The Kingston story: Bidders fail to pay up for auctioned cows

Base price

paddysdream wrote: »

Read this again and think you are agreeing with me!!!!!
Bank(you) lends me money(tractor) and trusts me to look after it(pay it back as agreed)
They assume I want it for reasons I state and not for anything else(spent on things I borrow it for)
If I held onto it(didn't make repayments as agreed) then bank calls me in and we talk,renegoitate etc and come to an agreement to sort it out.
If all the above fails bank gets legal(usually takes years)and looks at the security lodged and involves sheriff ,court (bit like getting neighbours,friends in to help)
I would be some bzatard if all the above fails to work on me.
If all else fails bank get possession of security and no other bank would touch me with a barge pole.
See, you agree with me 100%
Knew we were on the same page!!!!!!!!!!!!

Ah but your analogy is not accurate. Banks are not in the business of lending tractors to neighbours
You and I both know that a banks principle task is to make money for their shareholders - final.
However whilst trying to accomplish that task they also cover themselves well by charging interest, bank charges, reinvesting money on deposit etc, etc. Banks are risk takers with the added advantage of demanding collateral so they hold the trump card and in most cases are always on the winning side.

paddysdream wrote: »

Even if you borrowed to the hilt with the land left in as security and no attempt to repay ?

Why do you think that farmland should be immune to being repossessed ?Is it only farms this applies to or should anyone's house ,business or investment property.Is it the lenght of time a person has owned it that's important or should the court etc take a persons emotional attachment to their property into account?
Help me out here please !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!1

Simply because on a rising tide banks were quick to cash in the value of the collateral assist. There was feck all evictions until last year however once property prices started to rise the banks pulled the plug. During the debts of the recession it suited them (banks) not to foreclose on loans as the land/properties were been maintained etc. Which goes back to my previous point that a banks principle task is to make money for their shareholders.

Buford T. Justice XIX

Farmer Ed wrote: »

You have made my point for me. Kerry practically never filled its quota in 30 years of predominantly good milk price. Yet now as we enter more uncertain times. In the first year post quota even Kerry increases milk output by 11%.
Why didn't Kerry farmers decide to fill their quota when milk price was good? There was absolutely nothing stopping any individual farmer in kerry who wanted to do so, from expanding over the past 30 years and I'm sure some did. But the fact is collectively they didn't seem to have the desire to expand for whatever reason.

Now is it realistic to think that it is just a coincidence that they increased by that much last year or could it be that a lot of this extra milk production has been driven by hype? I think the kerry case study would suggest it is the latter. Can I repeat again my belief that Kerry people are as clever a bunch as you are ever likely to meet anywhere. It makes it all the more alarming that even they have got caught up in the hype.

Not to be getting of subject. The sad lesson here is that with rapid expansion comes enormous risk.

Kerry almost never filling its quota:D. When Kerry filled its quota, the country was over quota badly. Any year the country was under quota, Kerry was under quota. Look it up if you want, it's there in black and white.

Look, you're conflating quota and processing. They're two completely different issues in Kerry. The ability of Kerry to fill its quota was always dependent on weather, or more precisely, level of rainfall. In a wet year, Kerry cannot supply a large quantity of milk. The majority of land in Kerry is subject to twice the level of rainfall of the exact same land on the east coast. Yet, they make it work despite that huge disadvantage. Processing capacity is being put in place to cater for both future milk volumes predicted by annual surveys and upgrading plants to cater for different value added items that are being focused on.

Anyway, this is way off topic, open a new thread to discuss the 'hype' around the abolition of quotas if you want.

djmc

the_syco wrote: »

http://www.irishexaminer.com/video/news/peter-kingston-to-see-your-life-burnt-in-front-of-you-is-hard-392633.html



Seems their laziness shot themselves in the foot a long time ago.

If all of their cows were all still registered, I'd say the banks may have viewed the farm in a better light, as opposed to deciding to grab what's left of the farm, whilst they can.

.

The lazy family that won Ireland's fittest family and milked over 500 cows seven days a week
Lol.
Why should they be doing extra work for the bank who wouldn't work with them.
Another man could have fed them all bales of ragwort for the circling vultures ready to swipe in and profit from their misfortune.
They would get some land in a few months after if that happened.

sundula

https://www.agriland.ie/farming-news/damning-report-on-kingston-herd-says-vet-was-shocked-at-condition-of-animals/

If vets report is true then the animals are better off else where.

