Re Ireland Banking crisis 2008

sxt · 26-04-2019 11:04PM #1

Does anybody know if the outcome would have been different if different politicians had of been negotiating at that time or is that a fallacy

Would a seasoned politician like bertie arhern in a position of power, have been able to to prevent the coarse of history?

Or was Ireland always going to take the hit for Europe.

Mad_maxx · 27-04-2019 08:11AM

sxt wrote: »

Does anybody know if the outcome would have been different if different politicians had of been negotiating at that time or is that a fallacy

Would a seasoned politician like bertie arhern in a position of power, have been able to to prevent the coarse of history?

Or was Ireland always going to take the hit for Europe.

Bertie was only good at spending money so that era would not have suited him

amcalester · 27-04-2019 08:17AM

More likely to have turned out worse.

Look at Greece.

LessOutragePlz · 27-04-2019 08:18AM

sxt wrote: »

Would a seasoned politician like bertie arhern in a position of power, have been able to to prevent the coarse of history?

He would not have been in a position of power in that situation the Irish banking system needed to be bailed out so it had to be done on the Troika's terms we had very little negotiating power in that situation. Therefore, it wouldn't of mattered who was in power at the time since it would have made very little difference to the outcome of the negotiations.

Gloomtastic! · 27-04-2019 08:24AM

Mad_maxx wrote: »

Bertie was only good at spending tax payers money so that era would not have suited him

Just added that bit myself.

The €200 billion that we now owe, and will continue to do so forever probably, is comprised of €67-odd billion given to the banks but the remaining amount is due to how much Bertie had given to the pensioners, unemployed, public servants etc when we had the money and couldn’t take back, because politicians of all creed, didn’t want to lose their votes.

The opportunity was there when FG got into power but they bottled it.

bells of shandon · 27-04-2019 08:38AM

Irelands Banking Crisis was not a happenstance. It was organised.
First the Banking Regulation Dept was dismantled in 1998 and a new ineffective unit put in place.
Second the Banks got the green light to lend indiscriminately, with the regulators neutralised.
The Masters of the Universe received large bonuses on their Loan book turn-over. Greed was rampant.
Third the inevitable inability to repay loans occurred, and the Crash occurred.
The ECB has the power to buy up all toxic debts in the Eurozone, even at a large discount. It creates the money.
Instead they chose to cripple Ireland with unpayable debt as a form of enslavement.
Banks are like Pawnbrokers , they lend unrepayable sums and then seize the collateral when a loan goes into default, it is an old usury trick.

27-04-2019 09:54AM

sxt wrote: »

Does anybody know if the outcome would have been different if different politicians had of been negotiating at that time or is that a fallacy

Would a seasoned politician like bertie arhern in a position of power, have been able to to prevent the coarse of history?

Or was Ireland always going to take the hit for Europe.

The "Ireland Banking crisis 2008" was not a singular event OP

There were three main parts to it

The property bubble 1997 to 2008

The bank guarantee of 2008

The "Trioka" intervention.

The property bubble
This was government policy scantioned by the electorate that returned FF in three straight elections from 1997 to 2008
People were happy with the house price inflation and the easy credit.

The bank guarantee of 2008
There were two alternatives to the bank guarantee.
The first was to finiance the banks through their deposits.
If they had done this there would be mayhem as a awful lot of people have spent an awful lot of years saving their hard earned money, and to blow it all away like that would not have been popular.

The other was the famous "burn the bondholders"
Easier said than done as the bondholders were things like ordinary people's pensions, insurance policies, life assurance policies etc.
I think some middle ground could have been found on how to fix the banks but it happened the way it happened.

The "Trioka" intervention
This bailout saved us from ourselves in the end, as someone earlier posted look at Greece.
It gave us the stability to recover.
But even it is being watered down now due to the electorate.
In the last GE once FF said they were against water charges (something they negotiated with the Trioka) they got a huge jump in support
In the last few months another Trioka policy, Property tax, is being sacrificed at the alter of populism.
Property tax rates are not being reevaluated at this time simply because there is an election on the way.
Rates are still at 2011 values which is why off for 2019
A lot more people would be paying a lot more property tax if there was a reevaluation.

