The Great International Depression of 2008 & Beyond /

Half million euro mansions? You couldn't get a starter 3 bedroom semi in most areas of dublin for half a million 18 months ago.

johnfás wrote:

Half million euro mansions? You couldn't get a starter 3 bedroom semi in most areas of dublin for half a million 18 months ago.

It's very different now, isn't it. 'Down the country' you'd get a ranch one time for half a million, you understand, but now (well, ~two years ago) you'll get an oversized yoke in nice little estate. It'll cost you a million in the long run unless the ECB and other banks push the rate down to zero for the duration of your mortgage. Then, is there the job for life you need to sustain that lovely big momma of a house you bought so you could move away from (really 'piss off') the old neighbours and maybe impress the friends and family along the way ?

Ah let them fry now. There could be strange 'class' problems out of this if some people have their mortgages Freddie and Fannied; others worked harder for less and won't be bailed out. There could be an awful lot of bitterness, hatred and bile yet coming out of all this.

johnfás wrote:

Half million euro mansions? You couldn't get a starter 3 bedroom semi in most areas of dublin for half a million 18 months ago.

Auditor #9 wrote:

It's very different now, isn't it. 'Down the country' you'd get a ranch one time for half a million, you understand, but now (well, ~two years ago) you'll get an oversized yoke in nice little estate. It'll cost you a million in the long run unless the ECB and other banks push the rate down to zero for the duration of your mortgage. Then, is there the job for life you need to sustain that lovely big momma of a house you bought so you could move away from (really 'piss off') the old neighbours and maybe impress the friends and family along the way ?

Ah let them fry now. There could be strange 'class' problems out of this if some people have their mortgages Freddie and Fannied; others worked harder for less and won't be bailed out. There could be an awful lot of bitterness, hatred and bile yet coming out of all this.

Already there is, look at the Sindo, drumming up lynch mobs to string up the public sector workers, IBEC, primary school teachers who become Government Ministers, any one who isn't a Sindo journalist basically. The public sector workers might have been a bit smug, but mostly they didn't even ask for the money, it was pushed down their throats by Government just to make sure of their votes.

Where did it all come from? An awful lot of funny money came into the country in the last two or three years, and/or was invented by the Banks. The place was awash with it. The Banks were even stopped from using it as a fund in case of bad loans.

There is responsibilities on both sides, cactus. Last week George Lee was making the analogy of the people of Ireland living as if we were all at the roulette table of a casino. The Unions, that is the elected representatives of teachers etc, were at it just as much as the Government were.

johnfás wrote:

There is responsibilities on both sides, cactus. Last week George Lee was making the analogy of the people of Ireland living as if we were all at the roulette table of a casino. The Unions, that is the elected representatives of teachers etc, were at it just as much as the Government were.

Yes and the doctors too. Our consultants get paid twice what a Germand doctor would get. Average ESB wages are more than 70,000 p.a. and they were just paid an increase.
All heads were in the trough, that's true, but the problem was that the trough appeared to be full. If the supply of money had been tighter, we would have got deflation sooner, but without the horrendous indebtedness.

Absolutely. However, I still don't believe that people have fully woken up to the idea that they have bought a bad product. I disagree with the idea that the entire blame lies with the Government or the proverbial "they" for selling this product to people. The people bought into it as much as they were sold it.

As I have said before I have sympathy all around here for 80% of society who were merely hopping on the bandwagon and being led up the garden path. However, I have greatest sympathy for the savers in our society. These were the prudent people who followed the advice of Government to take out a pension, to invest and to save for their future. Many of these people have been the hardest hit and it is on the back of their savings and investments that the property cowboys made their dosh and indeed the average splurger bought their unafforable car and hot tub. They're also the people least likely to get a bailout.

johnfás wrote:

Absolutely. However, I still don't believe that people have fully woken up to the idea that they have bought a bad product. I disagree with the idea that the entire blame lies with the Government or the proverbial "they" for selling this product to people. The people bought into it as much as they were sold it.

As I have said before I have sympathy all around here for 80% of society who were merely hopping on the bandwagon and being led up the garden path. However, I have greatest sympathy for the savers in our society. These were the prudent people who followed the advice of Government to take out a pension, to invest and to save for their future. Many of these people have been the hardest hit and it is on the back of their savings and investments that the property cowboys made their dosh and indeed the average splurger bought their unafforable car and hot tub. They're also the people least likely to get a bailout.

I'm thinking of this more and more now and how unjust it seems. I'm also thinking of that bit of the Bible which states that it is not good to bury your Dinars but to put them work and turn them into other stuff...

What about the people who had nothing before during and won't have anything after this nonsense ? They are accounted for in the Bible too - Blessed are the people who have shag all, Theirs will be the Kingdom after the other two groups nuke each other.

I'm telling you there will be hatred and twisted bitterness as well as resentment and that will be just the bit coming from me. There will also be bloodshed and burnings [mod]No incitement to violence or potentially incriminating yourself please [/mod]

California may be about to pop. It will begin suspending the payments listed below in February in some attempt at closing a $42 billion deficit ...