Base price

sundula wrote: »

https://www.agriland.ie/farming-news/damning-report-on-kingston-herd-says-vet-was-shocked-at-condition-of-animals/

If vets report is true then the animals are better off else where.

As I have stated previously I don't know the circumstances of this unfortunate case other than what is printed in the media.
Here is something that was printed in the media from last year about the same veterinary practice which although no related to the Kingston case leaves a lot to be desired imo :mad:
http://www.independent.ie/irish-news/news/wanted-qualified-vet-for-50-a-week-for-jobbridge-post-34141340.html
**In addition when the news broke about this particular Jobsbridge post our own vet was horrified and disgusted.

Water John

Don't know in this case but similar lark was put out about Hanrahan when he was suing the chemical plant in Tipp. Poor farmer, neglecting animals etc.
This type of smearing is par for the course.
Take all such, with the obligatory, pinch of salt.

This is a media PR battle.

Sam Kade

djmc wrote: »

The lazy family that won Ireland's fittest family and milked over 500 cows seven days a week
Lol.
Why should they be doing extra work for the bank who wouldn't work with them.
Another man could have fed them all bales of ragwort for the circling vultures ready to swipe in and profit from their misfortune.
They would get some land in a few months after if that happened.

Who in their right mind would deliberately poison cattle to get back at the bank?

djmc

Not everyone would be in their right mind under such pressure.

Base price

Water John wrote: »

Don't know in this case but similar lark was put out about Hanrahan when he was suing the chemical plant in Tipp. Poor farmer, neglecting animals etc.
This type of smearing is par for the course.
Take all such, with the obligatory, pinch of salt.

This is a media PR battle.

+ 1000
I still have my original copy of The Red Book. One small man's fight against the might of an international pharmaceutical corporation (MSD), Dept of Agri, Dept of Environment and basically everyone else.

Water John

Didn't know of that book.
Is that written by Jerry O'Callaghan, West Cork?
Nice guy, lectured me in Ag College.

Same Sh**e in West Limerick. When scientific results might have been going somewhere specific, suddenly stopped.
Put out the word, poor farming practice.

BoatMad

Water John wrote: »

It is a normal function of banking to address the issue of non performing loans.

it is and they do so every day

Banks in normal circumstances should be agreeable to a write down if that makes the future of a business viable.

Thats very much a length of string, the bank will form a view as to the potential to recover the business, but often by the time the bank realises things are in trouble, its too late and the business typically needs even more capital injection and that where banks tend too baulk

This is the principle that underpins debt restructuring; business examinership, personal insolvency.

actually its not, banks tend to have personal guarantees and business failures still render the guarantors liable. Thats the issue that sunk most developers, they have provided PGs.

in the case of personal insolvency , you loose all your assets anyway . personal insolvency for a farmer would mean loosing the whole shoot and caboodle

Even banks themselves have been underwritten. If you applied strict, debtor must pay all his debts, capital and accumulated interest, all banks in Ireland would have been liquidated. AIB twice over.

No bank in ireland defaulted , all the current working banks had their capital ratios restored by investment , i.e. the Gov bought shares that it will make a gain on in time. Anglo was liquidated and the debts were paid by the state
Banks dont really go insolvent, what happens is their capital adequacy ratios fall and they are not allowed to create money out of nothing any more

No point in preaching moral hazard. Look at real life. Most don't set out with the intention or inclination not to pay back. S**t happens. That is part of the risk for both sides.

indeed and no doubt ACC bank will write of a considerable chunk of the 2+ million owned .

Remember banks are charging you interest on money printed by the ECB.

Yes and no

What level of writedown should a lender take?

No easy answer , but moral hazard suggests that write downs would be one of the last resorts . often the business is too far gone to recover anyway

Should there be an onus, to prove that the debtor is in an unrealistic situation?
Its why we have examinership on business. LG and also many developers and builders would not have resurrected themselves only that should practices were in place and are in fact a normal part of business finance.
Indeed examinership was written especially for LG in this country.

There is a wider societal interest to be taken into account.

