June 14, 2010

Looking back is the way forward

Posted in Banks · 55 comments ·
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The recent publication of Professor Patrick Honohan’s inquiry into the banking disaster reminds me of weekly scraps I had with lads when I was a boy.

Back then, I regularly ran the gauntlet of the local hard lads on the bus home from school.

Suffice to say that a Blackrock College uniform was considered to be a ‘legitimate target’ in Dun Laoghaire in the 1980s.The drill on the bus was always the same; some of the local shapers would get on and ask me for a smoke or some cash. It was always the same:

‘‘Hey Redser, any odds?”

‘‘No, sorry.”

‘‘Bollix.”

Then the slap came, normally delivered by the weediest ones (they were always the most dangerous).Then they tried to steal my gear bag – for the craic.

‘‘Please stop, I don’t want any hassle. Leave me alone, leave my bag alone.”

‘‘What the f… are you going to do about it, Redser?”

Fair question, because they knew there was nothing I could have done about it, so there was no option but to take the hiding. Now – let’s go back to the banking report.

The ‘‘what are you going to do about it’’ question could also be legitimately asked of Professor Honohan. As governor of the Central Bank, he has the authority, both moral and executive, to follow up on his excellent report and actually change the banking game here, so that it never happens again.

Can you imagine if we did something to ensure that never again will our country be destroyed by the greed of bankers, and never again will the banks be used to speculate on land and houses? Can you imagine if our houses would never again be used as glorified ATMs to facilitate a credit frenzy?

In the 1930s, following the disastrous bank-led speculation on the stock markets, the US authorities broke up banks into investment banks and ordinary banks.

This move followed the realisation that banks couldn’t be trusted, so they needed to be broken up and regulated. We need to do the same here.

Apart from appalling management, the main reason the banks got themselves into such a mess was that their balance sheets played tricks on them. The more money they lent out to property, the more the price of property went up. So the price of property went up – and up.

And as it went up, it played tricks on the banks and they thought the value of the security was going up too. But it wasn’t. In fact, the quality of the collateral was falling and getting more risky.

So the key to avoiding a new property boom is to change the amount of collateral that is permissible against property lending, because this is the relationship that is fooling the banks and making them more likely to lower their balance sheets.

What if we were to back up the banking report with a new way of looking at collateral?

What if Honohan were to look at a backward-looking index of property, let’s say property values over 25 years, and introduce a new system whereby the bank could lend only 80 per cent of the average price of a property over the past 25 years?

By adopting such a backward-looking approach, there would be no risk of any more booms or busts, because using the average price would limit the amount of cash that could be lent against any property.

We would eliminate the risk of banks getting into a lending war at the top of a cycle because they wouldn’t be allowed to use the latest valuation to justify the latest mega loan.

We might also break up the banks, as Roosevelt did after the Great Depression.

How would you do this? And why?

Well, it could prevent banks from ever again getting involved in property and push some to move back to a building society model.

Remember, international banks had derivatives – complex financial products in which risk was carefully hidden.

Our equivalents were more prosaic – commercial property,100 per cent mortgages and speculative development land deals. It was, as the bank reports said, a ‘‘plain vanilla’’ property boom.

Using this logic, if we were to follow the recent US move of banning commercial banks getting involved in derivatives, we could ban ‘normal’ banks from getting involved in property investment plays again.

We could have land and property banks that simply lend to property buyers, but are governed by tight regulation and backward-looking indices to limit loans.

All these small changes can be made. The interesting thing about the banking collapse is that it gives us permission to change, it gives us the excuse we need to revolutionise the system.

This is what Honohan has on his side.

We, the people, are on his side as we have never been before with a Central Bank governor.

When I was a young economist in the Central Bank, Honohan dropped in occasionally. At the time, he was working at the World Bank.

He was always helpful with his time and was happy to explain difficult ideas to younger economists, using his clear mind and his wonderful teaching skills. But more than anything else, he had a deprecating sense of humour.

It was the same sense of humour that he used when I first saw him debate, when he deftly filleted the pompous British economist Dr Patrick Minford in the early 1990s in Trinity – without him even noticing.

