The Big Bailout of the Eurozone (Another crisis coming? - Seriously)

[Bogball XV]

but do we not still own the land if we nationalise the banks, it doesn't really solve the problem only leaves the state running the banks and judging by how they run everything else I don't know if thats the best way forward

we could buy the banks for approx 10bn, it'd be cheaper than buying their loanbooks for 90bn and there might even be an upside (for the taxpayer as opposed to investors).
It's been ruled out because lenno and the genuises at the dept of finance (the same people who didn't understand that the pension levy would be tax deductible) have decided that nationalisation is like something from Citizen Smith and that we're not in the 70's anymore.  It's also a sleight of hand in that if we nationalise the banks then our national debt increases, the NAMA route makes it look like the banks are taking on the extra debt as they take the govt's bonds to the ecb and borrow against them.

All in all, NAMA is a disgrace, the fact that outside investors are looking to take a part of AIB conditional on the loanbook being sold off shows just how bad a deal the taxpayer is getting here.  Some lad from Bloxham was on talking there, he reckoned that the fact that outsiders were interested in investing showed just how brilliant an idea NAMA was and that outside confidence was being restored by lenno's brilliant plan.

I am not sure if I understand this correctly, but if we as tax payers take over the banks do we not assume their debts also which includes the bad loans

yes, but nama means that we only assume their bad loans

[tyronefan]

we are taking their bad loans at a discount (rate yet to be decided)   if we nationalise them we get their bad debts at full price.

it seems we will not know how good or bad it will be until we see the rate at which the government  buy the bad loans.

[muppet]

but do we not still own the land if we nationalise the banks, it doesn't really solve the problem only leaves the state running the banks and judging by how they run everything else I don't know if thats the best way forward

we could buy the banks for approx 10bn, it'd be cheaper than buying their loanbooks for 90bn and there might even be an upside (for the taxpayer as opposed to investors).
It's been ruled out because lenno and the genuises at the dept of finance (the same people who didn't understand that the pension levy would be tax deductible) have decided that nationalisation is like something from Citizen Smith and that we're not in the 70's anymore.  It's also a sleight of hand in that if we nationalise the banks then our national debt increases, the NAMA route makes it look like the banks are taking on the extra debt as they take the govt's bonds to the ecb and borrow against them.

All in all, NAMA is a disgrace, the fact that outside investors are looking to take a part of AIB conditional on the loanbook being sold off shows just how bad a deal the taxpayer is getting here.  Some lad from Bloxham was on talking there, he reckoned that the fact that outsiders were interested in investing showed just how brilliant an idea NAMA was and that outside confidence was being restored by lenno's brilliant plan.

Only just read this here now.

To my mind the AIB is like a rotten apple. The Government is going to cut out all the rotten bits and give it to the taxpayer while a foreign bank buys what's left. This is supposed to be good for us?

[Rossfan]

Instead of giving the Bankers/Builders €60bn the economy would do far better if the Govt divided the €60bn evenly among all the people of the 26 Counties. That would work out about €15k each I think.
People would go out spending it or paying off loans ,or saving it etc so employment would rise left right and centre, the banks would get loads of money deposited in them, lots of loans would be cleared etc and the whole economy would be stimulated.
Of course the Builders would all be liquidated 
which would make everyone happy except the FcukinFiannaFailures.

[Zapatista]

Instead of giving the Bankers/Builders €60bn the economy would do far better if the Govt divided the €60bn evenly among all the people of the 26 Counties. That would work out about €15k each I think.
People would go out spending it or paying off loans ,or saving it etc so employment would rise left right and centre, the banks would get loads of money deposited in them, lots of loans would be cleared etc and the whole economy would be stimulated.
Of course the Builders would all be liquidated 
which would make everyone happy except the FcukinFiannaFailures.

The problem there is that most people are more than 15K in debt. Also, they don't have 60bn.

[Bogball XV]

we are taking their bad loans at a discount (rate yet to be decided)   if we nationalise them we get their bad debts at full price.

it seems we will not know how good or bad it will be until we see the rate at which the government  buy the bad loans.

if we nationalise we get all their assets at what the market considers their fair price, in the eyes of the market the loans were already discounted, that's why since NAMA was announced, BOI shares have risen from 12c to 200c, as the market considers the banks wil get a much better deal with this new plan.

