Nationalisation Watch / Govt. rethinking 3.5 billion bailout for the banks?

cactus flower wrote:

Damn it, even the chickens have stopped laying for the past 2 days

Are you proposing we nationalise your chickens ?

EvotingMachine0197 wrote:

cactus flower wrote:

Damn it, even the chickens have stopped laying for the past 2 days

Are you proposing we nationalise your chickens ?

Eggsactly.

EvotingMachine0197 wrote:

Frightened Albanian wrote:

is it worth buying shares at 30c?

How do you mean FA ? If the bank makes it out of the mire over the next couple of years and things stabilise and debt recovery is good then it could be well worth it. But it could quite easily be a bloody disaster too. Anyone's guess really ...

that is what I was wondering.
I can't really see them nationalising all the banks............. if they go really really low a few hundred could be punted. In 100 years time when the recovery comes the great grandchildren would be smiling

They could nationalise them temporarily for a few years and then release them on the market again. I think they did this in Sweden. I'd say loads of the Swedes have got sweet jobs as financial advisors since last September or earlier.

A family friend of our's grandfather bought shares in the Manchester Ship Canal when they were at a very low ebb in the early 20th century. They sat in the family for 2 generations pretty much worthless and not thought about. That is until a large regeneration project was brought in, particularly around Salford, in the 1990s. The guy sold his shares and made a couple of hundred grand.

There is always money to be made if you pick the right things to buy. That if of course being the key variable as well as the great unknown.

cactus flower wrote:

EvotingMachine0197 wrote:

cactus flower wrote:

Damn it, even the chickens have stopped laying for the past 2 days

Are you proposing we nationalise your chickens ?

Eggsactly.

OK. I'll get Price Chickenhouse Coops on it straight away.

Saw this briefly on UTV last night but I don't know how big and ugly RBS is ..



RBS to be Nationalised --The Pin

I am still of the opinion that nationalising the bloody lot would be a good idea. both here and in the UK. Get it over and done with. No more market speculators, Government gets to reposess a land bank that will be of huge value in the future...including all those Anglo loans on City of Londres property...no more social housing need be built for decades, and the Governments gets to flog the lot at a profit in 5-10 years time. Plus which, they get to clean out the bonus culture in the City and to a lesser extent here..

why exactly is the left whingeing??? State controlled banks are a lefty fantasy, I would have thought. Not to mention death of modern capitalism as we knew it....

won't come cheap, though. But if we let any banks go down, the bond holders and insurers will never lend us another penny again.

And that could be much, much worse

Dail Debate at 1.30 pm I think. It will go to the Seanad this evening at 6.30 pm.

And you have disagreed with pay cuts on another thread here, expa? Complete nationalisation, though it may have to happen, would likely be the broadest and deepest act of wealth destruction in the history of the State.

johnfás wrote:

And you have disagreed with pay cuts on another thread here, expa? Complete nationalisation, though it may have to happen, would likely be the broadest and deepest act of wealth destruction in the history of the State.

I don't REALLY disagree with pay cuts. I am however, worried about a general strike and its economic effects. I suspect that making the public service pay higher pension contributions and taxing everyone more, plus early retirements and part time working, would achieve the same result with less disruption. Psychology!

I agree with you, but I think it would be less wealth destroying than letting the banks go bust, failing the guarantee, and never being lent a penny at a decent rate again. I suspect nationalisation would be cheaper than that. And the markets seem determined to dump our banks. What choice have we got?? Tell me that!

expat girl wrote:

I am still of the opinion that nationalising the bloody lot would be a good idea. both here and in the UK. Get it over and done with. No more market speculators, Government gets to reposess a land bank that will be of huge value in the future...including all those Anglo loans on City of Londres property...no more social housing need be built for decades, and the Governments gets to flog the lot at a profit in 5-10 years time. Plus which, they get to clean out the bonus culture in the City and to a lesser extent here..

why exactly is the left whingeing??? State controlled banks are a lefty fantasy, I would have thought. Not to mention death of modern capitalism as we knew it....

won't come cheap, though. But if we let any banks go down, the bond holders and insurers will never lend us another penny again.

