What have Brian Lenihan and Donald Rumsfeld got in common? Why “unknown, unknowns” obviously! The security dilemma outlined infamously by Rumsfeld in February 2002 sums up our minister’s dilemma perfectly. What most people fail to realise about the recapitalisation is that it is an exercise in reassuring the rest of the investing world that it is safe again to invest in Irish banks and, by extension, Ireland.
To achieve this, the recapitalisation needs to satisfy sceptical investors that the share prices of Irish banks constitute a “once in a generation” bargain.
Certainly on a historic basis or in terms of the banks’ assets, the share prices look unbelievably cheap. A successful recapitalisation leads to a rapid increase in the banks’ share price and ultimately bond investors flock back to the “clean” bank. This way, the share price rises and the Government can sell its stake — now worth considerably more than when it bought the stuff last night — at a significant profit. This is why the Government says it has no interest in owning the banks. The State believes that it will be able to profit from the deal.
But the assumption that €7bn will be enough runs straight up against the Rumsfeldian conundrum of “unknown, unknowns” which is why Mr Lenihan and Mr Rumsfeld are unusual, but desperate, bedfellows.
In 2003, Donald Rumsfeld won the Plain English Society’s “foot in mouth award for garbled speech” for his immortal “known, unknowns” speech. At the time he was ridiculed but when you cut through all the cheap jibes, you realise that he was on to something.
Rumsfeld articulated the investors’ conundrum perfectly and in his words of wisdom lies the fate of last night’s bank recapitalisation.
Let’s recap what Rummy actually said.
“As we know, there are known knowns. There are things we know that we know. We also know that there are known unknowns, that is to say that there are some things we know we don’t know. But there are also unknown, unknowns, the ones we don’t know we don’t know”.
In the Irish bank recapitalisation, the unknown unknowns are the extent of the bad debts. No-one has any idea how big they are and this is why the whole recapitalisation programme is a leap in the dark. The reason they are unknown is that no-one has any idea what other bad news will emerge from the upper echelons of the Irish banking system, its pathetic regulation and its craven cheerleaders in the golden circle.
In many ways, the banks are acting like the Catholic Church when the child abuse allegations arose. The first reaction was to quash the rumours and draw a line in the sand. This was the regulator’s, the Central Bank’s and the Government’s reaction in September. Back then, I remember going on a radio programme with Mr Lenihan and predicting that an Irish bank would be bust by Christmas. The minister warned that such talk was dangerous and irresponsible. The Central Bank declared that the banks were well-capitalised and the regulator stated that its “stress testing” proved that the banks were fine.
This was the same as the Church saying that child abuse was a rare, random isolated incident. Then there were more and more and more revelations.
Efforts to restore the credibility of the Church were irreparably damaged by the unknown unknowns. In the uncertainty, the institution was badly tarnished. Few bishops were trusted and even the good ones were regarded as suspect — or, at best, patsies defending a dreadful institution.
Think of the banks in the same light. The investors in this case are like sceptical but ultimately believing Catholics who want to believe that the system has rooted out the bad eggs but are not prepared to bet on it.
Investors are afraid of the unknown unknowns, which have not even been thought about, let alone quantified in the Irish banking system.
How many more ILP “bed and breakfasting” deposits in Anglo which were exposed on Tuesday, will emerge? How many more ludicrous examples of banking malfeasance will there be, and, more significantly, just how big will the bad debts be?
No Irish citizen has any interest in Lenihan’s great gamble failing, but the unknown, unknowns make the chances of failure extremely high. If we don’t know how much the bad debts will be how can we, with any certainty, say that the €7bn figure will be enough?
We do know that in 2002 both the Bank of Ireland and AIB senior management were furious that Anglo were hoovering up all the best commercial land deals, and that they vowed to “out-Anglo” Anglo.
Both banks ramped up their loan book, lending to every two-bit eejit who thought he or she was Donald Trump. As JP Morgan once said, “nothing so undermines your financial judgment as the sight of your neighbour getting rich”.
Bank of Ireland and AIB financed the economics of envy in the commercial property and development land game and it follows that their loans books are likely to be worse than Anglo’s. The extent of their bad debts will be horrendous.
Think about it: they doubled their loan books in the final four years of the boom. This means that their bad debts will be considerably more than the 10pc which is common in boom/bust scenarios. Even looking at the past four years, both banks lent close to €120bn each; 10pc of this means bad debts of €12bn.
This means that Lenihan’s €7bn will be swamped by bad debts. So why would any investor come in until this cash was gone? If they did so, they would risk losing their investment and equity capital in a deluge of yesterday’s bad debts.
The unknown, unknowns …
The entire board of ILP-TSB should resign. What ILP-TSB did was many times more dangerous to Ireland Inc than Sean Fitzpatrick. Also we should note that David Drumm is the real ‘supreme idiot’ in ANIB – I read an article in Phoenix in December showing his complete stupidity in finance.
You think David Fitzpatrick didn’t ask for the funds from ILP? Of course he did! He just resigned for something smaller – personal greed and amorality.
If I believed in hell, I’d say let him burn there.
Is it just me or did AIB double their estimates of bad debts a few hours after the recapitalisation deal was put in place? Over 6 billion now and still looking optimistic!
Perhaps I’m wrong but, if not, it’s yet another example of either ministerial incompetence or indifference. I can’t figure out how they had any negotiation position beyond begging for their jobs. I guess that’s the problem with having the Crony Party in power.
Er that would be a case of an unknown known becoming a known known.
A truly Rumsfeldian transformation.
Enough of a reason to take the pensions off the top three layers of management of AIB.
I suspect we have not seen the end of the range of shell games played with funds used to prop up the apparent strength of the Golden Circle of financial institutions here. As “normality” moves away of more and more of the electorate, expect TDs to come under a lot more pressure. Parish pump politics may become a dangerous passtime.
I do hope people are learning from this and I do hope we can work this out. I hope that there is an inherent Irish characteristic that causes us to knuckle down and sort this out for once and for all. Here’s hoping.
I agree that we have the potential to ‘knuckle down’ but when I listen to the politicians (all of the them) and especially the union leaders I despair for the future.
As one journalist puts it this morning: David Beggs, Jack O’Connor & Co are part of a surreal bunch of ‘genetically modified Arthur Scargills’ – these guys want us to pay wages and pensions we simply can no longer afford! And the main argument from these guys is that you shouldn’t deflate the economy further by taking p.s. salaries/bonuses out of the economy! Wow!! As the journalist puts it: This is like ‘putting the wooden walls of your house in the stove to stay warm. Soon you’ll be roofless leaving an empty stove for archaeologists to ponder over in a thousand years”. Excellent! – Voodoo economics – which is nothing more than I expect from our government and their 400,000 over-paid employees.
We should have a national unity government now (time is running out) if not the Greens should pull the plug and force the issue.
FF have an opinion poll result of 22%. FF are now in serious trouble. Fine Gael are now stuck on 32%. Watched a debate between Lenihan and Bruton. Bruton made a strong showing. Lenihan made a stronger showing than I expected. Miriam O’Callaghan gave advantage in the debate to Lenihan – so this hindered Bruton. Clearly Bruton is better than Kenny. Fine Gael are still a few bullets short of a loaded Colt 45. So they need better front benchers. And they might want to send Austin Deasy into hibernation before he makes an embarassment of himself again.
Gilmore is on a surge at the moment. I read the current version of Phoenix – and a cartoon about Gilmore’s policies. Here are Gilmore’s policies
1) Not that,
2) Not that either,
3) And definitely not that either,
4) that is not what we are in favour of,
5) and that is about all I can say on the matter.
So at this stage Gilmore would want to come up with more. His finance spokesperson, Joan Burton is not the sharpest tool in the box – and should be replaced with somebody who knows something more about economics, than the idea that recessions occur because we no longer have money.
I hope now that for the sake of the standards of our public governance that a cull of useless ministers will take place. This is the only thing Biffo can do to restore the FF vote. Clearly Martin Cullen, Noel Dempsey, Dick Roche, Mary Coughlan and a few more have failed repeatedly, and should be replaced.
The local elections will see many independent candidates. The Irish Times regards Independent candidates as a dangerous element to societal development – on the basis that they subvert the effectiveness of the class system as a means of deciding what happens in central government – and they even make a mockery of Ireland’s highly centralized decision making.
Totally agree with you. It is a golden age for opposition politicians now – you spend all your time saying tax increases = bad; giving money to ‘greedy banks’ = bad; increasing welfare = good AND guess what people agree with you. But the problem is that when the cast of Police Acadamy are in charge and they appear out of their depth – with the public screaming out for change – I wish the main parties would face up to crises we are in and agree some form a national coalition (maybe even without FF if thats possible on the current no.s). At least this will force Ms Burton et al to actually put forward ideas that have a better than sporting chance of working.
Joan Burton couldn’t put forward an idea, let alone one that has a chance of working. “We are in a recession because we ran out of money” Classic!!!!
Fianna Fail have ben in power for the majority of the past 80 years. I think its time to stick a fork in them. They are done. Their policies fail time and time again. They have their hands in the till and they have brought us to bankrptcy at least three times! They siezed control and threw us into an economic war with the UK that threw half a million people out of Ireland.
AIB have now been bailed out by the state TWICE! We are still paying a levy on our insurance for the Insurance Corporation of Ireland fiasco! Look at your car insurance. Look at the government levy. That is paying for bailing out AIB in 1984 for the Insurance Corporation of Ireland. We should have let them go bang then. They only rose up to cause us more pain.
What the hell needs to happen for this shower of losers to be thrown out on their fat arses?
Labour could hardly be any worse. Fianna Fail have proved they are not fit to run a bath.
Fordperfect I see your point. One party with a front bench dominated by incompetence and nepotism do not deserve to be in government. Therefore we should elect another party which is dominated by even more incompetence and nepotism should into power instead. Examined the Irish Times poll – The Irish Labour Party is based on a surge in the higher income groups – which is the segment of the population that usually votes for the PDs. I am not impressed with the intellectual state of the electorate.
Ireland is in trouble. And nobody in the Dail seen this coming. Labour wanted more spending than Fianna Fail during the Ahern years. In fact continual promises from the Labour Party to buy votes resulted in Ahern telling us he was a socialist all along himself – and the stupid inflationary policies.
Lets call the new party : The Conservative Unionist Party
Partie Conservatif de Union
As Margaret Thatcher said : the Irish do not hold the monopoly to the colour green we can say that the English do not hold the monopoly to the word Unionist
Dont follow
Hi Tim,
First off, I fully agree with your ‘claw-back’ sentiments as you expressed in a reply to Lorcan. Gordon Brown is thinking of doing something in the UK and in radical and stessed times, radical measures are needed. I’m all in favour of clawbacks of excessive profits. It would be good to clawback Goggins 2.9 million last year too, oh say to a 100k cap. As for Seanie F, ….. clawback and jail.