Gloomtastic! · 27-04-2019 09:59AM

Fr Tod Umptious wrote: »

The "Ireland Banking crisis 2008" was not a singular event OP

There were three main parts to it

The property bubble 1997 to 2008

The bank guarantee of 2008

The "Trioka" intervention.

The property bubble
This was government policy scantioned by the electorate that returned FF in three straight elections from 1997 to 2008
People were happy with the house price inflation and the easy credit.

The bank guarantee of 2008
There were two alternatives to the bank guarantee.
The first was to finiance the banks through their deposits.
If they had done this there would be mayhem as a awful lot of people have spent an awful lot of years saving their hard earned money, and to blow it all away like that would not have been popular.

The other was the famous "burn the bondholders"
Easier said than done as the bondholders were things like ordinary people's pensions, insurance policies, life assurance policies etc.
I think some middle ground could have been found on how to fix the banks but it happened the way it happened.

The "Trioka" intervention
This bailout saved us from ourselves in the end, as someone earlier posted look at Greece.
It gave us the stability to recover.
But even it is being watered down now due to the electorate.
In the last GE once FF said they were against water charges (something they negotiated with the Trioka) they got a huge jump in support
In the last few months another Trioka policy, Property tax, is being sacrificed at the alter of populism.
Property tax rates are not being reevaluated at this time simply because there is an election on the way.
Rates are still at 2011 values which is why off for 2019
A lot more people would be paying a lot more property tax if there was a reevaluation.

Why is always about paying more tax? Why don’t we start looking seriously at where we spend the money?

Mad_maxx · 27-04-2019 09:59AM

Gloomtastic! wrote: »

Just added that bit myself.

The €200 billion that we now owe, and will continue to do so forever probably, is comprised of €67-odd billion given to the banks but the remaining amount is due to how much Bertie had given to the pensioners, unemployed, public servants etc when we had the money and couldn’t take back, because politicians of all creed, didn’t want to lose their votes.

The opportunity was there when FG got into power but they bottled it.

All very true, we saddled the unborn with huge debts so guards could retire at fifty five with million euro pension pots yet still get free medical care upon reaching seventy

Those in senior years were shielded but largely speaking, the younger generations supported it, recall students on the streets and them arm in arm with wealthy pensioners who were irate at the idea of having to pay to visit the doctor

Brian lenehan sure had a torrid time of it

is_that_so · 27-04-2019 10:02AM

Gloomtastic! wrote: »

Just added that bit myself.

The €200 billion that we now owe, and will continue to do so forever probably, is comprised of €67-odd billion given to the banks but the remaining amount is due to how much Bertie had given to the pensioners, unemployed, public servants etc when we had the money and couldn’t take back, because politicians of all creed, didn’t want to lose their votes.

The opportunity was there when FG got into power but they bottled it.

Most of what we owe is down to the day to day running of a collapsed economy. There's that lazy €67bn again but reckless behaviour by banks did sink us. Ultimately liability will be about the cost of Anglo.

On the question, it wouldn't have made a lot of difference as the international context did matter. Some might imagine a " more prudent" FG/Labour but they'd have had some version or overspending, may not as wild. We'd still have ended up with a form of intervention.

Mad_maxx · 27-04-2019 10:04AM

Fr Tod Umptious wrote: »

The "Ireland Banking crisis 2008" was not a singular event OP

There were three main parts to it

The property bubble 1997 to 2008

The bank guarantee of 2008

The "Trioka" intervention.

The property bubble
This was government policy scantioned by the electorate that returned FF in three straight elections from 1997 to 2008
People were happy with the house price inflation and the easy credit.

The bank guarantee of 2008
There were two alternatives to the bank guarantee.
The first was to finiance the banks through their deposits.
If they had done this there would be mayhem as a awful lot of people have spent an awful lot of years saving their hard earned money, and to blow it all away like that would not have been popular.

The other was the famous "burn the bondholders"
Easier said than done as the bondholders were things like ordinary people's pensions, insurance policies, life assurance policies etc.
I think some middle ground could have been found on how to fix the banks but it happened the way it happened.

