# Brendan and David McWilliams on LateLateShow 26/Oct/12



## four18

All Brendans figures got lashed tonight on the late late show. I dont think he got a fair say but maybe David Mc Williams etc shouted louder than him. Good TV though and well done Brendan, You Tried but maybe rework the figures to see if you are actually in the ballpark at all.

_Mods' Note - i have moved the discussion of the actual figures use in the show to this thread

Brendan_


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## Husker

Wasn't really the forum for the guests to take cheap shots at each other. Thought it ruined the opportunity for a good discussion, to be honest.


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## PiedPiper

I was a major David Hall fan on that panal.

I dont see how 20,000 homeless families helps anyone.

There is a massive massive human cost.

How can the goverment say yes for children but is willing to have them dragged out of their homes away from their areas and schools and friends moving home is hugely stressfull at the best of times.

NO nobody need to lose their home and NO nobodys home should be sold or repossessed or anything of the sort.

The banks got paid and want paid again where is the justice in that.

If you want the proof of the damage and the human cost, I had my bike dragged out of my little hands by the sheriff when I was a child and they took our piano,

Then the local esb guy was driving by so for badness he took it apon himself to cut of the power with no notice although the bill was paid and he demanded a deposit, (you know the traditional begruddgery shamefull Irish kick a man when he's down)


So that night we went to bed with no bikes and no piano and a candle.  Being small silly children we played with the candle and set a sheet on fire.  Our poor mother stressed out of her head gave us all a good hard slap.   All these years later I still use a generator despise the ESB and show signs of trauma.  

How is a lost generation going to help, we already have the worst brain drain in history.


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## four18

I agree, They hardly involved the real people, ie, the audience.


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## riddles

*Well done Brendan*

.
No need to critiscise Brendan because Tubridy is incompetent.
Its about time the real story was told i can give more examples than an ipad can allow because of slow typing.

Simply lots of people jumped on the housing b wagon and lost and want out.  
We need to have a referendum about the country defaulting and starting again or not because thats what mcwilliams is suggesting.

Anyone on 100 per cent should be out on their ear


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## four18

PiedPiper said:


> I was a major David Hall fan on that panal.
> 
> I dont see how 20,000 homeless families helps anyone.
> 
> There is a massive massive human cost.
> 
> How can the goverment say yes for children but is willing to have them dragged out of their homes away from their areas and schools and friends moving home is hugely stressfull at the best of times.
> 
> NO nobody need to lose their home and NO nobodys home should be sold or repossessed or anything of the sort.
> 
> The banks got paid and want paid again where is the justice in that.
> 
> If you want the proof of the damage and the human cost, I had my bike dragged out of my little hands by the sheriff when I was a child and they took our piano,
> 
> Then the local esb guy was driving by so for badness he took it apon himself to cut of the power with no notice although the bill was paid and he demanded a deposit, (you know the traditional begruddgery shamefull Irish kick a man when he's down)
> 
> 
> So that night we went to bed with no bikes and no piano and a candle. Being small silly children we played with the candle and set a sheet on fire. Our poor mother stressed out of her head gave us all a good hard slap. All these years later I still use a generator despise the ESB and show signs of trauma.
> 
> How is a lost generation going to help, we already have the worst brain drain in history.


 
But How do you ''Flush Out'' the Wont pays from the Cant Pays ? ?


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## riddles

It would be pretty easy the wont pays will have dd to harvy normans full sky packages cc details of the jan ski hols and hp 3 series deals. O
All on the credit history.


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## four18

riddles said:


> It would be pretty easy the wont pays will have dd to harvy normans full sky packages cc details of the jan ski hols and hp 3 series deals. O
> All on the credit history.


Only on credit history if you default on your 62 inch plasma from harvey norman. Pay your bills and you are generally under the radar !


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## riddles

In fact its a pretty amazing model in ireland, you can actually chose never to work in your life and get access to free housing healh education and travel.

I have thrawled the internet and cannot find the criteria for what constitutes the most vulnerable in society or even the low low paid civil servant.  What does either mean in an economically validated sense? Your helps appreciated


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## galwayhous

I can't imagine anyone agreeing with David Hall except those who seek to forego their mortgage repayments.

There is nothing wrong with families renting, same as the rest of us.

Fair play to Brendan. He made some excellent points.


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## riddles

I think people are looking for solutions not sympathy.  Mortgages need to be adjusted to what people can reasonably afford to pay.  The outstanding debt is linked to the assett then the assett cannot be sold without discharging the debt at a later point.

Same with property tax for elderly same as college grants for farmers.  For those cannot right allow debts to accumalate against assett.

Individuals made a mistake a borrowed irresponsibily in large numbers driven by fear and greed.  There is a painful lesson to be learned there are easy solutions around but walkin away is not one of them.


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## Daddy

Debt for equity is a good idea and would help all families in trouble by halving the debt and halving the responsibility and both the lender and borrower take a hit they will probably be able to manage.  David was right 9 years ago and families are in big trouble and this idea while not David's only would be a start and give hope to people.


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## monagt

> Debt for equity is a good idea and would help all families in trouble by halving the debt and halving the responsibility and both the lender and borrower take a hit they will probably be able to manage. David was right 9 years ago and families are in big trouble and this idea while not David's only would be a start and give hope to people.



+1

No 1 listened to David then and no 1 is listening now.................


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## PiedPiper

More is the pity


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## mark12

Maybe we need a third opinion on these matters:


http://uti.is/2012/10/ireland-the-mortgage-debt-and-insolvency-framework/


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## Duke of Marmalade

Watched the show again this morning. _Boss_ did very well indeed, especially considering it was 3 against 1 and I am not too sure Tubridy hid his bias for fellow Blackrock boy, McWilliams. Was the _Boss_ right to launch his planned ambush about the guarantee? Maybe not, got Tubridy against him, I think, though someone has to challenge this aura that McW can get nothing wrong.

The McW piece from 2003 is brilliant, have to hand him that. But he has made some wild suggestions on the back of that success, which I won't go into here.

McW's presentation was very professionally (as an entertainer) delivered but I scrutinised it this morning for substance. Lot's about Granny's good room, but what has that to do with debt forgiveness? The metaphor is worth exploring. Granny is pretending to her betters that she is better off than she is. I presume McW is suggesting that Granny should come clean and admit that she is a pauper. Then of course all that money which she is borrowing to spend on the kids would dry up and then we would see a true spiral into economic and social chaos. Good kilkenomics stuff that, about Granny's good room, but lacks all credibility for informing national policy. 

So what about debt forgiveness? Actually McW has backed off this one. It is debt for equity swap these days. As the _Boss_ is tired pointing out equity without rent is forgiveness by another name.

Unbelievably McW lashed out at the possibility of Trackers coming home to roost. Maybe he is setting up his opening speech for 9 years' time. If ever the formula became tilted against the punter, they would simply remortgage, Tracker mortgagees are laughing all the way on their one way bet.

Dervla (?) unwittingly struck a chord for me when she asked at the end how could they afford the rent (as an alternative to a mortgage). This is what it is all about - not negative equity nor high mortgage outlay; mortgage repayments are actually much lower today than at the height of the boom. The fact that many people are in distress and can't afford to pay their mortgage is not because of negative equity, it is because they have been victims of the recession.  

Finally, can anyone explain to me this argument (by debt forgiveness lobby) that the lack of repossessions is evidence of more perfidy on the behalf of the banks?


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## sebadoh

PiedPiper said:


> I was a major David Hall fan on that panal.
> 
> I dont see how 20,000 homeless families helps anyone.
> 
> There is a massive massive human cost.
> 
> How can the goverment say yes for children but is willing to have them dragged out of their homes away from their areas and schools and friends moving home is hugely stressfull at the best of times.
> 
> NO nobody need to lose their home and NO nobodys home should be sold or repossessed or anything of the sort.
> 
> The banks got paid and want paid again where is the justice in that.
> 
> If you want the proof of the damage and the human cost, I had my bike dragged out of my little hands by the sheriff when I was a child and they took our piano,
> 
> Then the local esb guy was driving by so for badness he took it apon himself to cut of the power with no notice although the bill was paid and he demanded a deposit, (you know the traditional begruddgery shamefull Irish kick a man when he's down)
> 
> 
> So that night we went to bed with no bikes and no piano and a candle.  Being small silly children we played with the candle and set a sheet on fire.  Our poor mother stressed out of her head gave us all a good hard slap.   All these years later I still use a generator despise the ESB and show signs of trauma.
> 
> How is a lost generation going to help, we already have the worst brain drain in history.


Do you believe that people who either can't or wont pay for an asset should be allowed to retain that asset?


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## itsallwrong

'Simply lots of people jumped on the housing b wagon and lost and want out.'

