Follow @PoliticsIE
 
 
 
Page 1 of 4 1234 LastLast
Results 1 to 10 of 33

Thread: Myopic Lenihan: cheapest bailout in the world so far

  1. #1
    Politics.ie Member
    Join Date
    Jan 2007
    Location
    Dublin
    Posts
    817
    Mentioned
    0 Post(s)

    Default Myopic Lenihan: cheapest bailout in the world so far

    Quote Originally Posted by Irish Times
    MINISTER FOR Finance Brian Lenihan has said the bank guarantee scheme was "a necessary first step" and "the cheapest bailout in the world so far".

    ...

    Speaking before the lunch, Mr Lenihan repeated that he wanted the banks to raise any additional capital needed to protect against unforeseen losses by private means in the first instance.
    He said the banks' capital needs were being reviewed.
    Irish bailout cheapest in world, says Lenihan - The Irish Times - Fri, Oct 24, 2008

    Where does Mr Lenihan think the banks are going to find E15 Billion in private sector investment in the current environment? He's taking us all for fools and the markets know it.

  2. #2
    Politics.ie Member
    Join Date
    Jul 2005
    Posts
    129
    Mentioned
    0 Post(s)

    Default

    Where are you getting the figure of 15 billion from?

  3. #3
    Politics.ie Member
    Join Date
    Jan 2007
    Location
    Dublin
    Posts
    817
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by John_C View Post
    Where are you getting the figure of 15 billion from?
    That's the minimum the banks are going to need in the short term.

    See transcript of Patrick Neary session in Oireachtas recently.

    http://www.politics.ie/economy/36128...-reserves.html

  4. #4
    Politics.ie Member
    Join Date
    Jul 2005
    Posts
    129
    Mentioned
    0 Post(s)

    Default

    I've only read the newspaper reports which quoted him as saying that the banks could offset their loss making loans with other profitable ones. Did they misrepresent what he said?

  5. #5
    Politics.ie Member
    Join Date
    Jan 2007
    Location
    Dublin
    Posts
    817
    Mentioned
    0 Post(s)

    Default

    If you look at the thread I've linked in my above post you can see what he said (or rather didn't say). The idea that they could offset what will be short term losses against their short term profits is nonsense. He was pretending that these bad debts will develop over the long term. He's a spoofer just like Lenihan and the whole of the banking fraternity.

  6. #6
    Politics.ie Member
    Join Date
    Jul 2005
    Posts
    129
    Mentioned
    0 Post(s)

    Default

    Thanks,
    I had a look there and he said, "This leaves a balance of €15 billion secured directly on the underlying property. There will undoubtedly be some losses on these exposures.".

    Some losses on 15 billion is not the same as losses of 15 billion minimum.

  7. #7
    Politics.ie Member
    Join Date
    Jan 2007
    Location
    Dublin
    Posts
    817
    Mentioned
    0 Post(s)

    Default

    Quite correct. I was using a figure I heard from a journalist yesterday. I should have used my own from earlier.

    The bad debts won't result in a total loss. It's likely to be 66% plus though on those loans alone. That's over €10Bn.

  8. #8
    Politics.ie Member
    Join Date
    May 2007
    Location
    Dublin Bay South
    Posts
    12,938
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by HanleyS View Post
    Quite correct. I was using a figure I heard from a journalist yesterday. I should have used my own from earlier.

    The bad debts won't result in a total loss. It's likely to be 66% plus though on those loans alone. That's over 10Bn.



    So what? How does that harm the man in the street?

  9. #9
    Politics.ie Member
    Join Date
    Jan 2007
    Location
    Dublin
    Posts
    817
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by Odyessus View Post
    So what? How does that harm the man in the street?
    It ultimately means that we're going to have to stump up €10Bn plus to recapitalise the banks or let the financial system collapse.

  10. #10
    Politics.ie Member
    Join Date
    Jan 2007
    Posts
    2,423
    Mentioned
    0 Post(s)

    Default

    Quote Originally Posted by HanleyS View Post
    It ultimately means that we're going to have to stump up 10Bn plus to recapitalise the banks or let the financial system collapse.
    There will be losses in other credit classes as well such as BTL mortgages, corporate credit, investment property lending ex construction, car loans etc. So E8-10bn is a de minimus figure for the system as a whole. Without a re-cap, merger of 1 or 2 or trade sale there will be no functioning banking system in the country. Small business and personal borrowers will have reduced asset to credit, asset prices will continue to fall, business will contract and the economy will slump. Where does that leave the public finances?

    Lenihan should underwrite a rights issue for at least one of the big 2 quoted banks making it a national champion. He should then use his power to dispose or break up the rest.

    If he just lets the situation rumble on, the economy is doomed to sub zero growth for years.

Page 1 of 4 1234 LastLast

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •