March 14, 2013

Arrears and the Paradox of Aggregation

Posted in Irish Independent · 230 comments ·

So we have arrived at the day when the State has to deal with the consequences of the housing binge on the balance sheet of the ordinary person. A few years ago, people who warned this day would come were dismissed as doom-mongers. Now we see what was clear all along: the real merchants of doom were those who harassed a generation of people into debt, condemning them to negative equity and unpayable mortgages. This problem has to be fixed because the economy, burdened with such huge levels of debt, cannot grow.

It’s a simple equation. If people are paying back debt, they are not spending on other things. The economy runs on the basis that, in the aggregate, my spending is your income and your spending is my income.

Therefore, if people are not spending because they are paying back debt, everyone’s income eventually falls.
This fall in income becomes self-reinforcing. In turn, it leads to a situation where because of – not despite – your best efforts to pay off debt, your income actually falls faster than the rate at which you can pay off your debts. This leads to the strange and sometimes counterintuitive upshot whereby the person who tries to pay down debt fastest actually quickly ends up the most indebted relative to his income.


This contradiction is one of the crucial things to appreciate about macroeconomics. Macroeconomics is counterintuitive rather than intuitive. At its core is the “paradox of aggregation” which means what is good for the individual is not always good for the collective.

So for example, if I cut back on spending to pay back my mortgage, it – in isolation – is good for my balance sheet. But if everyone cuts back at the same time and copies me, who ends up spending? And, if no one is spending, who has any income?

In the end, the economy contracts and the level of debt – as a percentage of income – actually begins to rise rather than fall.

Seems illogical, doesn’t it? Well it is counterintuitive but that’s how it works.

PDH Mortgage accounts arrears 90  days Central bank

Look at the chart; you can see what is happening in Ireland. Arrears have continually risen over the past few years and at the same time, more and more people’s incomes have fallen – a direct result of more and more people trying to pay the debts off. Debt repayment was meant to be the solution, but it is becoming the nub of the problem.

This almost upside down way of looking at things explains why the government is in such a bind. Today the State has to deal with two specific types of debtors. The first is the ordinary mortgage holder and the second is the buy-to-let investor.

Let’s look at the ordinary mortgage holder first. The heroine of my recent book “The Good Room”, Olivia Vickers, is a typical mortgage holder. She is a teacher on a temporary contract. She is still working, but faces lower income due to higher income tax and property tax as well as the arrival of a second child. Olivia’s story is typical and is replicated all over the country.

Politically, the government has to do a deal with people like Olivia – a deal that does not threaten eviction. If it were to preside over mass evictions, it is political suicide.

One way to help the hundreds of thousands of ordinary neighbours, sisters and brother, sons and daughters who are in trouble is via a ‘debt for equity swap’ with the banks. This would involve the banks taking ownership of, say, half the house. The mortgage holder would pay half the mortgage. In, let’s say, fifteen years’ time, when the house is sold, the bank would recoup some of the equity and the seller wouldn’t see all of the capital upside. This is fair and just.

It would give the person breathing space. In such a deal, the banks would have to have the extra capital to cover the loss they would have to carry today and only recoup in the future. Given that the banks have already set aside €17billion capital for mortgage arrears, there is already money in the kitty to cover losses. The question is whether this figure is enough?

If it is not enough, what then? This is where the ECB comes in.

Clearly the ECB is the last line of defense here. It can’t afford another shock in the Irish banking system and it has shown itself, under Draghi, to be very adept at playing the debt juggling game. The ECB might be persuaded to hold bank equity and extend loans to the banks so that the capital base is sufficient to execute the debt for equity swap with the citizens. In this case, the ECB is simply using its role as lender of last resort to facilitate a debt for equity swap in Ireland. This piece of financial engineering would ensure a fair and sustained deal for our people who are in trouble and, in turn, by loosening their purse strings, would underpin demand in the economy. Such an outcome is precisely the outcome that we need for the strapped homeowner.

If we turn to the buy-to-let investor, there is no political reason why they should be bailed out or offered deals. However, there may be a sound financial reason not to take possession of houses now and sell them all.
This reason is called the “paradox of deleveraging”. This works in the same way as the paradox of aggregation. When the buy-to-let investor is well underwater and in arrears, the natural impulse for the bank is to tell the individual investor to sell, in order to fix his balance sheet. This makes sense and sounds prudent. But this is only the case if, when the individual investor sells, no one else is doing the same thing at the same time. What if the banks move on all the buy-to-let investors at the same time? There would be a deluge of selling, leading to falling prices. But remember, while the prices of the properties fall, the debts don’t. So we get into a situation where the debt relative to the value of the property rises rather than falls as a direct result of trying to pay the debt back!

This is the paradox of deleveraging and it is the dilemma faced by the government this morning. The best way to deal with this is to stagger selling the buy-to-lets and underpin the residential mortgages. Let’s see what Merrion Street decides.

  1. stevedublin

    where do you read the comments?

    • DECO

      No i disagree with you big time on this one if you use your process you dont own your own house the bank ownes it you would be better off defaulting now and walk away. Your letting the bank of the hook they were all ready given the money for writedowns let them use it thats what its for. I owe 230k my house is worth 80k max and im out of work im sending out cv s every day but cant get anything. im paying them a set amount i will never be able to pay 230k. I can pay 80k on a refinance over 20yrs its a 1 bed cottage. Thats all i can affoard. Bye the way i will fight them in the courts my self give a man something you have control leave him with nothing you have no control over him. Its not my fault it all went rong by God they will have to drag me out screaming. Then im gona go back in when they all go home they will have some fight on there hands.

      • Good luck. That’s the spirit and you are being grown up about it. You know what you have to do and you have accepted the fact.

        Politicians have given the bankers everything. They win every time and it is immoral

      • Grey Fox

        Give me a call Deco, I will stand shoulder to shoulder with you!

        • DECO

          Thanks to all out there going to Trim march on paddys day hope to get on TV news with protest against property TAX all wecome you can contact me We gota stand up to them pass on the word thanks again

      • molly

        Stand your ground this country needs people to have the backbone needed its not your fault ,its the banks and the governments fault.
        If the government where doing what they where elected to do instead of looking after themselves and there well payed cohorts we would be a lot better of .
        Things here are getting worse not better .
        Once you reach a certan age it’s the scrap heap of a waste of time fas training program.
        A couple of years ago one could start up something and make a living out of it now everybody is copying everybody and you end up with to many trying to compete for the same work ,you end up working for buttons.
        This government want this everybody working for buttons or claiming social wellfair,not much hope there ,even if you get depressed and go to the HSE and you would end up more depressed.

    • Just out of interest are you having problems using this site?

      I am not a stakeholder but I care about usability as I use the site often

      I find the system it a bit hard to adapt to and I was wondering if anyone else thought so.

      Maybe David can survey us and ask us if we are having problems and use the data to give feedback to his designer.

      • For example.

        (‘Posted in the Irish Indepedent’ 120 links)

        xxx links should be a link (in green of course) that takes you straight to the comments section (scenario – you have have already read the article (twice) and want to follow up on an email notification that there has been activity on your comment). You want to head straight to the reply

        You dont want to scroll down searching for the comments link. The last version of the site had this sussed bit now it looks like you don’t care as long as people have to bypass your plugs before they get to the meat. It looks amateurish and desperate and I suspect this might be deliberate

        The goal should be achievable in a single click and if not then people ask why.

        What is the problem?

        The current set up respects mobile users regarding the overhead of bandwidth (mobile surfing is not cheap) so just give them the article. If they want the comments then they will ask for them by clicking. Clickable forum links at the top and the bottom of the page would be a big improvement in usability

        Please do change the counter at the top into a link so
        people can get to what they come here for straight away. Otherwise I for one will soon get tired

        The articles are fine but it is the comments section that is the lifeblood and main activity on the blog

        It’s obvious. Make it slicker. It looks nice (but could be nicer) and the functionality needs attention

        Or you could hire Jacob Neilsen to tell you this and that does not come cheap

  2. Adam Byrne


  3. mogrady14

    Getting the taxpayer to pay for part of home buyer mortgages is not fair on the taxpayer.

    If the Government/Department of Finance lets people off paying (part) of their mortgages the slack will have to be picked up by the taxpayer (ordinary Irish people). So, the house owner gets let off and the taxpayer pays. How is this much better for the taxpayer?

    How can we be sure banks won’t look after their own families/cronies in the process of letting off homeowners? Banks in the past have written of politicians debts. Why shouldn’t we expect more of practices?


      I agree. If paying back debt means I have less to spend which means less for other peoples income then would it not be best if no one paid back any debt and it is all forgiven? This is the logical continuation of this argument.
      Of course, if no one pays back debt then who will do so – the taxpayer of course through increased taxes which means there is less to spend and so less income for other people.
      No matter who pays the debt (the person who borrowed or the tax payer) the net effect is the same – less to spend and so less income.
      What the article is advocating here is that the person who took out the debt gets forgiven whilst the people who either did not take out debt or who are paying back their debt pick up the cost. This is plainly immoral and unfair and will not increase the amount spent in the economy.
      There are a few options which I can see;
      1. If you cannot pay your debt then you lose your house. The borrower then walks away from the debt (it does not follow them – make it non-recourse) but do lose the asset which they cannot afford (the house). The bank takes a hit because it is likely the debt is higher than the property is worth but that is the price of bad lending. The tax payer (who owns the bank) shoulders some of this loss but from a societal point of view it may be OK. What is not OK is someone keeping an asset they cannot afford and having others pay for it.
      People may say that this will flood the market with properties and drive down prices. This is a good thing as lower prices mean lower cost of living which means increased competitiveness (I never understood why rising house prices was seen as a good thing but another living cost such as food or TV’s rising was seen as bad). Also, those people who have lost their homes will find it easier to get affordable property.
      2. If we need people to spend then rather than letting people in debt off the hook why not hand out a flat $100k to each citizen? I am not trying to be facetious here but if the aim is to get people spending then why not give money to all citizens, not just those who are in debt.
      3. Equity Share – if you can’t pay your debt but you want to keep the asset you cannot afford then the bank takes an equity stake in the property. When it is sold they keep that portion of the sale price. In the meantime they pick up a market rent for their share of the property.