And are happy to blame everyone but themselves and expect everyone else to bail them out. And it's not just PPR's. 
A big chunk of the troubled mortgage market are BTR's.

What about all the people who are not in trouble?
They get the bill for bailing out the reckless borrowers.


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## PiedPiper

*Time for a bit of humanity*



sebadoh said:


> Do you believe that people who either can't or wont pay for an asset should be allowed to retain that asset?


 
That totally depends on the definition of an asset.  Is a home an asset?  Is water an asset?

*assets* are economic resources ...... is my tiny apartment with its massive management fees really an asset not really but I need a home and I love it and its mine and I have put my heart and soul into it.

*So yes homes are not assets in my view.*

Homes are essential to life on the coldest weekend of the winter so far its horrible to sit on your couch in front of your fire thinking about all the people who should be thrown out on street.

If you want to give Brendan or some other punter a can of white paint and let him mark the doors of those he wants punished then off with you but Ireland won't be a better place.

Those who think they have something to gain by others misfortune or some moral hazard to punish are sorely mistaken.

There is no proof or statistics showing that some people are defaulting on purpose.  Its quite possibly made up by those who want the status quo to remain as it is.


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## newborn

The country is now divided by the people who are in negative equity and those that are not..........
People with equity in their homes often use the term 'reckless borrowing' and for some in negative equity that is possibly true, for others simply a case of unfortunate timing........
Either way the reality is some form of debt for equity swap is probably the kindest outcome anyone with an unsustainable mortgage can hope for.

However the idea that it is forgiveness by another name is somewhat unfair.........Once restructured in this way the bank effectively participates in ownership, yes there is no rent but against that they avoid crystalising the loss on the property and can write back the impairment provision they should have allocated against what was a non performing loan. They can  now also start taking to profit the interest earned on the newly performing (reduced) loan balance, as they ought not to have been taking interest on what was hitherto a non performing loan to their P and L.


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## Duke of Marmalade

_newborn_  I don't really know what McW means by debt for equity swap.

Let's say a punter has a mortgage of 300k on a property worth 200k.

Let's say bank takes 50% ownership, does it write down mortgage by 150K or 100K?  If the former, then that is 50K debt forgiveness.  If the latter then no debt forgiveness yet, but if the bank foregoes  rent for the next 20 years on its 100k share of the property that equates roughly to a gift of 50K (indeed it should be taxed as a gift).

It is negative equity which is making this debt crisis potentially much worse than in previous recessions.  Not because this time round there are more people who can't afford to keep up the payments but because of the strong temptation for strategic default, which was not present in times past.


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## newborn

Duke of Marmalade said:


> _newborn_ I don't really know what McW means by debt for equity swap.
> 
> Let's say a punter has a mortgage of 300k on a property worth 200k.
> 
> Let's say bank takes 50% ownership, does it write down mortgage by 150K or 100K? If the former, then that is 50K debt forgiveness. If the latter then no debt forgiveness yet, but if the bank foregoes rent for the next 20 years on its 100k share of the property that equates roughly to a gift of 50K (indeed it should be taxed as a gift).
> 
> It is negative equity which is making this debt crisis potentially much worse than in previous recessions. Not because this time round there are more people who can't afford to keep up the payments but because of the strong temptation for strategic default, which was not present in times past.


 
I would envisage it going to whatever leval was sustainable and the split of ownership reflecting this. i.e in your example if 100k was the only mortgage they could afford the Bank would own 66.66% and the borrower 33.33%. which is zero forgiveness now keeps people in their homes with some equity interest

Re your other point the absence of rent on the banks 66% is a drawback but the trade off is as I pointed out the writeback of a provision / non crystallisation of a loss and the fact interest will now be earned on the 100k that to date has not been income for the bank (or ought not to have been treated as such).


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## Duke of Marmalade

newborn said:


> I would envisage it going to whatever leval was sustainable and the split of ownership reflecting this. i.e in your example if 100k was the only mortgage they could afford the Bank would own 66.66% and the borrower 33.33%. which is zero forgiveness now keeps people in their homes with some equity interest


_newborn_ I think there is an element of forgiveness there. The bank has acquired an asset currently worth 133K (2/3rds of 200K) but has forgiven 200K of mortgage, that looks like a gift or forgiveness, call it what you will, of 67K. Now for the transaction of itself to have no forgiveness aspect would mean the bank owning the full property.


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## ontour

PiedPiper said:


> *So yes homes are not assets in my view.*
> 
> Homes are essential to life on the coldest weekend of the winter so far its horrible to sit on your couch in front of your fire thinking about all the people who should be thrown out on street.



You are confusing a home with ownership of property.  You do not need to own a property to have a healthy and happy home.  It is important for people to have a home but it is not essential to own property.

Ownership of something can create an asset or a liability.  For many people in trouble their property is a liability as it is incurring costs and they are unable to dispose of that property.

The world is not black and white.  Everyone in arrears should not have their property reposessed and everybody in a position of unrepayable debt should not be given that property because it is 'not their fault'.

One step should be for the banks to buy people out of tracker mortgages.  This would reduce the loan amount and may enable the person to get out of negative equity so that they have more options.  People may not be happy with what the banks offer and that is fine, they can keep their tracker rate.  This doesn't solve many of the circumstances but there is no single silver bullet to the mess.


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## newborn

Duke of Marmalade said:


> _newborn_ I think there is an element of forgiveness there. The bank has acquired an asset currently worth 133K (2/3rds of 200K) but has forgiven 200K of mortgage, that looks like a gift or forgiveness, call it what you will, of 67K. Now for the transaction of itself to have no forgiveness aspect would mean the bank owning the full property.


 
Yes on reflection you're correct in that there is an element of forgiveness there but by the same token you ignore the other positives for the Bank I outlined which make it a better option than enforcement and sale crystallising a loss............

Were it the case that the sustainable level is equal to or above the current value of the property less disposal costs then the argument that a Bank should restructure by way of debt / equity swap is even stronger.........

The really interesting part of the current debate is around what represents sustainability.......the prejudices of various bank policymakers and their own upbringing will determine what represents a 'realistic lifestyle'......


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## Duke of Marmalade

_newborn_ I just read Matthew Elderfield's speech where he talks about split mortgages. He explains one version of this as follows, taking our example.

Split the mortgage into the 100K that can be afforded and "warehouse" the other 200K which rolls up with interest. This seems interesting and has the potential in some cases to square the circle. The customer has not given up any ownership. She can afford to service the new mortgage and on the face of it the bank still has a fully performing loan.

Of course a lot depends on what happens to house prices but it is not unreasonable that over the next 20 years, house prices will rise significantly thus covering the rolled up warehouse mortgage and there is also a good possibility that the person will once again be able to service a mortgage similar to the original, after all she used to be able to afford it and at much higher interest rates,  in which case she can "buy back" the warehoused mortgage.

I presume Fiona Muldoon was lambasting the banks for not being more innovative like that rather than for not engaging in wholesale debt forgiveness.


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## newborn

Duke of Marmalade said:


> _newborn_ I just read Matthew Elderfield's speech where he talks about split mortgages. He explains one version of this as follows, taking our example.
> 
> Split the mortgage into the 100K that can be afforded and "warehouse" the other 200K which rolls up with interest. This seems interesting and has the potential in some cases to square the circle. The customer has not given up any ownership. She can afford to service the new mortgage and on the face of it the bank still has a fully performing loan.
> 
> Of course a lot depends on what happens to house prices but it is not unreasonable that over the next 20 years, house prices will rise significantly thus covering the rolled up warehouse mortgage and there is also a good possibility that the person will once again be able to service a mortgage similar to the original, after all she used to be able to afford it and at much higher interest rates, in which case she can "buy back" the warehoused mortgage.
> 
> I presume Fiona Muldoon was lambasting the banks for not being more innovative like that rather than for not engaging in wholesale debt forgiveness.


 
My sense is that none of the warehoused loan interest could be taken to profit  and in fact each amount of interest capitalised would hit the bank p and l as an additional impairment every quarter as the potential loss increases...........

To my mind that proposal compels a bank to impair each interest installment on the 200k over a long period which may or may not be written back and eliminates the bank having any possible long term upside through a share of the property...........


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## Delboy

PiedPiper said:


> ......There is no proof or statistics showing that some people are defaulting on purpose.  Its quite possibly made up by those who want the status quo to remain as it is.



Thats a very innocent comment you've made there. I can only assume you don't follow the news or read the papers too much. And that you speak with passion on this more from personal experiences, than common sense.
There are cases before the courts which show clearly that people, especially those with BTL's in NE, are pocketing the rent and have stopped paying mortgages. 
There's even a case study on 1 of the forums here where someone discusses this about their brother I think it is.

