.

Would demand for said houses not be the reason house prices were pushed up i.e supply and demand, or have people forgotten already the long queues of people looking to buy apartments off plans a few years ago.

ScumLord

Where's Atari jaguar? I can't cast my vote to show how little I care about finding someone to blame, I feel like my rights as a boards user have been neglected.

Old_-_School

There was multiple voting options so essentially each entity is being judged on their own merits as a percentage.

Wagon

Fighting Irish wrote: »

eh no

Well fúck, that's certainly changed my mind on the whole thing...

steddyeddy

cleremy jarkson wrote: »

One of the only posts so far in this thread whose opinion matches mine.

It doesn't matter how often banks pushed loans on people or how big the loans being offered were. Nobody had to accept them. People are supposedly free agents who should be responsible for their own lives. And very often they were used for buying holiday homes for pleasure purposes in Spain and Bulgaria etc. Disgusting self-indulgence on the part of others that we all ultimately have to pay for.

Having money is a luxury, and taking a loan out should be a massive decision for somebody. How is an economy supposed to function if people just borrow money and end up not having to pay it back because they are in the majority? Where's the justice for those who maintained what was always the quintessential Irish mentality of prudency with money and saving for when you want something? Holiday homes, 400 grand houses, new cars every 2 years etc are and always were always ludicrous financial decisions, and anyone who enjoyed the luxury of having any of those things shouldn't be bailed out now by people who didn't, it's just not fair.

That very true and I wouldnt disagree with you on that. I can understand people taking out loans in order to try and start a business though.

The other point I would make is banks that offers loans to people who clearly wont be able to pay them back are incompetent pure and simple, ten per cent of anglos income was through fraud. Incompetent and illegal banking certainly was going to have an impact.

epgc3fyqirnbsx

It's John's fault