Never bought a house - the moral hazard!

[Clanrickard]

What was effectively suggested was that mortgages should be written off and people allowed to stay in homes which they bought.

That would be lunacy no doubt and highly irresponsible. There would have to be some pain felt by the home owners.

[Mitsui2]

I don't think that's why Government exists. It exists to prevent the strong from dominating the weak...too severly.

??????

Who are those people in Leinster House then?

[hammer]

But the act of "helping" implicitly rewards the damaging behaviour. That is the "moral hazard".

Bail out people who made stupid financial decisions and they and others watching will see the benefit to them in doing the same again.

I am guessing you don't have any children. Parents come to understand the power of moral hazard.

Well the "people" were misled.

They were told that growth would continue, house prices would IF they fell have a soft landing, that the multiples of salary were in accordance with Central Bank guidelines, and that fundamentals were sound.

You cant overly blame ordinary people who aren`t all that up to speed on economics, depressions & understanding spin.

We are all Irish. I would prefer help a couple struggling with their mortgage than a Banker on €500,000 + per annum, or a developer that drives a Bentley, has a helicopter, member of the K Club on a 28 handicap...................etc

[jmayo]

There are a couple of crazy letters in the Irish Times these days saying that people's mortgages should be written off in a NAMA style deal.

Bad enough that we have real NAMA, but those who were prudent and knew that house prices ten times the average salary could not be sustained, bid their time and paid their dues by living in rented accomadation. Many of these folks saved well, put their money aside and now deserve the opportunity to buy a house at market value. They have put up with flatmates, living in crappy areas, not having personal space etc.

Now they see their savings devalued by the artificial supports for the collapsing market. Some folks are even talking about a NAMA for homeowners.

Those who were prudent with their money and sacrificed comforts shouldnot be penalised for the stupidity and greed of others. There was a 24 year old kid on the Frontline who was a plumber with a 600K mortgage. I feel sorry for him but why does he get to live in a house that he cannot pay for and I don't get to live in a house that I can pay for under present market conditions?

Did you watch the Irish property council guys on the other night on Frontline ?
Everyone is now looking for a bailout.

Agree with all the above aside from the feeling sorry for the guy who botched his own finances. I feel sorry for starving kids in Africa, not people who were in a position to make their own lifechoices. As someone with a few mortgages, I find it bizarre that I should be looking for sympathy or help from people who decided not to get involved in property were things to go wrong for me.

For once I believe we agree.

Why pay social welfare to someone who didn't study hard and dropped out of school?
Why pay for healthcare for someone who continues to smoke, drink heavily and eat fatty food?
Why, oh why, can't everyone be as perfect as the two posters on this thread?

Goverment exists because a society it consists of imperfect people acting individually and as a crowd not always doing the right thing, but the government must use its pool of resources to help.

So lets say I lost a lot at Cheltenham and thus am imperfect as you would say, should I get some of the governments pool of resources to help me over the hump ?
Are we supposed to now reward people for being unlucky or making poor decisions ?

[Jack White]

Well the "people" were misled.

They were told that growth would continue, house prices would IF they fell have a soft landing, that the multiples of salary were in accordance with Central Bank guidelines, and that fundamentals were sound.

You cant overly blame ordinary people who aren`t all that up to speed on economics, depressions & understanding spin.

People wanted to be misled. And are too willing ''to be told'' what to buy and what to think. And for such sheepleness, they cannot be blamed enough.

People who would research to the nth degree if it were the purchase of a car, a sound system, a holiday... blithely signed up to mega debt for the largest purchase most people will ever make.

It's not good enough to say the hype was all-pervasive. It was, but there were other voices, and they were mainstream enough - McWilliams et al.

That was enough to ring an alarm bell, to a mature person. The information was there for anyone willing to do more than a morning of research and reading - I'm thinking principally of the Property Pin, but others too.

Little sympathy. No bailout.

[meriwether]

Well the "people" were misled.

They were told that growth would continue, house prices would IF they fell have a soft landing, that the multiples of salary were in accordance with Central Bank guidelines, and that fundamentals were sound.

You cant overly blame ordinary people who aren`t all that up to speed on economics, depressions & understanding spin.

We are all Irish. I would prefer help a couple struggling with their mortgage than a Banker on €500,000 + per annum, or a developer that drives a Bentley, has a helicopter, member of the K Club on a 28 handicap...................etc

Here's a quick lesson in economics, depressions & understanding spin.

If you buy something, you have to pay for it.

Hows that?

[loaf]

Well the "people" were misled.

They were told that growth would continue, house prices would IF they fell have a soft landing, that the multiples of salary were in accordance with Central Bank guidelines, and that fundamentals were sound.

You cant overly blame ordinary people who aren`t all that up to speed on economics, depressions & understanding spin.

We are all Irish. I would prefer help a couple struggling with their mortgage than a Banker on €500,000 + per annum, or a developer that drives a Bentley, has a helicopter, member of the K Club on a 28 handicap...................etc

I'm going to sound a bit harsh here, but I think Joe Plumber has to take some blame. Anyone who accepts a poltical / economic message without question, or who buys into a way of life without realising that is obviously promoted for the benefit of the few, is not really in a position to complain.

For me, people need to question their own and their governments assumptions, question why certain things are promoted and encouraged. In short, to think for themselves.

Of course that doesn't mean that they'll discover the 'truth', but at least whatever conclusions they reach will be their own, and not some crooked political / ideological mantra.

[TradCat]

Here's a quick lesson in economics, depressions & understanding spin.

If you buy something, you have to pay for it.

Indeed. And when people who had bought houses were enjoying huge price increases I seem to remember it was their own astuteness they credited. Many even bought flats in the likes of Bulgaria on the strength of their gains.

Capitalism on the way up and socialism on the way down is a rip-off and should not be happening for the banks or anyone else.

[goosebump]

There are a couple of crazy letters in the Irish Times these days saying that people's mortgages should be written off in a NAMA style deal.

These letter appear to have a consistent theme.

The generally seek to transfer blame for individual actions to some monolithic third party like 'The Politicians' or 'The Banks'; they get all confused when it comes to what is happening with the banks, suggesting that in some way their money is being handed over in plastic sacks to developers; they finish up with some sort of chest thumping call to patriotic duty, which generally involves the phrase 'enough is enough' and which presumes that everybody is as blinkered and as thick as they are.

They are very tiresome.

[b.a. baracus]

Indeed. And when people who had bought houses were enjoying huge price increases I seem to remember it was their own astuteness they credited. Many even bought flats in the likes of Bulgaria on the strength of their gains.

Capitalism on the way up and socialism on the way down is a rip-off and should not be happening for the banks or anyone else.

Nail on head.