There is really no " wider societal interest ", there is a business relationship between the lender and the borrower thats all.

examinership is not really an option for self employed , its also extremely expensive and often is not successful , it mostly operates on the basis that additional capital investment is injected into the company, this is because companies have " shared" ownership. A person cannot be " shared "

The question is not if but how much of a write down should be acceptable or even imposed?

as I said it may not be that a write down would help

Remember many examinerships are done at 10 to 30 cent in the Euro.
In that way the small contractors are looked after to some extent also.

examinership debt reduction , mainly by creditors is a voluntary decision, creditors are not obligated and examinership requires typical a bank to set-aside its banking arrangements for the duration , again something that is difficult to do for self employed

if the creditors dont accept , then most examinership typically fails

BoatMad

Base price wrote: »

Ah but your analogy is not accurate. Banks are not in the business of lending tractors to neighbours
You and I both know that a banks principle task is to make money for their shareholders - final.

the basic principle of a bank is to prosper and stay in business , thats the key factor in all businesses , shareholder value is up there but not at the top. ( as the performance of bank shares in the past will tell you )

However whilst trying to accomplish that task they also cover themselves well by charging interest, bank charges, reinvesting money on deposit etc, etc. Banks are risk takers with the added advantage of demanding collateral so they hold the trump card and in most cases are always on the winning side.

FYI banks dont lend out deposits, they dont need to banks can create money from thin air in a computer .

banks do not cover all loans with 100% collateral as was easily seen in the crash. They take a risk too,.

Simply because on a rising tide banks were quick to cash in the value of the collateral assist. There was feck all evictions until last year however once property prices started to rise the banks pulled the plug. During the debts of the recession it suited them (banks) not to foreclose on loans as the land/properties were been maintained etc. Which goes back to my previous point that a banks principle task is to make money for their shareholders.

yes and no, the banks were reluctant to cystalise losses and therefore where there was a prospect of recovery of the asset collateral , they merely waited

remember at this stage loans ( loans payments ) were often hopelessly and irretrievably non recoverable

Water John

Thanks Boat for your detailed analysis of my points.
I tend to talk in broad brush strokes.

In simple language, all Irish banks went tits up and would have had their licences revoked only for you and I, whether we liked it or not, bailing them out.
The bank has spent over €1M with the sherrif already. thats 2.5 - 1 =1.5M

Lets say write down by 1/3 thats €1M.
Could a slimmed down enterprise of 250/300 cows carry that over an extended period?

there is a broader societal interest. It is to do with crystallising bad loans quickly and getting businesses and country operating again.
Should have been done with house mortgages as advocated by Matt Cooper and David McWilliams.
The banks got a write down. Give the customer a write down and get the country profitable again.
We would not now have the housing crises.

paddysdream

Base price wrote: »

Ah but your analogy is not accurate. Banks are not in the business of lending tractors to neighbours
You and I both know that a banks principle task is to make money for their shareholders - final.
However whilst trying to accomplish that task they also cover themselves well by charging interest, bank charges, reinvesting money on deposit etc, etc. Banks are risk takers with the added advantage of demanding collateral so they hold the trump card and in most cases are always on the winning side.


Simply because on a rising tide banks were quick to cash in the value of the collateral assist. There was feck all evictions until last year however once property prices started to rise the banks pulled the plug. During the debts of the recession it suited them (banks) not to foreclose on loans as the land/properties were been maintained etc. Which goes back to my previous point that a banks principle task is to make money for their shareholders.

Think you are missing the point or the analogy is a bit difficult for you!!!!!!!!!!!
If you get a loan of something on the understanding that it must be given back,be it money or a machine then if you fail to do so would the lender not be within their rights to seek the return by whatever means available to them esp if those means were part of the terms and conditions of getting the loan in the first place?
I of course understand that banks are in the business of making money.Would be rather naive to think otherwise.
Not much point in evicting someone if the value of the repossessed property is much less than the sum owed.Much better to wait until the value at least approaches outstanding debt.Rather like not selling cattle when the ar*e has fallen out of the trade but waiting till an upturn comes.
All this is rather basic common sense I would have thought.

BoatMad

Water John wrote: »

Thanks Boat for your detailed analysis of my points.
I tend to talk in broad brush strokes.

In simple language, all Irish banks went tits up and would have had their licences revoked only for you and I, whether we liked it or not, bailing them out.
The bank has spent over €1M with the sherrif already. thats 2.5 - 1 =1.5M

Lets say write down by 1/3 thats €1M.
Could a slimmed down enterprise of 250/300 cows carry that over an extended period?

there is a broader societal interest. It is to do with crystallising bad loans quickly and getting businesses and country operating again.
Should have been done with house mortgages as advocated by Matt Cooper and David McWilliams.
The banks got a write down. Give the customer a write down and get the country profitable again.
We would not now have the housing crises.