Back to the PS costs issue:
Tim> and spend evrything they have, just to get by, thus “spinning” that money through the economy, sustaining private sector jobs along the way
PS workers earn more than the private sector average so shouldnt on average be spending everthing that they have. If they are, they are living beyond their means on the spend side. Living beyond our means is a false economy. That must be accepted as a fact. So, not only would PS workers be spending beyond their means, but the salaries they would get is also borrowed (1 in 4 as someone approximated) and is beyond the countries means. It actually is a lot more, we are approaching 1 in 3!
If the PS was run as a private company, like a Toyota, or whatever, there would be 10,000′s of job cuts. So that is the choice, massive redundancies or reduced wages. Reduced wages would keep up services better and would also churn money through the economy better as people have to live.
> Money MUST move, if it is to be useful. Your justification for the cuts/levies on the PS workers requires money to remain stationary/static; therefore it is no USE to the economy.
No, I suggested that the monies saved by the PS ‘levies’ means that the equivalent amount of tax wont have to be levied equivalently on the private sector, and hence the same amount of money would be available to spend from the private sector. Its moving the same amount of money from one cohort of 400,000 people to another cohort of 1.3m people (400k unemployed).
Mathematically:
Levy amount = (approx) 400,000 x 50k x 7% = 1.400 billion
Tax not applied to the 1.3m private sector:
1,300,000 x 1,076 = 1.400 billion
Thus the 1.3 million private sector workers each have 1,076 euro (tax that they wouldnt have to pay otherwise) and will churn it in the economy. In a spreadsheet, the mney has just been moved from one column to another but it IS still there to spend in the economy.
By the way, public sector wages are paid for by private sector taxes, its the private sector that supports the public sector, not the other way around. Plus, the public sector in many areas is an inefficient monopoly. On most benchmarks in most countries, public sector output and productivity is much lower than private sector.
I have nothing against people that work in the public sector, including my own family members(!), indeed they are lukcy, and we DO need public sector services. I am not anti-PS at all. PS is a necessary enabler, etc.
MK1
Mk1, Thanks. I will “ruminate” on it.
MK1, you are correct.
Tim, nobody wants their kids to get a deficient education. And I do have sympathy that the cutbacks are hitting disadavantaged kids with special needs. What is happening in those cases is dreadful. But there has to be extensive cuts somewhere in Government spending ; there’s no way out of it. Would you have any suggestions where cuts could be made instead ?
The point is that the money you refer to is borrowed. This money has to be paid back in the future, with interest on top – by our taxes. Borrowed money should really be put to productive purposes, that will be useful to an economy and that will produce future revenues that will match or exceed the total cost of the borrowing. Borrowing to maintain a day-to-day cost base that is too high, is not productive, and not going to work. Keep that up, and one day the well will run dry, with not enough money to finance salaries and investments, at their current levels.
Every day, I look at my own child, and think of the next generation, who – if we do not get control of the situation – will spend their working lives paying off the loans that this generation will accrue on their behalf. I’d rather us take the hit, than them.
Am definitely not an admirer btw of the Government (or any of our politicians), who sat idly by as the country inflated itself into economic obesity.
I’m glad to see we agree on something – Irish banks are a disgrace. They were a disgrace during the so-called boom, and they are an even bigger disgrace during the fallout.
Paddy
Paddy, our positions may not be as far apart as you think:
“Borrowed money should really be put to productive purposes, that will be useful to an economy and that will produce future revenues”
I agree completely with this.
Our difference seems to be what we qualify as “productive”. Mary Harney continuously refers to education as being outside “The productive sector of the economy”. I VEHEMENTLY disagree. I view education as pre-emininently productive.
To paraphrase an old adage, If you think education is unproductive, try ignorance.
Try to see that interpretation in your own statement above; maybe we are closer to agreement.
ps, I have already indicated in an earlier post where I propose the money should come from – the tax exiles one would be permanent/ongoing revenue stream, and a huge one!
Tim,
I agree that good and focused education provided within a fair budget is productive. Of course it is. But there must be a budget, and the education provided must be sustainable financially, both in terms of the current financial position, and financial dividend derived in the future from the investment. That dividend may be material (from innovation, and profit), or it can be reaped in other ways, the betterment of the person for example. However, we must avoid the ‘blank cheque’ mentality, and try to get more for less given the disasterous current financial situation.
Ultimately, we must live in the real world, and by providing a stable financial position now, we will safeguard the provision of all services – including education – for our children.
I hope we can agree on that – at least in principle.
Paddy.
Joke of the day (because it is Friday the 13 th). http://www.irishtimes.com/newspaper/breaking/2009/0213/breaking12.htm
No mention of Ms. Bowler’s pay, or the fact that a director on IL&P got over 240 K in payment and never made it to any meetings….and that was about the height of the workload of the particular directorship invovled !!!
Tintan O’Fool sez that IL&P is a respectable institution. Well, I suppose if you spend your whole live studying North Dublin Fianna Fail, or Larry Goodman or the political history of Dublin Corporation….your standards can slip to the point that you find IL&P becomes acceptable….
Let’s face it – the Irish Concept of Management has failed. Forget about docking the nurses, or failing to deal with the cost base problem that is destroying industrial competitiveness…..the Irish concept of how to run an organization needs a massive overhaul…the most expensive people in society also happen to be the most useless….now, let’s take that assunder and replace it !!! Shane Ross was right all along – the entire thing is a joke.
Malcolm – I disagree with your suggestion – The volume of the unknown unknowns is too much to allow an incumbent minister to be trusted anymore .Too much damage has been caused and too many people have been hurt and more will too become unemployed and the remaining damaging viruses un veriifed in the banks can continue indefinately unless and until made transparent in full by an independent body of persons.. Once bitten twice bitten.- Shoot the Dog .
John Allen: I came late and am catching up with this addition to the usual two articles per week. As I said in response to the previous article, I watched all of Lenihan’s press conference on the RTE news website and thought he gave an apparently honest and detailed account of what he did and why he did it.
I am no apologist for FF, as anyone who remembers my earlier contributions will know. However it must be acknowledged that Lenihan did well for a man under extreme pressure. As Keynes said: “When the facts change, I change my mind—What do you do sir?”
I am prepared to give him some leeway to see how things work out over the next few weeks. I know that the market doesn’t agree with me, as the shares of both banks are down again at close this evening.
I wonder how many of our fellow-bloggers have watched the full 57 minutes of Lenihan’s press conference? Comments?
Malcolm, You make a good point. I know Lenihan; he is a very intelligent and articulate guy who can see what is going on and think on his feet. However, he is being stimeyed by people/things unclear to me as yet – cronyism is definitely one of those things, but there is more. I have to learn more.
Minister is meeting with IL&P representatives. Minister wanted more heads to roll in IL&P. The PR spin from IL&P is now in full spin – and let’s face it IL&P are masters of spin. This is becoming a farce. The Minister for Finance wanted Denis Casey in IL&P to stand down. So an arrangement was organised where the board got together to reinforce the position of the Denis Casey. Pure show. Denis Casey did not want to leave. If Denis Casey really did want to leave he would have resigned anway !!! This entire episode is a peice of showmanship. Effectively the board of IL&P are protecting their own little junket and sticking the two fingers at the taxpayer. And sticking their two arrogant fingers at the rest of us also. IL&P are doing that masterstroke of coverup specialists – damage limitation.
Shane Ross says that the ANIB results in December were misleading – and this was facilitated by IL&P. Effectively IL&P were taking part in a fraud against the shareholders of Anglo Irish Deposit. IL&P did this in a covert manner – and IL&P then state that they were instructed to do this by the IFRSA and Central Bank of Ireland. However IL&P were helping ANIB in a manner that was far less transparent than the Central Bank, or IFRSA – effectively covering Anglo’s deposits situation.
If Anglo went to the wall – which was going to happen last Autumn – then IL&P could have ended up stuck with a 7 billion Euro deposit in a bankrupt bank. This would have made IL&P’s misadventure with Icelandic banks look miniscule. IL&P committed a really risky manoevre. I wonder what would have happened to IL&P, if Anglo went to the wall, then IL&P would have followed very quickly. Clearly IL&P are run by a bunch of muppets.
We are listening to a scheme of lies. These bankers are lying to the Minister. The Department of Finance are not very good at finding out what happens. And we cannot trust either the Central Bank or the Financial Regulator. Both seem to act outside the state’s interest and often beneath the public interest.
I have a suggestion – the Minister tells IL&P that they will get excluded from the bank bailout, unless the directors go. That will force them out of position. It would at the very least force an EGM bu shareholders which would vote them out.
Are the board of IL&P now liable to get lawsuits from shareholders from ANIB ??? Will there be a list in the firing range including former directors of ANIB, Patrick sNeary, Enst&Young, IFRSA, maybe Sean Quinn, and now the directors of IL&P and IL&P itself ??
What went on between ILP and ANIB was mathematically 90 times worse than what was going on between INBS and ANIB. And possibly more likely to be described as fraud.
Really they are all just friends and pals. A real club of cronies.
Can we trust any of the standard companies on the ISEQ ?
I reckon that of the large companies that we hear about – only a few can be trusted – maybe RyanAir, Arzyta, Elan and Kerry Group are run properly….what do they all have in common….completely outside of the D4 culture of champagne in the Mews…
This is going to cause a big headache for the Irish Times – how long more can the IT continue to support the spin from IL&P ??
Let’s hope that Minister Lenihan will finally step up to the plate and put an end to the nonsense from the bankers – if he really does know the law, he should be able to tackle them !!!
It’s really a matter for the Office of the Director for Corporate Enforcement to handle. If you or I did something like this in a ltd. company we’d end up struck off and fined substantially. The public needs a clear sign that willful misleading of shareholders is not OK. It’s not “helping out”. It’s fundamentally unethical behaviour that undermines the credibility of our financial institutions.
Guys, have a read of this…
http://www.renegadeeconomist.com/default.asp?Display=60
Says it all. Leadership and Responsibility. My tuppance worth is that the world is getting too dangerous and fast to allow the slip shod approach we have taken to leadership and responsibility. Our etiquette derives from pre medieval times. Salute was the lifting of your visor, the handshake was to show your sword was put away. We need to develop new etiquette. We are dealing with a more aware generation. Reward and Punishment is very fast and ruthless and we are becoming more on our own again as individuals. The hierarchy of the protective bureacracy is crumbling IMHO. Poeple better start to learn living correctly. Good business etiquette is a start. Insist on it in all your dealings and your prosperity and that of your community is guaranteed.
Deco – I dont think we can now suggest that all management of Irish companies is in the same league as our banks – perish the thought – or maybe thats not what you are saying. As for Seamus Ross: it may well be his time now, because of course nobody likes bankers these days (and who could blame us) – but it shouldnt disguise the fact that Mr Ross remains a jumped-up moron who has never come up with even one workable proposal to fix the problems he sees every where. Dont be fooled by his silky anglo irish oratory!
Excellent point by Philip above- and to be honest it is really the only issue that anybody should be dealing with today in unison. Because I say again that the current debacle is not a money problem but a moral one.
There are always first rate financial proposals and suggestions on this forum but this is merely tending to the leaves on the remaining trees, while ignoring the fact that the wood itself has rotted away.
