Irish Bank Shares

boardsie08

I know there are other threads on this atm and yes I have read them, slightly different Q here though..

Right, so first off I'm a complete novice here, completely out of my depth so forgive the ignorance of my questions..

Re: the Government guaranteeing all the banks lately - will this eventually lead to nationalisation of the banks? If so, how long before this might happen?

Now I know a lot of people on here are completely against the idea, but I must say in my ignorant, simple state of mind the low prices atm on the Irish Bank shares is looking very appealing.

I had thought about investing in some shares in some of the irish banks for some time now, but never got around to it.

In my mind it now appears the perfect time to go for it, prices are very low atm, so "buy low, sell high"

I would only be investing an amount I could afford to lose. It would be money I could happily wait 5+ years to mature before I would cash in. I would have no short term use for this money.

Am I missing something glaringly obvious? I mean I know the banks are a very volatile market right now, but with some of them at just 2.5 or so they can't get much lower (well ok, yes they can, but 2.5 is low enough already in my eyes) and I reckon to sit tight on them for a few years as a long term investment they should rise.

Could the nationalisation of a bank mess all this up though?

Also, how exactly would I go about buying the shares, can I just go directly into the bank or do I have to go through a stockbroker or similar?

As I said, please excuse what are probably some laughably noob questions, but this is all brand spanking new to me.. all the same I'm keen to get my foot in the door somewhere while things are looking low.

Thanks all!

Time Magazine

boardsie08 wrote: »

I mean I know the banks are a very volatile market right now, but with some of them at just 2.5 or so they can't get much lower (well ok, yes they can, but 2.5 is low enough already in my eyes) and I reckon to sit tight on them for a few years as a long term investment they should rise.

It's not nationalisation, but do you trust the government to run a sector of the economy profitably? Unless they can, don't expect the shares to be worth much.

Am I missing something glaringly obvious?

Yes. Everyone in the country is thinking bank shares are great value right now. You're thinking of buying the shares up and selling later, like most average punters. You're thinking they're good value based on what they were in years previous.

In years to come, what average punter is going to look back at what the prices are now and think "You know, they were €2.50 but €5 is still good value"?

ixus

If you check through my post history, I've explained this before to people....whether they listened or not i don't know.....

In short: Banks share prices were high because they were selling loads of mortgages(with the view that house prices would rise) and other loans (cars etc). this has stopped now. this reflected their share prices, in that the banks would lend more and earn more.

The view now is that house prices will drop.

Why or how will banks earn more in the future to justify a return to a higher share price?

You REALLY need to ask yourself that question.

If you do, you will look at the number of houses in this countries (filled & empties), the level of unemployment in this countnry, the level of immigration/emigration etc.

How will banks make money in the future to return to there previous share prices?????

If you can tell me, I will buy those mofo's!

If you have money to spare, wait until after Christmas, learn about the global economy until then and then invest in the DAX or Eurostoxx (and diversification). Don't touch Irish stocks.

Ixus.


(i've has a few pints so forgive the spellings etc...)+