I see the courts were at all sorts of shenanigans last night in order to give the Carroll group more breathing space (and get them closer to NAMA).  They've apparently presented a business plan now (with info they had before, but decided not to bother furnishing), I hope Kelly shows the new plan the same disdain he did the last.  This plan seems to be as much bollocks as the last one:

"He said the companies had submitted "a considerably enhanced body of evidence" including a new independent accountant's report drafted by KPMG that was "more extensive" than a previous one and a report from the chief economist of Goodbody Stockbrokers, which shows a turnaround in the world economy in 2010 and in Ireland in 2011, and that this would back up the group's proposed survival plan"

[Ash Smoker]

It looks like a real stroke is being pulled now!
Fianna Fail, the great friend of the banker and developer will do everything it can to keep Carroll from going under.
The mug taxpayer will carry the can to prop up these leeches.

http://www.independent.ie/national-news/carroll-in-hospital-as-lawyers-beg-for-time-1860946.html

Carroll in hospital as lawyers beg for time

By Dearbhail McDonald Legal Editor

Saturday August 15 2009

TROUBLED developer Liam Carroll was in hospital last night and unable to attend a court where his lawyers made a dramatic 11th-hour bid to save his construction empire from collapse.

In an emergency sitting of the High Court last night, counsel for Mr Carroll revealed he is in hospital and unable to give instructions.

But lawyers acting on his behalf sought to present new evidence. This had not been heard by the Supreme Court, which refused to appoint an examiner to six of his companies last Tuesday.

As Mr Carroll battled against a midnight deadline to re-apply to have an examiner appointed, senior counsel Michael Cush begged Judge Eamon de Valera to apply his discretion and allow him to present the new examiner petition early next week.

There will now be a hearing on Thursday to establish whether the case should be allowed to proceed.

The case was brought to the High Court amid concerns that provisional liquidator Declan Taite could exercise his power to take over the assets of Mr Carroll's two main holding companies -- Vantive and Morston -- and take control of all of its subsidiaries.

Mr Cush said Mr Carroll had addressed the three main criticisms levelled at him by the Supreme Court.

Dramatic new evidence presented to the High Court last night included:

    * A new independent accountants' report compiled by KPMG.
    * New letters from his banks indicating support to provide ongoing finance for his projects.
    * New, updated valuations including statements from estate agents CBRE and Hooke and McDonald.
    * A report on the predicted upturn in the global economy in 2010 and the Irish economy in 2011 from the chief economist at Goodbody Stockbrokers.

Mr Cush said the new material was "a considerably enhanced body of evidence" and warned that if the examinership petition was not heard "we are facing the inevitable collapse of the (Zoe) group".

He accepted that some of the Supreme Court's criticisms were valid, but said some of the new material was not available to Mr Carroll when he first sought the court's protection. He insisted Mr Carroll "went looking for it".

However, ACC Bank, who are attempting to recover around €136m in loans owed to it by Mr Carroll, described his last ditch petition as "vexatious". The Dutch-owned bank said the move was an abuse of process as the matter had already been before both the High Court and the Supreme Court.

Solicitor Jane Marshall even accused Mr Carroll of using the Supreme Court ruling as "an advice on proofs" to create what was, in effect, a new action.

Agitating

Lawyers acting for Mr Taite, who is also a receiver for four of Mr Carroll's companies, said he was not agitating any course of action. His powers could be varied, but only if the court was satisfied there was a reasonable prospect that Mr Carroll's six companies would survive.

The court also heard that a seventh company controlled by Mr Carroll is seeking court protection.

It also emerged last night that the State-owned Anglo Irish Bank is willing to provide €8m to Mr Carroll if an examiner is appointed to help him complete a development in Dublin's Docklands.

[Lone Shark]

From what I can see the timeline on NAMA is fairly straightforward.

(1) Get the thing up and running before too much muck hits the fan with regard to Liam Carroll etc, so as to legitimately buy "packages" of loans for perhaps 75c in the euro. In theory all loans over a certain size have to be bought out, so that the state gets the good with the bad. In practice the banks get enough time to decide for themselves which loans they want to keep, so as to split it up from a 20m loan into four 5m loans.

(2) NAMA then takes about six months to put all the assets together, during which time no properties can be sold yet, and no repayments are sought because everything "takes time".

(3) The banks take the capital, shore up their liquidity ratios, and promptly resume their closed wallet policy since there is still a recession on after all. Government pressure will mean that there will still be some mortgages issued, since small mortgage holders are easy chase, but finance to business will remain impossible to get.

(4) Over time it will be revealed that several developers with, on average, 100m of debt, have no intention of paying anything off, have nothing only half finished estates in Cavan and Longford to show for it, and anything of value that they own has been transferred to their wives. The loans are worth approximately 10c in the euro at most.

