Let academic economists draw up replacement for NAMA.

[PaddyJoe McGillycuddy]

I guess you see what you want to see Hal. You mention the first part of the interview but not the second. What is your take on the fact that he thinks that overpaying for toxic loans is unfair to the taxpayer? What about his view that bankers are dumping their losses on society?

[KingKane]

Always with the bad figures & bad information.

The IMF had no interest in Ireland until 86/87.

The national debt from '77 to June '81 increased from 5.4 billion to 11.5 billion or by 113%, from '82 to '87 it increased from 14.8 billion to 30.1 billion or by 104%. Not too dissimilar in percentage terms but in actual terms very different, 77-81 + 6.1 billion, but '82-'87 + 15.3 billion or almost 3 times the earlier increase.

By contrast over the next 5 years '87-'92 there was only a 10% increase in the national debt. Something must have happened in '87.

Those numbers are wrong, I've had to do this so much over the years I have the accurate figures here




Irish national debt in the 1980s - the figures and the facts|Daniel Sullivan - he’s a little political

[powderfinger]

In a recent speech to the Oireachtas on the NAMA bill Dan Boyle, Green Party chairperson and finance spokesperson, made the following comment:

"What is failing to be addressed in the debate is that there is no clear, consistent, cohesive, coherent alternative".

Dan Boyle’s Seanad Speech on NAMA Banking Expert Peter Mathews on fixing Ireland's Banking Crisis

Dan must have missed this article in The Irish Times from Professor Karl Whelan:

Government must change flawed Nama strategy - The Irish Times - Fri, Oct 02, 2009

Whelan wrote the following:
"The idea that the only possible way to deal with banks in difficulty is to overpay them for their assets is, frankly, ridiculous.

Around the world, there are a series of well-established procedures for dealing with problem banks and none of them looks like the Government’s current Nama proposals".
(the whole article is excellent but from there on is especially relevant on alternatives to NAMA).

Dan also said:
"However, if one takes the public debate involving the 45 or 46 economists who do not like NAMA, were one to place them into a room and ask what they would have instead, the likelihood is you would get 45 or 46 different responses".

I make the following proposal. Invite all the academic economists to a conference. They are the most independent economists we have. Ask them to come back to you with a majority agreed proposal within 1 week. NAMA as is will lose €20 Billion according to property loan expert Peter Mathews. I guarantee the economists will come up with a better plan than property company board member Peter Bacon's is turning out to be.

What do other posters think?

It would be highly interesting to see an analysis on the FF/Green Nama plan benchmarked against two other asset recovery/management models which were used in the recent past elsewhere,in comparable situations.

Namely the Securum model which the Swedish initiated and the Danaharta SPV which was used to address the NPL's in the Malaysian banking crisis,also in the 90's.

[Mitsui]

I've a better idea. Why don't we remind ourselves every single day that FF have now bankrupted this country twice in 30 years - and that we should never let them near the levers of power ever again.

Only once a day?

I do it every time I come across another indication of how f***** the country is.

Not sure how many times a day that is - I lost count long ago.

[Hal]

I guess you see what you want to see Hal. You mention the first part of the interview but not the second. What is your take on the fact that he thinks that overpaying for toxic loans is unfair to the taxpayer? What about his view that bankers are dumping their losses on society?

Almost everybody thinks that overpaying would be unfair, but clearly he does not think paying a price based on long term value is overpaying.

At the end of the day with the NAMA plan the banks will pay 100% of the losses and at a minimum by having to sell 77 billion of loans to NAMA for 51.3 billion they are being forced to take the vast majority of the eventual total hit, up front.

[DCon]

Almost everybody thinks that overpaying would be unfair, but clearly he does not think paying a price based on long term value is overpaying.

At the end of the day with the NAMA plan the banks will pay 100% of the losses and at a minimum by having to sell 77 billion of loans to NAMA for 51.3 billion they are being forced to take the vast majority of the eventual total hit, up front.

banks paying the losses will NEVER happen. NEVER. Do you not understand this fundamental problem?

[Hal]

Those numbers are wrong, I've had to do this so much over the years I have the accurate figures here




Irish national debt in the 1980s - the figures and the facts|Daniel Sullivan - he’s a little political

Those figures a 100% correct. Your figures are incorrect in 2 important respects.
1. You take the figure for the end of '81 of almost 13 billion and put the total against the FF Government, when FG/Lab were in Government from half way through that year. The maximum that you could but down to the FF Government of that time would be 11.5 billion

2. Then you have the cheek to say that 12.9 billion is 240% of 5.4 billion over the FF time in Government, but going from 14 billion odd to 30 billion odd over the FG time in Government only represents a 100% increase. Now you can mess around with figures all you like, but don't try an obvious slight of hand like that and expect people to swallow it.

[Hal]

banks paying the losses will NEVER happen. NEVER. Do you not understand this fundamental problem?

You repeating that will not make it so.

Do you not understand this fundamental problem?

[KingKane]

Those figures a 100% correct. Your figures are incorrect in 2 important respects.
1. You take the figure for the end of '81 of almost 13 billion and put the total against the FF Government, when FG/Lab were in Government from half way through that year. The maximum that you could but down to the FF Government of that time would be 11.5 billion

2. Then you have the cheek to say that 12.9 billion is 240% of 5.4 billion over the FF time in Government, but going from 14 billion odd to 30 billion odd over the FG time in Government only represents a 100% increase. Now you can mess around with figures all you like, but don't try an obvious slight of hand like that and expect people to swallow it.

Hang on yourself, you are claiming that FG/Lab have to take half the responsiblity for the 1981 despite having been in office barely enough time to get an emergency budget through to plug an inherited 10%! (who thought we'd ever see those days again) deficit in the public finances before losing power without passing their next budget. If FF had had the entire year of 1981 to themselves it would have been even worse, so they can count themselves likely they ended up with only €13 Billion. And with interest rates and inflation up at levels of over 20% at the start of their period in office the increase from the end of end of 82 to end of 86 would have been nearly 100% from the interest payments alone without another extra penny being borrowed. If you exclude the accrued interest on the inherited FF national debt then the FG/Lab borrowing is significantly less than during the FF period.