David McWilliams is a tosser, here's why...

hobochris

Just to clarify, as it appears Op, you still do not grasp the difference between NAMA and a bad bank.

A bad bank can fail just like a business can, as a bank is essentially a company.Then other banks can buy up the assets.

NAMA however cannot fail without having huge impact on our international reputation as a creditworthy country, As rather then a private entity being accountable/responsible NAMA puts responsibility for Money Borrowed to cover bad debts on the State as it is a state agency.

In other words things go tits up in a bank it s is the private shareholders who pay, things go wrong in Nama it is everybody within the Tax net that pays.

brianthebard

Also a bad bank would at least have ownership and control of its assets, which NAMA does not since it is buying the bad loans, not the properties/portfolios.

dotsman

hobochris wrote: »

Just to clarify, as it appears Op, you still do not grasp the difference between NAMA and a bad bank.

A bad bank can fail just like a business can, as a bank is essentially a company.Then other banks can buy up the assets.

NAMA however cannot fail without having huge impact on our international reputation as a creditworthy country, As rather then a private entity being accountable/responsible NAMA puts responsibility for Money Borrowed to cover bad debts on the State as it is a state agency.

In other words things go tits up in a bank it s is the private shareholders who pay, things go wrong in Nama it is everybody within the Tax net that pays.

And just where would this bad bank get the funds to buy said loans? Exactly who would lend to it?

brianthebard wrote: »

Also a bad bank would at least have ownership and control of its assets, which NAMA does not since it is buying the bad loans, not the properties/portfolios.

Sounds like you want a "bad developer/property management company/estate agent" more than a bad bank?

Bob Z

faceman wrote: »

He predicted the crash coming every year. That was the issue.

But how is that populist? People prefer good news so wouldnt it be more populist just to jump on the bandwagon

dotsman

The media prefer bad news.

To be honest, I think people also prefer bad news!

After Hours was full of people cheering on the recession before it had even started (they even named it "stephen"). Entire websites were set up (such as "propertypin") who's sole intent was to crash the economy.

There was a lot of people wanting a housing collapse. Some out of a ridiculous belief that they would then be able to buy a house or a better/bigger house, not understanding the implications a housing crash would have on the wider economy and on bank's ability to lend. Others out of resentment/begrudgery against those they perceived as better off than them, not realising that a crash would have massive ramifications for all parts of society, not just the well off.

Believe me, in the middle of the last decade there was a strong and growing percentage of people who loved hearing about the impending collapse.

Bob Z

dotsman wrote: »

The media prefer bad news.

To be honest, I think people also prefer bad news!

After Hours was full of people cheering on the recession before it had even started (they even named it "stephen"). Entire websites were set up (such as "propertypin") who's sole intent was to crash the economy.

There was a lot of people wanting a housing collapse. Some out of a ridiculous belief that they would then be able to buy a house or a better/bigger house, not understanding the implications a housing crash would have on the wider economy and on bank's ability to lend. Others out of resentment/begrudgery against those they perceived as better off than them, not realising that a crash would have massive ramifications for all parts of society, not just the well off.

Believe me, in the middle of the last decade there was a strong and growing percentage of people who loved hearing about the impending collapse.

Maybe the media prefer bad news but I have it argued that newspapers were getting advertising money from house supplements and didn't properly investigate Or analyze the housing Market. When you think about it the maths are simple the price of houses was going up and rent was coming down. Banks were throwing loans at people. How else could it have ended?

hobochris

dotsman wrote: »

And just where would this bad bank get the funds to buy said loans? Exactly who would lend to it?

That's the point, The bad bank is not given funds.Any remaining capital the bank has is used to buy debts from other banks.

So when the bad bank goes down it takes as much bad debt as it can with it.

faceman

Bob Z wrote: »

But how is that populist? People prefer good news so wouldnt it be more populist just to jump on the bandwagon

His books and DVD. People prefer bad news, the media LOVES bad news. He has a number of books and DVDs, yet offers no plausible solutions with his Nostradamus style "predictions"

Banned Account

hobochris wrote: »

That's the point, The bad bank is not given funds.Any remaining capital the bank has is used to buy debts from other banks.

So when the bad bank goes down it takes as much bad debt as it can with it.

Unless I am missing something, this make absolutely no sense whatsoever.

dasdog

dotsman wrote: »

Entire websites were set up (such as "propertypin") who's sole intent was to crash the economy.