Capitalism only works within a strong moral framework- where there are unwavering principles of honesty and integrity. Ireland is suffering now because crookedness was deemed to be laudable if it produced financial gain.
Indeed we have reached a deplorable state in Western World society where anything and everything is laudable if it produces financial gain.
The Wild Western World.
People have abandoned essential principles of their lives in the pursuit of promoting their livelihoods. It is the road to oblivion.
We have to realise eventually that there is no answer to the financial crisis in merely financial terms- because if it is repaired back to it’s original form it will merely repeat it’s ghastly consequences. It has to be changed.
There is a much bigger issue out there that needs to be addressed, because all is now truly at stake. We must look at the wood not the trees.
Deco – we can invest in Real Ignorance by removing Mary Harney .Then we are proving how in a rare occassion real ignorance can be productive.
I see Casey and Bowler have NOT resigned. More of the arrogant, brazen, and unaccountable behaviour from the usual suspects.
American Nightmare
http://www.youtube.com/watch?v=_NMu1mFao3w
John, this looks like very scary truth: “We don’t know”.
I urge everyone to watch the clip from your link because we are nearly there.
Expect soft focus PR touchy-feely interview with Marian “Golden Circle” Finucance and Eamon Dunphy on RTE Radio 1 plus Mary Coughlan style profile building exercise in Weekend Irish Times for Bowler within 10 days…
May I remind you all that this crisis is not the sole responsibility of bankers. Mr Lenihan should go, and go before he’s pushed.
Fianna Fail is a serious political party interested in exercising power for the sake of the Irish people as well as for its own sake. Mr Lenihan, by his own admission, did not tell his leader about what was going on. Any politician with a trace of honour in his bones, ethics in his conscience, and care for his family’s epitaph would have fallen on his sword.
Mr Cowen did not reprimand Mr Lenihan for failing to manage Mr Neary. He should be ashamed of himself. Mr Cowen too should resign for not having managed well. He should I think also resign because he hasn’t led well either. But that’s another story.
None of this generation of Irish political leaders have grown up with any decent role models. We should be kind to them, and understand their disabilities. They are lost souls, adrift in a tsunami.
I agree with
“We have to realise eventually that there is no answer to the financial crisis in merely financial terms- because if it is repaired back to it’s original form it will merely repeat it’s ghastly consequences. It has to be changed.”
However, you eat an elephant in small pieces, bite by bite… I hope there will be some balance in this continuing debate. I hope we will all remember that responsibility deserves to be shared: bankers, auditors and politicians. The public is getting a crash course in business ethics. Hopefully, we’ll all emerge from this on more solid ground.
There is a much bigger issue out there that needs to be addressed, because all is now truly at stake. We must look at the wood not the trees.
No. We should not be kind. They are in charge. With power comes responsibility. They need to take it. Or get the hell out of the way who can do the job. No time for messing about with small time cattle dealing.
The assertion they grew up without role models is bullshit. Lenihan went to the same school I went to and he had plenty of Jesuitical training. He was the head prefect. As was his younger brother who I remember. He went to law school. By no means is he naive. He may be out of his depth but I wouldn’t feel any kindness nor mercy. He wanted the power and he got it. I wouldn’t lose any sleep for an unemployed lawyer. McDowall is living it up in the High Court and Lenihan will do the same when he is toppled,
Shame, disappointment, mature reflection are all words used to hide the fact that they got caught with their hands in the honey jar. Regret and sorrow and self flagellation are all well and good and might please the masses superficially but these chancers need to go and go now.
I would be all on for letting Fianna Fail fry trying to manage and horse trade out of it but it is too big and too unwieldy to do. We need the best bods in the best places and send the amateurs off to fix potholes and rezone land for their mates where they belong and know best.
I never thought I’d write this… in my lifetime
(1) We have seen the end of capitalism
(what we have is surely not ‘capitalism’ in any traditional meaning of the word)
(2) If a conversation on Irish radio at lunchtime is to be believed…
we may be about to see the end of the Irish civil war…
(meaning that there is now a possibility that FF & FG will have to merge into one political party, and Labour be other main party. I suspect if there were an election tomorrow, Labour could even become the biggest party of FF, FG & L.)
This is a world none of us is prepared for. All sorts of unknown unknowns, unconventional unconventionals and brilliantly scary stuff will emerge. This is no time to stop thinking and talking…
“we may be about to see the end of the Irish civil war…”
Or the start of a new one????
Keep dreaming Joan B.
I watched Lenihan on Prime Time last night and I saw him perform his best tricks ever and almost get away with it…but he did not .He tried .He is a manipulator and has a gift with words that can make a sinner a saint .He fudged and blustered and bluffed all through the debate . His revelation by intent of ‘heads on the plate ‘ wont wash and will only make matters worse for him .People will know that they will continue to suffer because of his prevaritique behaviour .He is a procrastinator and this over the new year has costed the nation dearly .His eyes are not sincere and his body language is stern and rigid .Actually the more he lies the more his eyes swell and his face inflates.He has LOST everything belonging to the Nation and his party and most of all to the people of the country who live in it .His Big Head should be on the Pigs PLATE .
Malcolm – Lenihan does not trive on logic.His forte is manipulation and he uses logic to tease your senses .And he did just that
Hi David,
‘Ramping up the loans’…, Herein rests a question, how do banks do this. They type numbers into accounts. Thats it. Experts remind all on the capital base ratios obligations regulating banking loans under the watchful eye of the bank of international settlements in Basel, I remind those who may be interested the simplicity to circumventing this is proven by tsb and anglo 7 billion., moving numbers on computers is easy to hide and carry out and do, over and over and over blowing up bubbles. This i think is the point of entry into revealing the truth behind this supposed banking crisis unknowables. Follow the money and only by doing this will we reach the possibility of implementing your solutions David. To do this means opening a can of worms asking the banks to reveal the true nature of these debts, the mechanics behind the creation of debt. Lets reveal to the population of Ireland how in actuality do banks supply loans to its customers. This will reveal the truth as to what the unknowables are. Simply reveal where loans come from once the bank decides to supply a loan(type numbers into an account) to a customer and take it from there. Most people in Ireland do not know the bank puts the loan into the account by simply typing in a few numbers and then charging a fee on a monthly basis to do so. This in of itself is economic treason, so lets start there and investigate this in a way which will yield results of a quality nature. The Chislers in behind the scenes are laughing their socks of at all of us wasting our time been distracted by a crisis that they set in motion. I figure if an individual is serious about getting to the nub of this they ought to start looking in the right place, which is, the banking system making out to the customer the loan they are supplying the customer with is real cash wheeled out from a bank vault. This is a lie. The trust between the customer and the bank is broken already in the first transaction through not informing the customer where the loan issued is originating. If the customer knew this they would soon realise the bank is something other than what it is making out it is, which is that the bank is a legalised loan shark operation protected by tax payers money and the government. This is explosive and real and well shall i say concerning.
We’re really in a goldfish bowl now as this article demonstrates;
http://www.bloomberg.com/apps/news?pid=20601102&sid=aCrUEStvvx_c&refer=uk
In it Eugene Sheehy, CEO at Allied Irish Banks said the case of Anglo Irish was “disappointing and caused problems” for Ireland’s reputation.
“But you can’t tar everybody with the same brush,” Sheehy said in an interview yesterday by telephone. “There are institutions in Ireland operating to the highest standards.”
Hmm. I wonder if those words come back to haunt him?
That is hilarious. Highest standards. Two words come to mind ‘John Rusnak’. I remember listening to former AIB Chairman Lochlainn Quinn explaining to the nation when the Rusnak losses in AIB were found that the AIB profits were large enough to take a 500 Million Dollar trading loss – with any difficulty. Lochlainn Quinn went on to then become Chairman of the ESB. It was vintage rip-off Ireland stuff, with all the viewers being scelped in order to pay for all the coverups. It worked. Quinn went from one over paid job being carried by the masses, to another.
Then we have all the overcharging. And the DIRT tax debacle – when Peter Sutherland was a director of the bank – and he went on to become EU Commisioner. Then there were all the loans to CJ – so that CJ could entertain his mistress. The offshore accounts.
Well – nice to know that AIB are setting the standards. Even more hilarious than Tintan O’Fool telling us earlier today that IL&P are “a respectable institution in the Irish banking sector”.
Let’s face it – official Ireland create delusions for us to swallow, and then proceeds to rob the fruits of our labour out of us with rip-off prices, fraud taxes like PRSI which give us nothing in return, and lies.
Given the emerging evidence of mis (mal)feasance across corporate Ireland, running to billions moved on whimisical means, does any one still believe that a few thousand would have swung a rezoning?
Or that all the foreign accounts in Irish banks have complied with money laundering rules?
Or that Irish banks had reciprocal slush fund arrangements with off shore financial centres?
These mightn’t be knowns but they’re obvious questions hanging like a bat in a chipshop.
The question has to be asked – what exactly was Patrick Sneery doing while all this was going on ? Was he telling people in Anglo and Permo – “No, I don’t see those transactions”.
Also, I have just found out that the money involved was over €8 billion. As these lads say themselves – it is only numbers !!!
The behaviour of the board of Irish Life/Permanent TSB is absolutely disgraceful. Casey has resigned. But so should Bowler. They should all resign. Immediately. The Irish Times has given minimal coverage to the event. An article at the bottom of the front page. But in the business section it is mentioned once. For comment the Irish Times is attacking the entire banking sector. Is the Irish Times trying to reduce the blushes of Irish Life&Permanent ? A case of “we will not offend our advertising sponsors ? ” The IT is lambasting Anglo, which is now a taxpayer funded organization), and minimizing the negative exposure to IL&P. I just wonder will Phoenix Magazine do a special on IL&P and
tell the citizenry what is really going in IL&P. Did a very interesting analysis of ANIB in December. Proved totally spot on, as well.
This country is rotten. It is easy to tell. We see media organs that talk about their own seriousness, call themselves opposition, talk about high standards, but are loaded with complexity, and deceit – are swayed by deference to commercial interests.
@ Furry lugs we will this time have a slow but bloodless turn over Labour will gain but we the people need a new party with a charter and a capped salary with no special pension allowance or un invoiced expenses.
@ Deco with regard to The Irish Times and then the general printed media ,I am this evening sitting in Sin E in Malaga Spain with my wonderful Spanish physiology college teacher , I say teacher as she is paid less than we give our primary equivalent here but I transgress , the Media is in turmoil now as while not over night but slowly the last six ,nine odd months the revenue has stopped coming in, next will be the actual government advertising spend will stop so now the girls in the marketing positions won’t be required the commerical managers won’t be required the production and graphic lay out teams won’t be required so while they were not hit by the levy last week they are looking now at where they need to go for the future. More important who will be brought forward. With this banking fraud all the other closed circles are crashing in on them selves . I was in a regional newsroom this week and with all that is going on their phones inward calls were low, why because the vast majority the eighty odd percent who are still working aren’t bother with even trying to change the system and it is this general perception that has us where we are as cycles go it is also time to kick out the upper stale establishment listen to 2FM larry gogan a man a few years from bus pass and He’s playing the charts songs , this country is completely nuts !.