      • celtic-michael

        Great Ideas. However, as all three will cost the banks money, their shareholders or owners will not be happy. If they do not like the government allowing this, then they may not want to contribute any money to Fine Gael and Labour. Thata wouldn’t be nice now, would it?

    • ObsessiveMathsFreak

      Getting the taxpayer to pay for part of home buyer mortgages is not fair on the taxpayer.

      We’ve paid for crooks, developers, bankers, civil servants and pensions for all combined. Now when it comes to paying for our fellow citizens, out fellow victims of the great crime, now you say it becomes unfair. Sorry, but you’ll have to define what you think is “fair” first.

      How can we be sure banks won’t look after their own families/cronies in the process of letting off homeowners? Banks in the past have written of politicians debts. Why shouldn’t we expect more of practices?

      They’ve already written off the debts of their friends; largest first, and are working their way down the line. This is part of why I don’t agree with David’s suggestion on the Buy-to-Lets here. Not without some qualifications.

      1) Firstly, I agree with the proposition that the BTL should be not all be sold at once. The sales will need to be staggered, probably for up to a decade. In the meantime, the government will have to rent the houses out.

      2) However, I disagree with the proposition that the government should not take __possession__ of the BTL houses all at once.

      I believe that the government should take possession of the whole swathe of BTL mortgages in one fell swoop.

      The BTL’s are the cancer that is killing Ireland. It goes beyond the monies owed and its effect on the banks’ balance sheets. You need to look deeply at the class of people who took out Buy To Let mortgages. Foolish, reckless, imprudent, even irresponsible, yes; but more importantly, these people are professionals, politically connected, and civic-ally central in Irish society.

      The BTLs are lawyers, doctors, dentists, senior civil servants, accountants, businesses owners, vets, teachers, nurses, and above all Gardai. There are Gardai in this country with over 15 properties each.

      Why has the mortgage situation been allowed to fester for so long? Why has Ireland dealt so badly with the bust? Why did the boom happen at all? The answers all go back to this group of people. The self proclaimed “movers and shakers”, “pillars of society”, and “people of vision”, who turned out to be little more than a shower of reckless gombeens living in a Golden Circle.

      The delay in the BTL situation is down to the influence these people continue to wield, and will continue to wield so long as the full extent of their bankruptcy stays uncovered. The government must take possession of these properties en-masse, and as speedily as possible. They can be disposed of later, in staggered batches, and rented in the meantime.

      Right now we have judges, lawyers, auditors, and Gardai who are all de-facto bankrupt. This is a cancer in our civic society which is in danger of becoming malignant. Seizing the BTLs en-masse will be a painful but absolutely necessary chemotherapy treatment for Ireland, financially and civicly.

      We must take possession now, realise the bankruptcies of our professional classes, and purge this contagion from Irish society before it kills the patient.

      • MICKEYG

        So because we let off crooks etc we should keep this up?
        Fair is where you are responsible for your actions and do not ask others to pay for your mistakes. I even gave a suggestion where some debt would be written off without recourse which is more than fair. Is that OK?

        • gizzy

          Does anyone think all the 100,000 in arrears just chose not to pay back their mortgages or do you think for one moment that maybe they lost their jobs or their businesses through no fault of their own not their own actions. The economy went into free fall that is unfair most that is what caused the problem not personal

          We have bailed out depositors by guaranteeing their deposits to the tune of 400 billion. The Troika has bailed out the government. We have bailed out the Banks to 70 billion.

          Bail out the mortgage holders in arrears suddenly it
          is morale hazard, unfair etc etc.

          What is fair is bail out nobody or bail out everybody.

          • Eireannach

            Yeah right Gizzy,

            I’d like some more money too. You see, it’s very hard for me at the moment, what I need to help me is more money. Give me your money! Money was given to banks, tribunal lawyers, doctors are overpaid, the solution is….just give me a lot of other people’s money.

            Please, I’m Irish…give me your money!

            Thanks in advance.

            Your ‘fellow citizen’ Eireannach

          • The big boys are welfare addicts blinded by fear, greed and religion (mental illness).

            Quarantine them and keep them in for observation. Poor sick puppies

            Their conservative predatory instincts would ensure 99% of the population was reduced to penal servitude while the privileged dish out lessons on ‘moral risk’ , ‘prudence’ and charity to the other 99%. Screw that. There is a huge lid yet to be lifted on this hypocratic self serving conservative corrupt catholic cesspit

            The resigning issues and sexual perversions of the 1% will never appear in the MSM. Is this the only country in the world where no member of parliament has ever had to resign over dodgy dealings or lewd sexual affairs?

            That is a deep question according to the global law of averages and on the surface it sounds flippant but I am of the opinion that it is a real question well worth asking. The Irish elites are well protected. Too protected and that is what is scaring the shit out of them. They might lose it

            This is what McWilliams understands because he is in agreement with them. They think they are a cut above and silence is their weapon of choice

            FG is full of conservative odd balls and they appear to have a deep hatred for everyone except their ideological masters who don’t even live in this country. FG are the biggest shower of clueless political losers anywhere

            This is what the coming fight is about and make no mistake this will turn into a global fight for survival and quite right too

            It will make Occupy Wall St look like a tea party. The real fight has yet to begin and we have only seen the makings of a fight. This is why these old conservatives are crapping themselves stupid

            Egypt, London and New York had better get used to it and make sure their troops are well tooled up with tear gas and water cannons

            Personally I think there are more subtle and deadlier weapons at our disposal such as mass non payment and non conformance

            Forget all this middle class small time Irish bs because there is a far bigger picture at work. The stuff McWilliams writes about is tory nonsense for kids and no-one gives a toss about Ireland and it’s adults with childrens hearts and minds

            The same is happening in America as more working people are sleeping in their cars to pay for imperial wars and Obama’s campaign of mass murder and sabotage

            It is neo conservatism gone insane and now the Amerikan republican party is split. Mad dogs on one side and even madder dogs on the other side who want even more war and more austerity

            This is what we are dealing with

      • The Dork of Cork


        “Why has the mortgage situation been allowed to fester for so long”

        Because the local banks expected another wave of globalization to wash over them just like all the other times….washing away all their credit waste while keeping their banking licence.

        Why should a real state be worried about private banks assets…….
        They have no real worth as such.

        They are a mere conduit to farming the fiat.

        But for some reason the banks can’t inflate this time.

        The solution is simple.

        The state remains in debt to the banks , (you don’t really own something you are in debt to.)

        The State via the exchequer thus creates money in the same fashion as the banks , with a keystroke
        As long as the money created cannot be legally lent on by banks there will be no inflation but enough medium of exchange will exist within the economy to use existing internal assets to the max.

        However in such a situation the banks are bust as they need inflation of their assets to bring back some capital from the future to replace the capital they destroyed in the past.

        Its a funny old Marty Mcfly world.

        In a energy constrained world (a world where you cannot bring money from the future into today there is no need or function for credit banks )
        They have no purpose , infact they never did other then extraction.

  4. “what is good for the individual is not always good for the collective”

    It’s called capitalism David. You’re slowly getting it.

  5. Patrick

    David, you have been reading “Thinking Fast and Slow”

    • Patrick,

      Its on the side of the bed, havn’t got to it yet. Is it as good as people say?



      • Tony

        I’m only a quarter way through, and so far it’s been pretty fascinating.

      • Patrick

        Yes it is good but tough going at times. I think that you will endorse some of it or it will endorse some of your theories.

      • SMOKEY

        Hey David is there anyway for you to “highlight your reply’s?”
        I always enjoy looking for your answers to everyone, assholes included,actually maybe that should be, all assholes included.
        But the point is yours is no longer Red or Bold or highlighted in any way or anything.
        Sometimes a quick scan to avoid the boring on and on and on and on and,……….,,…you get the picture, and just looking for your comments or a select few is invigorating.

        • bonbon

          HTML, the language of the blog, has standard recipe’s – just google for “HTML bold italic”. Look at it like adding a little chili here and there. Plain text does not make an enchilada!

  6. ThomasFergus

    Well said, David. Debt for equity swap is the way to go. The taxpayer doesn’t have to lose out at all, but judging by some of the comments above, Irish people will grumble over bank bailouts, fat cat salaries and the usual suspects walking into the sunset with rolls royce pensions, but they will simply not tolerate Johnny next door getting off scot free from “his” debts.
    This thinking is irrational in the extreme, but we’re the people who voted in FF three times so rational thinking isn’t what we do…..


      Not true. I disagree with what happened with all of the above but just because this did happen it does not mean that it is thus OK for Johnny next door to get away too.

      • ThomasFergus

        Johnny is not getting away. He’s losing 50% of the equity in his home, in return for 50% write down on his mortgage. In that way, both the borrower and the lender lose and gain something, which is the way it should be. And it has nothing to do with you.

        He might spend the spare money that he has (for the first time in a few years) on a local painter/decorator, or the annual fees for the club or gym, or whatever, and contribute to the Irish economy, rather than servicing a dead bank.

        The banks should then operate on a similar principle with their creditors.

    • Tony

      Thomas, thanks for that. You saved me writing my rant. It seems its ok for the country to borrow bazillions on an ongoing basis, roll it over again and again, and then trumpet about how “we’re back in the markets”, but if Paddy around the corner gets a bit of a dig out, the whole country has a his hissy fit.

      • ThomasFergus

        Paddy isn’t getting a dig out, he’s coming to a reasonable and just accommodation with his bank, who must bear some responsibility for lending vast amounts to Paddy, and who are institutionally far more at fault for the collapse of the Irish economy than paddy, who is a twentysomething/thirtysomething who bought at a normal time in his life like his parents before him.

        • MICKEYG

          Paddy may not be responsible for the collapse of the Irish economy like the banks and politicians are but he is responsible for his own decisions and for the debt which he freely entered into.

          • Grey Fox

            Not True….I can bring you to meet a large number of people, families where, once you reviewed their information and heard their stories you could not disagree with the conclusion that they were victims of the worst kind of predatory/reckless lending. You will agree that lots of people in Ireland are not astute when it comes to financial matters and they are most certainly led by popular opinion, when you have all the preconceived pillars of society,(all of them!) scaring individuals about getting on the property ladder, reassuring them that the growth will continue and advising naysayers to go and commit suicide, the picture regarding responsibility for ones own decisions is at the least, unclear.

      • Eireannach

        You too Tony, you’re insulting people to get them to agree to giving you money.

