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Thread: The Germans want to steal our houses!

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    Default The Germans want to steal our houses!

    Yes yes, I know it's a rather over dramatic interpretation of reported opinion but it does crystallise the ideas contained in this article which I have linked to in another thread, here is the nub of the matter -


    It would be more sensible -- and fairer -- for the crisis-ridden countries to exercise their own power to reduce their debts, namely by reaching for the assets of their citizens more than they have so far. As the most recent ECB study shows, there is certainly enough money available to do this.


    The assumption throughout the article is that houses are liquid assets, a deeply flawed hypothesis as I am sure we can all agree. They are, after all homes, not just investments, and the relationship between homeowners and their houses does not always conform to the tidy little logic of unimaginative economists, and quite right to, it's time we abandoned the idea of a house as merely a financial asset, look at the trouble we have brought upon ourselves by doing just that!

    Will the property tax become nothing more than an asset grab from the supposedly wealthy? The Germans might see this as a fair deal because over half of them live in rented accommodation, but that hardly accords with the situation in Ireland (as if that has any bearing on the matter) so will we be forced into the 'poverty' of rented property to keep our friends upon the continent happy?

    We have been warned!

    Poor Germany: It Is Time for a Debate on Euro Crisis Burden Sharing - SPIEGEL ONLINE
    Once your ability to function within society depends on a government controlled ID card then you are no longer a free citizen.

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    Quote Originally Posted by Mad as Fish View Post
    Yes yes, I know it's a rather over dramatic interpretation of reported opinion but it does crystallise the ideas contained in this article which I have linked to in another thread, here is the nub of the matter -


    It would be more sensible -- and fairer -- for the crisis-ridden countries to exercise their own power to reduce their debts, namely by reaching for the assets of their citizens more than they have so far. As the most recent ECB study shows, there is certainly enough money available to do this.


    The assumption throughout the article is that houses are liquid assets, a deeply flawed hypothesis as I am sure we can all agree. They are, after all homes, not just investments, and the relationship between homeowners and their houses does not always conform to the tidy little logic of unimaginative economists, and quite right to, it's time we abandoned the idea of a house as merely a financial asset, look at the trouble we have brought upon ourselves by doing just that!

    Will the property tax become nothing more than an asset grab from the supposedly wealthy? The Germans might see this as a fair deal because over half of them live in rented accommodation, but that hardly accords with the situation in Ireland (as if that has any bearing on the matter) so will we be forced into the 'poverty' of rented property to keep our friends upon the continent happy?

    We have been warned!

    Poor Germany: It Is Time for a Debate on Euro Crisis Burden Sharing - SPIEGEL ONLINE
    You know that that is exactly what will happen organically don't you?

    As we repay our indebtedness we will have to sell our assets - think NAMA and the IBRC as well as companies going into insolvency etc.

    Where do you think buyers for the assets of those liquidating entities will come from? Predominantly abroad because we have no domestic capital anymore in aggregate, we have massive net debt.

    So Irish entities sell assets to repay debts to foreigners and (other) foreigners will buy the assets being sold.

    Same net result without any central planning or intervention. The market does it automatically, always has.

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    Quote Originally Posted by Trainwreck View Post
    You know that that is exactly what will happen organically don't you?

    As we repay our indebtedness we will have to sell our assets - think NAMA and the IBRC as well as companies going into insolvency etc.

    Where do you think buyers for the assets of those liquidating entities will come from? Predominantly abroad because we have no domestic capital anymore in aggregate, we have massive net debt.

    So Irish entities sell assets to repay debts to foreigners and (other) foreigners will buy the assets being sold.

    Same net result without any central planning or intervention. The market does it automatically, always has.
    meh, a German landlord would probably tret his tenants more fairly than one of our own rackrent speculator/landlords.