Maria say’s Hola yet can’t understand why the people here have not seen each other for cafe . I have explained We all don’t still live in Ireland. Any way have a good weekend more fun next week beating up AIB ,BOI, selling their tickets but in the morning I’m playing Golf on a dry course Thank You Michael O Leary , oh and the Answer is Yes , of course if I meet a Banker I will challange him to say a small wager of 10 g per hole if I loose he gets a cheque while on the other side He Loses I get His Cash or he gets a Driver on the jaw. ..Bring on the clocks soon
My point about members of the current government having no decent role models has bee misunderstood. I should have put it more clearly. I think that from about 1970 on (that’s as precise as I can be) there were few honourable Irish politicians in power for long. [I exclude Gareth FitzGerald from this generalisation.] The likes of Charles Haughey were the trend setters. Their skulduggery seems to have been widely admired and unquestioned, until late in the game. I left Ireland in 1975. Every time I looked back at what was going on over here, I sensed a reduction in the influence of people of probity and ethics in public life. In fact, things were a lot worse than I suspected.
I’ve never been convinced that the model of transition from communal values to materialistic values was half complex enough. I lived through the 1950s and 1960s in Ireland and it was, for me, a difficult place dominated by priests and a catholic nationalism I had no truck with. So I’ve never had a golden age to hark back to.
Warts and all, I welcomed the economic success as it gathered pace. But the elephant in the room was the despicable example the generation in power was leaving littered all round them.
That’s why I’m trying to find out who were the few who spoke out and challenged the people to think differently and behave better.
As for being kind to Mr Lenihan, I advocate kindness in order to make it easier for him to go. He has disgraced himself, told what I’d call untruths. He’s got linguistic skill but, as another has said, look into his eyes… and remember he presided over the culture in his department – I’d like certain matters to be deniable… I cannot afford to know certain types of things… you all know how politics works… you’ll know when it’s right to inform me…
You don’t get to be an ordinary successful politician in Ireland without maintaining such a game. There are only certain types of people you want around you, and you can be sure all the senior civil servants know this. It’s in their politics 101.
Mr Lenihan has been decisive on Friday. He has deflected attention off himself. Unfortunately for him, his party has educated too many of us to let him get away with that trick.
It’s not that I think the banks deserve people to take it easier on them. Unfortunately there are not enough experienced citizens with the required forensic and moral skills to inspect the banks, auditors and politicians. And we cannot afford to import the skills, now that the world demand for such skills has increased so much.
So we need to find new people, who’ve been below the radar and support them to work for us. If we don’t do something extraordinary like this, we’ll never get to the bottom of this.
The only person who could make this happen is the person who holds the office of Taoiseach. Mr Cowen temporarily holds that office, and hasn’t yet demonstrated any skill at leading from a position of determination to get to the bottom of things. He’s an old fashioned politician, most comfortable among friends of the same persuasion. He stands for the status quo. But he might change stance. Paul did, on the road to Damascus. Certainly, if Mr Cowen doesn’t, he might become the inadvertent cause of a revolution – and need that jet. He should consider his family.
Those who spoke out got a jack-boot in the face. I know how these men operate. They destroy the careers of those who oppose them.
I have as close to zero sympathy for anyone involved. I have no respect for corporate Ireland nor the government. This carry on has been going on for decades not just during the boom.
BANANA REPUBLIC, SEPTIC ISLE!
Paul,
“there were few honourable Irish politicians in power for long. [I exclude Gareth FitzGerald from this generalisation.]”
Why do you exclude him?
AIB wrote off his (then) £200,000 mortgage when he became Taoiseach. (no corruption there, you think?)
We all accept at this point that a lot of people were caught with their trousers down so to speak.We are starting to realise that hugh defiencies in terms of competence,honesty,integrity,etc have now been exposed (more to follow Im sure). We are starting to see system and structural failures that are rocking the State to its very foundations.We are seeing at first hand the last desperate attempts by deeprooted vested interests both policital and economic to hold together a system that has served their exclusive interests since the foundation of the State.We are seeing at first hand the depths these people are prepared to go, to preserve what they consider to be their birthright.They will sacrifice pensioners,special needs children.low paid ps workers,and anybody else who they can, to weather this storm and protect their cosy,croney,clique.The International credit crises has lifted a veil of secrecy off Ireland and exposed a system of governance of its people that is so rotten that it goes beyond bananna Republic.The price we as a people pay now might prove great value if we can truely purge ourselves of these (?????) and put in place a new order to serve all of the people and re-establish our global reputation and re-connect with our lost but not forgotten Irish diaspora. In a weird but potentially wonderful way,maybe its “thanks for the credit crunch” it was’nt possible without you.Now pass the ballot box and here’s to our FIRST attempt at running a democracy.
There’s only 1 thing we can do now – petition Michael O’Leary to enter politics, hey – start a new no frills political party, Its bloody well needed!
Social Partnership will rightfully go out the window. It was the greatest charade, since the Dells, Intels etc… the companies which created the wealth did not recognise unions in their workplace.
Taxes would come down.
Foreign Investment would return.
Green agenda would be discarded – Nuclear Power brought to Carnsore Point.
Army disbanded.
New Legal System introduced, where there are consequences for those who commit fraud.
Here is a copy of my written and verbal presentation to National Crime Forum in 1998
file:///C:/DOCUME~1/User/LOCALS~1/TEMPOR~1/Content.MSO/WordWebPagePreview/PRIVATE%5B1%5D.htm
From todays Indo;
“Credit-default swaps on Irish government bonds jumped 95 basis points to a record 355 basis points or 3.55pc, the most of any euro area country. This rate compares to 265 basis points on products insuring against a default by the Greeks.
Part of the problem is the government bank guarantee scheme — the debts held by Irish financial institutions are more than 11 times the size of the economy, according to BNP Paribas SA. “The biggest budgetary offenders are facing a difficult future,” Mr Brzeski said.”
Now. Economists needed. Suppose that, as I’ve said before, that all these big players start getting at each other like rats in a barrel (Anglo /IL&P have started) and the true mess is exposed. Given that and the unwillingness of investors to take up Irish bonds, we default on say, the next 5bn repayment which is imminent. If that precipitates a default by say, Greece because all the PIGIS are suddenly lumped into the same bucket, at what point do the sovereign markets start taking a look at the viability of the Euro as a currency?
Whatever about Ireland entering a dark age, are we looking at the demise of the EU as a cohesive unit? And what price Lisbon2 if the EU is crippled financially?
Happy Valentines Day. Still waiting for the banking massacre.
Actually it´s not 11 its more like 3 times (actually better than Britain). But we are in more trouble than most as our GDP and national income is going than faster than onyone else AND unlike Britain we cant print money.
Spare a thought for the trials and tribulations of your old-fashioned ordinary decent bank-robber whose profile never used to overlap with that of bank manager:
“Advice for Bank Robbers
According to the FBI, most modern-day bank robberies are “unsophisticated and unprofessional crimes,” committed by young male repeat offenders who apparently don’t know the first thing about their business. This information was included in an article titled “How Not to Rob a Bank,” by Tim Clark, which appeared in the 1987 edition of The Old Farmers Almanac.
Clark reported that in spite of the widespread use of surveillance cameras, 76 percent of bank robbers use no disguise, 86 percent never study the bank before robbing it, and 95 percent make no long-range plans for concealing the loot. Thus, he offered this advice to would-be bank robbers, along with examples of what can happen if the rules aren’t followed:
1. Pick the right bank. Clark advises that you don’t follow the lead of the fellow in Anaheim, Cal., who tried to hold up a bank that was no longer in business and had no money. On the other hand, you don’t want to be too familiar with the bank. A California robber ran into his mother while making his getaway. She turned him in.
2. Approach the right teller. Granted, Clark says, this is harder to plan. One teller in Springfield, Mass., followed the holdup man out of the bank and down the street until she saw him go into a restaurant. She hailed a passing police car, and the police picked him up. Another teller was given a holdup note by a robber, and her father, who was next in line, wrestled the man to the ground and sat on him until authorities arrived.
3. Don’t sign your demand note. Demand notes have been written on the back of a subpoena issued in the name of a bank robber in Pittsburgh, on an envelope bearing the name and address of another in Detroit, and in East Hartford, Conn., on the back of a withdrawal slip giving the robber’s signature and account number.
4. Beware of dangerous vegetables. A man in White Plains, N. Y., tried to hold up a bank with a zucchini. The police captured him at his house, where he showed them his “weapon. ”
5. Avoid being fussy. A robber in Panorama City, Cal., gave a teller a note saying, “I have a gun. Give me all your twenties in this envelope.” The teller said, “All I’ve got is two twenties.” The robber took them and left.
6. Don’t advertise. A holdup man thought that if he smeared mercury ointment on his face, it would make him invisible to the cameras. Actually, it accentuated his features, giving authorities a much clearer picture. Bank robbers in Minnesota and California tried to create a diversion by throwing stolen money out of the windows of their cars. They succeeded only in drawing attention to themselves.
7. Take right turns only. Avoid the sad fate of the thieves in Florida who took a wrong turn and ended up on the Homestead Air Force Base. They drove up to a military police guardhouse and, thinking it was a tollbooth, offered the security men money.
8. Provide your own transportation. It is not clever to borrow the teller’s car, which she carefully described to police. This resulted in the most quickly solved bank robbery in the history of Pittsfield, Mass.
9. Don’t be too sensitive. In these days of exploding dye packs, stuffing the cash into your pants can lead to embarrassing stains, Clark points out, not to mention severe burns in sensitive places–as bandits in San Diego and Boston painfully discovered.
10. Consider another line of work. One nervous Newport, R.I., robber, while trying to stuff his ill-gotten gains into his shirt pocket, shot himself in the head and died instantly. Then there was the case of the hopeful criminal in Swansea, Mass., who, when the teller told him she had no money, fainted. He was still unconscious when the police arrived.
In view of such ineptitude, it is not surprising that in 1978 and 1979, for example, federal and state officers made arrests in 69 percent of the bank holdups reported. “
The inadequate response to our developing banking crisis was caused by a basic structural defect in government. The division of powers beween Legislative, Executive and Judicial branches has proved inappropriate for the task of regulating not just the banks but the government’s equitable treatment of the taxpayer, as required under Section 45 of the Irish Constitution.
The weakness is in the Judiciary, which is currently considered by most people as merely a branch of government. A sternly independent Judiciary would be concerned not only with magistracy, advocacy, attorneyship and conveyance but also with regulation and law enforcement. Thus the Ombudsmen, Financial Regulator, Director of Public Prosecutions and Garda Síochána should all be part of the Judiciary under The Supreme Court and the President.
This structure would have prevented the cosy relationship that developed between the government and the bankers and the developers and the planners. It would have acted as a brake on all excesses of authority and as a champion of the ordinary people of Ireland.
At present the Financial Regulator is conjoined with the Central Bank, which is responsible to the Legislative authority for its actions. This is key to explaining the present failure, as there is too cosy a relationship amongst the wider banking fraternity.