        This would be unbelievable in any other Western nation.

        In the UK or US, you’d be told to f**k off in no uncertain terms, your house repossessed, absolutely end of!

        • EMMETTOR

          “No recourse” in the US, of course, a big, big difference. Maybe it should be our first move to introduce at least a degree of this, here. The negative equity problem is at the root of this. In a normal market, you can simply downsize as your financial situation demands. Some of the arguments here are ignoring the bursting of the bubble and arguing to and fro, as if normal rules still applied.

    • Eireannach

      You want other Irish people to give you money, don’t you Thomas?

      And you reckon insulting us for being irrational is the way to ensure we agree to give you money.


  7. ThomasFergus

    If a bank takes 50% of the equity in someone’s home, in return for 50% off the mortgage, then when the homeowner pays the remaining 50%, he can choose to stay on with the bank having a 50% stake in the future value of the home, which can be liquidated if the owner sells or passed on with the home if the owner bequeaths it to his children.

    The banks themselves should offer the 50% equity in such homes as equity for their own debts to the bondholders (should’ve happened in the first instance), the Irish State and the ECB, in lieu of the debts they have to these institutions. The Irish State should never have got involved i the way that it did – this should all have been private business between banks and bondholders – but “we are where we are” now, to use that dreaded phrase.

  8. ThomasFergus

    People may get a sense of satisfaction at the suffocation of “imprudent” borrowers going under (most of them were very prudent, just victims of time and circumstance, while the most reckless are being protected under NAMA anyway), but if middle continues to sink under this mountain of debt, we’ll have learned absolutely nothing about our economic history over the last 200 years.

    We need a 21st century version of the Land League, to combat the neo-gombeenism of the banks (domestic and foreign, including Ulster Bank), NAMA and the ECB.


      I get no satisfaction form this but I will get less satisfaction if I have to pick up the cost. People need to be responsible for their actions.

      • Tony

        You’ve already picked up the cost. Remember €10 billion already given to banks to “deal with” mortgage debt?

        • MICKEYG

          So throw more bad money at it? Again, we cannot say “well A got away with so B should too”. I realize my money has been thrown away and I am angry about it. I do not want it to continue to happen.

          • Tony

            Obviously if the €10 billion hasn’t been used for the intended purpose, it’s still sitting there … ???
            So there’s no need to throw more money at it, simply use what’s already been handed over.

        • Grey Fox

          Should have been given to the Bank’s on behalf of mortgage holders of family home mortgages, the very least I expect when I part with money is something tangible in return,to hell with the begrudgers, we dealt with them back in the Tax Amnesty’s of the ’70s and ’80s and we are still here! Those mortgage holders that would have been bailed out, would in turn have spent that freed up money in the economy and maybe Davids income wouldn’t have been impacted so much, I would like to read David’s Book’s but I can’t afford them. I need and MRI, no medical card and no insurance because I am one of the squeezed middle and the vice is still going the wrong way! So although I pay my way PAYE, PRSI PENSION LEVY PRD etc…. I still have to come up with 250 yoyo’s that I don’t have for my public heath MRI otherwise I simply don’t get it! and I stay sick, the Black dog is heading up my road again!!

        • paddythepig

          Wrong. The money was given to banks to recapitalize them. After this debacle is all over, they may need to be recapitalized again.

      • ThomasFergus

        People are being responsible for their actions. But they are now dealing with zombie banks that are charging up to seven times the ECB rate in interest and they can’t change banks because the Irish government has driven out almost all comnpetition and so banks and the Irish state are just become debt collectors for the ECB and the bondholders.
        It’s no coincidence that the party of land agents – FG – are in power acting as the enforcer for these absentee banksters/landlords.
        And it is to Labour’s shame that they are allowing this madness to continue.

        • MICKEYG

          Fully agree. Why no new banks have entered the Irish market is something that needs further study. AIB, BOI etc. are not functioning institutions and should have been let die at the start of this process. They were saved as they were “necessary for the success of the economy” – this has clearly been shown to be false as they are a barrier to the success of the economy now.

      • EMMETTOR

        In reality, you’re saying “the mortgage holders need to be responsible for their actions” because nobody else has.

  9. 5Fingers

    On buy to let, it has been happening already. No one is being public about it. I would say that per apartment complex, we are looking at between 20% and 40% of the units are affected. The upside is that the management companies can now get the fees in place to do the much needed improvements which will benefit the tenants who own their apts. This too will improve the property value. Could be a lot of paradoxes at play which if played right could benefit those who really need it. We shall see.

    • ThomasFergus

      I checked the Revenue’s valuation of my home and it came to the €150-200,000 bracket. I then checked the property price register and found that two apartments in my block sold in the last six months for €65,000. I’ll be paying my tax on the latter valuation, even when the Revenue tell me that it isn’t “market” price, which of course it is.

      The “free market” is the biggest load of hocus pocus I’ve ever heard of.

      • 5Fingers

        Yes…sales of 1 and 2 bed units are typical at that price. In a bank repossession which is what I refer to, it is worse again. The Revenue numbers are pure fiction.

        • Tony

          A 4 bed semi near me is listed as having sold at the “not full value” of €15,000. Meanwhile the other 5 sales in 2012 and 2013 (yeah … 5 in a middle class Dublin suburb) are listed between 200k and 250k. If the banks go into repossession mode, the “not full value” will become the real market value very quickly.

  10. 5Fingers

    You say…”The economy runs on the basis that, in the aggregate, my spending is your income and your spending is my income”. Only true for a closed system. Ireland and most western economies are very open systems.

    Lets rewrite the phrase to reflect reality
    The economy runs on the basis that, in the aggregate, my spending is another economy’s income depending on local competitiveness and and that economy’s spending “may” be my income if I am cheaper than their local competition. Short of using trade barriers, you cannot stop leakage.

    The most the government can do is tinker around the edges and hope it does not cause a cave in.


    If the banks didn’t provide an annual remuneration package of € 70k per annum for their pampered staff, they would be in a considerably less mess than @ present. When your boss is bust , you don’t get paid. Smell the coffee IBOA.

    • Tony

      In small businesses it’s usually a case of “when your boss is bust, you’ve a better chance of getting paid than he has”. Not in socialised banking though.

  12. ThomasFergus

    My parents were able to take out a 10 year loan to pay their mortgage in 1967. The value of the house they bought was twice my father’s income, who was 28 years old when he bought. If I had been that “prudent” when I bought at aged 29, I would have been able to afford a parking space and would’ve had to build my dwelling on it. And I’d have only 2 years left on the ten year mortgage. Why, oh why, was I not as prudent as my parents? Or Michael Noonan? They’d never get up to their necks in debt unlike my reckless generation.

    • gizzy

      Spoke to my neighbour said he came back from the UK in 1972, got a plot from his father in law and built the house with 2000 pounds he had saved working on the railways. No loan no mortgage.

      • 33square

        “Spoke to my neighbour said he came back from the UK in 1972, got a plot from his father in law and built the house with 2000 pounds he had saved working on the railways. No loan no mortgage.”

        again… where?

        he should’ve left a little aside for a parking space… ThomasFergus would’ve given him twice his yearly wage it apparently…

    • 33square

      “My parents were able to take out a 10 year loan to pay their mortgage in 1967. The value of the house they bought was twice my father’s income, who was 28 years old when he bought. If I had been that “prudent” when I bought at aged 29, I would have been able to afford a parking space”


  13. Let’s say this would be done… then explain how:

    How do you deal with the swap account’s value loss when inflation rises (and it will!)

    Last but not least:

  14. gizzy

    There were plans put to this government for a a new mortgage and Business Bank while ring fencing the existing Banks. They chose not to go with a Banking Strategy but with a word PILLAR as if you can name something and it is so.
    The Irish Banks operate in a bust economy the only way they will become viable is to do anything required to fix that economy including debt write down Otherwise they will continue like pariahs increasing rates and charges to survive.

    Foreign banks will not come in here until many years after the economy stabilises.

    Trying to fix the Banks without fixing the Economy is a like giving a condom to somebody with erectile dysfunction.

  15. tomahawk

    Solution A
    1.Bank takes ownership of the percentage of the property equal to the percentage of the mortgage that the client cannot service.
    2. The client pays a rent to the bank for that fraction of the house that the bank owns.
    3.Client has option to buy back bank share.
    This is a simple win/win or lose/lose solution for all parties which doesn’t result in emotive evictions and does not attract can pay/wont pay brigade.
    The banks aren’t getting the cash at the moment anyhow so would be no worse off.

  16. tomahawk

    Solution A (expanded)
    1.Bank takes ownership of the percentage of the property equal to the percentage of the mortgage that the client cannot service.
    2.Client pays mortgage they can afford on the part of the property they own.
    3. The client also pays a rent to the bank for that fraction of the house that the bank owns.
    4.Client has option to buy back bank share or simply handing in keys with no recourse.
    This is a simple win/win or lose/lose solution for all parties which doesn’t result in emotive evictions and does not attract can pay/wont pay brigade.
    The banks aren’t getting the cash at the moment anyhow so would be no worse off. Looks like state are going to be hit again in some format so best to make sure there is no freeloading.

    • Tomahawk,

      I think you have it in one there my friend. Ultimately, the solution will look like that.



      • Tony

        The only problem with this is that a mortgage payer would also pay rent. Most borrowers can afford to pay a mortgage OR a rent, but hardly both. One must assume that, in any deal with a bank, the amount they can afford to pay on a mortgage would leave them without sufficient income to pay rent on top of that.

        • tomahawk

          “Most borrowers can afford to pay a mortgage OR a rent, but hardly both”?????
          this isn’t a problem for this solution!
          The figures must reflect reality which is what is missing from cheerleaders from both sides.
          Mortgage = 400k
          affordable mortgage =200k
          bank owns 50% of property.
          ‘affordable’ must mean just that.. including cost of renting 50% and other normal outgoings.
          Theres still the safety net of a 100% rental and 100% write off.

        • Eireannach

          Well if you can’t afford to pay your debts, you’re nothing but a financially illiterate Oirish twat, are you?

          Heaven knows there are 1,000s and 1,000s of those out there, abroad in the land.

          If it was up to me you’d all be repossessed and SENT to work in the mines of Australia, or the tar sands of Canada, and never come back again because the next generation hate your whinging guts, and I mean that absolutely, utterly sincerely.

