Cowen Says Ireland to Discuss Banks With EU Tomorrow

ixus

Game over for the banks. I'm going to speculate that interbank lending has frozen. All that money that went into NAMA may as well have been burned. As referenced on thepropertypin, the key is in the wording of the statements. It was very quiet today. Where is Lenihan? So, it has taken just over two years for this to play out.

Cowen Says Ireland to Discuss Banks With EU Tomorrow

Prime Minister Brian Cowen signaled that his government will discuss measures to help the Irish banking system with European finance ministers tomorrow as he resists pressure to ask for a bailout of the country’s finances.

“We have to discuss these matters with partners as to how best to underpin financial and banking stability within the euro area,” Cowen said in an interview with Irish broadcaster RTE in Dublin today. Cowen stressed the government is making no aid application “for the funding of the state” and said he doesn’t expect any concrete agreement to come out of tomorrow’s talks.

As European officials push Ireland to request aid, Cowen’s language marks a shift from last week, when the government said there were no talks underway with European authorities. While the government still says it has enough cash to last it until mid-2011, Justice Minister Dermot Ahern said today the country’s cash-strapped lenders “have issues” and contacts with the European Central Bank and the European Commission are “ongoing.”

“The issue, as you know, has been in what way can we bring stability into the markets so that the costs of money overall will start to reduce,” Cowen said. If the current level “were to become the norm, would make it difficult for the banks to function as engines of recovery.”

Ireland’s banks have been left weakened by a property- market collapse and grown increasingly reliant on ECB funding. ECB Vice President Vitor Constancio said today Ireland could use European Union aid to bail out its cash-strapped banks.

CoalBucket

Usual ****e from Cowen, deny, deny, deny, then alright it's happening.

Probably waiting to see will the bond markets drop the rate :mad:

Himself and Lenihan are probably round the back of government buildings burning documents as we speak.

It's looking well dodgy that the EU are encouraging us to borrow to prop up the banks. Yes it is for the stability of the euro but also the chance they have been waiting for to shaft us. Goodbye to control over our countries finances and tax rates.

Thank you Fianna Fail. Your inepititude has cost the Country it's financial sovereignty.

kaiser sauze

...and it has only taken two years for inevitability to smack Cowen and Lenihan in the head.

Seriously, how must we look to an informed international investor right now?

The government had a less painful way through this mess, they did not take it.

We guarantee, we don't need to nationalise, then we nationalise.

Our banks need about 10Bn in capital, no wait they need 15Bn, no wait they need 34Bn at the most!

NAMA, well NAMA-rama might be a better word for it. It clearly hasn't worked, the flight of deposits, and if you are correct about the frozen inter-bank market, demonstrates this.

"We've turned a corner", oh wait is this the corner that we were at last year?

Watching The Frontline on RTE player now, RTE should be ashamed of themselves for allowing such an illiterate audience to mouth off. 'We don't need a bailout, we need to stand on our own two feet and get the job done' was the overriding sentiment. A couple were at least able to point out that a bailout is not equal to a complete loss of sovereignty. On telling the IMF/ESRF to get stuffed, these people are just saying to let this astonishingly inept government continue to make even more mistakes. HOW LONG DOES IT TAKE BEFORE PEOPLE REALISE THAT THEY HAVE GOT EVERYTHING WRONG, NOTHING HAS WORKED, NOTHING IS LIKELY TO WORK AND THE MARKETS COULD REALLY GIVE A FCUK WHAT MEASURES ARE TAKEN IN THE UPCOMING BUDGET?

senordingdong

If only they could have used these two years to do something constructive and helpful instad of just lieing.

I'm no economincs expert but I knew full well not to believe a word they said.

OfflerCrocGod

I'd love to know what people here would have done differently from the Government that would have saved Ireland. You even have the magic powers of hindsight to aid you, a solution should be easy to come up with.

who the fug

OfflerCrocGod wrote: »

I'd love to know what people here would have done differently from the Government that would have saved Ireland. You even have the magic powers of hindsight to aid you, a solution should be easy to come up with.

having interest rates of 3% during a housing boom, is like stupid/dumb/moronic, you don't need hindsight to know that

senordingdong

Well...and I'm just speaking for myself here, I would have not put the interests of myself, my party, my buddies or the developers or the banks before the well being of the country and the people in it.

kaiser sauze

OfflerCrocGod wrote: »

I'd love to know what people here would have done differently from the Government that would have saved Ireland. You even have the magic powers of hindsight to aid you, a solution should be easy to come up with.

It's also very easy to take the stance you have now.

Are you saying that you would have done nothing differently?

OfflerCrocGod

kaiser sauze wrote: »

It's also very easy to take the stance you have now.

Are you saying that you would have done nothing differently?

