Government's should allow every distressed bank to go bankrupt and set up a fresh banking system under temporary state control rather than cripple the country by propping up a corrupt edifice, according to Joseph Stiglitz, the Nobel Prize-winning economist.
Let banks fail, says Nobel economist Joseph Stiglitz - Telegraph
This is what has to be done, but it will not be done, look at Obama's cabinet, old clinton administration and Wall street heads, the people solving the problem are the ones who caused it, and never spotted it. Will a radical restructuring of the Irish Banking system take place, with a clean out of bad debts happen, not voluntarily, but the market will force it.
What would Joseph Stiglitz think of that stupid Guarantee for the 'six-orphan's'?
The origin of which is unknown.
Hands up the cunning laimh who crafted this fundamentally flawed piece of artful dodgery.
Last edited by powderfinger; 3rd February 2009 at 10:53 PM.
Yeah this guy was featured on The Last Hook or something. The suggestion being that the only protections given should be to depositors and investors can shag off they took a risk and lost. However the Cowboys in charge in Ireland (the banks) want to be able to reap reward without risk..So to the wall they must go.
So let for example BoI fail and then all employers banking with them can't pay their staff or suppliers, the employees can't get their wages or spend it. The economy collapses.
Woop Woop
Isn't that what's happening with Anglo?Originally Posted by justcallmetex
It is becoming apparent that we will be unable to support the banks. Government efforts should turn to maintaining a clearance system or we will be reduced to barter.
Not if the state sets up its own banks and lends at the rate it is now lending to the failing banks. But we all know that this is not about propping up the economy, its about making sure that FF's wealthy backers stay wealthy.
No it is not. If Anglo had been let fall, the deposits would have been protected, the foreign financial companies, would have been protected by in hedging on the obviously risky high Anglo Irish. Instead we have now taken the risky loans on to our books. The potential downside for the Irish state is obvious. Who is being bailed out here, the Irish economy or the developers, that would have gone to the wall then, rather than this year or next. As the Irish economy reverts to mean, as all things do in the long run, Dublin houses prices will fall back to an average of 205K euro, that will leave countless apartments in worthless. Hard decisions should never be postponed.
Well he said that they should be replaced temporarily by a state run bank, this will happen in the long run anyway. The state is always the lender of last resort.
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