To the wall I say

The fed should stop bailing out institutions not matter how big they are. by doing so they are prolonging the credit crunch, putting more stain on the American Taxpayer and not allowing the market to readjust.

A painful readjustment is better than a painful prolonging. Put thes companies to the wall I say. Any Ideas?

Ps I have turned somewhat capatalist.

riven wrote:

The fed should stop bailing out institutions not matter how big they are. by doing so they are prolonging the credit crunch, putting more stain on the American Taxpayer and not allowing the market to readjust.

A painful readjustment is better than a painful prolonging. Put thes companies to the wall I say. Any Ideas?

Ps I have turned somewhat capatalist.

Hello riven. It seems that the State Capitalism currently being practiced in the US is driving people all over the place politically. evercloserunion here has also taken a leap to the right. Meanwhile, on P.ie and here others of us are delving into Marx and Lenin for explanations of what is going on.

What do you think would happen if they weren't bailed out? I'm not sure myself, but I have a mental impression of mass failures of banks with governments and central banks under pressure to bail out, no availability of credit so mass bankrupcies of companies (most companies use working overdrafts at times) and mass unemployment of millions of people, mass defaults on mortgages much higher than the present rates, serious poverty for a lot of people and so on.

I don't think the banks should be bailed out, I think they should be nationalised without compensation like Northern Rock. Bankers who have lied about assets should be prosecuted for fraud and the CAB or equivalent should seize their assets.

We've come through ten years in which a layer of people in the US and elsewhere have raked off billions, and the middle classes have been wafting along on a wave of credit, with the delusion that this is wealth. As well as the mortgage fiasco, there has been a huge increase in credit card debt, a lot of it not repayable. The gap between rich and poor in the US and Ireland has widened to a shocking extent.

If what has happened in the US had happened in Brazil or Mexico, the IMF would have forbidden a bail out. The whole "free market" mantra was a lie, behind which the US does what it likes and the "second and third rank" states are seen as something to be squeezed dry.

Over the last week I've heard economists and journalists repeat that we don't need to worry in Ireland, because the ECB will bail the Irish banks out no matter what. I am unsure if this is true. Can anyone confirm or otherwise?

riven wrote:

The fed should stop bailing out institutions not matter how big they are. by doing so they are prolonging the credit crunch, putting more stain on the American Taxpayer and not allowing the market to readjust.

A painful readjustment is better than a painful prolonging. Put thes companies to the wall I say. Any Ideas?

Ps I have turned somewhat capatalist.

Welcome, it's a lovely place to be!

riven wrote:

The fed should stop bailing out institutions not matter how big they are. by doing so they are prolonging the credit crunch, putting more stain on the American Taxpayer and not allowing the market to readjust.

A painful readjustment is better than a painful prolonging. Put thes companies to the wall I say. Any Ideas?

Ps I have turned somewhat capatalist.

Definitely. Moral hazard is created by bailing out irresponsible and irrational banking organisations. If they cannot conduct their business in a sustainable manner then they should be let go to wall. It is through this creative destruction of inefficient and incompetent firms that capitalism can re-assign investment funds to the efficient and competent and accelerate the return to equilibrium in the market.

I'm glad Lehmans went bankrupt and I hope that more banks follow it so that we can purge the system and move on from this mess. Shoring up irresponsible banks merely retains the faulty infrastructure of the financial system which led to the crisis in the first place. If we can demolish that infrastructure, we can rebuild and have a hope of building a smart and sound recovery out of this mess.

Should the Irish government have let AIB crash in 1985?

DeGaulle wrote:

Should the Irish government have let AIB crash in 1985?

It might have been an idea.

Ard-Taoiseach wrote:

DeGaulle wrote:

Should the Irish government have let AIB crash in 1985?

It might have been an idea.

Perhaps it might have brought down the whole banking system. On a best case scenario, lots of people would have lost money, lots of companies would have gone bankrupt and Bank of Ireland would have a virtual monopoly.

Have you seen this: http://www.timesonline.co.uk/tol/news/world/ireland/article4795342.ece ?

DeGaulle wrote:

Ard-Taoiseach wrote:

DeGaulle wrote:

Should the Irish government have let AIB crash in 1985?

It might have been an idea.

Perhaps it might have brought down the whole banking system. On a best case scenario, lots of people would have lost money, lots of companies would have gone bankrupt and Bank of Ireland would have a virtual monopoly.

Have you seen this: http://www.timesonline.co.uk/tol/news/world/ireland/article4795342.ece ?

And this ? http://www.tribune.ie/business/article/2008/sep/21/irish-banks-lending-level-near-highest-in-western-/