The "Trioka" intervention
This bailout saved us from ourselves in the end, as someone earlier posted look at Greece.
It gave us the stability to recover.
But even it is being watered down now due to the electorate.
In the last GE once FF said they were against water charges (something they negotiated with the Trioka) they got a huge jump in support
In the last few months another Trioka policy, Property tax, is being sacrificed at the alter of populism.
Property tax rates are not being reevaluated at this time simply because there is an election on the way.
Rates are still at 2011 values which is why off for 2019
A lot more people would be paying a lot more property tax if there was a reevaluation.

When the " bubble" set in is debatable but the boom actually began in 1995, it also peaked in 2006

I'd argue the "bubble" didn't really start until circa 2003, after that we were an economy based on house price appreciation and became a speculative bubble, when mc creavy was exiled to Europe for being too "thatcher", bertie appointed cowen as minister for buying off voters and he did a great job in that respect

Regarding saving bond holders etc, again that was about shielding the over fifties

27-04-2019 10:16AM

Mad_maxx wrote: »

When the " bubble" set in is debatable but the boom actually began in 1995, it also peaked in 2006

I'd argue the "bubble" didn't really start until circa 2003, after that we were an economy based on house price appreciation and became a speculative bubble, when mc creavy was exiled to Europe for being too "thatcher", bertie appointed cowen as minister for buying off voters and he did a great job in that respect

Regarding saving bond holders etc, again that was about shielding the over fifties

Yes the real property bubble was from 2003 on.
To that point it was a boom rather than a bubble.

The famous "soft landing" actually happened around 2002/2003 but no one noticed as the air was put back in again almost immediately.

Kermit.de.frog · 27-04-2019 10:23AM

sxt wrote: »

Does anybody know if the outcome would have been different if different politicians had of been negotiating at that time or is that a fallacy

Would a seasoned politician like bertie arhern in a position of power, have been able to to prevent the coarse of history?

Or was Ireland always going to take the hit for Europe.

This is such a load of nonsense propagated by people with no solutions to anything.

Ireland did not take any hit "for Europe".

Ireland bankrupted itself and banks through our own national incompetence and stupid governance.

Anyone who says otherwise or tries to bend this fact is an out and out liar or ignorant or both.

What's important is that it never happens again.

27-04-2019 10:27AM

Kermit.de.frog wrote: »

This such a load of nonsense propagated by people with no solutions to anything.

Ireland did not take any hit "for Europe".

Ireland bankrupted itself and banks through our own national incompetence and stupid governance.

Anyone who says otherwise or tries to bend this fact is an out and out liar or ignorant or both.

Iceland handled it somewhat better at the time, our then government succumbed to panic.

is_that_so · 27-04-2019 10:34AM

Deleted User wrote: »

Iceland handled it somewhat better at the time, our then government succumbed to panic.

Iceland has a population the size of Cork and is not subject to ECB rules for its banking. You need to do a lot better than the what about Iceland line.

27-04-2019 10:43AM

is_that_so wrote: »

Iceland has a population the size of Cork and is not subject to ECB rules for its banking. You need to do a lot better than the what about Iceland line.

You're putting words in my mouth, and introducing an irrelevant tangent about population. This debate concerns incompetent leadership.

is_that_so · 27-04-2019 10:47AM

Deleted User wrote: »

You're putting words in my mouth, and introducing an irrelevant tangent about population. This debate concerns incompetent leadership.

Hmm, I didn't see any of this in your "brief" post. You did include the irrelevant whataboutery purporting to be a direct comparison.

_Brian · 27-04-2019 10:48AM

Gloomtastic! wrote: »

Just added that bit myself.

The €200 billion that we now owe, and will continue to do so forever probably, is comprised of €67-odd billion given to the banks but the remaining amount is due to how much Bertie had given to the pensioners, unemployed, public servants etc when we had the money and couldn’t take back, because politicians of all creed, didn’t want to lose their votes.

The opportunity was there when FG got into power but they bottled it.

Remember when you complain about FF giving all this money away, FG we’re across the floor shouting for even more to be given away and that FF weren’t being generous enough.

The boom and following bust was an Irish phenomenon rather than a politically produced event, it was going to happen no matter who was in power.