And that could be much, much worse

Nationalising them with what? You are talking about hundreds of billions of bad debt. However I think you have a point that Morgan Kelly is missing about the bond holders. Essentially, there is no right answer to this problem and absolutely no point trying to score points against the left, who did not create this mess.

The IMF will cut jobs, wages and rack up the interest rates to unreal levels. In the Ukraine they have them at 30%.

johnfás wrote:

Errr, UK inflation? The UK inflation rate is set to half this week from circa 4.5% to 2.5.

The assets against which the loans are secured may be worth money in future years. But you may be waiting a long time when sites were being bought at 60 million an acre. Furthermore, Anglo will have international obligations arising from the loans it has taken out to feed the developers. These loans have to be serviced as well which adds another dimension. Finally, something like half the property that the loan book of Anglo is secured against are overseas. We're talking developments in Bulgaria here - they could take a well over a decade to normalise.

That sez it for me. Link to the Morgan Kelly thread below at the post above

https://machinenation.forumakers.com/economy-business-and-finance-f8/urgent-call-to-stop-anglo-irish-rescue-t1862.htm#61775

cactus flower wrote:

Nationalising them with what? You are talking about hundreds of billions of bad debt. However I think you have a point that Morgan Kelly is missing about the bond holders. Essentially, there is no right answer to this problem and absolutely no point trying to score points against the left, who did not create this mess.

The IMF will cut jobs, wages and rack up the interest rates to unreal levels. In the Ukraine they have them at 30%.

I don't intend scoring points against the left. I am left wing enough myself to see the very considerable advantages of having the previously overpaid bankers over a barrel. Long term advantages, that is. And having more Government control over this country's assets. Yes, this will be very painful in the short term. But the Morgan Kelly plan will have us bankrupt in the morning. As Tonys points out, he keeps inflating Anglo's liabilities....but unlike Lehman, etc...most of the assets the debtors "own" are TANGIBLE. Few worthless bits of paper here. Therefore, their value will re-appreciate in an upswing. The Government needs to view this on a 10-15 year timeline. So does the opposition.

The IMF will be relatively unable to do much about interest rates while we remain in the Euro, I would imagine.

Someone needs to go talk to the ECB about whether or not they could buy up bad debts. It will be necessary Europe wide, I fear.

Does anyone else see Sterling not lasting the year, or is it just me???

expat girl wrote:

cactus flower wrote:

Nationalising them with what? You are talking about hundreds of billions of bad debt. However I think you have a point that Morgan Kelly is missing about the bond holders. Essentially, there is no right answer to this problem and absolutely no point trying to score points against the left, who did not create this mess.

The IMF will cut jobs, wages and rack up the interest rates to unreal levels. In the Ukraine they have them at 30%.

I don't intend scoring points against the left. I am left wing enough myself to see the very considerable advantages of having the previously overpaid bankers over a barrel. Long term advantages, that is. And having more Government control over this country's assets. Yes, this will be very painful in the short term. But the Morgan Kelly plan will have us bankrupt in the morning. As Tonys points out, he keeps inflating Anglo's liabilities....but unlike Lehman, etc...most of the assets the debtors "own" are TANGIBLE. Few worthless bits of paper here. Therefore, their value will re-appreciate in an upswing. The Government needs to view this on a 10-15 year timeline. So does the opposition.

The IMF will be relatively unable to do much about interest rates while we remain in the Euro, I would imagine.

Someone needs to go talk to the ECB about whether or not they could buy up bad debts. It will be necessary Europe wide, I fear.

Does anyone else see Sterling not lasting the year, or is it just me???

Well, we agree about the property assets, they are not a total right off, only if sold at fire sale prices. The problem is that they may never recover to the speculative levels reached in Ireland in the last three years: moneys were spent like water, and land was bought for three times the sensible top of the market price. One of the problems we have is that the public and the markets don't have access to any sound information on Anglo's assets and liabilitiesm, and the Government is not trusted to be honest, to act in the public good, or to have a bull's notion what its doing.