Honohan is now deservedly in the most important economic position in the country, and power has shifted to him from the Department of Finance. Because of his open mind, we can expect more invaluable initiatives in the months ahead.

I expect that he will make bold moves when he feels it’s the right time.

Recreating our banking system to make sure that it functions properly will be one of the tasks. I don’t expect Professor Honohan to shrink from that challenge.

The report is only the beginning.

David McWilliams hosts the Dalkey Book Festival next weekend. Details can be found at www.dalkeybookfestival.org


  1. SM

    But some of your former schoolmates are going to have to accept his changes and not conspire with the industry to make his job impossible.

    Ahreeh Redser?

  2. Tull McAdoo

    Lets have a look back at what the HSE done to reduce the number of un-employed….
    Ireland Mother Ireland…
    http://www.irishexaminer.com/ireland/unadvertised-hse-jobs-filled-by-relatives-of-staff-122418.html#ixzz0qoUoqt4w

    • The Eye

      you should see what a well know stockbroker is up to appointing their mates into the nama fold….honest even giving them the interview questions in advance…. 250k pa yummy!

    • Deco

      I seen this earlier.

      Brings back memories of an incident involving the then Minister for Social Welfare in 1997.

      Prionsias de Rossa advertised jobs in the Department of Social Welfare in an internal Democratic Left booklet for party members only. No disclosure elsewhere. And then he got found out. He clearly was not expecting to get found out.

      So he went on the Dail and apologised “as Geailge” so that very few voters who hear him admitting that he did something wrong.

      The good news is that his political career went from strength. There is a plentiful supply of muppets who will enthusiastically look for more abuse from these crooks.

      We never learn…and it keeps happening…again…and again…and again…

  3. Tull McAdoo

    Lets look back at what FF were trying to do above in Inniskeen, the home of one of my great hero’s Patrick Kavanagh………..Where next ? NAMA? Can we have our rebate there lads?http://www.independent.ie/national-news/ff-senator-left-millions-out-of-pocket-as-land-plans-rejected-2219643.html

  4. SM

    Like I’ve said before, we need to stop being Irish.

  5. Tull McAdoo

    Ah fond memories when the natives were drunk on credit and nobody would question any of this……
    http://www.independent.ie/business/irish/83641m-a-year-in-public-money-props-up-ibec-1475189.html

  6. Bubble blowing property lending has got to be looked at. Gearing lending to reflect changes over an 25yr period and factoring in 80% loans would certainly help.

    Plus looking at the whole issue of the quality of construction and design and services. General planning issues need overhaul.

    We should look at successful lending policies/practices e.g Denmark as well.

    I’ll reserve my own judgement on Honan until I see the new regulations set in stone, new financial laws that will prohibit illegal lending to cronies without collateral, or setting up of scam ‘ built to fail ‘ companies, bonds for the construction industry to ensure they will complete developments, new laws on transparency and accountability in financial matters, a decent plan to clean up the mess.

    New regulations re the capitalisation of banks and safe equity/lending ratios.

    By all means break up the banks and make them more efficient/competitive. Most of all, lets look at what a future banking system would be like, not as the slave of a croney elite of political insiders, but as a public utility in service of the whole community of taxpayers. Predatory and exploitative lending practices need to be brought to boot.

    Not very impressed with Honan’s view Anglo was systemic to Irish banking system. We’ve had dandy Dukes turn more Anglo than Anglo itself, there certainly doesn’t appear to be any rush to publish the kind of changes to the banking system mentioned in D’s article, so perhaps we should prepare to be disappointed with Honan.

    Link to Honahan report here:

    http://bit.ly/cuYnCv

    As D says, so what?