          The younger generation hate the indebted older generation, and they are the future, not DMcW and his middle-class, apologetic to the BTL Dublin South Side pwoperty class, ‘solutions’.

          • The younger generation are probably more mature too

          • Grey Fox

            I was going to address your comment but on immediate reflection you are not worth the effort!

          • Eireannach

            Like I could care about you either, Grey Fox. You’re part of a generation of utter f**king twats I hate. Now, pay your debts or go to Australia, I either way I’m busy building my business without borrowed money.

            It’s a question of attitude.

          • redriversix

            you have no idea what you are talking about Eireannach……..and nothing will EVER be up to you

          • bonbon

            @rr6, It would be great, but whoever Eireannach is, hates the Irish, must be a stringer for FG/LP.

          • Ireland is renowed for its fighting men , my father told me. The trouble is that they too often fight each other instead of their common enemy, he continued.
            Thus they will remain subjected.
            Too bad it seems to be true.

            David’s essay pits one person against another and we rise to the bait. That’s how you sell newspapers but arrive at no solutions.

            Do not be suckered

          • Eireannach


            So who’s talking about a debt-for-equity swop?

            Nobody, except you usual whingers on the DMcW blogroll, that’s all.

            The reason debt-for-equity swotable is because outside of your cosy circle on this site, where you all reassure one another to keep each other warm in your overpriced houses, the wider Irish public is having none of it.

            As Noonan said yesterday, everyone will be deralt with on a case-by-case basis. In other words, you get the privilege of hanging separately.

            You just keep encouraging each other on this site, go ahead. It’ll compensate you for the fact that neither this government, nor the next, nor the one after it, will be giving you my money.

            You’re on your own with your respective bankers.

            We have NOT!!! got your back.

          • ThomasFergus

            Don’t worry eireannach, many people who can’t afford to pay their (now odious) debts are heading off to Australia and Canada, instead of being allowed to work out a sensible solution with the banks, who thanks to govt policy have the complete upper hand. So your wish is being granted. The thing is, as the banks refuse to deal sensibly with the debts of these financially illiterate Irish, they have to go cap in hand (ie demand from) the Government to get more taxpayers’ money to cover their losses. So although your wish is granted, you’re paying through the nose for it. Given your disgusting attitude, you fully deserve to do so!

          • Eireannach


            Consider the content of your response to my remarks.

            You say I have a ‘disgusting attitude’, this despite the fact that my atitude is standard policy in the UK and the US, for example, where foreclosure rates are much higher.

            Would you refer to foreclosure policy in the UK and US as ‘disgusting’? Or could it be that because I’m a fellow Irish citizen, you reckon I’m probably a softer touch, and a bit of name-calling and knock-kneed, mediocre cyber-intimidation should see me capitulate, and turn around 180 degrees, volte face, to pander to the clamouring masses in debt who feel entitled to personal bailouts, on the grounds that the bankers, lawyer, doctors, civil service, etc, etc, ‘got bailouts’.

            I have the precisely opposite view to you, all of you – Gizzy, Deco, RedRiverSix, DMcW, etc.

            I believe you resolve your problems with your creditors, without special hand-outs and opt-outs and bail-outs extended to you by the rest of society.

            I believe in accountability for one’s actions.

            I hold YOUR attitude to be disgusting, and in my defence, I would remind you that MY attitude is the standard attitude in our two great Anglophone neighbours, the UK and the US.

          • tomahawk

            Aint Oirish.
            have apartment but Dont have a Mortgage.
            Not a twat
            ……but I’m sure you’re right about most other things!
            Just trying to put forward a solution that avoids a complete breakdown. The ultimate point of the solution is the U.S. position of non recourse which I think you actually agree with.
            Helping people out is always ‘unfair’ from the perspective of those who don’t need help.
            Hey how come those earthquake victims are being helped when we don’t have an earthquake here? They should know better than setting up shop on a fault line. Chancers.

          • Eireannach


            You should think twice before comparing unfortunate earthquake victims with people in debt because they bought expensive houses and cars.

            I don’t think the people of Haiti would compare what happened to them with some dufus barrister in Dublin in a bind because he bought that new car, underwrote his children’s mortgages, and is now underwater.

            Upon mature reflection, I’m sure you’ll agree that the earthquake victims is not a tasteful analogy with Celtic Tiger indebted households.

    • jeeaaan

      who pays the property tax on the banks equity stake? in that case if your name is on the property and the bank own 50% equity?

    • jeeaaan

      fUNNY you mention it’s best to make sure there is no freeloading,the feeloaders are the banks coupled with the retention of the bailout funds and the taxpayer paying banking charge,meanwhile in many cases the charges are pushing people into arrears and have to plead for some ulterior solution. I think a lot of people are the losers here with a Fg/lbr led self effaced EU pleasers ignoring the people’s plight.The polls are telling the real story.This country will plod through a mire of difficulties just like Japan for years did because of the failure of radical solution.The people are being treated with contempt.The people are not the enemy here .There are many who like to keep the equiliberium and therefore we have a majority welfare state who do not support the workers ,and public vs private sector so one is pitted against the other and nobody does anything.This leaves the govt in a koscher place where no one group can rock the boat to a degree of being heard.This past weekend I passed a block of apts overlooking a part of not so desirable Dublin,it was bleak however it dawned on me these same apts sold for hundreds of thousands and launhed with an upmarket address.Many bought as a stepping stone but are now imprisoned with negative equity struggling and overlooking horses in fields in the middle of a dublin suburb.One must put themselves in these peoples shoes if it were me I would be tempted not to pay.So there you have it.”Client handing back keys with no recourse has to be the solution”

  17. 5Fingers

    “The economy runs on the basis that, in the aggregate, my spending is your income and your spending is my income.”

    When all that debt was taken on and spent on property, that income went to farmers and builders and contractors and decorators and cars and holidays so on and so on…so where did it all vanish to? Someone saving too much? No. It simply left the country buying services and goods from other countries. BMWs from Germany etc. Toys and TVs and Gadgets from Asia…very little from Ireland.

    By rights, debts should have fed to another part of the economy. It did not. Why? Nothing to do with banks.

    Anyway, this washout of debt that David describes will follow the path described. BUT, I am not so sure it’ll do any good unless a number of other issues are faced with respect Ireland’s productivity and competitiveness. In other words, we need to be careful freed up spend will not translate into increased taxes that sneak in on the basis of …shure all we’d be buying is imports, better to divert for Government use to pay off bond holders.

    • paddythepig

      100% correct

    • bonbon

      “Nothing to do with banks”? That’s a good one. Draghi would like that – give home a call at the ECB. Poor unfortunate, he needs all the support he can get.


      That personal debt is smaller than the mortgage debt. The most expensive Beemers didn’t quite cost what property cost. And we know where that money went and why very little of it went back into the economy. When you think about it, stamp duty was people taking out a mortgage to pay tax, the government then using that money to buy elections. Actually David’s analysis of how your income becomes mine, is correct, the other aspects of how money is spent reflects in Trade Balances, etc, but unless consumers are consuming the consumer economy fails.

  18. [...] Arrears and the Paradox of Aggregation | David McWilliams It would give the person breathing space. In such a deal, the banks would have to have the extra capital to cover the loss they would have to carry today and only recoup in the future. Given that the banks have already set aside €17billion capital for mortgage arrears, there is already money in the kitty to cover losses. Sign in or Register Now to reply [...]

  19. David, debt is a mugs game and this is the first thing people should teach their children. That along with a warning that adults should be seen and not heard

    If you switch off from the MSM and get on with your life you will have missed nothing of note. Why? Because all the talking heads know nowt worth knowing about life

    I don’t buy that people were railroaded into it. They made adult decisions that eventually herded them up dark lane and into a screaming nightmare. They drank from the poisoned chalice and the wine has turned to vinegar

    In 2000 when we all had well paid jobs and access to debt there were some people who refused to join the zeitgeist

    Anyone who was different or thought differently was given quare looks and Irish irrationality and mistrust was applied as it is to people who don’t drink. It takes bottle to be your own man no matter what country and era you live in

    When I look back 13 years and think of all the crazy peer pressure of the time I remember my Mother’s words echoing in my head – ‘don’t do it’. I resisted the temptation even though I could have joined the party with the wages I was pulling in

    If I did join the party I would have offloaded the debt after a few months and banked the profit. No point in getting sentimentally attached to bricks and plaster. You can’t eat it and it won’t give you a hug when you need one

    Looking in at the wreckage today is sad. The saddest thing of all is that nothing has changed and adults are now divided more than ever and bickering over what is and what is not fair

    Like a bunch of kids fighting over a bag of marbles

    • Eireannach

      I agree Paul,

      People were not forced into it, and if they’re looking for a soft touch, they’re not getting it from me.

      I’ve made mistakes in my own life in the past, but turning the corner and things getting better was predicated on realising that I’m the master of my own choices, I shape my own destiny, etc.

      It seems that like Nigerians looking for residency visas, like bust banks, and like cheeky Unionists planning on marching to Leinster House to demand removal of the flag, the broadly indebted Irish middle class 30-50 somethings think the Irish are a soft touch, just insult them and ‘chi-ching’, they be reaching into their pockets to bail you out too because they are shy and frail and can’t stand the insults being thrown at them.

      If it was up to me there’d be tear gas and repossessions and the job would be over and done with quickly. Life would move on. That’s more or less how it’s done in the majority of US states, btw.

      • I don’t have much respect for my generation and those older. They are so conservative that I can’t communicate honestly with them at all

        I am 48 and know my limitations. That is why I have always lived on what I had coming in. I had a mortgage for 18 months once and off loaded it and took a year off on the proceeds

        It is up to the young to take up the political reins and if it takes tear gas to do it then so be it. I would not blame them

        • EMMETTOR

          Well the Irish are conservative, young, old, middle-aged, men, women, the lot. Look at young Eireannach, there, frothing at the mouth about teargassing people out of their homes as the final solution. Like a young Blueshirt/Blackshirt-clad Colossus he strides across my screen, shouting “the young people are revolting!”

  20. David

    You must ‘log in’ to comment

    Change this link to green for consistency.

    Devil is in the detail.