The Financial Regulator’s organization chart is at:
http://www.financialregulator.ie/data/au-files/orgchart.pdf
We find that Pat Neary is still listed as Chief Executive. That function is responsible for the activities of a Prudential Director, a Consumer Director and a lightweight Legal Enforcement Team. This entire Regulator branch should be transferred from the Central Bank to the Judiciary, thus providing them with authority and respect, as they would be totally insulated from the political shenanigans of the government of the day.
Nothing short of an effective root and branch reformation of the entire government structure will satisfy the people that the lessons of the present crisis are being learned.
Hello David,
I am an avid fan of you work as an economist. I am following your coloumns and like them very much. Since early 2006 I have been listening to Nouriel Roubini and his forecast of the subprime crisis and the catastrophe of the world financial markets. I am German and have been living in this country for the past 15 years.
after your speech in the Galway Radisson Hotel whereby I criticised your mild manner in relation to the government action on the recession and I thought that at that stage you were a member of Brian Lenihan’s advisory team. But since then you are back to your old self.
Small and medium businesses in Ireland are the backbone of the economy and for that the government has so far failed to announce a plan to help and ease the pain for this sector. Even though the government is telling us everyday on the news how important we are to the economy, but no help or no plan is yet on the table.
Instead they tap the national pension fund to flush more money in to the drain. What is good for the government should be good for the people of Ireland. To go to Irish Life and Permanent who broke in my opinion the contract of trust in a banking institution and transfered our money around to crooks in Anglo to paint a healthier balance sheet to fool the EU Central Bank and foreign investors.
In my opinion small and medium businesses should have the right to take and tap their pension funds to recapitalise their businesses and families in these troubled times to get over the next 12-24 months , who are crucial to the Irish economy and inject capital into the system.
I know Irish Life and Permanent will not survive in that case but the Irish people will have a better chance to get around these troubed times. What is good enough for the government to tap the national pension fund should be only right for small businesses to tap their private pension funds and give them a decent chance to survive. Small businesses have no lobby, no support, or no bail out plan from the government. All that we have left is to tap into our pension funds to try and keep our heads above water.
I do not think Irish Life and Permanent has a strong case to deny people their money because they have broken crucial customer trust and have not been investing their money appropriately.
What is your opinion on this plan to tap the small businesses private pension funds for people who want to take their money out?
David, I am looking forward to hearing from you and wish you very well, thank you very much for all your analysis and your straight talk and independency. Your voice is good for the people of Ireland, your analysis is badly needed in an environment where people are trying to brush things under the carpet and protect the circle of corruption.
Sincerely
Ricky
Tim,
Thank you. You’ve exposed my lack of detailed info. I didn’t know that Gareth FitzGerald had a loan written off by AIB. Was he declared personally bankrupt? Sorry I’m shocked. For you this is old ground I know. The impression he makes on me today is that he’s making an honest effort to contribute to the economic debate. Is he a bit like Ben Dunne, a reformed public figure who mended his ways?
By the way is there any important politician you’d exclude from my generalisation?
Paul, no, he did not go bankrupt – that would have caused immediate expulsion from Dail Eireann. Why this favour was done, I am unsure; why it has never been covered by the remit of the Tribunals, I am not sure. But, was it his government that later bailed out AIB over ICC …….. hmmmmmm? Let’s have a little think ……
There is no politician that I would exclude (even Joe Behan has let me down in the past), now that Joe Higgins lost his seat (convenient, eh?) and Tony Gregory is dead, God rest his honourable soul.
Hello again, David,
Now that you have taken up my points about the good bank, and (as late arrivals to the party) the unknown “bad loans” time bonds ticking in BofI and AIB, I think that you should also mention the difficulty that the government have in making any appointments from within Anglo due to loans made to the executives from within, which they are unable to repay and which precludes them from any appointment to fill the recently vacant positions.
And we haven’t got to irish Nationwide yet … now there’s a can of worms – more on that later!!!
I don’t believe Garrett Fitzgerald was found to have done anything wrong.
However, his son Mark is the CEO of a major real estate operation – Sherry Fitzgerald:
http://www.sherryfitz.ie/ABOUTUS/message.aspx
See also:
http://archives.tcm.ie/businesspost/2003/08/31/story921211932.asp
So, The last person we want to listen to on this stuff is the likes of Garrett Fitzerald and his drivel published in the Irish Times.
mespilroadflats,
“I don’t believe Garrett Fitzgerald was found to have done anything wrong.”
I don’t believe Garrett Fitzgerald was ever investigated, for starters; next, I did not say he did anything wrong – AIB wrote off his mortgage, so, maybe AIB did something wrong. Would they write off yours? or mine?
Why would they do that?
P.S. David, the loans were made against share options – now worthless; in order to invest in Anglo’s private equity funds and various other investments (generally property related) and also now mainly worthless.
http://www.youtube.com/watch?v=RhbqiTzDRsM
Tim, SamB; Forget the past. The question that needs asked is ‘How do we persuade more honourable people to stand for election?’
The politicians we get are those who can survive the proprtional representation electoral system. That system is one that emphasises compromise over character, and mixes the good with the bad in the vipers’ nest of party political machines. Thus a ‘good’ candidate has to obtain not only a majority of first preference votes but survive the blandishments of the opposing party machine to get seconds and so on down the line. By the time the count has been completed people have lost interest. In some places a pig wearing the right rosette could be elected.
If party machines were abolished by law, not only would the cost of getting elected be reduced but each candidate would have to stand as an independent in a first-past-the-post electoral system. These candidates would outline their manifestos on the internet and voters would base their decision on the most attractive of those proposed programmes. This reform would also mean that each successful candidate could be held strictly to account by their constituents.
Any support for this?
Malcolm, What a tragedy it would be to forget the past! We would learn nothing if we did that.
I concede your point about the problems with the PR system of elections, but “first-past-the-post” has caused issues in Britain, too. I dod not see an all-independent election producing a functioning parliament – it would be too chaotic due to the myriad individual/single-issue manifestos to deliver.
I am unaware of any political system that is not, to a greater or lesser extent, corrupt. Alpha-male stuff, really: top silverback subdues all beneath him so only he gets the spoils, maybe protects a few beta males that are loyal to him and help him keep the others under control. Powerful politicians are only so because they control the population with spin, inflation, controlled wages, etc., thus keeping the spoils for themselves and their cronies. They tie the people up in knots they can’t unravell, so they can never overthrow the regime without violence. Look at the “knots” we are trying to unravell right now ……
I wrote earlier that I fear the Dept. of Finance and government in general is putting more effort at the moment into unravelling the bank problem than into working out how to raise the economy and protect our people from disaster. Lenihan let something slip about it on Primetime the other night. I fear that protection of the cronies is more important than that of the people in general. So, if our elected representatives will not look after us, who will?
Some, of late, have been looking to Obama to save us …… but, didn’t his electoral victory have just a little too much to do with the humongous amount of money he raised over the internet? Power is bought, not won. He hammered Hillary Clinton because he had a much bigger treasure-chest, I think. Are people looking to a man who bought power?
Oh! I am in danger of despair, or absorbtion in “the all”. I’m gonna stop now.
Tim: Politics is ‘The Art of the Possible’. There will be no better time in this generation to change things at a fundamental level. The Chinese would say ‘We have been gifted an opportunity, not a crisis. Looking back in anger will solve nothing but helps release steam from the disaffected multitude.
Present circumstances demand new approaches to how we organize society. This debate is happening here, now.
Malcolm, I am certainly not looking back in anger; I am trying to look back in analysis in order to make sure I know as much as possible about what brought us here, in order to learn from the mistakes and change what is bad and envision a better future.
‘The Art of the Possible’ is the line I have always been given by politicians who lie to my face. I know many of them rather well and there is a self-serving psychopathy to many of their actions. Here is a direct quote from a sitting minister, which I consider the most honest thing they have ever said to my face:
“Tim, I don’t give a shit what looking after education now will produce in 20 years – I have to get re-elected every 5″.
If you want to change the political system, you have to deal with that reality and that psychopathy. We cannot improve things while leaving self-serving liars in place. I am not saying anything here out of “anger”, as you suggest; I am acknowledging the reality of the kind of people we are dealing with and keeping my beady eye on them.
I think Yeats is relevant here, still; watch “the craven man in his seat”:
Although I can see him still.
The freckled man who goes
To a grey place on a hill
In grey Connemara clothes
At dawn to cast his flies,
It’s long since I began
To call up to the eyes
This wise and simple man.
All day I’d looked in the face
What I had hoped ‘twould be
To write for my own race
And the reality;
The living men that I hate,
The dead man that I loved,
The craven man in his seat,
The insolent unreproved,
And no knave brought to book
Who has won a drunken cheer,
The witty man and his joke
Aimed at the commonest ear,
The clever man who cries
The catch-cries of the clown,
The beating down of the wise
And great Art beaten down.
Maybe a twelvemonth since
Suddenly I began,
In scorn of this audience,
Imagining a man,
And his sun-freckled face,
And grey Connemara cloth,
Climbing up to a place
Where stone is dark under froth,
And the down-turn of his wrist
When the flies drop in the stream;
A man who does not exist,
A man who is but a dream;
And cried, ‘Before I am old
I shall have written him one
poem maybe as cold
And passionate as the dawn.’
Tim: perhaps I was expecting too much change. At the risk of accusations of egotism I quietly believe that I know more about the past than most people, as this has long been a special interest. Thus I understand in some detail how humanity reached where we are today. But when I look to the future, I see a canvas that this crisis has smeared with white spirit. There is an unique opportunity to restore those old outlines with new paint.
It is not beyond the wit of man in this age of the internet for constituents to keep their TDs on a very close heel with weekly opinion polls. You could see how even Lenihan reacted to the latest on the recent Prime Time. If voter satisfaction in a constituency fell below say 25% then that TD would have to submit to a bye-election. However my customary optimism often fails me.
Back to Yeats. My favourite is Why should not old men be mad?
WHY should not old men be mad?
Some have known a likely lad
That had a sound fly-fisher’s wrist
Turn to a drunken journalist;
A girl that knew all Dante once
Live to bear children to a dunce;
A Helen of social welfare dream,
Climb on a wagonette to scream.
Some think it a matter of course that chance
Should starve good men and bad advance,
That if their neighbours figured plain,
As though upon a lighted screen,
No single story would they find
Of an unbroken happy mind,
A finish worthy of the start.
Young men know nothing of this sort,
Observant old men know it well;
And when they know what old books tell
And that no better can be had,
Know why an old man should be mad.
Malcolm, I love that and will commit to memory. Thank you.
Ahh, Malcom, we really agree …I do not believe in dwelling on the past and I am a firm follower of Patrick Kavanagh’s thinking on the subject, viz :
“When Drake was winning seas for England,
We sailed in puddles of the past.”
I am also not in favour of hunting for heads to roll, or dwelling on all our mistakes – not just the bankers, but politicians, builders, developers, buyers, civil servants … all except the sellers! So I think that you missed my point, which is that the solution to Anglo’s problems are being hampered by the fact that it is not just Seanie that has been tainted by loans from his employer. That problem extends to others who could be considered as replacements from within the bank.
