Do Fianna Fail have the balls to completely Nationalise the Banks?

[adrem]

To be honest and whilst it goes against my right wing ideology (!) I think the govt needs to take some fairly immediate action and capitalise AIB and BoI to the tune of 2-3bn each right away. They should nationalise both temporarily in order to stabilise the market and in order to control the reopening of debt flows to business in Ireland.

It's not palatable but it is a requirement - yes it means a complete wipeout of existing shareholder value but at the end of the day they have already lost about 95% of their value over the last 12 months anyway.

Yes I know that we all lose (pension funds etc) but that extra 5% loss is more than compensated for by the benefits that will accrue from the stabilised banking system getting back to what it needs to be doing - business as usual.

The biggest problem is that Lenihan needs to move now and suspend dealing in both immediately before any more collateral damage is inflicted and I'm fairly sure his advisors probably don't see it as clearly as that (and they don't read p.ie !!)

[powderfinger]

The options are:

1 do nothing

2 give the banks more soft loans

3 nationalise and wipe out share holder value completely

Could we see AIB and BOI facing a reconstruction and emerging as a merged institution?

[Ciunas]

The options are:

1 do nothing

2 give the banks more soft loans

3 nationalise and wipe out share holder value completely

Morgan Kelly in the Irish Times Piling Anglo losses on to national debt risks bankrupting the State - The Irish Times - Tue, Jan 20, 2009 suggested letting the bank fail and provides a good argument. If Anglo-Irish is of "systemic importance to the finances of Fianna Fáil", I'm wondering what the Greens in Government are doing in agreeing to this bail out and the potential doubling of the National Debt.

[kellsangel]

If FF wipe out the shareholders they have no chance of making their money back. It is an irrational thing as some have lost a lot being late followers whereas others had been long standing shareholders.

The shareholders did not see that the banks were inflating a bubble and were a bubble themselves.

The wealth that has been lost in bank shares has been in many cases wealth accumulated over generations.

Fianna Fail will not be forgiven for wiping out this wealth if they wipe out existing share older equity should losses exceed the tier one capital of any bank.

The markets don't believe there is much for the existing shareholders.

The lack of new capital for the banks coupled with the uncertainty of peoples jobs, and the puzzle as to where property prices will be in a few years time have created a credit famine.

Delaying recapitalisation will aggravate the employment situation and the value of assets.

Recapitalising will aggravate existing shareholders as the amount of capital required can only leave existing shareholders with a token shareholding or none.

[nuj]

If FF wipe out the shareholders they have no chance of making their money back.

Who? FF?








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[The Earl of Desmond]

FF will do whatever it takes to protect the people who have bankrolled Fianna Fáil and to prevent any independent auditors uncovering how those same people have used laws and regulations, which Fianna Fáil has gutted since 87 to make sure those same people can't be held to account ala Anglo-Irish - what he did was wrong but wasn't 'illegal'..., to get away with what they've done.

If nationalising banks is what is required to do that then when Cowen gets his orders that's what he'll do.

[robert151410]

Do they have the balls not to nationalise the banks?

[Dreaded_Estate]

If FF wipe out the shareholders they have no chance of making their money back. It is an irrational thing as some have lost a lot being late followers whereas others had been long standing shareholders.

The shareholders did not see that the banks were inflating a bubble and were a bubble themselves.

The wealth that has been lost in bank shares has been in many cases wealth accumulated over generations.

Fianna Fail will not be forgiven for wiping out this wealth if they wipe out existing share older equity should losses exceed the tier one capital of any bank.

The markets don't believe there is much for the existing shareholders.

The lack of new capital for the banks coupled with the uncertainty of peoples jobs, and the puzzle as to where property prices will be in a few years time have created a credit famine.

Delaying recapitalisation will aggravate the employment situation and the value of assets.

Recapitalising will aggravate existing shareholders as the amount of capital required can only leave existing shareholders with a token shareholding or none.

Unfortunately that's exactly how it should be.

Shares usually give a higher return than a deposit account but for this extra return every shareholder must accept that they could lose all their money.