I listened to the LLS show last night and I saw BB up against it, 2 possibly 4 against 1. I can see some of DMcW's point about maybe the banks taking partial ownership of houses in trouble...and I can definitely see BB's point about people being adults and no 1 forced them to buy the houses in the first place.

If you bought a house that was way beyond your reach at the height of the boom, and perhaps still is even after the falls we've had, why should you be allowed to keep it. Why should those that sat out the madness or had the sense to buy smaller more affordable houses, now have to pay for this....and possibly have their chances of trading up seriously hindered by what in effect are 'bed blockers'. 
Sell the house for whatever it can achieve on the open market, reach an agreement with the bank on how much debt both parties will share following an open and transparent review of the case....and move to a home that is simply more affordable, or God forbid, rent!


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## PiedPiper

_There are cases before the courts which show clearly that people, especially those with BTL's in NE, are pocketing the rent and have stopped paying mortgages. 
There's even a case study on 1 of the forums here where someone discusses this about their brother I think it is._

What cases what statistics thats all hearsay and simply an assumption maybe its you who is a little innocent.  The person here was suggesting suspending payments and saving the cash to buy another house and balance it out which was an economic decision.

_why should you be allowed to keep it_

What are you do you really want to play god?  Get a grip how and I keep asking this how are all these homeless people going to make your life better or the economy better or society better, it won't.  A couple of thousand damanged kids will make society a much more dangerous and ugly place than it already is.

_Why should those that sat out the madness or had the sense to buy smaller more affordable houses, now have to pay for this...._
Hello you are paying for russian bond holders whose names you dont even know you are paying county managers more than the salary of Obama and Kenny combined, the dude running the FAI is getting more than a couple of european leaders together.  None of this bothers you, you are doing nothing about it but you want ordinary hardworking Irish people to be made homeless??  And you think I am a little soft and innocent come on now!!

Your asking me do I read the papers did you read that PTSB, Ulster Bank and so on are buying back their bonds, ie buying back the loans.  Why would they be doing that ask yourself some more difficult questions than is that fecker up the road got away lightly, and you might find the answers a lot more enlightling and less harmfull than running around with the paint can to thow out the unworthy.


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## Delboy

at Pied Piper....

sure, we'll just keep paying for everyone...line them up, who's next to get paid off. Eventually the whole thing will collapse and what then

You mention the case I referred to as being an 'economic decision'....there'll be lots of them

No one will be homeless, no need for the massive hysterics....if you can't afford a 2k mortgage in a NE house, then perhaps you can afford a 1.2k rental. Examine each case on its merits.
There's no shame in renting or perhaps even buying a smaller house, or God forbid moving into 1 of the BTL's a lot of those in trouble have in a less desirable location

But there simply cant be massive debt forgiveness, not while the asset is retained. No way


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## newborn

Delboy said:


> at Pied Piper....
> 
> sure, we'll just keep paying for everyone...line them up, who's next to get paid off. Eventually the whole thing will collapse and what then
> 
> You mention the case I referred to as being an 'economic decision'....there'll be lots of them
> 
> No one will be homeless, no need for the massive hysterics....if you can't afford a 2k mortgage in a NE house, then perhaps you can afford a 1.2k rental. Examine each case on its merits.
> There's no shame in renting or perhaps even buying a smaller house, or God forbid moving into 1 of the BTL's a lot of those in trouble have in a less desirable location
> 
> But there simply cant be massive debt forgiveness, not while the asset is retained. No way


 
I beg to differ, forced sale of PPRs should be a last resort..
.......none of what our Dear Leader or his acolytes propose recognises the economic virtues of or social cost of ignoring reasonable debt for equity swap arrangements.....constant reference to economic irresponsibility poses the question as to whether this forum simply pits one unfortunately timed house house buying generation against their predecessors.......


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## RMCF

Why do people continue to mention negative equity mortgages in this debate?

NE is only important if you plan to sell. If you can afford to pay the repayment on your mortgage every month then you should not be classed as a 'problem' mortgage just because your house is worth less than what you paid for it.

Trying to sort out this huge problem is about dealing with those who can't afford to pay their mortgage not those who are a bit peeved that they could be paying less.


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## ontour

RMCF said:


> NE is only important if you plan to sell.



NE is important if you can't afford your repayments and there is no sign of that situation changing.

 - No NE & afford repayments - No problem
 - NE & afford repayments - No problem ( mobility of workforce, suitable housing issue)
 - No NE & can't afford repayments - No problem (can sell)
 - NE & can't afford repayments - *problem*

It is not 'fair' but the situations the government need to resolve are those people that should sell rather than just those that want to sell or all people in NE.  From a government finances perspective the NE is the critical part if they can not force all the banks to take the hit.


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## PiedPiper

But Delboy that's exactly what we did with bond holders lined them up and paid them off!!


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## Importer

Much as i hate to admit it, Mc Williams is spot on (again)


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## Duke of Marmalade

Importer said:


> Much as i hate to admit it, Mc Williams is spot on (again)


_Importer_, what exactly did McWilliams say on the LLS? Very little about debt forgiveness, lot's about Granny's good room. What I think McWilliams is saying, but I am not sure, is that we should tell Merkel et. al. to stuff their loans, we can't pay, we are leaving your euro. I can understand why you hate to admit agreeing with that.

Whilst we are on leaving the euro, how about this from McWilliams in May 2009:





			
				McWilliams in Indo said:
			
		

> What can we do about this? The obvious answer is to leave the euro, reinstitute our own currency, allow it to plummet to reflect the real competitive position of our ruined, feeble economy and start again. The vast majority of economists and commentators say this is not possible. In fact, they ridicule those who suggest that this might be worth entertaining.
> Let me just remind you that the vast majority of economists and commentators believed the “soft landing” mantra. New ideas go through a cycle. First they and their proponents are ridiculed, then they are violently attacked and only then are they accepted as a universal truth. I suspect the same will happen to the idea of leaving the euro.


This is how McWilliams sees McWilliams, a latter day Copernicus who originally gets ridiculed, then gets violently attacked, until finally his genius is recognised as the universal truth. Well, three and half years later and "leaving the euro" is more ridiculed than ever by everyone. This period of ridicule must be unusually frustrating for our long suffering prophet.


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## Delboy

PiedPiper said:


> But Delboy that's exactly what we did with bond holders lined them up and paid them off!!



keep lining them up, the more the merrier....the money will keep falling from the sky.
Now I better  run out and buy a 1 or 2m euro house and pay the mortgage for the 1st few months or so, before reneging and putting my money away for more worthy bills. When this debt forgiveness comes along that you so want to see happen, I'll have myself a fine gaff at the expense of the compliant minority
happy days!


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## PiedPiper

*With all the peace and love in the universe*

Now Delboy, can I just tell you one last time with all the love in the universe.  Homeless people will not help you.  If its not love forgiveness and joy you are spreading then it may turn out to be m____re!!

Do you really want the can of white paint, do you really want to spread hate into the society that you live.

The high moral ground and begruddgery will not solve this crisis.

I hear your anger and feel your pain but wishing random strangers perish due to bad banks is not the way forward.

If you can't move on your thinking you can't move on.

With love and peace to all men.  PiedPiper


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## monagt

> This is how McWilliams sees McWilliams, a latter day Copernicus who originally gets ridiculed, then gets violently attacked, until finally his genius is recognised as the universal truth. Well, three and half years later and "leaving the euro" is more ridiculed than ever by everyone. This period of ridicule must be unusually frustrating for our long suffering prophet.



Its not a question of being right ALL the time but being right MORE OFTEN that the rest of of "knowledgeable" commentators.

He called the bust!



> After all, you only find out who is swimming naked when the tide goes out


 Warren Buffett.

If I had listened to DMcW from the start I would be a richer man today.


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## Delboy

PiedPiper said:


> _There are cases before the courts which show clearly that people, especially those with BTL's in NE, are pocketing the rent and have stopped paying mortgages.
> There's even a case study on 1 of the forums here where someone discusses this about their brother I think it is._
> 
> What cases what statistics thats all hearsay and simply an assumption maybe its you who is a little innocent.  The person here was suggesting suspending payments and saving the cash to buy another house and balance it out which was an economic decision.
> 
> _why should you be allowed to keep it_
> 
> What are you do you really want to play god?  Get a grip how and I keep asking this how are all these homeless people going to make your life better or the economy better or society better, it won't.  A couple of thousand damanged kids will make society a much more dangerous and ugly place than it already is.
> 
> _Why should those that sat out the madness or had the sense to buy smaller more affordable houses, now have to pay for this...._
> Hello you are paying for russian bond holders whose names you dont even know you are paying county managers more than the salary of Obama and Kenny combined, the dude running the FAI is getting more than a couple of european leaders together.  None of this bothers you, you are doing nothing about it but you want ordinary hardworking Irish people to be made homeless??  And you think I am a little soft and innocent come on now!!
> 
> Your asking me do I read the papers did you read that PTSB, Ulster Bank and so on are buying back their bonds, ie buying back the loans.  Why would they be doing that ask yourself some more difficult questions than is that fecker up the road got away lightly, and you might find the answers a lot more enlightling and less harmfull than running around with the paint can to thow out the unworthy.



