PRIME TIME "What to do with Anglo" Thurs 2nd Sept

[Dreaded_Estate]

I think you have a completely distorted view of what a bank is going to or even capable of doing.

Firstly, you cannot just hide losses on a company's or the state's balance sheet. What you are suggesting is basically fraud.

It is also completely at odds with what we actually want or what the markets want and need, certainty.

One way or the other the state is paying for every cent good or bad Anglo losses because of the guarantee. Even if you could do that, who do you think it would fool? The market certainly isnt going to buy it and i'm sure Eurostat would have a few awkward questions as to why we think it was ok to hide losses off balance sheet.
What we need is certainty on the final cost not more avoiding reality.

Secondly no bank good or bad can transfer or move assets onto its balance sheet with funding of some sort. And whether that is bondholders, deposits or the ECB they are going to want their,money back plus interest. When we finally get around to saying that Developer X's loan is only worth €1m instead of €10m the depositor or bondholder is still going to want their €10m back and the only one who will fill the hole is the state.

I'm not sure where you are getting these ideas on what a bad bank can do, but to say they are way off the mark is a massive understatement!

I have said this many times before but the Anglo losses are the result of liabilities greater than assets. We have little or no control over the value of assets and we have guaranteed the liabilities. So the hole is there and the state has to fill it regardless of how big it gets, and it will get much bigger.

It doesn't matter whether Anglo is wound up, split into good, bad or ugly the hole is still there and it isn't going anywhere until we fill it with state cash.

[Expatriot]

The only figure in my analysis that is not based on fact it the % haircut on the €19bn loans. There is a consensus on both sides that this will be in the range 60-70%, which is why I dealt with these 2 potential outcomes.



You really need to lighten up on the hubris.

The whole idea of even debating the figures with Anglo or in anyway letting the banks set the agenda is self defeating. They have lied from start about the figures that are out of public view.

Has that changed?

Your idea of consensus is a joke. I think we need to tell the banks the way it is going to be and let the dance around us rather than the other way around.

Nobody from Lenihan down involved in this policy has any credibility. The figures are different by at least a factor of ten compared to 2 years ago. We are told what we want to hear. You now basically have a new version of what people want to hear.

Regardless of any figures you or anyone else assure us about, the facts are that extremely important overseas opinion thinks the country is on the brink of bankruptcy because of Anglo et al. I have no interest in saving Anglo, let alone putting the future of the country on the line to do so. If that means nobody gets any money back from Anglo so be it. No deposit in Anglo is worth what is happening to this country now.

You guys have been bluffing and BSing for two years, nobody cares what figures you have. Only weeks ago people on your side of the argument were explaining pay rises in Anglo. Lets get real.

We might as well discuss the discount % for NAMA as the passengers on the Titanic should should have resigned the ship as it sunk. We need a plan B. Nothing is going to save Anglo or the banking system as it is. The idea that bond holders in such a system would be paid is laughable.

99% of the population have nothing to lose for a collapse in Anglo. So I say get the 1% out of the way.

[so2010]

The real final cost of Anglo etc. ?

I am enjoying your banter and maths but the real cost is out there growing in society at large.

[SideysGhost]

The real final cost of Anglo etc. ?

I am enjoying your banter and maths but the real cost is out there growing in society at large.

Well now. I'm on record as saying - the week of the Guarantee in Sept 08 - that by my reckoning, given historical debt impairment rates in the various categories of debt in previous housing bubble busts, that the minimum, best case scenario net cost of bailing out these insolvent banks over the cycle would be some €54bn. At the time Lenihan was insisting we'd make a profit from it!

The mid-range estimate I gave two years ago would be some €80-100bn, a figure that now, two years later, people like the New York Times and S&P are starting to agree with.

However in a worst-case scenario with bad debt defaults on the upper end of the scale for comparable housing busts in other OECD countries, then the total cost of the bad debts in the banks/NAMA could reach some €150-180bn.

We could never have afforded even the best-case scenario of €54bn. This figure was easily predictable mathematically on the Central Bank's own figures at the time of the Guarantee. That not one of the clowns associated with that policy, not one of the politicians, bankers, senior civil servants, regulators etc involved, had the wit to do such simple calculations shows to me just how droolingly moronic the incompetent sub-normal inbred freaks that are the members of Official Ireland really are.

[Expatriot]

Well now. I'm on record as saying - the week of the Guarantee in Sept 08 - that by my reckoning, given historical debt impairment rates in the various categories of debt in previous housing bubble busts, that the minimum, best case scenario net cost of bailing out these insolvent banks over the cycle would be some €54bn. At the time Lenihan was insisting we'd make a profit from it!

The mid-range estimate I gave two years ago would be some €80-100bn, a figure that now, two years later, people like the New York Times and S&P are starting to agree with.

However in a worst-case scenario with bad debt defaults on the upper end of the scale for comparable housing busts in other OECD countries, then the total cost of the bad debts in the banks/NAMA could reach some €150-180bn.

We could never have afforded even the best-case scenario of €54bn. This figure was easily predictable mathematically on the Central Bank's own figures at the time of the Guarantee. That not one of the clowns associated with that policy, not one of the politicians, bankers, senior civil servants, regulators etc involved, had the wit to do such simple calculations shows to me just how droolingly moronic the incompetent sub-normal inbred freaks that are the members of Official Ireland really are.

What is even more worrying is the thought that they did know what you knew. But for some reason other than the good of the country proceeded anyway. The fact that people are still passionately defending this policy at this stage says a lot to me.