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Thread: Is the eurocrisis about to engulf the Netherlands?

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    Default Is the eurocrisis about to engulf the Netherlands?

    Right since the start of the eurozone crisis, the Netherlands has been held up as one of the Triple A rated countries who were a pillar of fiscal virtue. The country's debt levels were respectable, the deficit looked manageable, unemployment appeared to be low. The Dutch were standing shoulder to shoulder with the Germans one the fiscal conservatism side of things. The Dutch hadn't gone crazy when it came to either personal or sovereign debt. Savings rates were good. Why couldn't everyone be like them?

    Well, all is not quite as it seems in the land of tulips and windmills. The Dutch actually have the highest consumer debt in Europe - 250% of available income. Unemployment is on the increase and the economy is on the slide. There was a property bubble after all and Dutch banks did go pretty crazy too. What makes it worse that many borrowers weren't paying off their loans. Instead, they put money into an investment fund hoping that the profit generated would pay off the loan. But what investment fund is generating a profit now?

    Unemployment still seems low but could be underestimated by 800,000 - proportionally, that's over 200,000 in Irish terms. Consumption is down. More people are saving as the cold winds of recession blow ever more strongly. In February 2013, bankruptcies hit a new record - the highest monthly figures since records began in 1981. Because of all the mortgages, the assets held by banks are four and a half times annual economic output. It's not Cyprus but it's not pretty.

    Economic Crisis Hits the Netherlands - SPIEGEL ONLINE

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    Politics.ie Member Baztard's Avatar
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    "Finland, along with Germany and the Netherlands, issued a joint statement last September following the agreement in June by EU leaders to break the link between sovereign and banking debt. This outlined its opposition to the use of the ESM fund for legacy assets. The Government is pressing for the fund to be used to directly recapitalise AIB and Bank of Ireland."


    Smug baztards, hope they get everything they deserve

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    Politics.ie Member Nemesiscorporation's Avatar
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    Quote Originally Posted by Iphonista View Post
    Right since the start of the eurozone crisis, the Netherlands has been held up as one of the Triple A rated countries who were a pillar of fiscal virtue. The country's debt levels were respectable, the deficit looked manageable, unemployment appeared to be low. The Dutch were standing shoulder to shoulder with the Germans one the fiscal conservatism side of things. The Dutch hadn't gone crazy when it came to either personal or sovereign debt. Savings rates were good. Why couldn't everyone be like them?

    Well, all is not quite as it seems in the land of tulips and windmills. The Dutch actually have the highest consumer debt in Europe - 250% of available income. Unemployment is on the increase and the economy is on the slide. There was a property bubble after all and Dutch banks did go pretty crazy too. What makes it worse that many borrowers weren't paying off their loans. Instead, they put money into an investment fund hoping that the profit generated would pay off the loan. But what investment fund is generating a profit now?

    Unemployment still seems low but could be underestimated by 800,000 - proportionally, that's over 200,000 in Irish terms. Consumption is down. More people are saving as the cold winds of recession blow ever more strongly. In February 2013, bankruptcies hit a new record - the highest monthly figures since records began in 1981. Because of all the mortgages, the assets held by banks are four and a half times annual economic output. It's not Cyprus but it's not pretty.

    Economic Crisis Hits the Netherlands - SPIEGEL ONLINE
    Yup, the Dutch disease has returned.

    Actually it never went away.

    Netherlands had a crap economy all through the 70's and 80's with slow grow from the mid 90's until about 5 years ago. Most of that so called growth from the mid 90's was in the financial services sector.

    Since the mid 90's Netherlands, Sweden, Denmark, Luxemburg, USA, Iceland, Australia, Canada, Japan, United Kingdom, Ireland, Italy, Greece, Spain, France and Belgium have all had major growth in there financial sectors, but with slowly creeping up youth unemployment as jobs have been steadily shipped offshore to China, India, etc.

    No one in those countries has the brains or determination to face down the banksters who are destroying our society and capitalism.

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    I just think it's mad that rather than paying off their mortgages, they were gambling it all on investment vehicles. WTF......?!

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    FunkyMonkey
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    Quote Originally Posted by iphonista View Post
    i just think it's mad that rather than paying off their mortgages, they were gambling it all on investment vehicles. Wtf......?!
    nama.

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    Politics.ie Member Nemesiscorporation's Avatar
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    Quote Originally Posted by Iphonista View Post
    I just think it's mad that rather than paying off their mortgages, they were gambling it all on investment vehicles. WTF......?!
    They still think it is a brilliant idea.

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    Quote Originally Posted by Iphonista View Post
    I just think it's mad that rather than paying off their mortgages, they were gambling it all on investment vehicles. WTF......?!
    I have a vague memory of some concept named something like endowment ''with profits'' mortgage or endowment loan being pushed here. I think the interest on the loan gets paid but the money for paying down the reducing balance goes into the investment vehicle.

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    Politics.ie Member DownTheyGo's Avatar
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    Quote Originally Posted by Nemesiscorporation View Post
    They still think it is a brilliant idea.
    UK Insurance companies pushed something like that during the '90s... endownment policies. Despite all the assurances and guarantees, came nowhere close to paying off many mortgages due end of term. So interest went on being paid and contributions were necessary far beyond the original planned term e.g. 20 years of endowment policy and interest payments became 30 years or longer. In many cases, the actual cost per month was higher than if a normal interest and capital only repayment mortgage had been selected.

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    Politics.ie Member Dublin 4's Avatar
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    Huge prop bubble there - I've linked it various times & it's expected to turn nasty...

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    Politics.ie Member Johnnybaii's Avatar
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    Read about this before, Decided against using Rabo as a result.

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