  7. Tull McAdoo

    “Just lifting the so called veil of respectability off the Irish landscape here Boss” ” The message does’nt seem to be getting through Boss” “Might have another failure to communicate here Boss”
    http://www.youtube.com/watch?v=1fuDDqU6n4o&feature=related

  8. Malcolm McClure

    David: I am constantly impressed by your ability to bring a fresh perspective twice weekly to Ireland’s economic blight. Every perspective on the matter has beenn explored ad nauseam. Everyone who has passed leaving has become an economic expert by necessity rather than choice. And you continue to educate and entertain in an inimitable way.
    Your backward looking idea is excellent in theory but difficult to implement in practice. As everyone knows by now property value depends on location, location, location. Average prices over 25 years have no meaning for situations like the nice Georgian rectory whose glebe has been covered with affordable housing; or the estate that finds itself fortuitously at the end of an unforeseen Dart extension. So instead of looking back we are all trying to follow a flying snipe through the sights of our economic shotgun.

    • @ Malcolm,

      Are you joking? “Every perspective on the matter has beenn explored ad nauseam.” On the contrary, lets be a contrarian and demand a proper commission of inquiry into what exactly happened during meetings on the night of 29/30 September 2008. We need an in depth public inquiry into how Government managed the banking crisis subsequently. Specifically we need a deep probe into communications/relationships/documents between DOF and Government and Central Bank both prior to and following the night of the guarantee. It’s no use limiting the remit of reports to stooges in the Central bank. This is only scapegoating real culprits in DOF and Government up to and including Cowen and Lenihan. Lets have a real commission of inquiry with real teeth, not one that excludes the guilty and points blame at the stooges. Wake up Malcolm and demand they give you a real investigation not one that’s hobbled and muzzled from the outset!

      • Honahan’s Report should only be the beginning opening round:

        “1.35 The terms of reference for this Report request that it highlight key specific areas that it
        considers appropriate for subsequent examination by the statutory Commission of
        Investigation.”

      • Malcolm McClure

        cbweb: Not joking, just slack writing efforts on my part. (I’d fail Leaving English with the sentence you quote.)
        I was trying to contrast David’s skill in finding new ways to unravel a very tangled string of circumstances with the hackneyed efforts of other commentators including some of our own efforts here.

        Cowen made an attempt today to spin the conclusion of Honohan that he was largely responsible for the mess by again blaming the international financial scene. Honohan, of course said that 75% of the mess in Ireland was the result of government’s (ie Cowen’s) mismanagement of the housing bubble.
        Cowen, in exculpation, said that nobody in the Dail during the boom had been vociferous in warning him that housing would eventually crash. Of course that excuse ignores the external views of DMcW and a few other respected Irish economists. Apparently for Cowen nothing matters unless someone raises it in the Oireachtas.

        • Hi Malcolm,

          Yeah, Kown seems unable to take responsibility. Apparently this is a childish trait:

          http://bit.ly/dD0h1R

          In the meantime we can try to support them with statements like “I know you didn’t mean it.”

          lol

          I’ll be away, posters, over the coming weeks, keep up the good work.

          Best

          Colm

  9. G

    And on and on it goes………………..

    FF senator left millions out of pocket as land plans rejected
    http://www.independent.ie/national-news/ff-senator-left-millions-out-of-pocket-as-land-plans-rejected-2219643.html

  10. G

    I think bullying, as described in the opening lines of this latest article, is a major issue in this country and country wide seminars should be held on it.

    It destroys esteem and confidence etc.

    On a more positive note, started my first business venture at the weekend and have been able to give work to one person, something I have long wished for.

    best to all, G.

  11. SM

    Is that ‘one’ you G? ;)

    • G

      ha ha, two then, with dreams of more……………….out of crisis comes opportunity!!

      • Heartiest Congrats G.
        Good to hear a bit of good news.
        Now a bit of advice, if I could be so bold.
        We had a mantra when working Trasna Sasana years ago so as to avoid British Bureaucracy;

        “Tell Nobody Nothing About Anything Whatsoever At All”

        Since our little Nation has turned into a haven for Bureaucratic Bunglers (ever notice how many British accents are employed by the HSE?), I’m finding I have to adopt the same attitude here now as I did 25 years ago in London just to survive.
        If official Ireland gets it’s hooks into you, it’s curtains.

        Yet again, well done and God Speed.
        F

      • Good luck with it, you deserve it!