The banks got no write down , the national pension reserve board invested in the banks to restore and enhance their capital adequacy reserves. that money is not lost , its in the form of shares , and the Government is likely too profit quite well out of the deal

( the money in Anglo is lost of course, but that was magicked out of thin air by the ECB anyway )

The taxpayer therefore will MAKE money from its investment in the banks

Million and Millions of bad loans where in effect written off by NAMA and IBRC ( siteserv for example)

writing off loans for many small business is not often the issue, the fact is that they often need further capitalisation and have no ability to repay that. Its one thing to write off an existing loan, but are you suggesting the bank danced a further loan and possibly write that off too.!!!!!

The fact is business failure is the natural side effect of being in business, that includes farmers. if the business fails , a farmer needs to do something else , simply because you have land doesnt make you a good farmer or more importantly a business man

Base price

Sam Kade wrote: »

Who in their right mind would deliberately poison cattle to get back at the bank?

+1

djmc wrote: »

Not everyone would be in their right mind under such pressure.

IMO no farmer would deliberately neglect the welfare of their animals. We Irish farmers are well know to be excellent stock people even under force majeure resulting in some desperate measures taken by some farmers during the fodder shortage of 2013.
It has been well known within the industry that this unfortunate debacle has been taking place for some time. I am sure that the local DVO were more than aware of the situation and would/should have intervened if necessary.

patsy_mccabe

BoatMad wrote: »

we irish do seem to have regulars runs of being " a bit mad ". Ive always claimed we are a bit of an over-addictive society

Yep, like growing spuds in the 1840's.

BoatMad

IMO no farmer would deliberately neglect the welfare of their animals.

there have been a number of farmers that have been prosecuted for cruelty to animals

Ive seen myself animals mistreated due to too high numbers for the available food etc , greed etc

Water John

If there had been any increased mortality, the vetinary section of Dept of Ag in Cork are quick to call out and view a place.

In fairness also clued in from a mental health point of view, as it is a key indicator in farming.

coolshannagh28

20 billion from the NPRF was injected into our banks we may possibly see a return on this but 44 billion was borrowed in one form or another to recapitalize our banks which would have folded without it.

Base price

paddysdream wrote: »

Think you are missing the point or the analogy is a bit difficult for you!!!!!!!!!!!
If you get a loan of something on the understanding that it must be given back,be it money or a machine then if you fail to do so would the lender not be within their rights to seek the return by whatever means available to them esp if those means were part of the terms and conditions of getting the loan in the first place?
I of course understand that banks are in the business of making money.Would be rather naive to think otherwise.
Not much point in evicting someone if the value of the repossessed property is much less than the sum owed.Much better to wait until the value at least approaches outstanding debt.Rather like not selling cattle when the ar*e has fallen out of the trade but waiting till an upturn comes.
All this is rather basic common sense I would have thought.

While I agree with you on the principle of taking out a loan and paying it back (with interest) one has to consider that from time to time it doesn't always work that way.
In my time I have seen banks agreeing to writing down the value of stock/land/property due to economic circumstances while allowing the lenders to trade out of debt. Those farmers/landowners are still in business and in some cases have gone on to be successful employers.
The modern banking clique don't seem to afford the same leeway now days which is IMO is an unfortunate consequence of global greed/wealth :mad:
Regarding your point re not selling cattle when the arse falls out of the trade - cattle are not inanimate objects like land or houses which can more or less remain in situ until the market improves - cattle can't wait for the rising tide

BoatMad

coolshannagh28 wrote: »

20 billion from the NPRF was injected into our banks we may possibly see a return on this but 44 billion was borrowed in one form or another to recapitalize our banks which would have folded without it.

no the money in anglo was not in the form of a recapitalisation , merely to support its orderly liquidation ( i didi not agree with it by the way ) . The anglo money was created out of thin air by the ECB and the interest on it is paid to the CBI which remits all its profits to the state . = free money

we will moist definitely see a return on the NPRF investment, it was done at rock bottom share prices.
not to mention the 1 billion bank levy that state charged the banks for the guarantee

not cheap for the banks , that " bailout"

The key thing is no new taxpayers money , went into the banks, despite popular mis-perceptions , the new taxes all paid for the exchequer deficit , that was the costs of all those public services and servants etc

sword1

Water John wrote: »

Thanks Boat for your detailed analysis of my points.
I tend to talk in broad brush strokes.