It will begin issuing "IOUs" to pay its bills - something it did before in 1992. California is a wildly profligate state according to the blogger, The American Thinker who says, though welfare recipients and students will get hammered, prison officers receive annual salaries of over 100k.

Expect tent cities, looting, riots if this isn't addressed by Terminator Schwarzenegger.

Quote :

California controller to suspend tax refunds, welfare checks, student grants

John Chiang announces that his office will suspend $3.7 billion in payments owed to Californians starting Feb. 1, because with no budget in place the state lacks sufficient cash to pay its bills.

By Evan Halper and Patrick McGreevy. January 17, 2009

Sacramento -- The state will suspend tax refunds, welfare checks, student grants and other payments owed to Californians starting Feb. 1, Controller John Chiang announced Friday.

Chiang said he had no choice but to stop making some $3.7 billion in payments in the absence of action by the governor and lawmakers to close the state's nearly $42-billion budget deficit. More than half of those payments are tax refunds.

The controller said the suspended payments could be rolled into IOUs if California still lacks sufficient cash to pay its bills come March or April.

"It pains me to pull this trigger," Chiang said at a news conference in his office. "But it is an action that is critically necessary."

The payments to be frozen include nearly $2 billion in tax refunds; $300 million in cash grants for needy families and the elderly, blind and disabled; and $13 million in grants for college students.

Even if a budget agreement is reached by the end of this month, tax refunds and other payments could remain temporarily frozen. Chiang said a budget deal may not generate cash quickly enough to resume them immediately.

Not all payments will stop Feb. 1. Most school and healthcare programs will be paid, as required by state and federal law. The state will continue to pay more than $6.6 billion in such bills.

And Los Angeles County officials said they would cover welfare payments to more than 500,000 local recipients -- for now.

But California is projected to be $346 million short of the funds it needs to pay all its bills in February. By March, the state would be so far in the red that even continuing to suspend payments would not cover the shortfall. California would be insolvent, making the issuance of IOUs likely.

State officials have already designed an IOU template, Chiang said, and have been negotiating with banks over whether taxpayers could cash or deposit them if they are issued. The state could be forced to pay as much as 5% interest on delayed tax refunds if they are not paid by the end of May, Chiang said.

The last time the state issued such IOUs -- the only time since the Great Depression -- was in 1992.

The suspension of payments is the latest radical move by officials to help keep the state from running out of cash as Gov. Arnold Schwarzenegger and the Legislature battle over how to avoid insolvency.

Schwarzenegger, who hopes to speed up public-works projects to stimulate the economy, wants tax increases, spending cuts and legislation to relax some environmental rules and allow private companies to do some government construction.

Democrats are seeking tax increases as well, but fewer spending cuts. Republican lawmakers would only pare spending and have been blocking any tax hikes.

Meanwhile, Schwarzenegger has ordered that most state workers take two days off per month without pay -- equivalent to about a 10% pay cut. The governor also ordered most state offices -- including all DMV field offices -- to close on those two days. The order is being challenged in court by labor unions.

The state has also halted payments of bond money for more than 5,300 public-works projects.

On Friday, the state Department of Finance temporarily exempted 276 of the projects from the freeze, reasoning that because they are nearly complete, it could cost the state more to shut them down than to finish them.

The exemption, through Feb. 1, will allow the continuation of school construction by the Inglewood Unified School District and the construction of a new Court of Appeal facility in Santa Ana. Work on new rail tracks at L.A.'s Union Station and road projects involving Irwindale Avenue, Martin Luther King Boulevard and Imperial Highway in Los Angeles County will also be able to continue.

Some projects were exempted because the state is under court order to do the jobs. Others would threaten public safety if left uncompleted, according to Mike Genest, Schwarzenegger's finance director.

"We're going to take the risk of allowing them to continue a little longer because we are very hopeful will have a budget by Feb. 1," Genest said.

Los Angeles Times

Meanwhile in other news, Bank of America will get 118 billion bailout

Quote :

Bank of America bail-out agreed


Bank of America will receive $20bn (£13.4bn) in fresh US government aid and $118bn worth of guarantees against bad assets.

The emergency funding will help the troubled bank - the US's largest - absorb the losses it incurred when it bought Merrill Lynch.

In return for the money, the US Treasury will take a stake in the bank.

Just hours after the aid package was announced, Merrill Lynch posted a fourth-quarter 2008 loss of $15.31bn.

Bank of America reported a loss of $1.7bn, compared with a profit of $268m for the same period a year earlier.

Bank of America had been seen as one of the strongest US banks, at least until its decision to take over Merrill.

"They were probably one of the best banks out there, balance sheet-wise, until they did the Merrill deal," said Cassandra Toroian at Bell Rock Capital.

http://news.bbc.co.uk/2/hi/business/7832484.stm

Members videos - elainec - recording of 2 min. newsreport on the subject of the UK 'bank guarantee' as eoinmn has called it, accurately perhaps. No doubt they are still reeling at the memory of Northern Rock customers queueing outside the institution at one stage.

There are question marks over HSBCs capitalisation too, according to Bloomberg - HSBC Falls After Shareholder Says It Needs More Funds (Update3)

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