THE BUDGET : TOXIC BANK FOR <aib,boi> what do yee think.....

Daragh101

what do yee think of the toxic bank idea and who will this benifit most, banks OR tax payer?????????????

Idu

definitely not the tax payer since we'll be carrying the burden. Only winners here are AIB/BOI and their shareholders

daveirl

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samson09

Who benefits from this?! First the government reward the banks for their greed induced losses and now they are literally handing over all the bad debt to you, your children and probably your grandchildren too. Not only have they done this, but they've just DOUBLED the national debt in the process. Why are we letting them do this? Its focking insane. Why not create and inject liquidity into a new bank that is owned by the people and run fairly for the people and leave AIB,BOI and the rest to sort out their own mess. We should not be rewarding those who are even partly responsible for focking up the economy.

We need to start reducing debt, not doubling it. We need to start living within our means again. We need to let house prices crash to their true value and to let the bad banks fail. Its only by hitting rock bottom can we purge this country of all its faults. Then, and only then, can we start to rebuild and prosper once more. And we need to base our economy on solid steel, not some phoney construction boom. For example, we have the potential to become one of the worlds leaders in research and development. Ireland also has the potential to acquire all of its energy from wind and even have some left over to sell to mainland europe. That alone would save the state some 6 billion euro a year. These are just a few examples of the direction we could take. However, until we get rid of every single politician in this country and replace them with good,honest, hard working members of society we will remain on course for the biggest kick up the arse this country has ever seen.

Rant over

ranger4

daveirl wrote: »

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sell off on the cards.

rugbyman

Ranger, you have been predicting a toxic banks for months, to the disdain of others,. you seem to be on the ball.

last week ,you suggested acontinuing rise in bank shares, with a profit taking drop post budget. But todays drop seems a bit hard for banks who are to be let off the toxic hook.


Samson, part of your rant is very true. Property needs to find its own level,which will be below its cost price(07/08 costs) because of the oversupply.

future cost prices will be lower due to cheaper labour and material costs.
But banks cannot be allowed to fail,one by one. That scenario is dreadful, the results could not be imagined.


Government needs to cutits own costs more,not raise taxes to pay these costs. perhaps its a start though.

Maybe now a message will filter through to state employees over 50. the message is we would rather you sat at home on half pay than pay you the other half to attend in your former workplace.

Regards,Rugbyman

daveirl

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rugbyman

daveirl,
i dont mean to split hairs. From memory I dont recall you making narky toned comments. From last summer hardly any definite pronouncements made on here have been proven right.

we are in asituation never before seen, and definite as any of us think in our beliefs, there is always more to be learned in discussion.

Some posterslast week predicted that the roler coaster would continue. this downward turn bears part of that out.

I havent a notion where things are going,

I sold ,successfully bank shares last week. Had I dreamed of todays fall,I would have sold all my bank if ireland and bought them back today and awaited a 1300 euro cheque for the difference.

Regards,rugbyman

ixus

rugbyman wrote: »

I sold ,successfully bank shares last week. Had I dreamed of todays fall,I would have sold all my bank if ireland and bought them back today and awaited a 1300 euro cheque for the difference.

So you're down 1300 on your remaining stock but you think they're a good buy at current prices? Why not double down (I mean up)? :rolleyes:

FFS, any retail investor trading these banks (on the buy side - in know there are no shorts) over the last year is really playing with fire.

If you've made a profit rugbyman it has been pure luck. I can say with near 100% certainty that there are far more people who have been burned than turned profit on Irish banks over the last year.

nesf

The problem is that to maintain their Tier 1 ratios the Government will either have to limit the haircut to 10-15% on the book values of these assets (which is far too small) or inject circa 17 billion in new equity for BoI and AIB if the haircut was a more realistic 50%. (back of napkin calculations from here). If they're injecting that much equity it's not that big a step to fully nationalising any of the Irish banks tbh.

daveirl

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AARRRGH

Idu wrote: »

shareholders

Explain please.

The way I see it is as follows -

1. Banks admit their liabilities - shares drop in price.
2. Government buys these liabilities for a fraction of their original value - shares drop in price.
3. Banks are left with a massive hole in their balance sheet, i.e. they have had to write off 10's of billions of "assets" due to the cut price sale - shares drop in price.
4. Banks require a bail out from the Government due to point 3 above - shares drop in price.
5. Government nationalises AIB and BOI due to having to bail them out to the tune of 10's of billions. At this stage, shareholders lose everything.

Idu

I posted that before the announcement which was basically an admission to nationalising the banks.

The conscensous before that had been that the government was going to free up the banks toxic assets leaving them in relatively healthy shape which would have seen the shares rise.

Obviously the budget changed that

daveirl

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