That site saved hundreds if not thousands of people from getting on the bullsh1t ladder to negative equity. It was setup as the main financial "advice" web site in the country BANNED the discussion of house prices in the summer of 2006 when they started going south. When the media and other interested parties were saying the fundamentals are sound, the pinsters said no...look at the numbers...they don't add up. And they were correct. RTE ran a TV programme encouraging people to sell their belongings and borrow the maximum amount possible to "get them out of there" to buy a half ass shoe box...presented by the someone who ran a mortgage lending company!!! One of the main newspapesr bought a property website for €50m at the start of the downturn and let it's journalists write front page nonsense for another year about how great everthing was. It was nothing short of propoganda.

dotsman wrote: »

not understanding the implications a housing crash would have on the wider economy and on bank's ability to lend.

When you build an economy on people buying and selling houses to each at inflated prices with access to 100% or 35 year mortgages you end up where we are now. Don't shoot the messanger rather look to the policy makers. And if the policy makers understood the implications then why did they put the economy country in such a risky predicament?

hobochris

Fitzcaraldo wrote: »

Unless I am missing something, this make absolutely no sense whatsoever.

Its about containing the bad debt. You load the bad bank with all the debt you can and let it go under.

It passes the responsibility for the bad debt onto the collapsed bank, In turn its creditors will have to write of some of the bad Debt they cannot recover.

This solution is better because the buck stops at the bad bank, and it leaves us with other banks in better shape, which can then buy up any remaining assets from the bad bank cheap in a fire sale.

Banned Account

hobochris wrote: »

Its about containing the bad debt. You load the bad bank with all the debt you can and let it go under.

It passes the responsibility for the bad debt onto the collapsed bank, In turn its creditors will have to write of some of the bad Debt they cannot recover.

This solution is better because the buck stops at the bad bank, and it leaves us with other banks in better shape, which can then buy up any remaining assets from the bad bank cheap in a fire sale.

How does one decide which bank is to be the bad bank. If the babd bank needs capital to acquire these "assets" where does it get the capital from - if it has enough capital to acquire these assets, surely it isn't a bad bank in the first place.

If there is to be a new bad bank created, who would the creditors be - no-one would invest in it.

hobochris

Fitzcaraldo wrote: »

How does one decide which bank is to be the bad bank. If the babd bank needs capital to acquire these "assets" where does it get the capital from - if it has enough capital to acquire these assets, surely it isn't a bad bank in the first place.

If there is to be a new bad bank created, who would the creditors be - no-one would invest in it.

It sheds its assets to gain capital to by the bad debts from the other banks.

Banned Account

hobochris wrote: »

It sheds its assets to gain capital to by the bad debts from the other banks.

Would there not be a big question as to the realisable value of these assets in the current climates? Is it not the case that the majority of these "assets" in the Irish banking system are actually property related loans?

Secondly, how does one identify which bank is to be the bad bank and how does one deal with the inevitable legal challenge that would come from the bond holders of the bank who would argue that the state has arbitrarily targeted them making their investment worthless.

Would we not end up in the NAMA situation regarding the valuing of the bad debts leaving good banks with holes in the balance sheets that would still need to be filled by promissory notes from the taxpayer?

dotsman

hobochris wrote: »

That's the point, The bad bank is not given funds.Any remaining capital the bank has is used to buy debts from other banks.

So when the bad bank goes down it takes as much bad debt as it can with it.

As per Fitzcaraldo's posts, I'm not getting what you are saying. Where does the "remaining capital" come from if it doesn't have any capital to begin with? How does it buy the bad debts without having any capital?

dasdog wrote: »

That site saved hundreds if not thousands of people from getting on the bullsh1t ladder to negative equity. It was setup as the main financial "advice" web site in the country BANNED the discussion of house prices in the summer of 2006 when they started going south. When the media and other interested parties were saying the fundamentals are sound, the pinsters said no...look at the numbers...they don't add up. And they were correct. RTE ran a TV programme encouraging people to sell their belongings and borrow the maximum amount possible to "get them out of there" to buy a half ass shoe box...presented by the someone who ran a mortgage lending company!!! One of the main newspapesr bought a property website for €50m at the start of the downturn and let it's journalists write front page nonsense for another year about how great everthing was. It was nothing short of propoganda.



When you build an economy on people buying and selling houses to each at inflated prices with access to 100% or 35 year mortgages you end up where we are now. Don't shoot the messanger rather look to the policy makers. And if the policy makers understood the implications then why did they put the economy country in such a risky predicament?

It's not about shooting the messenger. I was just saying that David mcWilliams comments are populist. I was using the propertypin as an example of the large number of people with a negative outlook to the economy.

If I remember correctly, askaboutmoney locked that discussion because it was the same posts just being repeated and people cheering on any mention of impending doom. I'm not saying that the mainstream media (up until the future shock programs) wasn't total propaganda - I agree, they were atrocious. I'm just saying that an opposite (and just as strong) reaction formed among a sizeable percentage of the population.