  21. molly

    O great the mortgages people can’t afford to pay are going to be given a write down to help the domestic market only this is the stuff of fairy tails.
    There’s plenty of people here with no mortgage and they find things hard,I just don’t think this will be the saviour of the domestic market.
    This government is again barking mad.
    home heating
    COST OF LIViNG ALL IS RISING AND UNTIL SOMETHING IS DONE TO SORT OUT GREED and corruption we are sunk .wheres the change mr Kenny and mr Gilmore .

  22. Moral and ethical decay and corruption are endemic.

    Sound money systems lead to affluence. Affluence leads to depravity. Depravity leads to corruption. Most of those corrupted are within a corrupt system and do not know that they themselves are corrupted.

    We have everyone arguing about who should get this or that. Who should be relieved of personal responsibility and who should not.

    We hear the argument of “It wasn’t my fault, everyone else was doing it.
    The state (read my neighbour) should bail me out. Somebody else should pay , it’s only fair. It is not fair I should pay what I owe, I was trapped.

    What a bunch of school children whiners. Makes me sick to listen to it all. Makes me even sicker when the chorus is lead by an educated trained person who should know better; but then that proves the point that most are corrupted without realization of that fact.

    I read a long time ago that a dishonest monetary system will corrupt society as everyone looks for a way to cheat the system and their neighbour.

    We have a dishonest monetary system. It leads to a lack of standard. The lack of a standard leads to loss of moral and ethical action. Then we are lost.

    A lost people will not be able to locate the solution. Then the only foreseeable result is a collapse of society. That will lead to anarchy and authoritarianism. That will lead to a dictator. Finally a people will become moral and ethical and will regain their lost freedom.

    Until a people can return to an honest monetary system there is no solution to solve the current and growing problems.

    Until a people can see who gave them the current debt based credit system of money, that impoverishes all, they will be unable to see how to be rid of the current system. Until they see who controls the current system they will be unable to purge the corruption.

    Until the people understand that he who controls the money supply controls society, they will address symptoms and not causes.As symptoms are address to no results society divides against itself.

    To short circuit the coming disaster a people must return to honest money, away from dishonest money.

    1.The fiat debt based money system must be abandoned.
    2.The private central banking system must be closed and destroyed.
    3.The commercial fractional reserve system of banking must be banned.
    4.Legal tender laws must be repealed.
    5.The Money System must be returned to the people. Money is private property and not a public utility.
    6.Most of the world will revert to a precious metal based monetary system.

    Our good friend David refuses to agree , disagree, or even discuss any of the above. He just will not go there. Corruption reigns.

    He says my spending is his income. A nice trite little phrase.
    BUT your debt is not my debt and it should not be. Neither should my debt be your debt.

    • 5Fingers

      Let me take one item. “The Money System must be returned to the people. Money is private property and not a public utility.”

      If you are dealing with a large multinational with enormous buying power with the ability to move cash and settle debts anywhere they choose irrespective of where they incurred cost, you will never get control of the money system. If say you control it in one country, they’ll put their investment where there are less constraints. You need a global commitment to pull this off and you will not get it for the same reason that corp taxes will remain different. Everyone wants investment in their neck of the woods.

      It is not that there is anything fundamentally wrong with what you say. It is that it is not possible to achieve without serious global commitment. Of course, the joke is, if you did manage to pull it off, then markets would be more stable anyway gold or no gold.

      We are an utterly interconnected and open world from a consumer perspective but we do no cooperate to ensure mutual good. Global monopolies take advantage of that.

      • Respectfully disagree.
        currnetly the money system is controled by the central banks who give licence to commercial bankls to create money out of nothing.
        In addition to creating money out of nothing they loan it into existence. Then the cgarge interest on the loan.
        As all money is created this way(except coin) then all money is a debyt being charged interest. As the interest does not exist at the time of the loan but only isenterered as a leger entry there is no money in existance to pay the interest.
        Thus more money must be issued to pay the interest and as all money is issued as a debt then charging interest exponentially increases the debt load.
        This is unsustainable as eventually all assets are owned by the banks as it is impossible to pay back the debt.

        This is a debt trap and it is engineered and programmed to be so.

        As countries and individuals we are fighting eachother to get enough to repay the banks but it cannot be done. It is physically impossible.

        Once it is understood then one can see that the current money system must be dispensed with.

        It can be done person by person and community by commumuty and country by country. Any who try will be vilified by the PTB to sow discent and confusion.

        Libya was one such country, Iran another. And Chavez was leading that way.

        Any country with an educated population can go that way too.

        The current way is perpetual debt and slavery. The alterative is sovency and freedom.
        Gold and silver are a free man’s money. Also known as honest money.

    • 33square

      “I read a long time ago that a dishonest monetary system will corrupt society as everyone looks for a way to cheat the system and their neighbour.”

      everyone looks for ways to cheat every system that they encounter (traffic lights, queues, slot machines), whether they will admit to it or not or are even consciously aware of it. they might not actually cheat the system but they will investigate it to learn it’s boundaries. if they didn’t, people wouldn’t get good at things like playing the piano. it’s proprioception or, put another way, the hacker in all of us. once you know the boundaries of any system, you can can traverse it safe in the knowledge that you won’t negatively affect it, you can extend it, restrict it, recreate it or destory it.

      i’ll cut to the chase by asking some questions…

      what is an honest monetary system?
      can one exist?
      is profit possible with such a system?
      has the monetary value of bitcoin gone through the roof since the latest “crash”? (currently ~36 euro per bitcoin)
      are bitcoins just another bubble/fad?
      is a cashless society possible?
      is it desirable?
      is a digital currency durable (it certainly isn’t in a traditional sense)?
      is lending possible with a digital currency?
      if a digital currency were to become mainstream, what would happen to traditional banks? (would they be involved)
      and internet service providers?
      where does internet anonymity fit in with all this?
      and political activism & journalism? (freedom of the press, freedom of expression)
      and open source software?
      and mobile internet?
      and NFC chips in smart phones?

      the good ol’ days:
      when mobile phones took off, what age group took to them first?
      how quickly did they become mainstream?
      before you knew they existed or were available at a reasonable price, did you need or want one?
      what made you need or want one the first time you bought one?
      what would happen if you could not use one any more for some reason?
      prior to having one, when you made an arrangement with someone, were you more likely to keep it than you are now?
      do you need or want a mobile phone now?
      if you never owned one, why didn’t you?

      worth thinking about… “crises precipitate change”

  23. grougho

    hi all,
    fairly selfish question, but am asking advise,,,
    we are a small family and thinking of buying a small house (largely with savings) in cork city. we have one permanent half time job and one half time self employed. should we or should we not.
    any advise appriecated.
    thanks in advance.

    • General answer
      If you are financing:
      Your monthly payments of mortgage, heat, light, property taxes etc should not exceed 38-40% of your gross income before taxes.
      You should get a fixed rate mortgage that is fixed for at least 5 years.
      You should buy nothing if you see your income decreasing at all over the next 5 years.
      If there is a capital expense needed on the house then ammortise it over the period of time before it needs to be paid for and include that amount in your 40% of gross income and start a sinking fund to pay the cost of the capital expense.
      You must not worry about whether the value of the house will go up or down in the next foreseeable future unless you have to sell. In which case do not buy.
      If you do not buy, put your savings into gold or silver. The PM ounces bought will buy you twice as much home five years from now IMO.

      These are points to ponder. You are responsible for your own decisions!!{:-)

  24. mediator

    Is it my imagination or does “DECOs” recent posts sound like someone
    else? Hi Deco is that really you or have you sold your moniker or had it hijacked?

  25. Reality Check

    Methinks it’s a different “Deco” to the capitals “DECO” username. The real “Deco” known around these parts is far more eloquent. Just my humble opinion.

  26. bonbon

    Has anybody looked at this AIB legal document ?
    Confidential document lifts lid on AIB veil of secrecy on mortgage deals

    9 Mar (Sinn Féin News Report) Sinn Féin Finance Spokesperson Pearse Doherty TD has today released a confidential non-disclosure document used by AIB to gag borrowers in the buy-to-let market on mortgage deals with the bank.
    There you will find a link to the AIB PRE-NEGOTIATION NON-DISCLOSURE UNDERTAKING, to be signed.

    How many have ben bludgeoned into this trap? Why is AIB afraid it becomes public I wonder?

  27. wills

    Another excellent article explaining the legalized gangsterism of *bent economics*.

  28. bonbon

    For the metalists and bi-metalists (gold and silver clique), have a look at polymetalic nodules:

    Note that the giant defense contractor Lockheed Martin is behind this British effort to exploit our polymetalic nodules – A new and controversial frontier in mining is opening up as a British firm joins a growing rush to exploit minerals in the depths of the oceans.

    UK Seabed Resources is a subsidiary of the British arm of Lockheed Martin. It has plans for a major prospecting operation in the Pacific.

  29. molly

    As I was talking to a friend of mine ,I asked him was he going to pay the property tax,his reply was well I don’t want to but I have no choice.
    He went on to say by the time this government are finished with us we will be left in our nude.
    This to me is quite true,what makes things more depressing is when you look at the government and then you look at the opposition and the penny drops,we really are up the creek.

    • If you are going to end up in the nude then what is the point in paying?

    • Eireannach


      Do they pay their property tax in the UK, in France, in the Netherlands, etc, etc, etc?

      Of course they do, because in every other country, the consequences of not doing so are very serious.

      The problem with Ireland is too many people, especially country people, think the state is a joke ‘run by Dublin’ and they have the bare-faced cheek to pay no tax (if they’re farmers) and refuse to pay a property tax.

      There is going to be war over this property tax, and the nonpayers are going to lose, big time.

  30. paddythepig

    What is Olivia vickers doing having a second child when supposedly she is strapped for money?

    • Dorothy Jones

      ‘Morning paddy, that’s a question alright to start the day with :) :)

    • bonbon

      Ireland has never recovered from the genocide of 1846. Anyone that claims “too many people”, such as Al Gore, Prince Philip, Dr. Schellnhuber, to mention only a few, and who puts a price on human life, will be judged by the Nürnberg Code. There Dr. Alexander clearly stated everything began with putting a price on life, a subtle shift leading to catastrophe. When lists are drawn up of “lives not worth living”, for medical care, population reduction, remember what happened to Dr. Brandt.

      • paddythepig

        So your point is? Plain English please.

      • bonbon

        Plain English? Well that’s easy. Today the conscious agenda, expressed in Brutish, is very simple – population reduction.