Bertie has many many failings, a politician from a long dead era. He could however negotiate and potentially he might have gotten a bit better deal for us, but I’d imagine by so little it would Be insignificant in overall terms.

Bertie should have only one positive memory in Irish history and that was his contribution to peace in the north. No other politician since could deliver what he negotiated behind the scenes. He was only able to do this because of his somewhat dubious nature and ability to deal with essential criminals as he seemed very comfortable doing. Enda, Leo, Michael et al wouldn’t have the stomach to shake hands with the people who needed talking to and befriending, they are all much too self riotous and straight laced to meet such people on even terms.
Maybento thise in the Pale and beyond this means nothing but for those in border counties and regularly being north of the border it’s a big deal, politically he Could possibly have done better for Ireland, but on the peace process he was essential.

bells of shandon · 27-04-2019 10:49AM

Most people do not understand what money is.
Money is a medium of exchange, to facilitate trade and industry.
It is a store of value, but can be devalued by inflation.
It is a tool to enable production, by paying wages ,buying materials etc.
Money has no intrinsic value, it cannot buy you water or a chicken from a native of the Amazon jungle.
It receives its value, when the GOVT requires a citizen to pay his taxes and only accepts the coin and paper money of the Nation.
A Nation that does not control its own currency, has no control over its economy, to stimulate industry, it cannot issue currency.
Ireland relies on taxes to finance its expenditure,
THe shortfall between taxes and expenditure is the deficit. This is made up by borrowing from the International Banking System at interest.
The interest can vary ,depending on the ability. risk of repayment.

A Nation without its own currency can go bankrupt. A Nation like the UK or USA,jAPAN etc can never run short of money, it creates it.
Ireland has never had control of its own currency from its founding in 1921.
Michael Collins negotiated in the Treaty an autonomous currency for the Free State (as then).
The Irish currency was pegged to the British Sterling (on his death)'
.This removed the ability of Ireland to invest and forge a strong economy and is the reason for the stagnant years from 1921- 70's.
Irelands recent booms are because of Foreign investment at low tax rates and not the result of Govt investment in the indigenous industries.

Mad_maxx · 27-04-2019 10:54AM

Kermit.de.frog wrote: »

This is such a load of nonsense propagated by people with no solutions to anything.

Ireland did not take any hit "for Europe".

Ireland bankrupted itself and banks through our own national incompetence and stupid governance.

Anyone who says otherwise or tries to bend this fact is an out and out liar or ignorant or both.

What's important is that it never happens again.

Not entirely true, saving bond holders of all grades was pretty unprecedented but the combined forces of Timothy Geithner and Jean Claude Trichet, ensured the Irish tax payer picked up the tab for those who bought risk assets

We could never have avoided the entire bill but covered far too wide

Wibbs · 27-04-2019 10:57AM

_Brian wrote: »

Remember when you complain about FF giving all this money away, FG we’re across the floor shouting for even more to be given away and that FF weren’t being generous enough.

Yeah that seems to be forgotten all too easily B. FF were bad, but if FG had been in power it would have been essentially the same and we'd be berating them instead. They can be both cheeks of the same smelly arse.

And I agree with you re Bertie and the peace process. FF tended to more get stuck in regarding the North in both negative and positive ways, FG tended to regard it more at a distance.

Mad_maxx · 27-04-2019 11:01AM

Wibbs wrote: »

Yeah that seems to be forgotten all too easily B. FF were bad, but if FG had been in power it would have been essentially the same and we'd be berating them instead. They can be both cheeks of the same smelly arse.

And I agree with you re Bertie and the peace process. FF tended to more get stuck in regarding the North in both negative and positive ways, FG tended to regard it more at a distance.

FF have always been more eager to lavish voters with money, there isn't much in it as all parties vigorously court the public sector but FF see no value at all in prudence

27-04-2019 11:21AM

is_that_so wrote: »

Hmm, I didn't see any of this in your "brief" post. You did include the irrelevant whataboutery purporting to be a direct comparison.