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    They need more space...
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Well suppose, just suppose that the normal rules of bankruptcy had prevailed back in 2007/2008: For example, you running your hot dog stand go bust, declared bankrupt, sheriff comes and siezes any assets and the taxman, suppliers, employees, other creditors, bank divvy up the spoils.
    Now take this in the too big to fail of systemic importance level:
    In 2002 Foreign creditors lend short term to Irish banks. Irish banks lend to builders and developers. Builders, developers build houses but can't sell them, (or people lose jobs and can't pay for them).
    People go bust, builders developers go bust, Irish banks go bust. Foreign banks call in the mighty EU sheriff and divvy up the spoils. That means (on this logic which is a bit stretched out) that German banks and their shareholders should be the proud owners of underwater estates in Leitrim and longford and wherever. Course Fritz doesn't want to move to Ballymote. It gets wet and cold in the winter, so the practical thing is to sell them on. But not all at once as that would mean they would get a lot less and everyone would be in negative equity.
    "Well, OK. Fine. As long as it comes with a steady paycheck, I'd believe whatever they wanted me to believe, as the Guy in Ghostbusters said."

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    It is a very difficult balancing act this government has inherited from the last shower but we're near tipping point with middle Ireland left with no more to give. You can only push so far...

    If we cannot come out of this then what hope for others and what incentive? Real and substantial debt write down is essential and Europe/Germany need to see this or else the best pupil in the class needs to tell the teacher to get stuffed.

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    Quote Originally Posted by Trainwreck View Post
    You know that that is exactly what will happen organically don't you?

    As we repay our indebtedness we will have to sell our assets - think NAMA and the IBRC as well as companies going into insolvency etc.

    Where do you think buyers for the assets of those liquidating entities will come from? Predominantly abroad because we have no domestic capital anymore in aggregate, we have massive net debt.

    So Irish entities sell assets to repay debts to foreigners and (other) foreigners will buy the assets being sold.

    Same net result without any central planning or intervention. The market does it automatically, always has.
    Will it though?

    Why are these foreigners not buying up property at present? It can't get much cheaper than it is and there is plenty on offer. Should foreigners buy Irish property then won't they be subject to exactly the same tax upon their assets as a homeowner, where is the incentive? Why is foreign investment in buying to let a good thing but Irish buying to let bad? Which foreigners do you have in mind and where will their money come from anyway? As far as I can tell most of the worlds capital is uselessly sloshing around the various financial markets, if it becomes available to purchase residential property then why should the Irish be denied access to it?

    It is also noticeable that the Irish are very slowly shedding their indebtedness -

    Householders have been desperately trying to pay down car loans, card debts and mortgages and now the average debt for every man, woman and child in Ireland has fallen to €41,000, down from €47,400 four years ago, new figures from the Central Bank indicate.

    Households chipping away at debt even as income falls - Independent.ie

    As we emerge from debt (without selling our houses) the urgent need to liquidise our assets declines, especially if inflation once again becomes a factor in EU economics. These foreigners had better start buying sooner rather than later, before it's too late.
    Once your ability to function within society depends on a government controlled ID card then you are no longer a free citizen.

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    Politics.ie Member EoinMag's Avatar
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    I was in Germany on work last week, they feel exactly the same as we do, at least the small man on the street, there is no animosity towards the Irish, although there was a few months back.

    They feel they are being ridden from on high by politicians and financiers on dream money.

    Reading the ire directed towards the Germans here, it's disgusting really how the Irish won't take responbility for themselves and their actions.
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    So Irish entities sell assets to repay debts to foreigners and (other) foreigners will buy the assets being sold.
    As long as we don't sell anything strategic, like one of our energy companies or something like that.

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    Politics.ie Member Heligoland's Avatar
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    Quote Originally Posted by EoinMag View Post
    I was in Germany on work last week, they feel exactly the same as we do, at least the small man on the street, there is no animosity towards the Irish, although there was a few months back.

    They feel they are being ridden from on high by politicians and financiers on dream money.
    What chance have we of seeing a change of government in Germany like we did in France?

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