        Everyone knows, (except maybe the FG/LP notables) that the bailouts never possibly could work. So, as some others have noticed, they are going to pull off a monetary switch with catastrophic results. To prepare the unwitting the idea of a price on life must be widespread, the trick Hitler used. Start with the “cost of healthcare” for chronic illness, the number of infants for example, and the door is opening again to a holocaust beyond most peoples imagination. It all started with that little step, hardly noticeable, subtle, as Dr. Alexander said at Nürnberg.

    • I thought only novels had heroes and heroines.

    • Maybe she has no self discipline and should come up with a better risk management strategy for controlling her primal urges?

  31. bonbon

    Nice sentiments there DMcW, but without breaking the banks, they are merely that.
    Glass-Steagall is not sentimental, and is step number 1 for any possible recovery. I would not speak to the Irish as British East Indie Company chief Adam Smith did :

    “To man is allotted a much humbler department …. Nature has directed us to the greater part of these by original and immediate instincts. Hunger, thirst,the passion which unites the two sexes, the love of pleasure,and the dread of pain, prompt us to apply those means for their own sakes, and without any consideration of their tendency to those beneficent ends which the great Director of nature intended to produce by them.”
    —Adam Smith Theory of Moral Sentiments —1759

    Now to tell us Irish that we are allotted a humble department, of instincts and make “deals”, rather than taking on the economy with full consideration, and banking, just shows the continuing rule, most of the time. Economists do not even realize the grip Adam Smith has, and people most of the time play being humble and do not notice the monumental condescension.

    It is really only this, and nothing else, that is keeping the system lurching along.

  32. 5Fingers

    I really think the Irish hate or detest themselves.

    You say…”The mortgage holder would pay half the mortgage. In, let’s say, fifteen years’ time, when the house is sold, the bank would recoup some of the equity and the seller wouldn’t see all of the capital upside. This is fair and just.The likely reality of the Mortgage cleanup”.

    Here is the likely reality…

    “Mr Elderfield’s statement claiming that the regulator intends to remove the current cap on number of times a bank is allowed to contact or call or visit a borrower ahead of the review of the code of conduct is very concerning. In our view, the central bank is underestimating the extent to which the banks are willing to go to pressure borrowers. It also pre-empts the actual review of the code of conduct for mortgage arrears.. ”

    I have to ask myself if the French or the Germans would allow their citizens to be treated like this? What is it about the Irish that makes them so willing to knife one another?

    About the famine years:
    A few points:
    1) Ireland had an abundance of food at the cheapest price in Europe. The poorest in Ireland could not afford it. Lets not repeat this race to the bottom nonsense today – we are again being relieved of our resources because they are the cheapest in Europe – Our Wind, Our Oil, all because we cannot afford to ramp it up.

    2) Irish Landlords were exhorted to look after the poor. Few took up that role. FG and Lab and and.. are very willing to milk what we little have left out of this place. This is a land clearance exercise to allow Ireland be milked as resource for selling to rest of Europe. Idea is to hamper / undercut developments in Europe while hampering national development in Ireland.

    Irish psyche is short-term oriented and very anti community. Is it the Radon gas? Is it the Islander mentality? What is going on?

  33. ThomasFergus

    I have no problem with foreclosures, or accountability for one’s actions, so long as the banks don’t expect to keep going after the owner for debt after they’ve seized his property. If your attitude is the same as that of the UK and US (and it isn’t btw, our bankruptcy laws are still Victorian in comparison and the complete opposite to American bankruptcy laws) then you’d have no problem with the tens of thousands of people of my generation handing in the keys and calling it quits; but that’s not what’s happening here. The zombies still want to come after people AFTER they’ve foreclosed on them.

    People in my generation are often paying interest rates of up to 7 times the ECB rate to banks that have lost unquantifiable amounts of money on speculation but who have turned into zombies by govts who dance to their tune, and who as a result are tying to fix their balance sheet by turning the screws on mortgage holders (see above) and shutting down lending to businesses (and putative house buyers) and thus depressing the private economy even further, and house prices below any imagined “market” value.

    State policy (in collusion with private banks) drove house prices up during the boom, state policy (in collusion with same banks) is driving the prices ever further downwards. Many people of my generation are trapped in this spiral; it’s the Irish catholic guilt thing going back to the famine that allows people like you to come on here and scream abuse at us.

    Some idividuals make mistakes and some individuals can be canny investors and do well for themselves. However, most people who bought in the noughties were at a time in their lives when they buy homes, just like people did in the 60s or the 80s or whenever. There are some chancers out there no doubt, but most are either comfortable or ruined due to nothing more than timing and circumstance. What part of that do you not understand?

    The private debts of Irish banks are odious. The private debts of ordinary Irish citizens, thanks to the nature of the guarantee, the bailouts and govt policy in cahoots with the banks, are also odious. People signed up to mortgages with banks that were competing for their business, in a society and polity that discourages renting (esp when compared to the rights of tenants in Europe); they did not sign up for mortgages with banks that would later demand that competition be removed by govt policy so they could turn the screws on mortgage holders who would have nowhere else to go, again thanks to govt policy. What part of that do you not understand?

    And spare me the cyber intimidation accusation: you’ve just told us you hate our whinging guts, wished for us all to work down the mines of oz or the tar sands of Canada, and accused one of us of being a “financially illiterate Irish twat”. That’s why people are angry with your comments.

    I’ll leave it by saying that I’d love to meet you under a dropping ball, but I suppose we can’t always get what we want in life eh?

  34. Eireannach

    Wrong about the Catholic guilt thing, Thomas. Very wrong.

    My view is – everything is twisted and corrupted. Banks shouldn’t be bailed out, pressed homeowners shouldn’t be bailed out, it’s all twisted and distorted.

    The idea that homeowners are next in line at the trough, after bankers and the public sector, politicians and tribunal lawyers and doctors….the whole thing smacks of the utter collapse of any verstige of a social contract.

    Now answer me this – will the Irish government’s policy change from ‘sort it out yourself with your lender’ to ‘debt-for-equity’ or other across the board ‘solutions’?

    I’m hard headed and pragmatic? Will there be a change of policy? Will pressed mortgage holders get a get-out-jail card, as the banks did?

    I doubt it. But it doesn’t stop most of this blogroll huffing and puffing and generally making a load of noise to no practical effect.

    Basically, you’re on your own Thomas. Sorry to report, but you’re on your own.

    • ThomasFergus

      I don’t believe homeowners should be bailed out. I don’t believe debt for equity is a bail out. If your mortgage is written down 50%, the bank will own 50% of your home when you finish paying your mortgage. That’s very different to the “prudent” borrower who was “smart” enough to buy his home in 1987 with a 15 year mortgage.

      And I know I’m on my own. After the bank guarantee and the endless bailouts, it was made clear to ordinary Irish people trapped in negative equity that each and every one of them was “on their own”.

  35. Eireannach

    I believe in non-recourse, that is, if the bank forecloses, the homeowner loses the house and the bank can’t chase the homeowner for the outstanding balance.

    Why don’t we have non-recourse laws in Ireland?

    Because we have too many indebted households who still believe, even now, that they should be ENTITLED to keep the houses they can’t afford! There should be debt-to-equity, or some other accountancy trickery, to allow they to plod on as before toward happy retirement in ‘their own home’.

    Lots of Irish people still refuse to admit they’ve screwed up, epically.

    So they are fighting on the line that society should defend their right (wtf?) to keep a house they can’t afford to pay for.

    If they admitted they were sunk, they could push for non-recourse laws. But no! That’s not good enough, they want to keep ‘their’ houses, you see, even though they can never in fact own these houses, the deeds will always belong to the bank.

    So it is Irish denial or their own tom-foolery and financial illiteracy that is stymying changing of our laws to closer correspond with the UK and US.

    DMcW and his fans are now in the realm of cloud-cookoo land, trying to dream up accountancy shenanigans, extend-and-pretend schemes, etc, etc that are designed to PREVENT the house of cards falling on the Celtic Tiger generation.

    Bring down the house of cards, I say. Just get this crap over with.

    • ThomasFergus

      I’m all in favour of non-recourse laws. A lot of people trapped in negative equity are in favour of them. Most of us would like nothing better than to hand over the keys and start again, even with a bust credit rating. But the banks are opposed to that. And the government is oppposed, as it does the bidding of the banks. So you have people facing the prospect not only of foreclosure, which would be fair enough if they could call it quits, but also facing the zombie banks coming after them for the remainder of the money after they firesale their property. This is 21st century neo-gombeen land agentism and the like.

      If I quit my property and emigrate to Australia, then the loss made by the bank on my property will be made good by the government, who will tax the few people left in this country like you to pay for it. It’s in your interest that this doesn’t happen, but you don’t seem to get that.

    • Personally I welcome your anger and find it refreshing. It’s good to hear someone who has a bit of spark in them rather than a bunch of old conservative lackeys talking shop about gold, property prices etc. All that technical stuff would bore the arse out of a bottle

      I see you are taking pelters but don’t let that distract you. David McWilliams is also getting pelters today and I understand why

      Let me say one thing. Not everyone on this site is a comfortable tory. Some of us have the blood of Red Clydeside in our veins and live minimal and simple lives because we were educated from an early age on the follies of affluence and delusion. I have no debt and never will have so I am one exception for a start

      I don’t like them much myself but I find this site to be a good asset when trying to make sense of the uber conservative Irish psyche. I find them fascinating. Some of them are even intelligent!

      Ok that joke was a bit below the belt and I take it back

      If you know your enemy and keep them close you will catch more bees with honey rather than with vinegar.

      Use your anger to educate and do it with style friend

      • Grey Fox

        Paul the “Div” if you wanted to honestly take back your stupid joke, you could have used the backspace button! but there is no effect garnered from that is there? Were you having a GWB moment?

    • bonbon

      Yer doing a Beppo clown act there. Hey we have our very own Eireannach Grillo!

      No surprise Grillo’s crowd praises Mussolini, and ye want black-shirt Sir Oswald Mosely’s United States of Europe.

      Looks like the fascists want to join hands, again!

      • You asked earlier who this ‘Eireannach’ guy is

        Many people have asked who the ‘Bondon’ is and never been given an answer. Why should he answer you?