  12. Another good read from our host.
    If we went back a little further to examine the origins of Banking in this Country, when Collins put aside his gun he sat outside the GPO issuing Bonds to everyone so they could share in the growth of the new nation.
    Alternatively, Our beloved Dev did a bit of creative fundraising in the States, had Collins shot and ploughed on to the inevitable conclusion we have today.
    This is a personal historic comment BTW and any resemblance to blasphemy is regretted.

  13. Not so sure about this idea, seems a little clunky and easy to manipulate. I think a better solution would be to put a limit on the amount of lending that can be secured against property, say 50% of the loan book. If a bank reaches that limit and wants to lend more, they must lend to something other than property. This ensures that property never again gobbles all the resources and promotes balanced growth across the entire economy, not just construction through a boom.

    • “something other than property”

      Like what? Salary, jobs, investments, good business plan, track record, friends of ff, backing by other institutions, personal skill base, IDA, Enterprise Ireland, colleges/universities, …what do you have in mind?

      • :)
        Personal loans, working capital, doesn’t actually matter, the bank can decide what it wants to lend to, it’s their job. Can’t be backed by property though. The net effect will be:
        - reduction in property prices,
        - removal of future credit fueled property booms,
        - a boost to every other sector of the economy as the money flows through businesses and enterprises whos focus is anything but building concrete boxes.

        It would create a much more balanced economy which would then be much less prone to boom and bust cycles as it is not overly reliant on any one sector.

        • Hi jcollery,

          Not sure if what you suggest will remove problems, but certainly would be a brake. Not even going to mention cross collateralization, or need to examine documents of title, schenanigans Honan draws attention to, as we both agree I’m sure on that. Biggest problem with your suggestion as with D’s suggestion, is you can still get incompetent bankers like Seanie who will use mortgage payments coming onto their books as their own collateral to borrow the hell out of the markets bursting all common sense restrictions on safe asset/borrowing ratios.

          What if you were to deny this to Seanie? What if you were to force Seanie to secure the mortgage he’s has acquired onto his books in such a way as to protect both himself, the lender and the borrower?

          Come in, Denmark! This is nice:

          http://bit.ly/b2YB4g

          “Danish Mortgages Financial Model

          The character of the Danish mortgage market is very distinctive, with 98 percent of Danish mortgages being funded by bonds that are issued in the capital market.

          Both fixed rate and variable rate mortgages are available, with rates linked to the price of these bonds. When bond prices fall, mortgage interest rates rise and vice versa.

          In effect, these bonds mirror the mortgages that they support. For example, if €300,000 is borrowed at a fixed rate over a 20 year term, the mortgage loan would be included in a collection of 20-year fixed rate loans which act as security for mortgage bonds of an equivalent value held by investors.

          The mortgage bank would sell an additional €300,000 worth of bonds in the financial market and credit the value to the borrower. As the
          mortgage is repaid by the borrower, the mortgage bank makes payments to the bondholders, in proportion to the value of their bonds.

          The mortgage interest rate is agreed on the date that the mortgage is issued. It is calculated by taking the
          bond yield on that day and adding the mortgage bank’s margin to cover their costs.

          These mortgage bonds are traded on the Copenhagen stock exchange, so information about bond yields is widely available.

          As a result, the base rate is the same for all the mortgage banks, so they are forced to compete by trimming their margins. This competition between lenders results in margins of around 0.5 percent, which is considerably lower than the margins added by mortgage lenders in other EU countries.

          Mortgage arrangement fees are
          also consistent across the sector: 0.1 percent of the mortgage value plus a fixed fee of around €300.”

          Instead of lending factored against average property prices over the past 25 years with all of the indeterminacy of those calculations, instead, you future proof prices by factoring prices into long term secure bonds that cast in stone the cost of a mortgage and the amount available to a person looking for a mortgage.

          The system works very well both in favour of the borrower and lender ending crazy speculation that in the end benefits nobody:)

    • Foxconn

      http://bit.ly/di6NDB

      Wills can say more about this type of exploitation.

      • wills

        Gladly will cbweb.

        The world community functions under a plutocratic system, or, what I like to call, a *Jailor system*.