Yes I would have broadened the tax base and outlawed high LTV loans/mortgages I would have changed the Irish mortgage system to be like the Danish one*I would have tightened up regulation on the banks to be even tighter then Basel III capital ratios (I like the Swiss approach, big buffers!). I would have cut government spending removed benchmarking and focused on paying off the dwindling national debt faster and set up a SWF for Ireland for any surpluses.


You must be delusional if you think the electorate would have accepted even ONE of those suggestions.




*I have no idea why that isn't being done everywhere in Europe right now.

senordingdong

OfflerCrocGod wrote: »

Yes I would have broadened the tax base and outlawed high LTV loans/mortgages I would have changed the Irish mortgage system to be like the Danish one*I would have tightened up regulation on the banks to be even tighter then Basel III capital ratios (I like the Swiss approach, big buffers!). I would have cut government spending removed benchmarking and focused on paying off the dwindling national debt faster and set up a SWF for Ireland for any surpluses.


You must be delusional if you think the electorate would have accepted even ONE of those suggestions.




*I have no idea why that isn't being done everywhere in Europe right now.

So basically you would have done everythign differently?

ixus

OfflerCrocGod wrote: »

I'd love to know what people here would have done differently from the Government that would have saved Ireland. You even have the magic powers of hindsight to aid you, a solution should be easy to come up with.

You're kidding me, right? It's quite simple. Cap mortgage's at 4/5 times earnings. Absolutely no 100% mortgages. Max 80% requiring a 20% deposit. Max 20 year mortgages. So, what could have prevented this from occurring? In two words, Financial Regulation.

It's not rocket science. If the above was implemented, house prices would not have gone out of control, even with two income families. Wage inflation would not have gone out of control keeping the labor force competitive. The price of land, including farm land, would not have gone out of control. Lending would not have gone out of control and been soley focussed on property.

If you think this is hindsight, I can pull up a post I wrote on askaboutmoney back in 2004/2005 I think saying that house prices were way out of control. I was in my early 20's then and briefly considered buying. I soon realised that it was a fools game.

Now, that was prevention rather than cure.

The cure:

Let Anglo go bust. Let AIB go bust or be bought out. Let BOI go bust or be bought out. The bailout of these banks has and will cost the tax payer far more than it would have if the government had let the banks go to the wall. IT is likely that BOI or AIB would have been bought by another bank and asset stripped. So what? It would have cost us nothing.

They should have only agreed to back Senior bondholders and this, only because they were other EU banks. Refusing to do so would have resulted in Irish banks never being able access interbank lending again.

After all the money that has been thrown into a black hole, what outcome do we have? Things have become worse.

senordingdong

ixus wrote: »

You're kidding me, right? It's quite simple. Cap mortgage's at 4/5 times earnings. Absolutely no 100% mortgages. Max 80% requiring a 20% deposit. Max 20 year mortgages. So, what could have prevented this from occurring? In two words, Financial Regulation.

It's not rocket science. If the above was implemented, house prices would not have gone out of control, even with two income families. Wage inflation would not have gone out of control keeping the labor force competitive. The price of land, including farm land, would not have gone out of control. Lending would not have gone out of control and been soley focussed on property.

If you think this is hindsight, I can pull up a post I wrote on askaboutmoney back in 2004/2005 I think saying that house prices were way out of control. I was in my early 20's then and briefly considered buying. I soon realised that it was a fools game.

Now, that was prevention rather than cure.

The cure:

Let Anglo go bust. Let AIB go bust or be bought out. Let BOI go bust or be bought out. The bailout of these banks has and will cost the tax payer far more than it would have if the government had let the banks go to the wall. IT is likely that BOI or AIB would have been bought by another bank and asset stripped. So what? It would have cost us nothing.

They should have only agreed to back Senior bondholders and this, only because they were other EU banks. Refusing to do so would have resulted in Irish banks never being able access interbank lending again.

After all the money that has been thrown into a black hole, what outcome do we have? Things have become worse.

But Fianna Fails buddies and associates have been kept sweet.
That's what really matters.

OfflerCrocGod

senordingdong wrote: »

So basically you would have done everythign differently?

We're still in a democracy last I checked and anyone who tried was I was outlining in the boom years would have been turfed out in no time.

"I'm cutting wages and stopping you from getting a house because in a few years there will be a global financial crisis."

You actually believe anyone in power could have come out with something like that and not been ridiculed and immediately finished?!

In the end this was a lesson the country needed to learn, we weren't mature and we weren't capable of dealing with our new-found wealth. Never attribute to malice that which is adequately explained by stupidity.

As for letting the banks go bust this time the 1930's called they want their failed economic policies back.

When you've got a problem you deal with it. Deal.

ixus

A democracy? How'd you get that one? Harney is in government when she shouldn't be. Opposition parties had to take a court case to get FF to hold bi-elections in Donegal.