You refuse to believe that any cases exist where people refuse to pay their mortgage or are acting irrationaly in their dealings with arrears.
And seeing as you wont answer my question on another thread as to whether you were part of the Anti Eviction group who protested in Dundalk (after saying you are a member of some such group), here's a little article for you to read about the man in that case
[broken link removed]
"As arrears grew, Mr Dooley rented the property out to tenants but still failed to make the monthly repayments, PTSB said."

Your either a troll, a very indebted person as the result of a bad house(s) purchase, or a very innocent poster.
I don't think it possible to have a rationale, adult discussion on you with this and your childish replies confirm that.
So I bow out of any further replies to you


----------



## Duke of Marmalade

monagt said:


> Its not a question of being right ALL the time but being right MORE OFTEN that the rest of of "knowledgeable" commentators.
> 
> He called the bust!
> 
> If I had listened to DMcW from the start I would be a richer man today.


He called the bust in 1998 almost a decade too early. If you rented then as he advised you would be worse off today. A stopped clock is right twice a day, McWilliams was right in 2003.

He was off the wall when he advised that we should insure Anglo's deposits ("international insurers would bite our hands off for such a large amount of business") and then we should default and collect the insurance money.

He was under the influence of garlic when he called the blanket guarantee a "masterstroke".

He was having a deposit selling moment when he said the IBRC should walk away from its ELA. Goddammit the ELA is owned by our central bank, we was recommending defaulting on ourselves

I could go on. Seems to me he was right once - even that stopped clock scores twice.

He is wrong now about defaulting on our obligations, about mass debt forgiveness to stimulate the economy and that those on Tracker mortgages will be the next catastrophe.


----------



## Wishes

I am no fan of McWilliams's pop culture economics and I have yet to see Friday's LL Show so will comment further when I do.

I was listening to the MF show this morning and it seems, from what one of the panel were saying, is that we are looking at total callapse in 3 years time. 

Call me negative but the folks that are on their high horse seem convinced that they are immune from the after-effects of 100,000 people potentially losing their home.

1) Where will they be housed? 
2) Potential Social Unrest?
3) House prices plummeting further?

The list goes on.


----------



## Delboy

that '1' was Malachy Steenson of the Workers party...nuff said


----------



## ontour

Wishes said:


> 1) Where will they be housed?



No one is saying that we should demolish houses or apartments if people can not afford their mortgage.  The housing stock still exists.  They may end up renting their current house or somewhere else.  The goal is to release people from debt that they will never be able to pay.  I am at a complete loss as to why this is being perceived as cruel, begrudgery or unfair.



Wishes said:


> 2) Potential Social Unrest?


When would there be general social unrest if people with totally insustainable debt are given a way out.  It is more likely that there would be social unrest if the state pardoned debts but left individuals with the assets.



Wishes said:


> 3) House prices plummeting further?


Artificial house prices and interference is part of the reason we got into this mess.  The market is in limbo, more transactions is good for the economy so let's stop interfering with supply by not enabling sales.

It would appear that those that did not go 'all in' on the property market are willing to accept that there will be a cost to them to assist their fellow country people who are in desperate financial circumstances.  It would appear from this thread that many believe that those who took the gamble, and lost, should not also accept that there will be a cost.


----------



## Beatthebanks

I think David McWilliams did an excellant job on the Late Late. When will the powers that be realise that there are a percentage of mortgages that will NEVER be repaid. People who are not in trouble dont want to pick up the tab for those that cant pay but whether they like it or not they will have to pay someday. The people with impossible mortgages will be made bankrupt, the bank will have to write off the full loan and the bank will go back to the taxpayer for more money anyway.


----------



## Calico

I just watched it and didn't think Brendan did too badly. Ryan Tubridy was a bit biased and patronising but then he always is. David McWilliams made good points but I'm not sure what his answer to austerity is. For distressed mortgages the answer probably lies somewhere between the two points of view. There are some people out there who may have a legitimate case for some kind of debt forgiveness, or forbearance, but there can't be a policy of it.


----------



## Beatthebanks

Sooner rather than later the banks are going to have to deal with the mortgage arrears and make a decision about each customer. Unless there is some sort of policy its going to be difficult to achieve a level of fairness. If its left to individual banks or bankers some people will get great deals and others will suffer badly


----------



## monagt

All hail David McWilliams.........


> This week, Mr Celente will be in Dublin giving a talk in the Gibson Hotel and ahead of his visit he shared some interesting thoughts on what lies ahead in 2013 and beyond.
> 
> "Ireland is heading the same way as the rest of Europe -- down. Why would it get any better when you are imposing austerity, cutting pensions, raising taxes and making people work till they are dead? Ireland had its option to walk away from the EU -- but didn't. The people voted in the austerity coalition government -- are they into sadomasochism? Sadly people often get what they deserve."


Irish Independent......29-10-12


----------



## Complainer

Daddy said:


> Debt for equity is a good idea and would help all families in trouble by halving the debt and halving the responsibility and both the lender and borrower take a hit they will probably be able to manage.  David was right 9 years ago and families are in big trouble and this idea while not David's only would be a start and give hope to people.


I don't understand the '9 years ago' reference. Ironically, 9 years ago (and indeed up to about 18 months ago), Hall was big supporter of Brian Lenihan in Dublin West - the man who walked us into this mess in 2008 by signing up for the unlimited bank guarantee. It's a pity that Hall didn't use his influence to avoid the problem arising in the first place, instead of waiting till the problem exploded and expecting others to pay to clean up the mess.


----------



## Duke of Marmalade

Beatthebanks said:


> I think David McWilliams did an excellant job on the Late Late.


He did a good job at promoting his book _The Good Room _but as Tubridy noted had very little specific to say about debt forgiveness.


----------



## Duke of Marmalade

monagt said:


> All hail David McWilliams.........
> Irish Independent......29-10-12


 
_Monagt_ yes David (come back all is forfgiven) is a tonic compared to this guy.  According to this doomsayer it really doesn't matter about our petty problems we are heading straight into WWIII and pretty soon at that.

Why do the media lap up the doomsayers so much?  There does seem to be a streak of sado-machism in the tabloid readership that likes to live through disaster movies.


----------



## Brendan Burgess

Complainer said:


> I don't understand the '9 years ago' reference. Ironically, 9 years ago (and indeed up to about 18 months ago), Hall was big supporter of Brian Lenihan in Dublin West - the man who walked us into this mess in 2008 by signing up for the unlimited bank guarantee. It's a pity that Hall didn't use his influence to avoid the problem arising in the first place, instead of waiting till the problem exploded and expecting others to pay to clean up the mess.



Hi Complainer

The reference is to DAvid McWilliams and not David Hall, both of whom were on the show. The show started with a clip of McWilliams from 2003 saying that house prices were a scam.


----------



## PiedPiper

About the eviction in Dundalk.  Yes that's the protest I was at.  The sheriff was Mairead Ahern sister in law of Dermot Ahern former minister for justice.  I doubt very much there was any funny business around her appointment.  We went out to her house in Blackrock stunning palatial spread overlooking the sea.  In contrast Eugene was dragged out of a quite small apartment in the town.  

The lender has been bailed out and therefore been paid.  The door was smashed in and the guy was physically assaulted and dragged out.  What your missing here is at no point did he refuse to pay.  You still believe in the idea that the bank should be paid more than once.

I don't there is nothing childish or wrong with that you want to punish people and see more evictions and I want love peace and goodwill to all men.

The idea that there will be social unrest one way or the other is kind of pointless, compared to Greece Spain or London we are not moving.

I think the social cost will be much more suttle.  Sucide, cancer that kind of thing.  The idea that debt write downs would bring the begrudgers on the street is laughable.  Food poverty isn't bringing people out!!


----------



## Wishes

I agree PiedPier.  

I believe there are very few in a comfortable position and the few that are stilling on top wont get up off their cozy chairs to protest so I think we can all rest assure there.

What do you mean, when you say Eugene did not refuse to pay?  What was he paying?


----------



## monagt

This is a Prime Time appearance by DMcW to remind people of his position, 4 years before the bubble burst - RTE Prime Time -16 October 2003

http://www.youtube.com/watch?v=cxtkjZFfuZI

Watch DMcW and judge for yourselves. 