You mention "fundamentals", and that's just it. By far the biggest fundamental in the markets is sentiment. The extreme positive sentiment is what drove the boom as high as it did, just as negative sentiment (that started to come to the boil about the same time as David McWilliams) is driving it down. Population/demographics/earnings/interest rates etc have only differed slightly (relatively) between now and 2006, yet the market is completely different.

stmol32

thebigbiffo wrote: »

i sat beside him on a flight from amsterdam once...he has no control over his kids either, which adds to his tosser level. but then again i was stoned...and i dont take kindly to screaming kids bouncing around me while i'm trying to eat my ryanair pizza

Ryanair don't fly to Amsterdam. The OP's take on things is getting more and more iffy with each post.

parker kent

Bob Z wrote: »

Maybe the media prefer bad news but I have it argued that newspapers were getting advertising money from house supplements and didn't properly investigate Or analyze the housing Market. When you think about it the maths are simple the price of houses was going up and rent was coming down. Banks were throwing loans at people. How else could it have ended?

Weird thing is that the newspapers had plenty of articles discussing a looming downturn. I did a thesis on newspaper coverage of the property market in 2007 and there were interesting enough results. I picked 2007 as prices peaked in February that year.

The property sections and journalists like Brendan O'Connor spoke a lot of rubbish as expected(The Sindo were in the middle of their property tax agenda). But there was actually a higher frequency of negative comments about the prospects of the property market in the business and analysis sections of the main papers in Ireland.

So it just showed that people ignored the writers who were giving worthwhile analysis in favour of the more showbizzy/attention seeking type of journalism. The newspapers obviously did not make this easy by giving the likes of O'Connor and the property section greater visibility. But it is not as if there were no references or predictions of a property crash. A few were actually pretty spot on like Moore McDowell.

thebigbiffo

stmol32 wrote: »

Ryanair don't fly to Amsterdam. The OP's take on things is getting more and more iffy with each post.

yep, that was an obnoxious lie. i only said it to further my political agenda and there is no possible way in the world i could have mistaken ryanair with aer lingus when writing my hastily thought through anecdote...:rolleyes:

why is it that posters here can be so touchy about a media personality? the amount of negative personal comments directed at me since i started a thread with the intent of pointing out the ridiculous hypocricy of some of the called 'experts' we are supposed to listen to on a daily basis.

thebigbiffo

hobochris wrote: »

Just to clarify, as it appears Op, you still do not grasp the difference between NAMA and a bad bank.

A bad bank can fail just like a business can, as a bank is essentially a company.Then other banks can buy up the assets.

NAMA however cannot fail without having huge impact on our international reputation as a creditworthy country, As rather then a private entity being accountable/responsible NAMA puts responsibility for Money Borrowed to cover bad debts on the State as it is a state agency.

In other words things go tits up in a bank it s is the private shareholders who pay, things go wrong in Nama it is everybody within the Tax net that pays.

http://en.wikipedia.org/wiki/Swedish_banking_rescue

http://en.wikipedia.org/wiki/Bad_bank

let me just quote the first paragraph from the 'bad bank' link

Bad bank is a term for a financial institution created to hold nonperforming assets owned by a state guaranteed bank.[1] Such institutions have been created to address challenges arising during an economic credit crunch wherein private banks are allowed to take problem assets off their books.[2] Securum, a Swedish bank founded to take on bad assets during the Swedish banking rescue of 1991 and 1992, is an example of such a bank.
The financial crisis of 2007–2010 resulted in bad banks being set-up to handle the crisis in a variety of countries. For example, a bad bank was suggested as part of the Emergency Economic Stabilization Act of 2008 to help address the subprime mortgage crisis in the US. In Ireland, a bad bank, the National Asset Management Agency, is to be established in response to the financial crisis in that country.

hobochris...i think it's fair to say that YOU, sir, haven't a shaggin clue, not an iota, not a jot, a bean what you are talking about.

nuff said

parker kent

thebigbiffo wrote: »

http://en.wikipedia.org/wiki/Swedish_banking_rescue

http://en.wikipedia.org/wiki/Bad_bank

let me just quote the first paragraph from the 'bad bank' link

Bad bank is a term for a financial institution created to hold nonperforming assets owned by a state guaranteed bank.[1] Such institutions have been created to address challenges arising during an economic credit crunch wherein private banks are allowed to take problem assets off their books.[2] Securum, a Swedish bank founded to take on bad assets during the Swedish banking rescue of 1991 and 1992, is an example of such a bank.
The financial crisis of 2007–2010 resulted in bad banks being set-up to handle the crisis in a variety of countries. For example, a bad bank was suggested as part of the Emergency Economic Stabilization Act of 2008 to help address the subprime mortgage crisis in the US. In Ireland, a bad bank, the National Asset Management Agency, is to be established in response to the financial crisis in that country.

hobochris...i think it's fair to say that YOU, sir, haven't a shaggin clue, not an iota, not a jot, a bean what you are talking about.

nuff said

Wikipedia is hardly an authoritative source in fairness.