We have to take the long view, but we also have to take short term actions that (unlike the Banks Guarantee) don't leave in the mire for the long term.

Don't worry, Cactus, like Youngdan I am pricing in hyperinflation. The books will be balanced as soon as the ECB finally decides that buying bad debts for new money ("quantitative easing") is an option. Yes I agree that the actual value will never reach the same levels but we only need the nominal values to go up to balance the books.

The banks (with the possible exception of Anglo) may be of some use to the State in the end. The current HUGE problem is uncertainty, the Government has it within its power to end the uncertainty. It should do so, now. The markets will then move on to the next victims, and we will be ignored for a good long while, long enough to go through the banks books at leisure and figure out a sensible solution. Which may include setting up a bad bank, selling off bad debts to the ECB or similar.

Similarly, to start people spending again, all we need is the return of some semblance of stability, reassurance that we will all be paid at the end of the month, etc. All the markets are doing right now is spreading panic. They also need to reach an agreement, any agreement, on the public sector wage bill such that uncertainty is ended and we can all start again.

Fear is the real enemy, and we have that in bucket loads

expat girl wrote:

why exactly is the left whingeing??? State controlled banks are a lefty fantasy, I would have thought. Not to mention death of modern capitalism as we knew it....

I think 3 question marks to that question is a little worrying...

First of all it is the neoliberals' ideology which is failing here not anything from what could be genuinely be called 'the left'.

The worst excesses of this crisis can be put down to the policies of neoliberalism, specifically de-regulation, the market regulating itself, low public sector involvement, high regressive taxes and movement of wealth upwards etc.

Although crises would still happen within a more Keynesian model too.

Also, and perhaps you are being flippant, but nationalisation does not mean the death of modern capitalism. Far from it, an economy with large nationalised sectors can still have all the defining features of capitalism.

Lastly, top down style nationalisation with the same elite ex-capitalists and/or co-ordinators in control is not a "lefty fantasy" certainly not outside the one or two still existing Stalinists or ex-Stalinists, or Labour if you include NuLabour on the left.

Democratic 'nationalisation' (public ownership) with democratic regulation involving consumers and workers with openness and transparency (none of this 'commercial confidentiality' which is used so much to hide the high costs of PPPs for instance) is what the criticism is aiming to achieve (I'm speaking about Higgins on Vincent Browne last night here).

AIB and BOI both hit 29c. Back up a little now. They can't last the week surely?

The worst mistake is to be panicked into making a rushed decision. IMO the government is not at all on top of this . There is lack of real clarity as to what they will do and the costs. It changes by the day. That is the sign of bad crisis management. There would have been a lot more respect in the market if they had let a few of the Banks fail, provided their position was clear and tenable.

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I've heard Enda Kenny and Gilmore speak, and they are bitterly complaining that with the Bill only published last night and being rushed through, there is no democracy in it.

A pile of waffle so far on the allocation of time motion.

Nothing concrete about what it is they want to discuss, just the usual bluster. Christ, when will get a decent opposition?

A man jailed for defaulting on a 3,000 euro Credit Union loan...

Do you see stuff like that going on Kate P?

The longer the debate goes on, the more stress they can create within the cabinet and the more of a wedge they cannot drive between the Government parties.

The letter from Cowen asking them to keep a lid on things has been thrown back in his face.

cactus flower wrote:

A man jailed for defaulting on a 3,000 euro Credit Union loan...

Do you see stuff like that going on Kate P?

All the time, cactus, but the situation is rarely as simple as Caoimhín presents it. I attend courts in three counties where judges work hard at getting debtors into a position where they can pay something rather than nothing. Jailing is a last resort, usually after repeated failure to meet installment orders, failure to address the court (ie, turn up and explain their situation), failure to present adequate statements of means...

The difficulty pointed out by Judge John Neilan recently is that a person who goes up town to steal a sausage can avail of criminal legal aid almost immediately whereas accessing civil legal aid involves considerable paperwork and time.