The 1930's is happening all over again. I suggest you read that book (the Great Crash,1929) I mentioned before. Saying that, it could be Weimar!

OfflerCrocGod

ixus wrote: »

A democracy? How'd you get that one? Harney is in government when she shouldn't be. Opposition parties had to take a court case to get FF to hold bi-elections in Donegal.

The 1930's is happening all over again. I suggest you read that book (the Great Crash,1929) I mentioned before. Saying that, it could be Weimar!

Weimar was a democracy and it had rampant inflation, right now above trend inflation would help with our debt, our problem it the opposite in fact.

The 1930s could very well happen all over again if we repeat the same steps. The next step would be letting the banks fail. I'm suggesting while that may sound like a grand and satisfying idea it would in fact cause a massive amount of pain. Far more then it would alleviate.

kaiser sauze

OfflerCrocGod wrote: »

Yes I would have broadened the tax base and outlawed high LTV loans/mortgages I would have changed the Irish mortgage system to be like the Danish one*I would have tightened up regulation on the banks to be even tighter then Basel III capital ratios (I like the Swiss approach, big buffers!). I would have cut government spending removed benchmarking and focused on paying off the dwindling national debt faster and set up a SWF for Ireland for any surpluses.


You must be delusional if you think the electorate would have accepted even ONE of those suggestions.




*I have no idea why that isn't being done everywhere in Europe right now.

...and you're getting onto me about hindsight?

Good one, have a nice day.

OfflerCrocGod

kaiser sauze wrote: »

...and you're getting onto me about hindsight?

Good one, have a nice day.

So you actually believe that the electorate would have accepted the changes I suggest? When the good times where rolling the government was going to slam on the brakes and you think that it would have been accepted?

No one put a gun to people's heads and forced them to take loans they could never repay. ixus said he didn't buy in 2004 because prices where too high, no one forced him to take a loan. Everyone has their own personal responsibility in this mess and most people would have not accepted austerity measures in the middle of strong growth. Politically impossible to push through. Even with hindsight!

This is a needed lesson.

pocketdooz

OfflerCrocGod wrote: »

So you actually believe that the electorate would have accepted the changes I suggest? When the good times where rolling the government was going to slam on the brakes and you think that it would have been accepted?

No one put a gun to people's heads and forced them to take loans they could never repay. ixus said he didn't buy in 2004 because prices where too high, no one forced him to take a loan. Everyone has their own personal responsibility in this mess and most people would have not accepted austerity measures in the middle of strong growth. Politically impossible to push through. Even with hindsight!

This is a needed lesson.

Agree with the above 100%

.

iMax

ixus wrote: »

A democracy? How'd you get that one? Harney is in government when she shouldn't be. Opposition parties had to take a court case to get FF to hold bi-elections in Donegal.

+1

Not to mention the ex Taoiseach sitting as a TD illegally & the increases in payments & allowances they grant themselves & the failure for legal process in investigations.

We don't live in a republic, we're in a dictatorship (Specifically: A government controlled by one person, or a small group of people. In this form of government the power rests entirely on the person or group of people, and can be obtained by force or by inheritance. The dictator(s) may also take away much of its peoples' freedom. In contemporary usage, dictatorship refers to an autocratic form of absolute rule by leadership unrestricted by law, constitutions, or other social and political factors within the state.)

kaiser sauze

OfflerCrocGod wrote: »

So you actually believe that the electorate would have accepted the changes I suggest? When the good times where rolling the government was going to slam on the brakes and you think that it would have been accepted?

No one put a gun to people's heads and forced them to take loans they could never repay. ixus said he didn't buy in 2004 because prices where too high, no one forced him to take a loan. Everyone has their own personal responsibility in this mess and most people would have not accepted austerity measures in the middle of strong growth. Politically impossible to push through. Even with hindsight!

This is a needed lesson.

The government are put there by the electorate to do the right thing for the country. It is up to the government to put policies in place that are for the greater good.

Instead, and this is touching on what 'ixus' stated, we have a oligarchy in society that are enriching themselves at the expense of others.

There were plenty of voices telling the government to slow things down, this was done publicly and not behind closed doors. What happened, in one case, when someone tried to question something? They were told to, paraphrasing, "go off and commit suicide".

The system is broken, a strong government would have done the things necessary. In place of that we have a rag-tag bunch of misfits who are allied with Independents who virtually hold this country to ransom with secret deals.

You also make the mistake of believing that large-scale austerity would have been necessary during the boom, that is flat out wrong. It would have only been necessary to gently 'brake' the economy, the market would have adjusted and we would not have the enormous mess we face now. It is far easier to ease something off than to riddle it full of bullet holes like we will end up doing now.

I agree with you that people need to exercise personal responsibility, I have never indicated otherwise. This applies to both financial and voting tasks.