        The slave prisoners labour holds the system in place through the usurping of its wealth generation / exploitation in action under the shell of democracy and consumerism and materialism etc.

  14. This sound’s like a good Idea. Looking Forward. :lol:
    http://www.rte.ie/business/2010/0614/mortgage.html

  15. wills

    David.

    I love the article and reason why is because I see in it advocacy for *credit provision* and *money creation* as *utility*.

    Everything got lost when the utility of credit and money creation became weaponized and taken over by a gang of thugs and sleveens for their own special interests and agenda beyond the *common good*.

    The article provides a simple straight forward reminder on a *credit / banking how to guide* for the community to access and use to build real capital and pursue wealth generation with common good beneficence.

    The values of our culture we all share are so *lost* and *adrift* and *amorphous* and *interchangeable* it is clear our culture and way of living is not under the rule of law equal for all citizens.

    We are living in a *social order* of a type which is been organized by coercion and propaganda and violence and abuse of power in such rapidness using technology that it requires pin point accurate diagnosis and counter intelligent truth refraction of a type this article spread the word on today.

    Well done.

  16. Deco

    PIGIS watch
    http://www.bloomberg.com/apps/news?pid=20601087&sid=aMYA0pYqoy4o&pos=2

    This is bad news, because the PIGS as a category all seem to take some hit. And the UK can expect some sort of hit from this also. British gilts are under immense pressure after all the debacles involving RBoS, Northern Rock, etc..Plus the immense borrowing from New Labour under Blair/Brown with a continual effort to buy votes…

    This will have implications on the shares on the ISEQ and the companies that are the backbone of IBEC (the real governing party in Ireland).

  17. I like the new web design Congratulations David .It is nice to know that you have availed of the new moon phase to renew your site .Maybe I am one of the earliest contributors .

    I would like to refer to the on going delicate political matters relating to the recent demotion of Richard Bruton.
    Last night while I was watching RB on the tv news I noticed how watery his eyes were .The first reaction I had was ‘gosh he is a pisces ‘and ‘how does he survive in dirty politics’.So I decided I had to do some research and I did .
    I said in last blog that the new moon was last saturday and that the little pull was beginning to only become bigger as the week progressed but will seriously become much bigger from saturday coming namely 19th until the actual full moon on the 26th sat June.I also said that we are in for 4 weeks of hell on high water .This has started a little sooner that I had expected.We have a Moon Wobble on July 3rd during this four week period.

    Ok lets examine the following results against the above background .The following are the sun signs and astro occupations of the elected leaders etc :

    Enda Kenna Taurus Earth – farmer
    Kieran ODonnell Taurus Earth – farmer
    Richard Bruton Pisces Water – nurse/ doctor

    Kown Capricorn Earth – accountant/ record keeper
    Lenihan Gemini Air – broker / commission/ slave trader
    Ahern Virgo Earth – seamstress / perfection/ craftsman
    Haughy Virgo Earth – seamstress / perfection/ craftsman

    Eamonn Gilmore Taurus Earth – farmer

    What is interesting is the predominance of the earth signs in all the parties and this gives much credibility to the level of logic that will be tabled in discussions and what is much needed to lift our country from the low level we now find ourselves in.All earth signs are pragmatic and logical with two feet on the ground.So between all the earth signs we appear to have a level pitch playing ground between all parties and it will be hard to prefer one over the other.
    So what gave rise to the recent spat by EK demoting RB.As you can read from above RB is a pisces and they are always the first to be influenced by the pull of the moon where their emotions swing up or down .I believe RB did something over week end that unstabled EK and thus casusing firm earthly actions of logic to prevail and not emotional roll a coaster campaign.Unless RB has been accurate in his intuition it may have been a loss cause as the public are now reading their party public profile .What is interesting is that EK has promoted KOD a fellow Taurus .So when you have two taureans supporting together that should ensure their success in their party.Taureans are bulls with horns.
    So on the wider political spectrum the odd man out is Lenihan the diplomatic / broker / punch line operator/ communicator / deceptive / slave trader .He is alone in his field and can he survive ?Imagine four bulls in the ring and a metador with a red cloak doing the samba to get their attention.