No connection and don't really like him............


----------



## PiedPiper

http://www.thesun.co.uk/sol/homepag...iffs-came-and-threw-me-out-on-the-street.html

Thank god someone agrees with me!! 

What is he paying, what is anyone paying, maybe the penny dropped with him even if he starved even if he bent till he broke the outcome would be the same and the system isnt working, it's time for change.

https://www.youtube.com/watch?v=mNxRwaF6iyo

With love and respect Mugga would you not be way better off being less concerned with what others have and more concerned about sucide rates, and the damage this horrible mess is going to do to the future generations of Irish people. Look around you its like the end of the world shops closing, business closing. I was in a house the other day and we had such a laugh that they were Dunnes Biscuits and not Lidl!!

I would say you could count on one hand the number of Irish families in trouble with their mortgages with bank account abroad, I don’t know of any families facing eviction with properties abroad.  Of course it is possible but if they are in any of the usual locations like Spain or Bulgaria chances are they are worthless and a problem too.

Don't be buying into the old spin it’s destructive there must be a positive way forward based on kindness and fairness.

If we are going to move on and move past this and build a Sovereign Ireland to be proud of its my view that the best place to start is not with 20,000 homeless families.


----------



## Complainer

Brendan Burgess said:


> Hi Complainer
> 
> The reference is to DAvid McWilliams and not David Hall, both of whom were on the show. The show started with a clip of McWilliams from 2003 saying that house prices were a scam.



Thanks for the clarification, I get it now.


----------



## Beatthebanks

I agree with you PiedPiper.
I really do wonder what it will take to get Irish people out on the streets to protest at what these incompetent politicians are doing to our country.
Its time we stopped being selfish and we start to support each other. Lets work together to get debt write down for all - by refusing to pay back the Germans and other foreign banks. How poor do we have to get before we stand up to these guys.
Our top four politicians, who are supposed to be fighting our cause, are three schoolteachers and a trade unionist !! They may be good teachers but I would not hire a teacher to run a large corporation like Ireland. You get people qualified to do the job. These guys haven't a clue and are advised by people under them who have never been in business. What hope have we with such a bunch of incompetents. We have no choice as a people to protest and get our message across.
It is said we are all "drummed down" and too lazy to get out and work at this. Everybody stays stuck indoors glued to either Sky sports or all these mindless reality TV shows. Simon Cowell has a lot to answer for!
What do others think?


----------



## ontour

Beatthebanks said:


> Its time we stopped being selfish and we start to support each other.



Who is being selfish?



Beatthebanks said:


> Lets work together to get debt write down for all - by refusing to pay back the Germans and other foreign banks.



What money are you suggesting we refuse to repay, the EU bailout?  Are you suggesting that this can be done and we stay in the Eurozone/ EU?

Why should there be a debt write down for all?  It is like saying that everyone who plays the lotto this week should win the jackpot, it would be great but it is pure dream land.

If you look at the losses that NIB announced, much of it is dues to commercial loans, I would guess that the situation is similar in the state supported institutions.  The money pumped in to the banks has not paid off everyone's mortgage, the banks are still dependent on the majority of mortgage holders paying their debt for the banks to survive.


----------



## shigllgetcha

Beatthebanks said:


> Lets work together to get debt write down for all - by refusing to pay back the Germans and other foreign banks.


 
Why should everyone get a write down? Plenty of people borrowed responsibily and plenty of people are only in temporary problems that will correct themselves when the economy gets back on its feet that would be better helped with a holiday from their mortgage or an extended interest only period.

Also what are you suggesting we dont pay back? Bank bonds or government bonds. Ill agree anglo shouldnt have been paid back but to suggest not paying back bonds on banks that are trying to keep operating wont work.

You think when we stop paying bank bonds, our banks close because they cant fund themselves and our mortgages become property of german banks well be treated better? 

A hair cut maybe but all out not paying wont end well



Beatthebanks said:


> Our top four politicians, who are supposed to be fighting our cause, are three schoolteachers and a trade unionist !! They may be good teachers but I would not hire a teacher to run a large corporation like Ireland. You get people qualified to do the job.


 
We voted them in. Thats kinda how it works

What a soapbox rant


----------



## Delboy

there's a lot of newbie posters (and 1 or 2 not so newbie) on this site all of a sudden talking absolute rubbish. Real childish arguments adding nothing to the debate and only wasting space on threads.
If I did'nt know any better, I'd say some of those gobdaw AntiEviction groups around the country have joined the site following some recent TV appearances by Brendan


----------



## truthseeker

Wow - what a patronising and offensive post! Are only some people entitled to an opinion?


----------



## mark12

Why are there so many uninformed people posting uninformed comments?

These are the facts:

We do not have to pay for mortgage defaulters in foreign owned banks, ie Ulster Bank, NIB, and Bank of Ireland, these are not owned by the taxpayer and never will be.

As to our own future bank losses in AIB, TSB, the ESM will provide all the extra capital, not the taxpayer.

Please stop making uninformed statements like ''why should i pay for my neighbour's mortgage? '' because it's not true, you won't.


----------



## Delboy

truthseeker said:


> Wow - what a patronising and offensive post! Are only some people entitled to an opinion?



everyone is entitled to an opinion of course. But it's undeniable that a lot of new posters seem to have appeared recently, all pushing an agenda, and coming out with some ridiculously childish arguments to back up their points.... trolling IMO


----------



## orka

mark12 said:


> Why are there so many uninformed people posting uninformed comments?
> 
> These are the facts:.....


Those are your version/interpretation - that doesn't make them 'the facts'.  The discussion of your facts should probably stay in the special thread created for them http://www.askaboutmoney.com/showthread.php?t=173959 rather than forcing the discussion in 2 threads (at least until you get anyone/everyone to agree that your facts are THE facts)


----------



## mark12

Orka, so you want to keep talking about paying for defaulters in Ulster Bank, BOI, NIB... Ok fine, let me know when your bill arrives in the post.

I thought this was a proper forum.


----------



## orka

truthseeker said:


> Wow - what a patronising and offensive post! Are only some people entitled to an opinion?


 


Delboy said:


> everyone is entitled to an opinion of course. But it's undeniable that a lot of new posters seem to have appeared recently, all pushing an agenda, and coming out with some ridiculously childish arguments to back up their points.... trolling IMO


I agree with delboy.  And I've seen this on other threads too - people arguing forcefully and repeatedly, sounding almost intelligent but with no substance or back-up - and that might lead less informed readers to believe what is being said.  Of course everyone is entitled to an opinion but it does drag the standard of the discussion down if the opinion is an unsupported rant that is repeated over and over.  For example above - don't repay the Germans - okay - that's an opinion but what does it mean and what will be the impact? Yeah - don't pay the Germans, forgive the mortgages, ... - great opinions if there's a practical idea behind them but what does it add to the discussion?


----------



## colc

I have to say I thought Brendan was to be applauded for his honesty regardless of anything...  In fairness the truth is a lot of people took out mortgages way beyond their means in recent years..  Also those of us who were frugal and maybe extra cautious will effectively end up paying for others mistakes which is just as unfair maybe the banks taking equity in peoples homes as suggested would make sense you'd have to make sure it was done in a positive way though...

Whatever the numbers now theres gonna be a hell of a lot more in arrears in future in my opinion and we have to make sure to avoid another bubble at all costs...


----------



## orka

mark12 said:


> Orka, so you want to keep talking about paying for defaulters in Ulster Bank, BOI, NIB... Ok fine, let me know when your bill arrives in the post.
> 
> I thought this was a proper forum.


I don't talk about paying for defaulters.  I can see some merit in your view about the state owned banks.  I object to any form of debt forgiveness that allows the borrower to retain full ownership of the asset because of the unfairness of selectively enriching some people (both the can't pays who in hindsight cannot afford the asset and the inevitable won't pays who will slip through whatever forgiveness criteria are set) and not others.


----------



## colc

mark12 said:


> Why are there so many uninformed people posting uninformed comments?
> 
> These are the facts:
> 
> We do not have to pay for mortgage defaulters in foreign owned banks, ie Ulster Bank, NIB, and Bank of Ireland, these are not owned by the taxpayer and never will be.
> 
> As to our own future bank losses in AIB, TSB, the ESM will provide all the extra capital, not the taxpayer.
> 
> Please stop making uninformed statements like ''why should i pay for my neighbour's mortgage? '' because it's not true, you won't.


 
Where exactly does the ESM's monet come from though...I'm not being smart now I just dont know much about the ESM?