A needed lesson, indeed.

RoadKillTs

He hasn't mentioned anything about bailout. He is a gutless pr*ck.


Link to Live Dail

OfflerCrocGod

RoadKillTs wrote: »

He hasn't mentioned anything about bailout. He is a gutless pr*ck.


Link to Live Dail

I'm not certain that the rush for a bailout is really that large for Europe's politicians. Look at EURUSD.

I'm wondering if they are playing a dangerous game instead...after all the Americans are playing a dangerous game printing lots of $...

ranger4

Yes FF has placed country in state its presently in with non regulation and cronyism of the highest order but WHAT CREDIBLE alternative does the irish people presently have? A Labour gov tied to the hip of unions would not be able to implement austerity plan and take harsh measures to reduce deficet plus their economic policy would massivly increase deficet on the other hand FG has some credible ideas but without strong leadership will not be seen as strong government, What ireland needs is radical shakeup with possibly of a new party formed with individuals who are prepaired to be ACCOUNTABLE for their actions and offer a real viable alternative not the same old same old style of irish politics which has lead ireland to the sorry state it presently find itself in.

wackjob

kaiser sauze wrote: »

...and it has only taken two years for inevitability to smack Cowen and Lenihan in the head.

Seriously, how must we look to an informed international investor right now?

The government had a less painful way through this mess, they did not take it.

We guarantee, we don't need to nationalise, then we nationalise.

Our banks need about 10Bn in capital, no wait they need 15Bn, no wait they need 34Bn at the most!

NAMA, well NAMA-rama might be a better word for it. It clearly hasn't worked, the flight of deposits, and if you are correct about the frozen inter-bank market, demonstrates this.

"We've turned a corner", oh wait is this the corner that we were at last year?

Watching The Frontline on RTE player now, RTE should be ashamed of themselves for allowing such an illiterate audience to mouth off. 'We don't need a bailout, we need to stand on our own two feet and get the job done' was the overriding sentiment. A couple were at least able to point out that a bailout is not equal to a complete loss of sovereignty. On telling the IMF/ESRF to get stuffed, these people are just saying to let this astonishingly inept government continue to make even more mistakes. HOW LONG DOES IT TAKE BEFORE PEOPLE REALISE THAT THEY HAVE GOT EVERYTHING WRONG, NOTHING HAS WORKED, NOTHING IS LIKELY TO WORK AND THE MARKETS COULD REALLY GIVE A FCUK WHAT MEASURES ARE TAKEN IN THE UPCOMING BUDGET?

great summary and unfortunately on the mark, Lenihan has been a complete disaster.

This required someone numerate in Sept 2008 who could see this was too big for a guarantee & someone with the guts to take the hard decision then and make the banks the problem of the banks that lent them money.

Pride, politics, hubris and 60bn euro of our money later, we are going to have this all piled on the tax payer by the IMF/Euro and get roggered on corp tax rate while we are on the floor.

WE have no powder left in the gun, all given to the banker that lied, stole and ran rings around the idiots we elected...

Paying the price for electing idiots and believing that politics doesn't really impact us...... put some money in our pocket and we checked out mentally...... we didn't deserve to pay this high a price for it

senordingdong

wackjob wrote: »

Paying the price for electing idiots and believing that politics doesn't really impact us...... put some money in our pocket and we checked out mentally...... we didn't deserve to pay this high a price for it

I have a feeling that alot of idiots that elected and financially backed FF are not actually idiots, and probably remain largely unaffected by the mess.

Jim2007

senordingdong wrote: »

I have a feeling that alot of idiots that elected and financially backed FF are not actually idiots, and probably remain largely unaffected by the mess.

In short term bubbles that is usually true, but in long term stuff like the Celtic tiger the opposite is usually what happens!

When it lasts for so long there comes a point when the 'rain makers' actually believe they can make rain!

A classic example from my part of the world in UBS, a Swiss bank, it lost $50b in the US housing bubble. Documents for the early day show that they understood the risks starting out, but over time they started to believe that these MBS were as good as Governemt Bonds and started to hold them for their own account instead of selling them on to investors - when the music stopped they were left holding a little over $50b of them!!!

Have a read of "Extraordinary Popular Delusions and the Madness of Crowds", it was written 1841 and it is still as topical today.

Jim.

mono627

Jim2007 wrote: »

Have a read of "Extraordinary Popular Delusions and the Madness of Crowds", it was written 1841 and it is still as topical today.

Jim, what's that book like to read? I'm looking for a light read at the moment

ixus

Checkout the interesting articles/videos section for something similar.

mono627

ixus wrote: »

Checkout the interesting articles/videos section for something similar.

That's actually perfect Ixus, thanks.

Jim2007

mono627 wrote: »

Jim, what's that book like to read? I'm looking for a light read at the moment

It's on line here, see for yourself