You don't seem to have an adequate grasp of punctuation either, I'll leave you to your derisory musings.

paw patrol · 27-04-2019 12:14PM

they should have refused to bail out the banks or at least to the extent we have, the EU would have blinked as if the Irish banks fell over the German banks would have been in the ****.

The problem is that people view convenience in the immediate term as more important than the correct solution. No TD has the balls to preach hard times , all they care about is more votes. So the least worst solution eve if it costs us more is always the option rather than the best solution.

Also boils my piss the high taxes - take VAT as an example. Lenihan increased VAt to 23% instead of trying to slash VAT to increase spending and probably lower unemployment.....but no...they tried to tax us out of the hole despite every expert stating this was a bag of sh1te.

Take NAMA now (and also the banks) the taxpayer bailed them out...yet they are selling off these property to (mostly) foreign investment vehicles in bulk instead of offering cut-price properties to the irish citizens.
Why? cos it's easier for them even if individual sales may take in more money.

They (the government and Revenue) always seem to take decisions that ride the taxpayer. It seems like a load of gimps run the show to this day.

Mad_maxx wrote: »

Not entirely true, saving bond holders of all grades was pretty unprecedented but the combined forces of Timothy Geithner and Jean Claude Trichet, ensured the Irish tax payer picked up the tab for those who bought risk assets

We could never have avoided the entire bill but covered far too wide

I wish people took time to read this post twice...that is the facts...we repaid peoples investment in a private company...this is disgusting.

Charles Ingles · 27-04-2019 12:17PM

Not a fan of Bertie, but I would have much rather he was around and in charge of bailout negotiations, he's a slippery old eel is Bertie he wouldn't have been walked all over

bells of shandon · 27-04-2019 12:42PM

is_that_so wrote: »

Iceland has a population the size of Cork and is not subject to ECB rules for its banking. You need to do a lot better than the what about Iceland line.

You got it right on the ECB.
Iceland is an Independent Sovereign Nation.It has its own currency and controls its borders.
Unlike Ireland which is enslaved by the ECB control of the Euro, and does not control its borders.

Wanderer78 · 27-04-2019 12:44PM

Thank god we solved the issues within the banking sector!

MrFresh · 27-04-2019 12:48PM

bells of shandon wrote: »

Irelands Banking Crisis was not a happenstance. It was organised.
First the Banking Regulation Dept was dismantled in 1998 and a new ineffective unit put in place.
Second the Banks got the green light to lend indiscriminately, with the regulators neutralised.
The Masters of the Universe received large bonuses on their Loan book turn-over. Greed was rampant.
Third the inevitable inability to repay loans occurred, and the Crash occurred.
The ECB has the power to buy up all toxic debts in the Eurozone, even at a large discount. It creates the money.
Instead they chose to cripple Ireland with unpayable debt as a form of enslavement.
Banks are like Pawnbrokers , they lend unrepayable sums and then seize the collateral when a loan goes into default, it is an old usury trick.

Organised by who?

Wanderer78 · 27-04-2019 12:54PM

MrFresh wrote:

Organised by who?

By ourselves of course, we ve been lead to believe, by ourselves, by deregulating the financial sector, which in turn flooded the planet with cheap credit, caused a rapid rise in asset prices, all eventually went tits up in 08, bailed out the sector that largely caused it in the first place, and now apparently, everything is grand

MrFresh · 27-04-2019 01:02PM

paw patrol wrote: »

they should have refused to bail out the banks or at least to the extent we have, the EU would have blinked as if the Irish banks fell over the German banks would have been in the ****.

Similar sentiment was going around about Brexit. The EU didn't blink. UK is in a shambles.

Franz Von Peppercorn · 27-04-2019 01:03PM

Kermit.de.frog wrote: »

This is such a load of nonsense propagated by people with no solutions to anything.

Ireland did not take any hit "for Europe".

Ireland bankrupted itself and banks through our own national incompetence and stupid governance.

Anyone who says otherwise or tries to bend this fact is an out and out liar or ignorant or both.

What's important is that it never happens again.

Not true. If Ireland pays off the bad debts of retail bank lenders in Ireland it protects the banks who lead to those banks. In a fully federal system that would be paid by the federal state or monetised by the ECB.

Re Ireland Banking crisis 2008

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