----------



## colc

Delboy said:


> there's a lot of newbie posters (and 1 or 2 not so newbie) on this site all of a sudden talking absolute rubbish. Real childish arguments adding nothing to the debate and only wasting space on threads.
> If I did'nt know any better, I'd say some of those gobdaw AntiEviction groups around the country have joined the site following some recent TV appearances by Brendan


 
Btw I'd have to agree about some of these anti eviction groups a lot of what they say doesnt add up...  Some of it dishonest though I appreciate some of the people they're choosing to represent have real problems...


----------



## mark12

I agree Orka, i'm also against debt forgiveness, because it is almost impossible to distinguish between a can't/won't pay.

My point was, let's just be honest about the cases where there is real bill for the taxpayer, otherwise we are just wasting our time.

For example, I don't care at all when the bank in question is foreign owned, same as any comercial deal between 2 parties, or in cases where the loss to the state owned bank materialises after january 2013.


----------



## ajapale

Delboy said:


> there's a lot of newbie posters (and 1 or 2 not so newbie) on this site all of a sudden talking absolute rubbish. Real childish arguments adding nothing to the debate and only wasting space on threads.
> If I did'nt know any better, I'd say some of those gobdaw AntiEviction groups around the country have joined the site following some recent TV appearances by Brendan





truthseeker said:


> Wow - what a patronising and offensive post! Are only some people entitled to an opinion?



Please stay on topic and use the report post facility to bring things like this to the attention of the mods.

Thanks
aj mod


----------



## dam099

What about making all the residential mortgages non-recourse? It should be doable for the state owned banks. It may be more problematic with the foreign owned ones and BOI but no more so than forcing debt forgiveness of other kinds on them.

That way people in a hopeless situation can walk away but with the consequence that there is no windfall in getting to keep the property. Maybe combine it with a rent back scheme that allows them to stay in the property for a number of years until they can find a suitable alternative rental elsewhere.

People in negative equity but who can afford their repayments have a choice, walk away and start anew albeit with their credit history compromised for a number of years or decide they want to keep the property and thus keep paying. (BTW I think the compromised credit history is probably necessary fir a few years or the won't pays might be tempted to hand back the keys and then just buy a similar house nearby but now without the negative equity).

This should help sort out the “can’t pay” from the “won’t pay” mortgage holders as there is now a consequence for those who simply won’t pay because they think they will get a magic do-over.

Irish people (myself included) want to own their own house but owning one is not some fundamental human right (I would agree having a roof over your head is but everyone owning is not the only way society can achieve this). Lots of people (perhaps a minority in Ireland but the majority in many other countries including our overlords in Europe) don’t own their own house either because they could never afford one in the first place or they made a choice not to buy but to rent instead.


----------



## Gardener

If we can send aid to Uganda, surely we can afford to help our own citizens who are momentarily distressed.

I am NOT an advocate of debt write off but I am an advocate of keeping people in their homes.  By releasing them from their obligations the state will be left with a major deficit as most property purchased in the last ten years are in negative equity.  

By the banks collecting "rental" each month from the debtors they are at least receiving interest or a percentage of, whilst still holding the "asset".

If the banks start selling property now they may well be throwing the bath water out with the baby.  Let's not make drastic decisions, lets give people a time frame to recover, and hopefully for the economy to pick up again.  If we don't wait we most certainly are looking at bailing the zombie banks out again.


----------



## newborn

dam099 said:


> What about making all the residential mortgages non-recourse? It should be doable for the state owned banks. It may be more problematic with the foreign owned ones and BOI but no more so than forcing debt forgiveness of other kinds on them.
> 
> That way people in a hopeless situation can walk away but with the consequence that there is no windfall in getting to keep the property. Maybe combine it with a rent back scheme that allows them to stay in the property for a number of years until they can find a suitable alternative rental elsewhere.
> 
> People in negative equity but who can afford their repayments have a choice, walk away and start anew albeit with their credit history compromised for a number of years or decide they want to keep the property and thus keep paying. (BTW I think the compromised credit history is probably necessary fir a few years or the won't pays might be tempted to hand back the keys and then just buy a similar house nearby but now without the negative equity).
> 
> This should help sort out the “can’t pay” from the “won’t pay” mortgage holders as there is now a consequence for those who simply won’t pay because they think they will get a magic do-over.
> 
> Irish people (myself included) want to own their own house but owning one is not some fundamental human right (I would agree having a roof over your head is but everyone owning is not the only way society can achieve this). Lots of people (perhaps a minority in Ireland but the majority in many other countries including our overlords in Europe) don’t own their own house either because they could never afford one in the first place or they made a choice not to buy but to rent instead.


 
Very interesting post. Never happen for homeloans but may indeed prevail for commercial lending in the future. 

PGs are generally no good when you need them and cloud the whole initial credit process.


----------



## Duke of Marmalade

mark12 said:


> We do not have to pay for mortgage defaulters in foreign owned banks, ie Ulster Bank, NIB, and Bank of Ireland, these are not owned by the taxpayer and never will be.
> 
> As to our own future bank losses in AIB, TSB, the ESM will provide all the extra capital, not the taxpayer.


Your first point here is correct and puts the kibosh on any sort of wholesale debt forgiveness scheme, unless the state directly pays down the 54% of mortgages that the taxpayer does not own.

You keep banging on about that second point which seems to me to be totally wrong. When in 2014 the ECB supervision regime is in place and a state owned bank needs capital, this is what will happen.

The bank's balance sheet will be considered on a realistic basis allowing for future expected defaults and of course any past debt forgiveness. If the bank is underwater on this realistic basis the hole will need to be filled by the national government. Only then will the ESM recapitalise that bank. 

If the realistic position is above water but still needs stress capital the ESM will buy the bank off the state for its net asset value and then subscribe the necessary capital.

Make no mistake. There will be no filling of legacy holes by the ESM. Any debt forgiveness scheme undertaken prior to the new regime will fall directly to the taxpayers one way or another.


----------



## mark12

Ok, so maybe the banks are being smarter than i thought, they know that the taxpayers are broke and won't inject any more money in the banks.

So they are keeping people on interest only and reduced payments so that the actual losses only cristalise after 2014 when the ESM quicks in, could i be correct?


----------



## Duke of Marmalade

Maybe, but the Germans weren't born yesterday.  Before they get involved in any bank recap they will want a thorough transparent assessment of the bank's balance sheet.


----------



## ontour

Duke of Marmalade said:


> Maybe, but the Germans weren't born yesterday........



Approximately 1,800 were born yesterday


----------



## PiedPiper

[broken link removed]

Two sides interesting


----------



## Duke of Marmalade

ontour said:


> approximately 1,800 were born yesterday :d


:d


----------



## PiedPiper

That's not quite fair, I think this is a great forum, I rarely agree with a word you say, but you have every right to say it.  I don't agree with a word Brendan says but I am educating myself and preparing my defense and if you want to know how a ruthless banker thinks this is a great source of insight.  The first line of defense is to know your enemy.   Having said that I am a girl and I do get emotional at the news of people losing their homes and businesses.  I was in the back of the high court watching an old man shaking with fear trying to defend his home and I did cry on the bus home.  This is a human crisis.


----------



## ontour

Piedpiper, 
Would you limit state support to those in trouble with their family home or would you extend the state intevention to people with investment apartments, commercial property or foreign property?


----------



## itsallwrong

Existing support and structuring options are limited to the persons family home.  Any further flavours of help should be the same.


----------



## Brendan Burgess

PiedPiper said:


> [broken link removed]
> 
> Two sides interesting



Hi Piper

Check out this thread for a bit of context

What Brendan Burgess has actually said about property, prices and borrowing


----------



## PiedPiper

Great comeback, well done and yes its all about context, always good to know whats out there and to respond.

If very hard to have perspective on any situation when you are in the thick of it and this forum is a brillant resource.


----------



## Wishes

Either McWilliams or Hall mentioned an equity swap with the bank.  Pay half the mortgage over, lets say 15 years.  I've already exhausted this approach and got a firm no.


----------



## Brendan Burgess

Wishes said:


> Either McWilliams or Hall mentioned an equity swap with the bank.  Pay half the mortgage over, lets say 15 years.  I've already exhausted this approach and got a firm no.



McWilliams mentioned it. For the audience, it sounds like a really nice idea. It has the ring of  some clever financial engineering trick that solves everyone's problems.  

It's another of the really simplistic solutions. All they have to do is a few numbers to see that it is nonsense. 

A guide to "debt for equity" mortgages


----------



## Renter7

I'm just watching this episode of late late show now. Whatever you think of Brendan's views, it is very clear that Tubridty was biased towards McWilliams. He completely cut him off on guarantee issue at start and never stopped interrupting him.