Banned Account

parker kent wrote: »

Wikipedia is hardly an authoritative source in fairness.

Same could be said for David McWilliams.

parker kent

Fitzcaraldo wrote: »

Same could be said for David McWilliams.

At least we know he writes his articles not bored school kids.

thebigbiffo

parker kent wrote: »

Wikipedia is hardly an authoritative source in fairness.

man i just f'ucking knew someone would come back with that...

NAMA's a bad bank, build a bridge - get over it. start a thread to get a campaign going to have the media, financial institutions, economic commentators, politicians and people like me to start refering to it as a...what? i suggest "taxpayer funded institution managing underperforming loans bought from almost crippled banks at a discount with the view to selling off these loans once viable" bank - but that just doesn't have the same ring to it.

bad bank is a sufficient enough term for me though, so i'll stick with it

thebigbiffo

parker kent wrote: »

Wikipedia is hardly an authoritative source in fairness.

also, i've went to the bother of providing links (regardless of your position on source) - maybe you could do the same when you've step down off your high horse?

stmol32

thebigbiffo wrote: »

there is no possible way in the world i could have mistaken ryanair with aer lingus when writing my hastily thought through anecdote...:rolleyes:

Except it's not just that one thing you've mistaken. You seem confused about a lot of things on this thread.

parker kent

thebigbiffo wrote: »

also, i've went to the bother of providing links (regardless of your position on source) - maybe you could do the same when you've step down off your high horse?

Well I and numerous others have given links/sources throughout the rest of the thread so I fail to see the point in constantly posting links. This was when you were claiming it was impossible to find McWilliams' original articles the bad bank.

We are going around in circles here on this thread. One line on Wikipedia does not counteract everything else that has been said here about the differences between what McWilliams originally suggested and what NAMA became.

brianthebard

dotsman wrote: »

Sounds like you want a "bad developer/property management company/estate agent" more than a bad bank?

No idea what you mean by that, but the answer is probably No.

thebigbiffo wrote: »

man i just f'ucking knew someone would come back with that...

NAMA's a bad bank, build a bridge - get over it.

Its not though, and just cause someone wrote it on wiki (could be you for all we know) doesn't make it true.

thebigbiffo

stmol32 wrote: »

Except it's not just that one thing you've mistaken. You seem confused about a lot of things on this thread.

maybe you could point out what i seem to be confused about? its clear imo...mcwilliams suggested a bad bad - this is what we got according to the majority of sources and references I can find and now he's against it...this = tosser to me

thebigbiffo

brianthebard wrote: »

No idea what you mean by that, but the answer is probably No.



Its not though, and just cause someone wrote it on wiki (could be you for all we know) doesn't make it true.

http://www.uniset.ca/lloydata/grmcna.htm
http://www.pbs.org/newshour/bb/business/jan-june09/banks_02-06.html
http://www.businessweek.com/news/2010-02-26/irish-nama-bad-bank-plan-wins-european-commission-approval.html
http://www.asymptotix.eu/content/ntma-ireland-and-nama-bad-bank-matter-pricing-imparied-assets

(i could go on)

and the link i posted much earlier which i thought would put this ridiculous argument about whether NAMA is a bad bank to bed

http://www.finfacts.ie/irishfinancenews/article_1019357.shtml

can you post some reliable sources now to back up your claim that's it's not a bad bank?

thebigbiffo

parker kent wrote: »

Well I and numerous others have given links/sources throughout the rest of the thread so I fail to see the point in constantly posting links. This was when you were claiming it was impossible to find McWilliams' original articles the bad bank.

We are going around in circles here on this thread. One line on Wikipedia does not counteract everything else that has been said here about the differences between what McWilliams originally suggested and what NAMA became.

the only links you've provided are to mcwilliams sites and only prove that he wrote one thing 2 years ago and changed his mind progressively since - proving my original point.

the argument has gone on to what the definition of a bad bank is and the only link provided which tried to prove it wasn't was by brianthebard which quite clearly states NAMA IS a bad bank. here it is: http://www.progressive-economy.ie/20...h-banking.html

you are right on one thing though - the thread has gone in circles. i keep asking why the whole country refers to NAMA as a bad bank except you and a couple of others and you've been avoiding the question at all costs. other posters here have backed up that defition without reply. so...

point proven...you yourselves referenced McW calling for a bad bank then changing his mind when it was implemented. job done. he's a tosser. he should grow a set and stick to his guns cause he's actually a smart guy...problem is he now thinks of himself as some kind of all knowing prophet when in fact he's only a pied piper.