We all need to look for a solution. Our government thinks that it will be found by deflating! By taxing and cutting when the US and the UK are inflating – Now there is a fundamental difference of opinion!
I know which side I have chosen and I’m voting with my feet. I’ve no intention of staying to “sail in the puddles of the past”
SamB: Bank officials at all levels were themselves willing and grateful participants in the loan binge. How does one find a clean pair of banker’s hands anywhere in these circumstances?— Q1 at the executive banker’s interview for responsible position in nationalized bank— How much do you owe your last employer?—A1. Just €3 millions. — Good-day Sir! Don’t phone or email.
However, before you head off into the unknown, bear in mind that Irish youngsters are much better educated and able to speak up for themselves than during previous recessions. Education leads to practical solutions being sought for even sticky problems, so I am optimistic that the younger generation will find a way out of this mess and the country will be a better place afterwards.
Hi Malcom,
I have survived every recession from the 60s on. And as much as I admire our young people, I despair when I see the plaintive baby faces looking at me for answers when I visit the banks.
Unfortunately, we are no longer masters of our own destiny and the answer can only come from the Germans. See:
http://business.timesonline.co.uk/tol/business/economics/article5733723.ece
I don’t know how to post onto this site what I have in an e-mail version .Any suggestions?
John, use edit – select all – copy, then Right click here and hit paste.
CRIME AND IRISH BANKS
Actual Address to the National Crime Forum
At Civil Hall, Limerick
Wednesday 29th April 1998
Mr. Chairman,
I would like to have the unique opportunity to make a brief contribution to your Forum on Crime Policy. I am a professional qualified accountant practicing in Limerick for twenty one years. I have been the victim of serious crime more than once in my quest when reporting my professional opinion on suspicions I encountered during my normal day to day activities and those that have shot the righteous messenger continue to enjoy the spoils of their malicious tirade. As someone who has had extensive experience in serious Crime Prevention at home and abroad and who has been written of in a best seller in the Danish language ‘Wissum Sagen’ and who is known to the Fraud Squad and the D.P.P for his contributions in the prevention of real serious crime I would like to comment under the following headings:
a) Crime Prevention:
b) Reporting of Crime:
c) The Irish Courts:
d) The needs of the victims who report Crime
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I hope my effort today at this Forum is not whitewashed and used solely as a tool to avoid government embarrassment or to prevent the laying bare to the Public a debased judicial system that forces the righteous civic person reporting of suspicious crime to third parties to be charged for a crime and put on trial by the office of the Director of Public Prosecution, a place that is a hermatic façade of a secretive ruler that needs reform by stealth.
To you member of the public the truth is universal and your beliefs are personal and this Forum must be objective and address you at that high moral level.
I hope that the findings of this Forum will influence the Irish Public and change the existing system of criminal law were reporting of suspicious crime to impending injured third parties is concerned to enable all righteous citizens to feel safe when reporting a crime and not to be ostracised to suppurating scandal.
a) CRIME PREVENTION: Unfortunately there is little cultural
awareness that gives the general public and particularly business people and professionals enough confidence that they can feel safe when reporting a crime. Real people in crime are usually very clever and protect themselves by being invisible and with a litigious threat and blackmail. More education is required to assist a concerned civic citizen to know how to anticipate hostility. We need to create a visible vested culture that can be seen to work.
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b) REPORTING OF CRIME: For those who are brave enough
sometimes their circumstances can be to difficult to report by choice, but instead may do so to a pending injured third party. Their actions require considerable courage and usually they are alone when doing it. This is very difficult and dangerous and sometimes requires certain experience to cope with a successful plan.
The biggest problem when not being able to report initially to the Gardai is knowing whether there is a trust in the pending injured third party that he or she will tell the truth to the Gardai. The third party may not share a trust for various reasons eg.
a) It might prevent his or her pending promotion; and
b) He or she may not have experience and makes a mistake then ‘he covers himself or herself’ and the civic honourable citizen becomes a suspect, in crime as a result of their civic duty in Crime Prevention.
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The following are words spoken by St. Peter in the Bible:
“Who can harm you if you devote yourselves to doing good? If you suffer for the sake of Righteousness, happy are you. Do you not fear what they fear or be disturbed as they are, but bless the Lord Christ in your heart. Always have an answer ready when you are called upon to account for your hope, but give it simply and with respect. Keep your conscience clear so that those who liable and slander you may be put to shame by your upright, Christian Living. Better to suffer for doing good, if it is Gods’s will, than for doing wrong.”
Forsan et haec olim meminisce juvabit. Perhaps there will be a time when even this will be pleasant to remember.
My personal experience relates to banks and especially at their management and higher level. I will comment on Bank Management further in this submission.
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c) THE COURTS: Should concerned civic citizen become a victim of
malice due to his honourable reporting to a pending injured third party and he claims he reported it to the Gardai after his wrongful arrest, sometimes the process of justice quickly moves against the civic citizen. Not by design by the Gardai but because of the system Irish Criminal Law before the Book of Evidence is presented to the D.P.P., does not allow the civic (now a suspect) citizen to read the evidence so that his is able to address the real issues in an additional report thus allowing the Gardai and the D.P.P. to have more information at their disposal so that the civic citizen is not prosecuted by the D.P.P. and thus saving himself to face a trial and public humiliation.
The court should allow this and the Gardai invite the civic citizen to cooperate in his report. I have personally experience a case of this kind where the Gardai did not press for charges but the malicious evidence on the Book of Evidence forced the D.P.P to prosecute. In this case the trial proceeded and the Justice of the Central Criminal Court directed the jury” an acquittal” before the defence were called and after the malicious evidence by the prosecution was partially made clarified by the Justice under cross examination.
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d) THE NEEDS OF THE The Criminal Injury Tribunal is the
VICTIMS WHO REPORT only resort under the Irish System of
CRIME: Criminal Law to show the truth of a
persons civic action’s and honourable deeds. The remit of this
Tribunal needs to be changed to offer further financial assistance and encouragement and to provide a sanctuary to show that having examined all the evidence and including that of the Gardai their decision to recognise the civic honourable actins are made public thus restoring the citizens good name.
It’s remit was enacted in the early seventies to serve the needs of the public then by then Minister Mr. Gerard Collins. Today, times have changed dramatically and the present system in it’s design does not assist in real crime prevention or does it recognise the honourable civic acts of persons who volunteer in dangerous circumstances to prevent crime, neither does it encourage themselves to meet in person anybody making a claim. The existing system has no transparency in showing the truth, is too narrow focussed, lacks accountability for their actions and only serves to purge civil right and constitutional rights by selective representation in their tribunal reports of claims and demeaning professionals and others by ignoring their extraordinary voluntary acts in dangerous circumstances. It is a hinderance to crime prevention and it only serves to encourage it in it’s present form.
Findings, of single members of the Tribunal have been known to ignore victims claims for courageous acts in the prevention of crime carried out in and from Ireland on crime taking place within the E.U.
The amount of the reforms I suggest are the following:
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• Higher public profile to victims who report crime;
• Ease of access to claims by victims who report Crime;
• More clarity and explanations in what they have to offer;
• Practical and Comprehensive Explanations of their type of Crime cover;
• Greater Budget in their Financial Resources to undertake more responsibility;
• Better printing material to educate the public;
• Reform of their existing remit to serve adequately the needs of society;
• Changes in their Garda Report Form as used in their procedural claims to include more effective information;
• Visits to the Province outside of Dublin and more person to person meetings;
• More reform to enable them to serve the State Public Policy for righteous messengers wrongly charged on a case by case basis when the agenda of the D.P.P cannot do so;
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• To examine any case where the defendant believes that he is being victimised in the reporting of crime and for their report to be sent to the D.P.P before a decision is made whether to prosecute.
• Powers to arbitrate for the relief or elimination of expenditure incurred during Crime Prevention eg. Rates, Light & Heat, Bank Interest, Tax Relief etc.
• To Remove the rigid stringent time rule when making a claim and to replace it with a flexible practical procedure. This new rule would replace many claims made by honourable people and allow them reasonable time to recover from their dangerous ordeal so that justice to them is seen to be done.
• To review the remit to remove any further obstacles that are seen to purge a clients claim.
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It is official that local authorities have no policy on Crime Prevention and do not give you Rates Relief if you incurred that expense when reporting and preventing a Crime.
I would like to conclude by showing to you in these submissions criticisms and reservations in the system of Irish Criminal Law as we have it and the authorities and financial regulators under which the righteous person abides by. My submission will include the following:
1. The Institution of Irish Banks and their Management verses The Accountant and other Righteous Professional Business Persons;
2. The Institute of Bankers in Ireland; and
3. Accounting Profession;
4. National and Local Press;
5. Solicitors.
1. The Institution of Irish Banks and their Management versus The Accountant and the Righteous Professional Business Persons.
It’s a lie to talk about an all embracing voice of Code of Ethics between the Banks and professional advisers particularly accountants. “The bank managers are the mullahs”. Forget the over legislated professionally qualified accountants, the mullahs (bank managers) are enveloped in “a cuirass of unpenetrable dogmatic secrecy in a sterling sanctuary”…… a depressing, stifling, choking influence which drives less confident accountants and unqualified and inexperienced business people into crime or persecute the righteous honourable public.
And why do these people move to crime?. They fly from sham and hypocrisy of trusting bank managers in search of their perceived reality and truth of how actual codes of proper business behaviour is overlooked.
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The bank are legislated but the bank Managers are not and neither are the employees of banks to any reasonable transparent or accountability for their mistakes and wrongdoings. The ombudsman for credit institutions does and excellent job but his terms of reference restricts his governance of greater dimension where real business matters.
The conventional wisdom about the Professional Code of Practice of Accountants is that it facilitated the development of a national identity and a cohesive professional working practice in an emerging state and that it’s authority began to wane when prosperity and education gave bank manager enough spunk to think for themselves. On the basis of current evidence, bank manager’s gridlock is set to strangle the pastoral energy of the honest independent professional and business men.
The institutional Professional Code of practice enshrined in Ethics of Accountants in Practice has not been absorbed in the institution of banks and the business relationships of bank managers, and their bank employees are not under pressure to make changes to accommodate the needs and duties to protect State Public Policy in this State. Instead the banks continue to defy it’s own prominence. Quite literally, the code buck never stops, because the Institution of Banks always puts the onus for responsibility on to others outside of the banks and clinging to their ever more rigid rituals with ever – decreasing levels of sensitivity. The message is clear: don’t legislate bank managers and their employees in their mistakes and wrongdoings particularly if you are a professional business person and you get locked up for voicing your civic duties and responsibilities. The common Law would dictate through legislation ‘Mirabile dictu’ (most marvellous to relate) each bank official denial that he heard your proper communication of caution.