(5) In the meantime Anglo goes bust anyway, while foreign investors come in and cherry pick the carcasses of AIB, BOI and PTSB. Anglo leaves the state on the hook for another 100bn in bondholder funds because the guarantee is still in place. Anyone thinking that they've cleaned up their act, have a look at the Bovale story coming out today.

(6) The Irish public begins to realise that we were sold the biggest con job in the history of the free world. People start to get angry. The government claims that "they couldn't have known" that things would be as bad as this, and that "the banks deceived us". In the meantime all the bankers have retired with their golden parachutes.

(7) Now here's the real sting in the tail - NAMA has the right to sell any assets they own with no VAT, no stamp, or anything, should the government so decree. They will "liquidate" a wide variety of assets as such, probably within a year of an election. "Commercial sensitivity" will preclude prices being issued, but essentially that half finished estate in Gowna or Mullinalaghta will be sold on to some insider, who'll pick it up for a song - since NAMA is going to be bust anyway. Basically this will be the mechanism for FF and their cronies to have one last dip in the pot before they are voted out.

( After one term of FF being in opposition, the country will be beginning to recover, but because it's not fast enough, and becuase some harsh medicine will be felt, the new goverment will be voted out with people claiming that "they're all the same" and falling, yet again, for cheap promises and nods and winks. People finally give up on the idea of fair governance and vote with the guy who promises to sell little Johnny and Mary a cheap house, glossing over the fact that he himself picked it up in the firesale for virtually nothing.


I think I've covered most of it there. Anybody who would like to add some details that I may have missed, feel free.

[Ash Smoker]

From what I can see the timeline on NAMA is fairly straightforward.

(1) Get the thing up and running before too much muck hits the fan with regard to Liam Carroll etc, so as to legitimately buy "packages" of loans for perhaps 75c in the euro. In theory all loans over a certain size have to be bought out, so that the state gets the good with the bad. In practice the banks get enough time to decide for themselves which loans they want to keep, so as to split it up from a 20m loan into four 5m loans.

(2) NAMA then takes about six months to put all the assets together, during which time no properties can be sold yet, and no repayments are sought because everything "takes time".

(3) The banks take the capital, shore up their liquidity ratios, and promptly resume their closed wallet policy since there is still a recession on after all. Government pressure will mean that there will still be some mortgages issued, since small mortgage holders are easy chase, but finance to business will remain impossible to get.

(4) Over time it will be revealed that several developers with, on average, 100m of debt, have no intention of paying anything off, have nothing only half finished estates in Cavan and Longford to show for it, and anything of value that they own has been transferred to their wives. The loans are worth approximately 10c in the euro at most.

(5) In the meantime Anglo goes bust anyway, while foreign investors come in and cherry pick the carcasses of AIB, BOI and PTSB. Anglo leaves the state on the hook for another 100bn in bondholder funds because the guarantee is still in place. Anyone thinking that they've cleaned up their act, have a look at the Bovale story coming out today.

(6) The Irish public begins to realise that we were sold the biggest con job in the history of the free world. People start to get angry. The government claims that "they couldn't have known" that things would be as bad as this, and that "the banks deceived us". In the meantime all the bankers have retired with their golden parachutes.

(7) Now here's the real sting in the tail - NAMA has the right to sell any assets they own with no VAT, no stamp, or anything, should the government so decree. They will "liquidate" a wide variety of assets as such, probably within a year of an election. "Commercial sensitivity" will preclude prices being issued, but essentially that half finished estate in Gowna or Mullinalaghta will be sold on to some insider, who'll pick it up for a song - since NAMA is going to be bust anyway. Basically this will be the mechanism for FF and their cronies to have one last dip in the pot before they are voted out.

( After one term of FF being in opposition, the country will be beginning to recover, but because it's not fast enough, and becuase some harsh medicine will be felt, the new goverment will be voted out with people claiming that "they're all the same" and falling, yet again, for cheap promises and nods and winks. People finally give up on the idea of fair governance and vote with the guy who promises to sell little Johnny and Mary a cheap house, glossing over the fact that he himself picked it up in the firesale for virtually nothing.


I think I've covered most of it there. Anybody who would like to add some details that I may have missed, feel free.

You should sent that to the letter section of the papers.
The public are slowly waking up to Nama now.
People are realising that the country was run for the benefit of a cosy inner circle for the last decade and that any measures taken will look after their interests first and foremost.

We are being run like a South American banana republic.