----------



## Gardener

Renter7 said:


> I'm just watching this episode of late late show now. Whatever you think of Brendan's views, it is very clear that Tubridty was biased towards McWilliams. He completely cut him off on guarantee issue at start and never stopped interrupting him.



Yes, I was disappointed McWilliams wasn't grilled more on the bank guarantee.


----------



## Delboy

Gardener said:


> Yes, I was disappointed McWilliams wasn't grilled more on the bank guarantee.



I don't think it was the correct forum to bring up the Guarantee. It brought the debate off topic.
And it also looked like Brendan was trying to blacken McWilliams with his very 1st contribution...and I'd say that turned a lot off people against Brendan straight away


----------



## Brendan Burgess

Delboy said:


> I don't think it was the correct forum to bring up the Guarantee. It brought the debate off topic.
> And it also looked like Brendan was trying to blacken McWilliams with his very 1st contribution...and I'd say that turned a lot off people against Brendan straight away



Hi Delboy

Goo point. 

What I was trying, but failed to do, was to show that Mc Williams is a great guy for big ideas. He just doesn't think them through. He sees no downsides. Many people listening to him on Friday would have thought "This idea sounds good" just like Brian Lenihan thought. 

If I could rewind, I would have left out the bit about not thinking much of him as an economist. he is primarily a story teller and an entertainer. That is not a basis for analyis and economic policy formation.


----------



## Gardener

Brendan, I think you are being too modest/polite.

Tubridy lead a disasterious MC.  He failed to push McWilliams for answers to back up his comedy sketch analysis.  There is no room for this caper in dire times like this.


----------



## zen

I've been on this forum for a long time. I've both learned a lot and over times have become extremly vexed by some peoples response and sometimes wonder if some of the frequent posters are in fact moderators in the same room. This is one such thread

I want to add my two cents here, I absolutely curl up with anger when I hear that lending instutions are "doing everything they can to help mortgage holders", No they are absolutely not, they are helping the borrowers to help themselves in paying back the loan. Thats not helping!! Any lenders reading this, you wanna help? Take some of the risk and write of some of your rightful share of debt that is equally yours, after all we bailed all you lot out. Period

David McWilliams said hundreds of thosands putting the humain side on the statistics, some just see, ah, 66,000 homes, but how many people??!!

Lenders are getting the money back under the pathetic guise of "helping the borrower" by restructuring the loan, which is just ultimately extending the terms on the loans (and getting a bigger return) that they themselves have shrewedly surgically removed themselves of *ANY* risk. .

Also Brendan I have become suprised by your arguments throughout the forum and seen it in action on TV. Your old matra is always the same, "you borrowed the money, you pay back the loan", While I agree in pricinple, you talk as if there is a finite amount of money with an equal amount of debt in society. If everyone paid every penny back in the world you would imagine there would be no debt, right? Wrong, there would be (is) a massive cloud of debt left as there is not enough money to pay back the monies owed. And why is that, because as you and everyone now knows, it doesn't exist its as simple as that and thats what it all boils down to, you cannot get blood from a stone. Its like a mafia version of the game monopoly.


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## Gardener

Correct me if I'm wrong but isn't Brendan pro people having the choice to return their unsustainable mortgages and revoking the remainder of the debt (negative equity).  This couldn't be more fair.

What's getting up peoples goat is - they want to keep the asset.  Why should you be allowed keep the asset, not pay for it and throw aside your origional contract?


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## Wishes

zen said:


> I want to add my two cents here, I absolutely curl up with anger when I hear that lending instutions are "doing everything they can to help mortgage holders", No they are absolutely not, they are helping the borrowers to help themselves in paying back the loan. Thats not helping!! Any lenders reading this, you wanna help? Take some of the risk and write of some of your rightful share of debt that is equally yours, after all we bailed all you lot out. Period



I couldn't agree more.

For the people on this forum that don't believe there should be a part write off of debt, why don't you ask for a return of your TAX that the banks have engulfed.  There has been very few repossessions, that we are being told, so why not return the bailout.  Very little money from the bailout has actually been used to go towards distress property losses anyway.

I feel sorry for people who are indebted to the foreign banks.  They currently hold the supreme attitude of not being bailed out so feel they can treat people as they please.


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## Bronte

I watched this show. Brendan you did not come across at all well. Immediately after McWilliams made his presentation for some reason you launched into an attack on him. You immediately looked bad by doing this. The format of this show for this debate I don't understand. It wasn't actually a debate, no idea what it was really meant to achieve. McWilliams is very good on TV, he has either prepared himself very well or has had professional coching. You were much better on the Frontline programme some time back. 

Not sure what is the issue between you and McWilliams. But if your figures are better than his then you need to demonstrate this. I actually cannot remember what McWilliams point was, something about debt for equity swop, but it sounded plausable and good. On a once of viewing of a Friday night of a chat show - that would be my take on it. 

And if I didn't misunderstand David Hall wants all people in NE to have their debts written off ?


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## Brendan Burgess

Hi Bronte

I tried to do too much and got it wrong. McWilliams was being portrayed as some sort of visionary. He is nothing of the sort. He was largely responsible for the bank guarantee and I wanted to highlight that. I didn't get a chance to develop it. 



> I actually cannot remember what McWilliams point was, something about debt for equity swop, but it sounded plausable and good.



This is what he said


> [FONT=&quot]We should bring in a debt for equity swap which was done in America during the Great Depression.  The bank will own half your house and then in 15 years’ time when you sell your house the bank will get first call on the half of it, [/FONT]




You are dead right. It "sounds plausible and good". But it's absolute nonsense as I have demonstrated in this post: A guide to "debt for equity" mortgages 

By the way, I can find no mention of debt for equity swaps during the Great Depression.  I have emailed McWilliams asking him for a reference.


> Not sure what is the issue between you and McWilliams



My issue is the same as my issue with any economist or commentator who sees a simple solution to a complex problem especially, where there is no simple solution. 

This thread discusses the numbers in the programme

McWilliams claimed that the greatest crisis facing the country is the hundreds of thousands of people who are facing arrears.  He later said that there were 128,000 people in arrears over 120 days.  There are 66,000 homes with mortgages in excess of 90 says arrears as of 30 June.


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## 44brendan

Bronte I agree with your summation on Brendan's performance. Unfortunately it did come across as an attack on the credibility of David McWilliams, rather than a debate on the substance of his arguements. The debt for equity debate will continue. 
In effect, our banks are already in a situation, where (due to the constraints of MARP) they are currently effective owners of many of their Home Loan & BTL portfolios. 
I fully appreciate the arguments of David Hall who would like to support a substantial level of debt forgiveness for those in negative equity. However, neither he nor other proponents of such a policy have offered any detail on how such a scheme could be practically implemented or financed.
The foreign and non-state owned banks cannot be forced to write-off debt without being adequately compensated. Further write offs by State owned banks would involve substantial additional losses for those banks. These losses would then need to be subsidised by the State. (i.e. the taxpayers). A lot of commentators on this forum have identified the fact that the State owned banks have already been "bailed out" and in return for that bail out should be prepared to take the hit on mortgages in negative equity. However, the proceeds of past bailout funding were fully utilised in supporting historical losses. New losses will require new funding. So effectively, those supporting negative equity write offs are supporting a taxpayer (not banks) funding of these write offs. 
The difficulty with the proposals by David Hall and to a certain extent David McWilliams is that they are presented as sound bites rather than fully fleshed out proposals. If these people have fully fleshed out the costings and financing of their proposals we should be given the opportunity to examine them in detail. To be fair to BB, he has backed up all his arguements with detail and illustration. If we don't agree with them we have ample opportunity to look for weaknesses in the figures presented.


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## Firefly

Brendan Burgess said:


> .cWilliams was being portrayed as some sort of visionary. He is nothing of the sort. He was largely responsible for the bank guarantee and I wanted to highlight that. I didn't get a chance to develop it.


 
Hi Brendan,

I'm not sure developing the point re: the bank guarantee would have been useful. Instead (and it's always easier from the side-lines ) I think it would have been a lot more effective to have simply asked D McW:

1. "Who would be financing these debt-writedowns?" 
2. "How would moral hazard be prevented?"


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## Gardener

Firefly said:


> 1. "Who would be financing these debt-writedowns?"



This is a key question and one I have yet to see McWilliams being asked.


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## elcato

His answer will be  "Thr Bonks of course", cue cheesy grin and audience clapping enthusiastically. Then "So folks it's time for a break" from Tubridy.