  18. Maybe it might be more accurate to imagine the following :

    Three Bulls in the Ring

    One Referee sitting in his post looking on – Kown ( will he be toppled over ?)

    One Metador ready to fight all three bulls – Lenihan

    One Doctor on the sidewalks ready to nurse the injured.- RB

    • There is a noticeable absence of Fire Signs at the higher political level .When that is the case dont expect any Real Change in the existing structures .If anything happens it will be only musical chairs .

  19. Macbeth:
    I have no spur
    To prick the sides of my intent, but only
    Vaulting ambition, which o’erleaps itself,
    And falls on th’other. . . .
    Macbeth Act 1, scene 7. 25—28

    Could that be Richard Bruton above? What bad timing? We had hope King Kown would be ousted today. Events conspire with blind political judgement to save the Kown moron once again!

    But there’s certainly change in Ireland with support for FF down to 17% and the public 75% view Brady should resign.

    Its a political watershed that will replace the old political lines of civil war politics with new ones based on the response to the banking crisis. On one side, FF with support the bankers, ‘tax and be damned’ the taxpayers. There’s an emerging political force wanting bankers and cronies of FF to get their comeuppance. Unfortunately, FG don’t appear to have what it takes, ongoing evidence being they’re part of the problem serving only to extend the FF destruction of the Irish economy rather than halt it.

    What’s to be done? How about a single issue political party? The Terminate Anglo Party? Candidate in each constituency?

    • Philip

      The RB leadership challenge was ill-timed in the extreme. FF cannot believe their luck.

      I do not believe the polls any more. Ask any small farmer’s son down the country. Cowen is a well meaning misunderstood person. And Lenihan seems to be the only leader in the whole place. As for Gilmore, we have a man of the people happily dodging issues and with no clear policies and SF offered support does not help at al at all. As for our fascist Greens, you have to admire them – they are hanging in there and they are Europeanising us whether we like it or not while playing ba grand game of nimbyism.

      No…the only thing that’ll bring FF down will be an external event. Something that’ll lead to half the HSE being unpaid for weeks or the Public service coffers being dried up. Councils are out of cash. HSE cuts are overdue. Cuts across the whole public service are way overdue and it’ll be enforced by an external event. Mr Allen has his prosaic style of expressing this.

      • Colin

        Philip,

        The problem is that we have too many farmers and too many farmers’ sons. All small farms are unsustainable businesses when you take away EU Subsidies, plots sold for one off housing and once off NRA Cheques for buying land to build roads on.

        We need more creators of wealth, i.e. Engineers and Technicians, and only when we’re worried about the sons and daughters of these crucially important people will we be able to get on track.

      • Gege Le Beau

        The leadership contest had to come to a head, Kenny was given many chances to turn things around, he is just not cutting it with the Irish public and he should go, I can’t see how he can survive when some of his highest profile people and his number one star are lined up against him. FG will emerge a fractured party for sure, but maybe it is a defining moment, a changing of the guard, a bursting forth of energies and ideas etc, this simply had to happen………Kenny no doubt wants the Taoiseach’s job more than anyone in the Dail, has rebuilt the party and done the running, but the polls down lie, he is a drag on his party, he should cut a deal and step aside, but it doesn’t look he will.

        • Magnificent moment for Bruton to leave port and start a new party. From my soundings, he’d attract a huge following immediately. The country is so hungry for change, it would follow Moses across the Red Sea.

    • Colin

      cbweb,

      There was and is no doubt Cowen is going to survive the no-confidence motion, unless someone knows something about the Greens pulling the plug all of a sudden.

      I’m convinced Baby Brute has good intentions, and his primary concern is the well being of the country. I admire him for this and salute his courage. Kenny is beginning to catch FFitis – I was shocked to hear he now feels ENTITLED to be Taoiseach. BB also is not insisting that he should be the new party leader – he simply wants new leadership.

      I think BB’s fears were that the next government would be LAB/FG, with Gilmore as Taoiseach. Unpalatable for him I’m sure.