[bcarrier]

Whether NAMA is a rip off or clever off government balance sheet manipulation depends almost entirely on the valuation methodolgy adopted and assumptions used in valuing initial loans ( and underlying property ) taken over. There is plenty of scope for manipulation especially by changing tax variables  and the developers margin in arriving at a residual property value and consequential loan impairment.

I can almost hear the masses saying " they can forget about developers margin anyway " ....shooting themselves in the foot in the process.

[Billys Boots]

The public are slowly waking up to Nama now.
People are realising that the country was run for the benefit of a cosy inner circle for the last decade and that any measures taken will look after their interests first and foremost.

Last decade my arse, it's been exactly like that since the early 70s.  This information was clear at the time of the last general election, and the one before, and we voted them back in.  It's about time the voters of Ireland took responsibility for their own actions.

[Declan]

(4) Over time it will be revealed that several developers with, on average, 100m of debt, have no intention of paying anything off, have nothing only half finished estates in Cavan and Longford to show for it, and anything of value that they own has been transferred to their wives. The loans are worth approximately 10c in the euro at most.

(5) In the meantime Anglo goes bust anyway, while foreign investors come in and cherry pick the carcasses of AIB, BOI and PTSB. Anglo leaves the state on the hook for another 100bn in bondholder funds because the guarantee is still in place. Anyone thinking that they've cleaned up their act, have a look at the Bovale story coming out today.

(6) The Irish public begins to realise that we were sold the biggest con job in the history of the free world. People start to get angry. The government claims that "they couldn't have known" that things would be as bad as this, and that "the banks deceived us". In the meantime all the bankers have retired with their golden parachutes.

(7) Now here's the real sting in the tail - NAMA has the right to sell any assets they own with no VAT, no stamp, or anything, should the government so decree. They will "liquidate" a wide variety of assets as such, probably within a year of an election. "Commercial sensitivity" will preclude prices being issued, but essentially that half finished estate in Gowna or Mullinalaghta will be sold on to some insider, who'll pick it up for a song - since NAMA is going to be bust anyway. Basically this will be the mechanism for FF and their cronies to have one last dip in the pot before they are voted out.

(Cool After one term of FF being in opposition, the country will be beginning to recover, but because it's not fast enough, and becuase some harsh medicine will be felt, the new goverment will be voted out with people claiming that "they're all the same" and falling, yet again, for cheap promises and nods and winks. People finally give up on the idea of fair governance and vote with the guy who promises to sell little Johnny and Mary a cheap house, glossing over the fact that he himself picked it up in the firesale for virtually nothing.

Great post LS. The latest stuff on Bovale and Anglo backing them is just unreal - As BB said it's about time the voters of Ireland took some responsibility for their actions in continually voting in that shower. The argument re the link between "recreational" drug use and gangland killings comes to my mind. Anyone who has voted for FF since late 60s early 70's is culpable!

[muppet]

Another bank makes a run for it.

http://www.rte.ie/business/2009/0818/greencore.html

The Anglo/Bovale story should alert the citizens as to what exactly the bank guarantee and NAMA are all about.

Taxpayers money used to protect a corrupt bank * who are using that taxpayers collateral to protect known corrupt property ** developers.

* a bank loaning money to property developers exclusively for the purpose of purchasing shares in the same bank is illegal and if this was the States there would be many Anglo officials in jail.....we haven't even had a court case
** http://www.irishtimes.com/newspaper/opinion/2009/0818/1224252768992.html


As an aside what will be the tipping point for the citizens?

NAMA
General Election as sleveen FFers just as Rae baulk over something like a roof on his town hall
December budget
Some 'unforeseen' but entirely yet predictable scandal

[Declan]

As an aside what will be the tipping point for the citizens?

Unfortunately we have none muppet. Will continue to moan and give out yet will do nothing about it. 

[bcarrier]

I am not sure what to make of the Anglo/Bovale story .

It looks like Bovale already have the most of the money already and are negotiating an extension of repayment . Anglo could presumably appoint a liquidator to sell the assets and reclaim what it can  but has made a commercial judgement that it has a better chance of recovering its debt by making additional advances to Bovale to complete unfinished development. There was some talk of an hotel being completed and leased to an operator on propertypin.com . The worst thing banks can get left with is uncompleted development - undeveloped land and completed units can be readily sold but half finished work in progress will be a nightmare to handle. Design and building warranties can be invalidated and value destroyed completely.

Without knowing the details of underlying transaction it is impossible to tell whether anglo are making the correct decision or not though I can understand why you may not want to give them the benefit of the doubt.

As an aside since Bovale are trading insolvently ....the balance sheet has negative net worth are Directors personally liable for any losses arising to creditors ?