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## Delboy

elcato said:


> His answer will be  "Thr Bonks of course", cue cheesy grin and audience clapping enthusiastically. Then "So folks it's time for a break" from Tubridy.



so true


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## Wishes

Firefly said:


> Hi Brendan,
> 
> I'm not sure developing the point re: the bank guarantee would have been useful. Instead (and it's always easier from the side-lines ) I think it would have been a lot more effective to have simply asked D McW:
> 
> 1. "Who would be financing these debt-writedowns?"
> 2. "How would moral hazard be prevented?"



Your TAX has already been extracted from you to finance these debt-write downs.  

Whether debt write downs happen or not you TAX has already gone up in smoke.


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## colc

Gardener said:


> This is a key question and one I have yet to see McWilliams being asked.


 

Exactly...  Everybody else....  ie taxpayers...  doesnt feel very fair really to be honest...


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## Firefly

Wishes said:


> Your TAX has already been extracted from you to finance these debt-write downs.
> 
> Whether debt write downs happen or not you TAX has already gone up in smoke.


 
From what I hear, the banks have been over-capitalised by 12bn. So if the debt-write downs are less than this then you're right. If they go higher though, the question still stands...who will pay for these additional debt-writedowns.

It would be something if the gov forced the banks to use or lose this 12bn too by the way - we'd have our childrens hospital built, a metro to Dublin airport and still have change to make a little dent in our national debt....


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## PiedPiper

http://www.bbc.co.uk/news/business-20207064

Are you guys not embarrassed now that it has come out the bailout money has been spent on the Pension funds?

There is no need for the blame game and no need for people to lose their homes.


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## Bronte

PiedPiper said:


> Are you guys not embarrassed now that it has come out the bailout money has been spent on the Pension funds?


 
No, not embarrassed, just still as hopping mad with the banks, but that level of anger went up seriously with that story.  Will deal with it on another thread though.


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## Leper

I saw the show. Nobody was interested in figures. Ryan Tubridy cut off Brendan Burgess because he said he wanted to give people hope.

We can shout until all of us are hoarse but the bottom line here is every householder in the country now has a home worth considerably less than it was six years ago. Whether we like it or not we are all in some kind of negative equity. The banks made fortunes out of our payments and they think we can still pay up. The banks caused the situation - no banker is in prison as a result - Brendan Burgess gave no hope to the people who pay up. Therefore, RyanTubridy virtually ignored him. 

The people need hope without which nobody has a chance.


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## Bronte

That's a very interesting take on it Leper. I think you're right that we need hope. I also think we need some kind of vengeance, and seeing a few bankers jailed would be very cathartic. I know vengeance is a very strong word, but as I said I'm hopping mad (- plus I've just read one of those desparate posts that sometimes happen on here).


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## Brendan Burgess

Bronte said:


> TI also think we need some kind of vengeance, and seeing a few bankers jailed would be very cathartic. I know vengeance is a very strong word, but as I said I'm hopping mad .



Hi Bronte

I think that this is very dangerous.  We live in a civilised democracy.  That protects your rights, my rights and, whether we like it or not, bankers' rights. 

Greed, stupidity, arrogance, carelessness, group think, etc are not criminal offences and people should not go to jail for them.

If people did commit criminal offences, then the judge should impose an appropriate sentence based on the facts of the case and the seriousness of the crime. He should not jail anyone just because we are all annoyed at the way we have lost money due to their greed and stupidity and because catharsis might be good for us. 

I must ring my friend Ryan Tubridy to see if he would like that view aired on the Late Late Show. 

Brendan


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## Bronte

I absolutly do not expect anyone to be jailed unless they've done something wrong, please don't get me wrong. I fully agree with the rule of law and am grateful to live in a civilised society. But there seems to be something wrong that in the USA they are able to bring people to court and jail them within a very short period of time and in Ireland, years go by and nothing. There is something wrong with our legal system in bringing white collar criminals to book. At the very least we should have had a court case by now. And it is truly very galling to see very rich people, some of them bankrupt not seeming to have any change in lifestyle and indeed some bankers seem now to be drawing down very large pensions after having money pumped into their pensions via the taxpayer. 

I only want bankers to be jailed for breaking the rules, and for things like propping up share prices. Obviously they cannot be jailed for loaning too much money to people as that is not an offence. And indeed it is not the bankers fault that some people were very greedy and borrowed too much. But then we are at the question of whether banks should be allowed to fail. And the need for proper regulation. Maybe it's time to look at whether banks in a capitalist society is a failed model.

In relation to Ryan Turbidy, that would be a very hot and heavy Late Late and I'd say very popular. Far more popular than the one with you and McW.


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## Leper

Brendan Burgess said:


> Hi Bronte
> 
> I think that this is very dangerous. We live in a civilised democracy. That protects your rights, my rights and, whether we like it or not, bankers' rights.
> 
> Greed, stupidity, arrogance, carelessness, group think, etc are not criminal offences and people should not go to jail for them.
> 
> If people did commit criminal offences, then the judge should impose an appropriate sentence based on the facts of the case and the seriousness of the crime. He should not jail anyone just because we are all annoyed at the way we have lost money due to their greed and stupidity and because catharsis might be good for us.
> 
> I must ring my friend Ryan Tubridy to see if he would like that view aired on the Late Late Show.
> 
> Brendan


 
Bronte, you've got it right.  Brendan Burgess you've got it wrong.  Let's get back to Mr Burgess being sidelined on the Late Late Show.  He could show no hope for the Irish people stuck in negative equity with large debts. Parents who give sugar and sweets continuously to their two-year-olds complain down the road that their child needs dental treatment.  The child can't afford the treatment, but the parents blame the child, afterall the child took the sweets every day. Why blame the parents, all they wanted was peace and quiet?

It is the same with the banks.  Remember, five years ago we were all talking about the country being awash with money.  Nobody was ever going to see a poor day.  The banks fed the greed (they themselves being the greediest); it was like the parents and their child above.

At best, the banks behaved irresponsably.  It could not be construed that they did not behave illegally.  Many of them headed off into early retirement with bulging back pockets of lump sums and pensions which are unbelieveable.

Somebody must pay for the way the banks acted.  They are not blaming themselves (obviously) - the parents above are not blaming themselves either - and the child (the Irish people) must pay up with money they have not got.

Brendan, with respect, please take a Reality Check.


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## Bronte

Brendan Burgess said:


> I think that this is very dangerous. We live in a civilised democracy. That protects your rights, my rights and, whether we like it or not, bankers' rights.


 

I wonder though does our democracy protect our rights if regulators and bankers can get away with not doing the right thing? Does the system perpetuate the ivory towers of the elites. 

Regulators are there precisely to protect citizens from clever bankers/financers, they are there to put rules in place so the consumbers who don't understand complex financial transactions are not taken advantage of. They are there to prevent people being stupid in taking out too much money when they plainly cannot afford it.

The model of a regulator has failed in our civilised democracy, and what happens this failed regulator, he swans off into the sunset. That is galling.

The bankers who wined and dined the regulator and dished out money like confetti and who knew or ought to know that if you give people too much money it's going to end in tears, what happens those bankers, they too swan off into the sunset. That too is very galling. 

So when ordinary people have to pay for the two failed entities, the banks and regulators, well people do have a right to be mad, even if they made too made a mistake in overextending. So maybe on the Late Late people are sick and tired of it, they haven't seen anyone punished and the only ones feeling the pain are ordinary people. 

A solution to this mess I do not have, but I believe that we need to have write downs where debt is unsustainable, for those that need it, unfortunately I'm well aware of people already up to tricks to deceive on their level of indebtedness and diddling the Marp. 

Personally I'd rather not have taxpayers money bail out people, but there is no other way if we are going to get the economy going again. But more than that we need a root and branch reform of the banking system. Will that happen, when pigs fly.

(As an aside, and I've just noticed this thread is very well viewed, so it must be a very important topic for a lot of people)


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## Ceist Beag

Brendan Burgess said:


> Hi Bronte
> 
> I think that this is very dangerous.  We live in a civilised democracy.  That protects your rights, my rights and, whether we like it or not, bankers' rights.
> 
> 
> Brendan



Hi Brendan, whilst I agree with your general view is there not something missing here - with these rights comes responsibility and as far as I can see to date no punishment has been meted out to those responsible for running the banks into the ground. Whilst it is not a criminal offence it surely must be possible to hit these people where it hurts, in the pocket. It is absolutely scandalous that those in authority in these banks could walk away with a golden handshake and sit back on large pensions while everyone else has to pay for the mess they created.


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## Complainer

Maybe we could find a solution in the markets themselves;

http://www.telegraph.co.uk/finance/...et-campaigners-buy-up-debt-to-abolish-it.html


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## Leper

Let's get back to Ryantubridy and his remark that he wanted to give some hope to the people of Ireland.  What do you think? Is there any hope for us? If so, where is this hope?


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## PiedPiper

We have to make our own hope and help ourselves.


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