      • @Colin

        Hi Colin,

        Nope, Kown is merely a peddler of the old corrupt pathways of FF, a safe pair of hands, no vision, no comprehension of where we’re going, floundering in the wake of Lenny’s/Ahearn’s mess. Make no mistake about it, Kowns’s good intentions extend not to the taxpayer, only to the bankers and FF cronies whov’ve made the mess we’re in and made it worse. Presume you mean RB instead of BB(or do you mean Baby Bruton?)I take your point RB is not insisting that he should be the new party leader — he simply wants new leadership. Listening between the lines I agree we’re likely to have BV (Baby Varadkar aka Leo Varadkar) shoved to the fore. RB being a political suicide bomber for his own and party’s political future. What a circus?

        Look outward to the rest of the world, folks, looking inward its a choice between Greek Sirens (FF) and the snakes of Medusa(FG).

        Kudos on the good effort of ILP on the banks, I’ll give them a vote next time.

        As for the others, where’s me vomit bucket:)

  20. Hellooooooooooo campers.

    Nice.

    Very good.

    Could we do the posts log in reverse, alot easier to read oldest post first, newest post last.

    • Philip

      I agree on this one. Comments in reverse order.

      And another thing, can you have a link opened on a separate tab or window. It means I do not have to re-load your page when I go back. Copying and pasting links is sooo inelegant and clunky.

      • webmaster

        Hi Philip, Wills,

        Thanks for the feedback!

        The comments are now oldest first on each page, with latest set of comments on the first page in cases with paged comments.

        With the links do you mean all links on the site, or just links within articles?

    • coldblow

      I tried to log on yesterday to agree with you Wills, but couldn’t get through. I notice today that I was logged on automatically on entering the site.

  21. [...] Looking back is the way forward | David McWilliams [...]

  22. Yup.Now we’re suckin’ diesel.
    We’ve had a couple of tweaks to the site over the last two years which were overall improvements generally but this overhaul works much better. Might take a little effort to acclimatise to the navigation side of things but methinks we’ve moved from Blog-rant to studious assessment forum. It’ll suit our heavyweights and no more than they deserve since what is being played out now is what I read here 2 years ago.
    Well done.
    F

    • Gege Le Beau

      It would be useful if some clever clogs on this site, could do a family tree of the Dail, I think it might go some way to explaining the country’s current predicament, a chart with all the familial links, across all parties especially FF and FG would be most useful, if their private interests could be added, well……….

      Think this speaks volumes……………..

      “The nine Fine Gael rebels include five TDs with deep Fine Gael roots including Mr Naughten himself (son of former TD Liam Naughten), communications spokesman Simon Coveney (son of former Fine Gael minister Hugh Coveney), social protection spokeswoman Olwyn Enright (daughter of former TD Tom Enright), foreign affairs spokesman Billy Timmins (son of former TD Godfrey Timmins) and agriculture spokesman Michael Creed (son of former TD Donal Creed).”

      http://www.independent.ie/national-news/rival-camps-antikenny-2221953.html

  23. lff12

    The reports are a coverup for government. They place the blame on the regulatory regime and banking sector without questioning why the housing/property bubbles developed in the first place. They did so because FF shut down social housing in the mid 1990s and brought in rent allowance to “house” tenants who previously might have found social housing in the massive portfolios of slumlords, handsomely subsidised by the taxpayer. This inflated (and continues) to inflate rent prices at the bottom 33-50% of the rented market and creates an effective state controlled sector which ironically, the government don’t really want to control. They want to pretend that its a “competitive market.”

    Those who chose not to sit in ever inflating rented homes had no choice but to pay equally inflated house prices. There was no other option. There was NO other option.

    And there still is NO other option.

    That is why eventually the bubble will reinflate and we will find ourselves back in the same old cycle again. For all the talk of vacant housing – the point is that they can AFFORD to keep it vacant rather than sell/rent at fire sale prices – so they can keep pricing on housing/rents artificially high and reignite the whole cycle again.

    Its classic old stuff about witholding a limited resource from the market in order to create an artificial shortage. Overpricing generates as much of a shortage as witholding.

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