        Fuck off

        ‘Eireannach’ got to who ever was using the Bonbon moniker today. I detect a sign of weakness and I smell fraud

        Hope ‘Eireannach’ keeps posting

        Are you all really that lacking in confidence that you have to hide behind a moniker?

        That is sad

        • bonbon

          I never asked who anyone is, but fascism smells the same everywhere from Italy to Dublin. And it always has a British clown act running the show. Beppo Grillo’s party light, Lombardini, praised Mussolini, well known to have worked all along for MI5 (Guardian declassification not long ago). Some rather nasty here propose British Black Shirt Sir Oswald Mosley’s United States of Europe. There’s that British clown act again.

          And to hide behind fluent Gaeilge is the filthiest insult to our culture imaginable. But that is what fascism is all about, an utter hatred of culture, peoples, humanity itself.

  36. molly

    Why Must we go around In so many circles when surly we should be going in a straight line .
    Surly the back bone of the domistic economy is the small buiness .
    People need money in there pocket to pay for goods and services,quite simply the money has been removed from people’s pockets and so untill this is addressed properly window dressing is not going to work.

  37. bonbon

    Private Equity Crash Could Trigger Next Financial Crisis, Bank of England Warns

    15 March (LPAC) The Bank of England has issued a warning that the huge amounts of bad loans on the books of banks that lent to equity firms for their wild leveraged buyouts of corporations prior to the crisis, will be the trigger for the next financial crisis. The warning came from a report published today in the Quarterly Bulletin of the Bank of England, which added that the BOE would use its new role as the watchdog of the City of London to monitor private equity deals in future “episodes of exuberance” to prevent a repeat of the debt-driven takeover boom in the run-up to the banking crisis.

  38. Bamboo

    “In, let’s say, fifteen years’ time, when the house is sold, the bank would recoup some of the equity and the seller wouldn’t see all of the capital upside. This is fair and just.”

    This is assuming and hoping that property prices will go back to the level it is before the boom in 15 years or thereabouts. I don’t know what percentage of the properties are sold in god-forsaken places in the country, little housing estates are scattered all over the place with hardly any amenities, schools or public transport. Looking at the current disasters: Priory Hall, estates on flood planes, ghost estates, etc. My guess is that people will think twice this time before buying.

    Taking all aspects of the (global) financial changes/developments, the change of the Irish thinking and culture, changes in social classes, unsustainable employment, etc, – I don’t think property prices will go back to those levels of the boom years.

    So the banks, spruikers (reference David: A spruiker is a snake-oil salesman who ramps up the prices by talking up the market.) and our government have to come up with a good plan to hike up the prices again to get their money back. These property prices can only be hiked up artificially like it is done in the past with an army of spruikers. I think people will learn at this stage from this crisis. People who didn’t get caught are just very, very lucky.

    I can’t see at all how these prices will go up again so the banks can “recoup some of the equity. Can someone explain please!!

    The only way out is a massive scheme of regeneration in the bigger town and cities in Ireland. This means demolishing existing areas with perfectly good houses, re-housing people into temporary accommodation (yes, it mean years of massive protest and lots of squabbling in the media, lots of power struggles).

    • Eireannach

      Correct Bamboo. There will be no property boom in Ireland for 50 years, the number of empty houses stands at approx. 300,000.

      With peak oil and the continuing rise in oil prices, the suburban sprawl blow-out of the late Celtic Tiger years will be seen, in the rear view mirror of history, as the greatest misallocation of resources in the history of Ireland.

      Anyone who devises some b*ll*x scheme, which is predicated on some fanciful notion of property prices rising in the future, is a dispicable liar, gingerly side-stepping and avoiding dealing with the looming energy crisis.

      NOTE TO READERS: this includes the esteemed and otherwise helpful pundit, David McWilliams.

      Competent economist he is – cutting edge energy guru and urban renewal visionary, he emphatically is NOT.

    • Eireannach

      Actually, may I take this opportunity for clarifying something for me.

      You use the Aussie term ‘spruiker’, referring to a snake-oil salesman who talks up a market to make money for himself and/or his clients or vested interest group.

      DMcW is a kind of ‘spruiker’, batting for the Celtic Tiger sunk middle class.

      He wants readers to believe debt-for-equity will work, because property prices ‘will rise in the future’. Really, he’s just getting his buddies out of trouble, the banks will end up holding the sh*t end of the stick, and the taxpayers will cover the hole in the banks.

      In other words, our esteemed host is a ‘spruiker’ who wants you and I, Bamboo, to get the Celtic Tiger Jaguar Dads and SUV-and-decking aspirational classes out of trouble now, using the ruse of phoney optimism in the future of Irish property prices, simultaneously landing the banks in trouble, which will be covered by you and I!

      DMcW and his 40something generation are not going to sucker me into swallow this muck.

      Would that the rest of you had more backbone and stood up to this spruiker happy-talk!

    • Eireannach

      I meant ‘may I take this opportunity to thank Bamboo for clarifying something for me’.

      Namely, DMcW is a spruiker trying to save his 40something generation’s ass with happy talk of rising property prices in the future, even though all the signs indicate that he’s delusion, or perhaps lying, i.e. actual ‘spruiker’ behaviour.

  39. Harper66

    Tomorrow, Saturday 16th March 4pm

    The people of Ireland will gather at the gates of Dail Eireann on Kildare Street in an act of solidarity to tell our government that we say NO to bank bail outs and heartless austerity measures and demand real representation. Put people first.

  40. bonbon

    A warning of unprecedented emergency. The EU has started to levy depositors accounts directly to bail out Cyprus!

    In a radical departure from previous euro zone rescues for Greece, Ireland, Portugal and Spain, finance ministers struck a deal to lend the indebted island €10 billion. But in return, depositors would have to forfeit up to 10 per cent of their savings.

    As Deputy Doherty said, the Government needs to report on progress on their deal :
    “The decision last night to impose a levy of 6.75% on ordinary Cypriot deposit holders under €100,000 and a 9.9% levy on those over €100,000 is madness. From what we are hearing no bank bondholders are to suffer losses in this ‘deal’, but savers are going to be burnt, at a time when Europe needs depositors and needs to offer depositors real security to get them. Already there are reports of people queuing outside Cypriot banks to try to withdraw their money. Europe has caused a bank run in a eurozone country.”

    • get your money savings out of the banking system. Have physical gold and silver in hand. it is the only money not suject to inflation by constant printing. It will and has maintain purchasing power of your savings.
      It is not readily accessed by predatory government and can be a medium of exchange world wide.
      Sidestep the governments and central banks.

      • bonbon

        You know very well they will go after any money, metal or paper. So Glass-Steagall or be robbed.

        We must re-instate a Credit system immediately to avoid the intended genocide.

        • You know very well that you have no understanding of gold as money or how or why it works and any knowledge of the fact that the rest of the worlf is moving inexoribly to renew gold and silver as money.

          Neither do you understand that glass Stegall will do nothing to prevent central bankers or commercial bankers ripping off the people using debt based fiat credit currency and fractional reserve banking.

          Neither does it do anything to prevent another bailout of an insolvent bank.
          Glass Steagall is a waste of time and effort and Unless you can explain in any detail how it works to do any of the above I will remain convinced it will not.

          and as I recall the biggest theif of all was FDR who force the sale of private gold to the government at @20.67 an ounce and then promptly revalued it at $35.00

          Folks, keep your gold and silver coins at home, in hand, and see how disposed you are to hand them over to anyone for less than full value. beats hanging on to paper fiat being devalued daily.

          Lets see what you have to say when gold is at $3000.

          As far as the proposed bon bon genocide, the best is to have access to land to grow food. but of course that is easier to seize than gold and silver coin.
          They have to find the coin first whereas the land is always where it last was!!

          bon bon , please explain how your oft touted credit plan actually works. Give us a run down of how it is implemented and operated.

          • bonbon

            Your metalism is from a dream epoch of a world population of 1 billion. And the “coincidental” fact that that is exactly the target from the financial crowd actually running the banks shows your complicity. You very well know a “hard” currency with no credit will collapse the economy causing a depression beyond belief. Complicity in this horror show oozes from the metalists.

            Pol Pot also moved people to the land, emptying the cities. The killing fields were only a party compared to what would happen putting 7 billion out to the “land”.

            So do not be led by the nose with a gold ring to the killing fields.

          • your a nasty bit of goods Mr bon bon.
            Accusing someone of complicitness in a scheme similar to Pol Pot is bizarre and preposterous. you go from one outrage to another.

            character assination is your forte. If you do not like or agree with the messanger , why shoot him. Perhaps I can expect a visit from one of your LaRouche ruffians who are documented as attacking opponents with baseball bats.

            you have no explanation as to how your own suggestions would work. You have been asked many reasonable questions by a number of people but refuse to even attempt a response.

            Your comments verge on madness. General comments from you that, because I suggest gold and silver will be reinstated as money, I am somehow proposing a genocide, as you put it, is totally incomprehensible.

            I conclude you do it deliberately which makes you a wicked and evil man in my opinion.

            I am trying to suggest a way for people to avoid the inflationary deprevations of the current banking system. For you to disagree is acceptable. For you to suggest the reasons you do is unforgivable.

      • dwalsh

        Last time there was a depression gold was confiscated.

        Bonbon is right Tony; your thinking is outdated. Commodity money is the cause, not the solution to our global crisis and challenge.

        I know you wont agree; I just want to say it anyway.

        All the best.

        • Goodday dwalsh
          “Freedom of Speech is the one gift you must give to your worst enemies in order to keep it for yourself”
          Doug Christie 1949-1013.
          Audi Altercam Partem (hear both sides)

          Not that I think you my worst enemy but you are entitled to your opinion.

          Sometimes we must return to the wisdom of the ages. Some truths are eternal.

          Gols was only confiscated by FDR, nobody else. It is so thinly owned that to go after it these days would be counter productive. After all the state would be demonstrating its value. That would drive the value higher and prove that gold is the ultimate money.

          commodity money is not the cause of the global crises. More the cause is the unlimited production of fiat debt based currency being printed into extintion.

          Ther eis no solution to that problem other than the inevitable bust fostered by the credit fueled boom.
          It is a convenient excuse to blame commodity money.
          If commodity money had been in use in the first place the debt based boom would never have happened and so there would be no collapse to have a cause blamed.

          Most have heard these statements of blame and accepted the propaganda without qualification. When exaMINED ONE QUESTIONS THESE STATEMENTS AND BECOMES AWARE OF THE MOTIVES BEHIND THEM.