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Let’s make no mistake about it, bank Managers with the employees are paid to keep their mouth shut and with full approval of the Board of Directors of the Banks. The wise old owl hears but doesn’t speak contradicting ‘the listening bank’ as it is often referred to. Legislation does not penetrate the abuse of this privilege thus creating a maelstrom of incestual discourse against the common good and State Public Policy. How then can anyone wholeheartedly throw their support behind the advice of the D.P.P when he said that “no one has the right to silence when they have knowledge that would assist in prevention of Crime”. Legislation review is required to dislodge this gridlock thus enabling the free-flow of full consensual constructive energy to fulfil the intentions of the D.P.P.
The Institute of Bankers should be seen to play a significant role and made to do so rather than resting on their laurels and remaining faceless. Thus the Central Bank must act immediately in this regard to uphold the retention of wealth and growth within the state.
Made-to-measure change happens when it suits the bank institutions. Such as customers ‘Charter of Rights’ handed out in pamphlets at every branch. But this does not address the issue and merely play to lop service a vital organ in the bank customer relationships. Bank Managers are legislated to hear you when they say so but not to listen to you at anytime.
Because of it’s self-proclaimed divine prominence, the Institution of Banks is insulated from self scrutiny and comfortably argue that the world of crime has gone wrong and not the bank. Thus vocations to up holding proper code of business practice are falling, not because the Institution of Banks is out of touch but because ordinary business people and independent qualified professionals, just can’t hack it. Everyone, it seems, is blamed for business wrongdoings and shortcomings save the bank manager and the institution of the bank itself.
The effect of such phenomenon is that institution of banks is allergic to change and unable to listen to dissenting voices.
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Concerned Professional Accountants and business people are entitled to express themselves in a democracy as much as any other group. Either way the idea that bank managers and the Institution of Banks might free itself from the maw of history and actually engage in significant social dialogue is an interesting prospect, but is it realistic?.
If recent criminal cases and Tribunals tell us anything, their lesson is that, despite any claims the Board of Management of Banks may make, no single voice of a relevant concerned person operating under licence from the Minister (such of independent qualified auditors) is allowed to speak with both authority and credibility. The Institution of Banks may claim to support democracy outside it’s own walls but it’s mandate to represent it’s customers within the democratic process has little basis in fact. That’s why the prospect of a ‘qualified concerned voice’ needs to be handled with great political caution. For practical purposes, it’s appeal is highly suspect. Certainty will always attract some support but it won’t develop the democratic process for a transparent Code of Practice by bank managers and their employees when dealing with the public.
It might be interesting to quote from the Bible Luke 6.5, the Manuscript D contains the followings, omitted in other manuscripts: “On the same day Jesus saw a man working on The Sabbath. He said to him: ‘Man if you know what you are doing you are blessed; but if you do not know, you are accursed and a transgressor of the law.”
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2. The Institute of Bankers in Ireland:
The following is the Transcript of a letter I sent to the Irish Times and published in July 1996.
Banking Code of Ethics
Sirs, – As a concerned professional dealing with Irish Banks, I am critical of the existing “code of ethics” promulgated by the Institute of Bankers in Ireland as shown on their brochure A Guide for Members (pages 6,7 and 8). This so-called code is not a proper “code of ethics” and is an indictment as to why such a reputable conservative and authoritative body should have been allowed to proclaim this without coming under the watchful eye of the Department of Finance and the Central Bank of Ireland.
The reasons for my concern are as follows:
The code is short, too general and not specific;
It is not a complete code, as it should be, but rather a memorandum;
The code is not positive and allows the preservation of face less members to remain faceless in a coat of ivory;
There is no attempt to measure the degrees of accountability or to attribute responsibility to its members;
The code resembles a preamble to those codes enshrined with the comparable institutes in the other European member-countries;
There is no comparison between the written codes promulgated by other professional institutes in Ireland, such as accountants and solicitors. Given the serious responsibility and trust empowered to bankers, it is some wonder how any detection of crime can be effective when a person trusting, and “in confidence” with a solicitors banker would have to solely rely on the propriety of that member or employee of the bank, as it is loosely stated in the brochure.
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The code is technically fraught with danger for any concerned and/or civic-minded person, professional or otherwise, in trusting a member or senior bank employee in difficult circumstances, lest the banker acts unwisely and shrouds himself in a veil of conspiracy to silence.
Recent and new legislation legislates on important areas of bankers responsibilities, but this does not allow the Institute of Bankers of Ireland to acquiesce and do nothing more. Their memorandum states that their code is founded on mutual trust and public confidence. This should also include upholding state public policy, and be seen clearly to do so.
During the Irish presidency of the European Community, I therefore call on the Minister, the Central Bank and Institute of Bankers in Ireland to show their true sense of responsibility and accountability and their solidarity with the other community members and to write it all down clearly, so that we can all know were we stand. – Yours, etc.,
JOHN ALLEN
21 Pery Court
Pery Square,
Limerick.
……………………………………………….
Since the letter was printed in the Irish Times nobody wrote a letter to the editor making reference to it and that was published.
I therefore call on the Institute of Bankers in Ireland to do so now.
……………………………………………….
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3. Accounting Profession
The Accounting Profession is very well regulated and made Accountable to the Minister. However, I find it difficult to understand why one Accounting Association insists that all complaints from aggrieved Irish persons should have to be sent to London and an English lawyer employed there should scrutinise the complaint in London that inevitable ends up being spin spun and muzzelled to an English melody and may fail to reach the investigation level at which the Irish Government has only it’s first right to participate. I consider this procedure to be a serious weakness and does not serve well the State Public Policy in Ireland or the Irish clients of it’s members. I am referring to the Association of Charted Certified Accountants.
4. National and Local Press:
Without good journalism and reporting we would not be as well informed as we are today. However, I am concerned by the methods employed by some journalist reporting on criminal cases at national and local level. In my experience I have seen and observed in the Four Courts how certain journalist sit in for part of the hearing and move around the building visiting other court hearings. They obviously do not stay for the full hearing in many cases and habitually negotiate themselves beside the prosecuting team peeping at their files. This is a contempt of court proceedings and should be seen to be stopped. They should be made to wear clear clothing with identification that at all times they can be observed by court officers and their whereabouts.
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5. Solicitors:
I believe that firms of solicitors should be compelled to take on a % of their clients that wish to take action against a bank which that firm also acts on behalf of.
______________________________________________________
______________________________________________________
It seems informally difficult to get the bank management to utter the innocuous word “sorry”, but rather the course of going to law and telling lies and deceiving the public into thinking ‘bluff and bluster’ will prevail in the Courts, that oratorical powers will sway any jury and obscure any inconvenient fact.
The civic righteous victim is shown by the forces of law and order as a device shadowed by conviction and not as a person of conviction upholding State Public Policy or at stated by Aristotle “the field of public honour”.
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In my personal experience of malicious victimisation and ostracisation I was offered in writing from the Bank of Ireland professional advice signed by the Regional Manager in Dublin “take and Action for false imprisonment against the Garda Authorities” , as this “is the appropriate route”. This advice was made after Gardai released me after questioning and told me that they would not be pressing any charges, and before the Bank Officials completed their written evidence into the ‘Book of Evidence’ that directly and reluctantly led to me being charged by the D.P.P.. The Justice of The Central Criminal Court directed the Jury of “an acquittal” verdict immediately after he cross examined the Regional Manager and without any defense entered and graituously awarded me some costs.
I was being demonished for my beliefs by the bank officials. Needless to say in good time after the trial the special Fraud Square, after examination of special evidence listened to my complaint and agreed to carry out criminal investigation into the Bank Officials and sent their file to the D.P.P.
As a person who was born and lived all his life in Limerick just across at the other side of this river from this new and wonderful building, I can feel the chimes of the church bells. The constant roar of the Curraghgabhar Falls must have been thereapeutic and energetic. There is magic in those waterfalls when the tide is out and when standing beside them one can feel the tectonic pressure beneath the earths crust as it generates tremendous amounts of piezo- electricity.
The economic trend in Irish banking today indicates that Irish banks today, as we know them, will not be the same in ten years time. Shareholders of these banks will be different by then too. But the customers will not change and they will continue to be you and I.
Bank management need to be legislated to protect he stakeholder…… the customer ….. the good neighbour ….. the civic the righteous.
The currency of banks should include proper governance of the responsibilities and duties of management and the licensing of all management personnel.
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To the Minister for Justice I salute you in your quest to implement ‘zero tolerance’, in this state for Serious crime.
To you Minister I and your electorate would like to see your visible vested interest by showing how you can today very clearly show how you can guarantee 100% safety to a righteous person reporting of a serious crime today to impending injured third parties, other than the Gardai and to remove the judicial adversary system and the game of baccarat a righteous messenger is forced to play with his life. I will put my licence to practice on the table to tell the truth if you can assure me the banks have to do the same. The cavalier use by the banks of the genuine trust of righteous civic persons and their contempt for the truth and common honesty of the people needs to be legislated against. The anthromorphism of banks and its iconisation has led to a contagion of collapsing moral in Irish Society today that can only lessen the virility of the Irish Punt sooner rather than later.
Minister….. your zero % tolerance today requires your 100% support to those that report on serious crime other than to the Gardai. Your support should include your assurance to the complainant to full freedom of information between the Gardai and the D.P.P where the complaint submissions have been made to the D.P.P. on criminal investigations reported to by the Gardai by righteous persons reporting of suspions of serious crime to pending injured third parties and your support to my written request to The Department of Enterprise, Trade and Employment to request the appointment of an “Inspector to the Bank of Ireland”.
Show me now how you can assure me of your full support in writing, and how I can feel safe today that I can cooperate with you on your zero % tolerance.
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Minister…….. you need my vote to support your zero % tolerance and I need your vote of 100% safety.
Finally, my complement goes to the Garda Fraud Bureau for their expertise I have witnessed and to their professionalism in dealing with difficult and dangerous situations. We are very fortunate to have such body of able people to serve our society well.
Signed:
_____________________________
John Allen
Copy sent to Chairman of European Central Bank on Tuesday 10th February 2009.
And I am sure they read it! Not.
Dynamite, John! Thank you.
Hi david
You are all missing the point. You are all blathering on in shock and outrage. What did you all expect to happen when the power to make money out of thin air is in the hands of private individuals/bankers. We are in the aftermath, picking over the pieces of it to which the professional incompetence on show is only one part. If anyone is serious about doing or saying something of merit then one must face up to this fact and put emotion aside. It was engineered for godsakes, the property bubble was deliberately blown up to fleece any dope that got involved. These bankers run the credit system and opened the spigots to seduce any old fool into running up debts to purchase overvalued property and alot did obviously. And not only in Ireland did this ponzi scheme occur, we’ve got America. UK, Spain,…… David if you are serious about been involved in the solving of this debt/money system carnage surely you should be outlining over and over as to what enables it to happen in the first place and informing the 99% of the public as to how the banks can make money out of thin air and inflate bubbles deliberately to make a killing. Are you been threatened by the powers at be to keep silent on this.
I agree with you – the main reason we are in this mess is the collapsed global pyramid of virtual money. Interesting that the Bank of England have started producing their own form of funny money by buying high grade banking assets. I think they will be bitterly dissapointed with the outcome of this exercise. Anyhow unfortunately Ireland can longer avail of this luxury as nobody but the ECB is willing to lend to us hence our money printers in Sandyford will also shortly be joining the jobless.
http://baselinescenario.files.wordpress.com/2009/02/cds-feb-13-2009-european-sovereigns.pdf
We took a hammering on Friday.