In simple language, all Irish banks went tits up and would have had their licences revoked only for you and I, whether we liked it or not, bailing them out.
The bank has spent over €1M with the sherrif already. thats 2.5 - 1 =1.5M

Lets say write down by 1/3 thats €1M.
Could a slimmed down enterprise of 250/300 cows carry that over an extended period?

there is a broader societal interest. It is to do with crystallising bad loans quickly and getting businesses and country operating again.
Should have been done with house mortgages as advocated by Matt Cooper and David McWilliams.
The banks got a write down. Give the customer a write down and get the country profitable again.
We would not now have the housing crises.

No, you would end up with everyone defaulting because their neighbours got a write down, I know people who were laughing at me for paying my mortgage when they had plenty spare cash to pay theirs but they were spending theirs on holiday etc because people who weren't paying their mortgage were going to get a write down and they would miss out if they paid theirs, people will convince themselves they are entitled to more and more, borrow the cash and pay it back if you can and if there are no consequences when you don't nobody will pay back and therefore nobody will be able to borrow

BoatMad

The modern banking clique don't seem to afford the same leeway now days which is IMO is an unfortunate consequence of global greed/wealth

where is the evidence of what you say. Im remember in the good old days trying to get loans , sure the banks didn't foreclose, they just laughed at you in the first place

there were no good old days

Water John

I think most of those are urban legends, Sword.

That is the usual cry of the moral hazard brigade. Studies have shown cases such as you say are quite low.

In reality internationally, write downs, are an accepted part of banking.

paddysdream

Base price wrote: »

While I agree with you on the principle of taking out a loan and paying it back (with interest) one has to consider that from time to time it doesn't always work that way.
In my time I have seen banks agreeing to writing down the value of stock/land/property due to economic circumstances while allowing the lenders to trade out of debt. Those farmers/landowners are still in business and in some cases have gone on to be successful employers.
The modern banking clique don't seem to afford the same leeway now days which is IMO is an unfortunate consequence of global greed/wealth :mad:
Regarding your point re not selling cattle when the arse falls out of the trade - cattle are not inanimate objects like land or houses which can more or less remain in situ until the market improves - cattle can't wait for the rising tide

If you think banks were more inclined to write down/give leeway in previous times then God bless your innocence.
They always seek to maximise their return(like any business)and have done so for ever.Recent events have not changed their basic principles.
Of course they will deal but only if they feel that the underlying business is viable (from the point of view of extracting as much as possible.No point in pouring water into a holed bucket.

BoatMad

sword1 wrote: »

No, you would end up with everyone defaulting because their neighbours got a write down, I know people who were laughing at me for paying my mortgage when they had plenty spare cash to pay theirs but they were spending theirs on holiday etc because people who weren't paying their mortgage were going to get a write down and they would miss out if they paid theirs, people will convince themselves they are entitled to more and more, borrow the cash and pay it back if you can and if there are no consequences when you don't nobody will pay back and therefore nobody will be able to borrow

utterly an urban myth , firstly very very few mortgage holders got actual write downs and no one but no one was defaulting willingly on a primary residence mortgage

sword1

Water John wrote: »

I think most of those are urban legends, Sword.

That is the usual cry of the moral hazard brigade. Studies have shown cases such as you say are quite low.

In reality internationally, write downs, are an accepted part of banking.

I know nothing of the usual cry, just relating my own experience which has led to people being in big debt now because of the belief that writedowns were on the horizon when they weren't, in reality if the banks are making a bigger loss going this route, in the long term they are making a big saving because many others would try it

BoatMad

people being in big debt now because of the belief that writedowns were on the horizon when they weren't,

some people in reality are idiots , especially ones that acted like you said. Idiots usually end up at the bottom

coolshannagh28

BoatMad wrote: »

no the money in anglo was not in the form of a recapitalisation , merely to support its orderly liquidation ( i didi not agree with it by the way ) . The anglo money was created out of thin air by the ECB and the interest on it is paid to the CBI which remits all its profits to the state . = free money

we will moist definitely see a return on the NPRF investment, it was done at rock bottom share prices.
not to mention the 1 billion bank levy that state charged the banks for the guarantee

not cheap for the banks , that " bailout"

The key thing is no new taxpayers money , went into the banks, despite popular mis-perceptions , the new taxes all paid for the exchequer deficit , that was the costs of all those public services and servants etc

I didn't mention Anglo ,we recapitalized our banks AIB BOI Permanent and Nationwide using the NPRF and borrowed money we have and may see a further return if the economy continues to perform as expected .
I definitely agree that our deficit caused by the explosion in the cost of public services ,servants etc was as much a contributor to our economic crisis as the banking crash.