          Believe you me the PTB do not want an honest money system as they would not be able to steal from the people anymore. So they propagate the delusions.

          Shortly there will be evidence one way or the other and gold will win the final battle.

  41. redriversix

    Once again EU/ECB Governments & their finance ministers reach in to the pockets of private citizens and steal their money for the Benefit of Bank & State bailouts.

    Cyprus was robbed today and nobody again,gives a shit….
    What was done to Cypriots Today is theft..nothing more ..nothing less..Total Criminality..

    If you are in Financial trouble, don’t worry about it…Banks can get bailed out,you are worth more than some fucked up Banking System & their puppet lackey finance Ministers..

    And if you think EU ripping off Cypriot Bank Depositors is a one off..think again..this is a test..

    They will steal everyone ‘s money…be advised !!!

    So if you cant pay for your House, don’t worry about it..DO NOT LEAVE IT.

    I don’t care if you are rich,poor unemployed or self employed..KEEP YOUR MONEY..PROTECT YOUR FAMILY
    EU/ECB are thieves ,crooks & Gangsters.. that’s it…

    Eireannach if you don’t like this…I don’t give two shits , your life is a fiction,you Judge all and know fuck all.


    • Grey Fox

      Well said RR6, I concur absolutely, I would say that with few exceptions, families who find themselves unable to service mortgages now would willingly pay what they can and increase those payments as and if their situations improve but intent means nothing to the banks or in fact to our government so in that vein they deserve no consideration at all!
      The Banks outsmarted themselves because the got drunk on greed, they were able to get drunk because they managed to remove all the risk for themselves, they will now outsmart themselves again by thinking they can reach into ordinary depositer’s account and take!
      I sincerely hope that all the people of Europe realise that Cyprus is the testing ground I would dearly like to see a massive run on all European Bank’s on Monday, they deserve no less, as for that Eireannach gobshite! and his one dimensional facist/racist view of Irish people a doubt anybody gives two shits what he says he obviously has some other axe to grind with the Irish which he is not elaborating on here.

      • redriversix

        Morning GreyFox

        BBC reporting this morning that the “debate” regarding bailout to be held in Cypriot Parliament today has been cancelled..!

        EU thieves wont like that..either Cypriot Government does not think it can get agreement in parliament or they are going to ram it through without our Government does..! ?

  42. redriversix

    Once again EU/ECB Governments & their finance ministers reach in to the pockets of private citizens and steal their money for the Benefit of Bank & State bailouts.

    Cyprus was robbed today and nobody again,gives a shit….
    What was done to Cypriots Today is theft..nothing more ..nothing less..Total Criminality..

    If you are in Financial trouble, don’t worry about it…Banks can get bailed out,you are worth more than some fucked up Banking System & their puppet lackey finance Ministers..

    And if you think EU ripping off Cypriot Bank Depositors is a one off..think again..this is a test..

    They will steal everyone ‘s money…be advised !!!

    So if you cant pay for your House, don’t worry about it..DO NOT LEAVE IT.

    I don’t care if you are rich,poor unemployed or self employed..KEEP YOUR MONEY..PROTECT YOUR FAMILY
    EU/ECB are thieves ,crooks & Gangsters.. that’s it…

    Eireannach if you don’t like this…I don’t give two shits , your life is a fiction,you Judge all and know fuck all.

    Their is nothing to fear but fear itself……


    • molly

      We here have been robbed and a hell of a lot of people have been trampled over in the stampede of bankers who can’t loose.
      When I think of bankers it’s like telling a gambler to keep on gambling they can’t loose and then when the Boys at the top of the bank tree fuck up it becomes a circus,if you start up a buiness and it goes belly up even if you work 23 hours a day you will get nothing.
      When the bankers fuck up they get rewarded with our money,its about time risk takers in the domestic economy who start up small company’s get bailed out and helped not crucified after all they make a much better contribution to society .
      This whole system called Europe is one country after another being destroyed for what and for who’s benefit ,its back wards and down wards we are being taken.

      • bonbon

        And the instrument of this destruction is the Euro. One nation-state after another, faster than Hitler, destroyed. Even the lipservice to international law flouted. Britain’s dream of the end of the Nation State is near. So near Cameron wants to distance himself from the fallout.

    • Eireannach

      Still no debt-for-equity swop deal, so you’re all hat and no cattle, Barry.

      • redriversix

        I do not ,nor do have to deal with Corrupt Banks and ask permission from them , or their fraudulent Government to do whats right..

        I have no Cattle , but I do have an old Cavalry officers Hat……..

  43. redriversix

    I will tell you just how terrified the I.M.F /E.C.B /E.U is

    If they are unable to allow tiny banks in the overall context,in Cyprus go Bankrupt….Just how big is the coming financial Collapse going to be for bigger/Mega Banks…?

    How insolvent are the Mega Banks ?…

    Think you all better dust off those old biscuit tins…!

    Except,of course,here in Ireland where everything is recovering & booming at a remarkable rate.

      • redriversix

        I understand the Link Tony…

        I think most people will have realized the Value of Gold & silver ahead of Paper by now.

        It will be very interesting to see the Russian reaction on Tuesday.

        If their were loopholes which allowed fraudulent banking in Cyprus.Which I have no doubt their is…as their is criminal, fraudulent,& deceitful behavior in Banking across the World as is well documented by now.

        The citizens of a State should not be punished,if their is money laundering continuing in Cyprus for Russian “whatever” then that should be investigated,criminal charges brought,and a trial date set is business as usual.

        Their are “Civil fines” being issued to Banks on a almost weekly basis now for some “unlawful activity” or another.

        Banks merely factor in Fines today as a cost of doing business.No “fear factor whatsoever…in fact Banks probably have more power now then they did 6 years ago.

        As regards Russia,they will wait in the long grass to react to their money being taken… if the EU do not give it back quietly 6 or 8 weeks from now in a quiet car park outside Paris ! which is far more likely……..

        How much did U.K Depositors lose ?

        Turns out that the pen is FAR mightier than the sword and Putin knows this better than anyone…As you know Mr Putin & Frau Merkel have a excellent business “understanding”

        Happy Paddys Day,Tony

        Hope their is not too much trouble in Dublin City today as is the norm

        • bonbon

          That Russian money is parked offshore to avoid tax back home. Russia could claim that tax as theirs. Could some crazy NATO jerks be contemplating a showdown?

        • Hi Barry
          Thanks for the good wishes.
          There are many perspectives in this ecomonic and social maelstrom. All have a point of view based on personal knowledge and experience.

          I have no personal benefit to posting on this or any other blog but wish to help those who I can make aware. Each according to his/her own will make decisions. Lets hope they are the correct ones for you at this moment.

          Take care, blessings abound.

    • bonbon

      They are totally insolvent – read any of my posts, and numerous LarouchePac videos. Fully and thoroughly documented for years. Your choice.

      So now the question is will FG try the Cyprus trick?

      The only way to avert this is to split the banks, nothing else whatsoever will work. This is the one step not yet taken. Unless this is done they will try to leach quadrillions from the world economy, not stealing in broad daylight. The huge shadow baning debt must be cast off to fend for itself with no guarantee, and commercial baking must be restarted under Hamiltonian Credit to save the real economy.

  44. Greetings All
    Happy St. Patrick’s

    • Grey Fox

      Happy Paddy’s Day Tony.
      Fecking snowing here this morning!

      • bonbon

        Nature decided to rain on the greenie parade ( no pun intended ) and it snowed! So much for “global warming” and Co2 windbags.

        The only good Co2 windbags are uilleann pipes at full throttle! No better music to banish the greenies.

      • had a good day here. Wore a good leprechaun hat to the club and had a few minutes banter. Then out to the race course and a fun 14 mile sale. lots of challenging weather and currents and back to the club house for a late lunch after a 5 hour sail.

        no snow here this year. Daffodils are blooming, blossoms on the plum and wild cherry, grass growing, underbrush green.
        trees budding. sunny this morning but cloudy this afternoon.
        hope you all enjoyed your day.

        I went to the funeral on friday of a very fine man. A defender of free speach and a man of integrity. it was a sad day but a joy to see the numbers who travelled hundreds of miles to pay respects.
        Doug Christie had integrity.

  45. bonbon

    Cyprus : German SPD and ECB directorate member Asmussen put it brutally : “Before the banks reopen, the mandatory levy will be drawn from the accounts. The rest of the account is free for disposal.”
    He denied that this will be the policy for other countries. Nobody believes a word. So much for the SPD election platform.
    German Finance Minister Schaeuble proposed a 40% (!) haircut on Cypriot bank accounts. This had also been the proposal of the International Monetary Fund- from CyBC and DPA.

    So with an Irish EU Council presidency, the obvious questions.

    • bonbon

      Christine Lagarde, managing director of the IMF : “The IMF has always said that we would support a solution that is sustainable, that is fully financed, and that appropriately allocates the burden sharing.” Wow – the IMF wanted 40% to share the burden!
      This move is sold by the tax on 18 billion Euros of suspected Russian money-laundering in Cyprus banks. But it is a precedent for the entire Eurozone.

  46. redriversix via @reuters”

    3 Cypriot parties say they will not support “bailout” plan/robbery

  47. redriversix

    A gentle reminder of EU democracy from 5 years ago..10 minutes long ..enjoy & reflect

    • molly

      Governments don’t tell the truth,they tell there version of the truth,they tell people if you keep supporting us things will get better.
      Better for who ,its pure crap this talk of recovery,the plain truth is this government have made things so tough here that people can’t afford to live here.
      Job creation is a white wash ,the true figures are being hidden by clever accounting ,this government knows full well what they are doing is wrong,they are weakening the low to middle income house holds and making the rich ,richer at our cost.
      The government is including them selves in the group of the rich ,so there looking after there own .
      They are too well payed and are in the position of making themselves richer,through the gravy train they have set up for themselves
      For the government to be for the people they need to be on the same pay as the people,low to middle incomes and not the crazy amounts they blood suck off us remember we pay there wages .
      They think they can do what they want when they want.

  48. bonbon

    How’s that for a paradox of arrears and aggregation. The EU simply steals the aggregation to pay off the arrears. Anyone who thought something is “solved”, “calmed”, “just make a deal”, is in for a wake-up call.

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