Question is, do we ring the IMF, the ECB or do we do what the sovereign CDS are saying and default now?
Or should we wait until the ratings agencies actually downgrade us?
Lorcan, The IMF would free us from the stranglehold the Lisbon Treaty would put on our democracy. No doubt the ECB would demand that pound of flesh, and without a refendum this time. Orchestrated for that purpose, or not, the mess we’re in mocks our democracy anyway you look at it, I think.
Bit paranoid to my mind Tim, but anyway.
We really really do not want the IMF coming in here. Personally I don’t see what you mean by the ‘stranglehold’ of the Lisbon treaty, but whatever that is, the IMF rolling into town and cutting €6bn from our budget would have to be worse.
That’s when we’d see a democratic deficit.
Agreed – and politely put
Lorcan, I am not paranoid: they really are out to get me ; )
Seriously, though, have you looked at articles 113 to 118 of Lisbon, pushing the globalisation/privatisation/free-market agenda? That system has proven itself a failure, yet Lisbon will force this on everyone, over-riding sovereignty everywhere.
Nothing else in the Treaty bothers me and the “No” camp just threw red herrings around before the referendum. I tried really hard to publicise 113-118 at public meetings, every radio station, newspaper and TV phone-in/emails, etc., but guess what? No media outlet allowed it. They wouldn’t even mention the numbers of the articles, let alone invite the public to read them, analyse them or discuss them. They would not even try to argue against my point, or even dismiss me; The just ignored the point, as if they feared people would read the articles for themselves.
Check out 113-118.
I have to laugh when I hear this cr&p about Lisbon. The morans who voted NO have contributed greatly to why we are this mess – without any friends. We need Europe more than ever now. I would happily transfer complete sovereignty to Brussells if it would free us from our own incompetent politicians (all of them).
I have to laugh when I hear this cr&p about Lisbon from people who did not bother to read it – many of our political masters did not read it and, yet, they asked us to vote for it. Agreed, most of the no camp obviously did not read it either; if they had, they would have seen that the “reasons” they put forward for rejection are not in the treaty, anywhere. So, both sides were disingenuous in their dealings with the Irish people.
Does that really not bother you chaps?
Sorry SeanOC but if you don’t understand a contract and those who are telling you to sign the same contract don’t understand it either the only logical thing is to refuse to sign it.
Your assertion that no voters are “morans” only highlight that it is you and not them is the moron!
I voted no because I did not and still do not understand the treaty. We have come to a stage where democracy is on its last legs.
We should definitely try to borrow more first before we default even if we have to borrow at 300bps given current swaps the outright rate will be low. BTW I am sure Trichet is now telling his PA not to accept any calls from a Mr Lenihan.
SeanOC, Yes, Lorcan is polite; he has never treated me, or anyone else I believe, any other way. I admire and try to emulate his approach here. I am happy to read what you say and respond, if appropriate, but using terms such a “crap” and “morons” is not really the level on which I am happy to engage.
At the risk of being slaughtered for being overly casual about the whole situation Lorcan, isn’t it time to roll out Christy and the Waterboys? I went for a few jars with the other half last night and overheard a typical conversation centered around how people were going to keep having the craic despite the Guverurnment and those feckers up in deh banks. A couple of economic statements from meself engendered strange blank looks.
A real Marie Antoinette moment.
Furrylugs, I really like your Brehon-Grameen idea; way better than even credit unions. Would need some hefty philanthropists to capitalise it first, though. There are plenty around. Let’s start talking to people about it – 6 degrees of separation, again.
Just floating a possible alternative to the current banking theories Tim. I f it was founded on a charitable non-profit basis, the hawks would stay away. No-one to screw. No massive bonuses and every punt ploughed back in. Keep it community based with a central council for arbitration purposes.
I’m trying to bring myself up to speed on the mechanics. Grameen has flaws but the Brehon aspect might iron those out.
BRB
Hello Guys and Girls
@Lorcan and Tim
The casual way in which people in this Blog and in the Media talk about “The IMF coming in here” or “The ECB sorting us out” shows how far we have come “or regressed” in terms of our sovereignty. We no longer even expect that we have the right to govern ourselves. It would be interesting to get some perspective on this change which as happened gradually over many years but is now so ingrained as to be something easily accepted.
If you want some perspective on what the IMF is about you should read Joseph Stiglitz who worked within that organisation and has some very telling criticisms of what it is about. It is a supranational organisation that has subverted democracy and the human rights of countries and individuals wherever it has had the opportunity (read the third world).
It is not about actually solving the problems of humanity and is not concerned with helping Ireland. It’s agenda has resulted in the impoverishment of many developing nation states under the benign guise of globalisation and free trade.
As for the ECB and European “project” – their democratic bona fides have been on show ever since the Lisbon referendum wasn’t carried. Don’t forget that we or at least those with power in this country voted for the Act of Union in 1800 and we know where that got us.
mediator, I agree; however, if it is a “toss-up” between the two, which would you choose? I know a man that works in the IMF and, although I tend to be distrustful of most large organisations, he is a very reasonable and honourable man. I was in “digs” when I was in college, in his mother’s house and knew his brothers and sister very well also. His mother died in my arms, more or less, when I was in third year (or was it second?) Maybe that’s just “cronyism”, too, but I would rather have Tommy McLoughlin taking care of matters here, if things get that bad (and it certainly looks as though it might) than a bunch of bureaucrats from Europe who do not care about us – Tommy has friends and family here and his father, Christopher, was Connolly’s “runner” in the GPO (I was given Christopher’s copy of “Bunracht na hEireann” as a gift and that same Bunracht may yet help us).
Then again, there are probably lots of Irish people in the ECB who have friends and family here too. I am just tossing ideas into the pot just in case one might spark something for someone.
On your point about sovereignty, I am not sure that I understand your meaning. I think that the general feeling at the moment is that our sovereignty is a mirage due to the fact that most of us have been unaware that our country has not been run in the way that it should be and that the attendant priorities of a “sovereign state” do not exist for those who have been running the golden circle, instead of the country. I fear that they have been (mis)managing a company (the famous “Ireland Inc.”), instead of a “country”.
However, I assure you that I am not “casual” about any of this (and I do not believe Lorcan is, either, but he will speak for himself, if he chooses to, I’m sure) and I hope that my posts here do not indicate that I am cavalier about the problem. If you interpret them as such, then I must become even more precise in my expression. I thought I was making myself clear; do you think I need to work on it further, or have I got the wrong end of the stick? It can be difficult to communicate clearly in this medium, without benefit of tone and physical means of expression. A sort of “lost in translation”.
ps., I do not consider globalisation or free trade “benign”; au contraire! (hence, my point about Lisbon 113-118).
“Oh what a tangled web we weave,when first we practice to decieve” The office of the DPP will be busy for some time inestigating the Financial Regulator,Governor of the Central Bank,the high street Banks,DDA,Building Societies.10 people who stumped up 7.5 million each for 300 million worth of shares in Anglo.etc etc etc. The list just gets longer by the day.All the spin in the world wont put the lid back on this can of worms.This has become the doomsday scenario.We know it would be political suicide for Cowen to go back to the people for a new mandate to deal with this,odds are FF will try to brazen it out like before.Cowen has no choice but to clear the whole lot out even if it mean’s losing the odd counter law suit (small price to pay in terms of the overall scenario). He needs to call a meeting with all the leaders of all parties,agree a committee to select replacements for all the boards,hire the necessary experts,send a clear signal to the markets,put country before party,ego’s will have to be parked,were way past fuc…g about with this shit.The future of the country depends on this being done right.Let’s show the World were off the bananna’s.Let’s grow up as a nation.
jim, that’s impossible for Fianna Fail. It was possible in times past, due to a thing known as “the cult of the Leader”; that train left with Bertie. Questionable as the cult of the leader is, it may have been helpful in these circumstances. Even a false leader can be of use, once he CAN lead; Cowen cannot, I fear.
Folks, something worth a read:
http://timesbusiness.typepad.com/money_weblog/2009/01/the-ten-men-to-blame-for-the-credit-crunch.html
…… a bit speculative, but maybe some background here (thanks, Lorcan, for the lead that linked to this).
Tim in particular, all in general – thank you very much for continuing my education.
I am utterly astonished that no one has suggested a single significant national politician who’s been a decent role model in the period 1975 – now. The implications, in terms of the two generations of voters and aspiring politicians, are clear to me. None of Fianna Fail, none of Fine Gael, and none of Labour has the wherewithall to fall back on. No reliable examples means no reliable fund of values and inspiration with which to lead the body politic into these unchartered waters.
Perhaps there is someone who has realised the error of their ways,and made a fundamental shift? [Wasn't Gareth FitzGerald associated with the Miltown Institute, an ethical think tank, way back? Surely he had a come-to-Jesus experience after he was weak enough to permit AIB to write off that mortgage?]
Perhaps there is a politician who’s lived out of Ireland, and experienced a culture within which there was a healthy diversity of political, ethical and spiritual clash?
Otherwise, I suggest we examine the track record of the fourth estate: the media, the think tanks, the universities… A few names have been suggested so far. I’ll bring those forward and display a list soon. [Ah, I've just remembered Jim Kemmy. I nominate him.] Without such names I have no where to place my confidence, and it hangs here by a thread.
A true story: I employ a cleaner. Her husband has been made redundant. Two or three children at school. Rather than do the cleaning myself, I go reading & writing on David McWilliams. I don’t save myself money. I take the hit. I look for work I could outsource to the husband, window cleaning and gardening. Another hit. Why? Not only because I have sympathy for the dispossessed. I don’t want to lose a cleaner, don’t want her to re-migrate. She’s good. He’s unknown. And more, I want the money to circulate in the economy. I don’t want my local shop to become unviable for obvious reasons. Sure, some of what I pay that family go on emigrants’ remittances, but, in this case I suspect and hope they have reduced their remittances. I have a selfish altruistic will to do my bit for the national economy. I bet some of you are doing the same in your microcosm of the national economy in a global world.
Tim, another thanks. The Yeats is wonderful. You have enriched my perspective by introducing me to a poem I did not know. Little did you know that I’m primarily a working poet masquerading as a commentator on the ways of the modern Irish, a deep sleeper for the revolution
- who wishes he invented the phrase “Attempt at a Reevaluation of All Values”.
David McWilliams, I am so looking forward to your next piece. You facilitate thought in my world. For me, it’s less vital that you’re right than you’re opening up channels and giving insiders within the system an opportunity and a place to tell their story, so that those of us outside can feel on a little more solid ground. Heartfelt thanks.
When Jim Kemmy was mayor of Limerick in 1991-92, he was also a sitting TD, so he found himself temporarily in receipt of two salaries. What did he do?
He walked the streets of the town he loved at night, and made sure that anyone he came across who was in need of some assistance was helped – sourced by his second income. His pockets were empty when he returned from his walks.
An inspiration to us all.