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McWilliams at it again

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  • Registered Users, Registered Users 2 Posts: 5,932 ✭✭✭hinault


    changes wrote: »
    Well whatever happens i couldn't stomach people who bought 2nd, 3rd or even 4th properties being bailed out. If those people stayed out of it during the boom wouldn't be in half the trouble we are in now.

    fair point.

    If those same "investors" had stayed out of the market it might have reduced the overheating that was happening at that time.

    I have no sympathy for those kind - they should be left to fend for themselves.


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    Basically the wages increases of the last 7 years for all have been funded by the young homeowners of this country ,if they had not been giving the mortgages the house prices would not have risen to such ridicules levels.The whole economy lived off the fat of the construction boom.
    Even the wise few (who like to strut around the Irish Economy & Budget 2010 forum telling us how they predicted the whole thing) earned their wages from the house boom either directly or indirectly.
    We all benefited from the Celtic tiger so i think it's only fair that we all share the burden of its demise...and as someone else said 70,000 people handing back the keys would mean the tax payer foots the bill......


  • Registered Users, Registered Users 2 Posts: 13,011 ✭✭✭✭Sand


    It does not immediately follow that if homeowners were to default on their homes that the taxpayers would have to bail out the banks. The government chose to bail out the banks, it could just as easily choose not to and force the banks to make a deal with their creditors.

    Whats best for the bank's bondholders is not what is best for Ireland, or vice versa. Someone has to lose money, and I choose the involved parties.


  • Registered Users, Registered Users 2 Posts: 8 fjortal


    I am one of those "greedy" etc 2007 house buyers, in a rediculous amount of neg equity, a ghost town outside dublin, mortgaged until I am 70, with 3 kids under 4 1/2 (before I get into a debate about contraception....jobs oxo!)

    I do not expect a bail out (although the ..whats good for the goose thing does stick in my throat a bit). I will pay my mortgage, I entered into a contract (foolishly or otherwise).... but we are a one income family and if my partner lost his job.... it really scares me that other mothers and families are living this nightmare!

    I really feel that the vitriol and anger is so misplaced, the "greedy" who had the audacity and stupidy to buy houses V the clever who rented, the public V the private, where are the voters?

    I do not believe that there is a strong viable alternative and thats what even more depressing than the negative equity.

    grammer and spelling are not a strong point..... this is my first post.


  • Closed Accounts Posts: 1,914 ✭✭✭danbohan


    del88 wrote: »
    Basically the wages increases of the last 7 years for all have been funded by the young homeowners of this country ,if they had not been giving the mortgages the house prices would not have risen to such ridicules levels.The whole economy lived off the fat of the construction boom.
    Even the wise few (who like to strut around the Irish Economy & Budget 2010 forum telling us how they predicted the whole thing) earned their wages from the house boom either directly or indirectly.
    We all benefited from the Celtic tiger so i think it's only fair that we all share the burden of its demise...and as someone else said 70,000 people handing back the keys would mean the tax payer foots the bill......

    ogh i get it now , its all our fault , we benefited from the brave people who decided that a 3 bed semi in clondalkin was worth at least 2x times as much as in most similar European city's.and because we did not get involved in this we should now give them some of the money we saved by not doing so . its risk equalization , sort like VHI, why did nobody just tell us this before then we all be happy


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  • Closed Accounts Posts: 2,487 ✭✭✭Mister men


    So let me get this straight... people bought houses they could'nt afford and now people like myself (who rented through those years and still is renting as prices are still to high) are expected to help them out? :mad:


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    Mister men wrote: »
    So let me get this straight... people bought houses they could'nt afford and now people like myself (who rented through those years and still is renting as prices are still to high) are expected to help them out? :mad:
    These people partly payed your wages for the last few year and most could afford them when they had a job.


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    danbohan wrote: »
    ogh i get it now , its all our fault , we benefited from the brave people who decided that a 3 bed semi in clondalkin was worth at least 2x times as much as in most similar European city's.and because we did not get involved in this we should now give them some of the money we saved by not doing so . its risk equalization , sort like VHI, why did nobody just tell us this before then we all be happy

    No it's not your fault, it's the governments fault... their job (which me and you employed them to do) was to look after the best interests of the people of this country....they failed....they allowed the banks to give large mortgages to the young of this country leaving them with debts that they may never pay back.....the government (and a lot of the opposition) actively encouraged people to buy in to the property market.


  • Registered Users, Registered Users 2 Posts: 43,313 ✭✭✭✭K-9


    del88 wrote: »
    Basically the wages increases of the last 7 years for all have been funded by the young homeowners of this country ,if they had not been giving the mortgages the house prices would not have risen to such ridicules levels.The whole economy lived off the fat of the construction boom.
    Even the wise few (who like to strut around the Irish Economy & Budget 2010 forum telling us how they predicted the whole thing) earned their wages from the house boom either directly or indirectly.
    We all benefited from the Celtic tiger so i think it's only fair that we all share the burden of its demise...and as someone else said 70,000 people handing back the keys would mean the tax payer foots the bill......
    fjortal wrote: »
    I am one of those "greedy" etc 2007 house buyers, in a rediculous amount of neg equity, a ghost town outside dublin, mortgaged until I am 70, with 3 kids under 4 1/2 (before I get into a debate about contraception....jobs oxo!)

    I do not expect a bail out (although the ..whats good for the goose thing does stick in my throat a bit). I will pay my mortgage, I entered into a contract (foolishly or otherwise).... but we are a one income family and if my partner lost his job.... it really scares me that other mothers and families are living this nightmare!

    I really feel that the vitriol and anger is so misplaced, the "greedy" who had the audacity and stupidy to buy houses V the clever who rented, the public V the private, where are the voters?

    I do not believe that there is a strong viable alternative and thats what even more depressing than the negative equity.

    grammer and spelling are not a strong point..... this is my first post.
    del88 wrote: »
    No it's not your fault, it's the governments fault... their job (which me and you employed them to do) was to look after the best interests of the people of this country....they failed....they allowed the banks to give large mortgages to the young of this country leaving them with debts that they may never pay back.....the government (and a lot of the opposition) actively encouraged people to buy in to the property market.

    All good posts.

    Personally, I'm against the notion of a NAMA for the people but economically there maybe an argument for it. Most of the people who bought in the last 5 years are in negative equity, young and indebted for terms of 30 to 40 years.

    This is the part of the bubble that annoyed me most, 35/40 year mortgages. I could see the logic of them in a time of high interest rates, but at a time of record low interest rates?

    Yes, people should have known better, but there has been a huge transfer of wealth and debt in this country over the last decade or so.

    People profited from the gullibility of many people. That shouldn't be forgotten. Some people did make a fortune out of the bubble and they shouldn't be let just sit back and laugh at the ill fortune of others. They should pay their share too.

    Anyway, economically, we maybe doing more damage forcing people to pay massive 40 year mortgages on property that may never return to the bubble values paid, within 10/20 years time at best. You have the madness of the same people paying over priced mortgages for property worth 1/2 what it was worth AND increased taxes and cuts to Services to BAIL OUT the very banks who often negligently sold them these very mortgages.

    Surely these taxpayers, who are getting hit twice, deserve some break? Or are people not of systemic importance? Just banks and bond holders?

    Some sort of package may free up disposable income, which can be used to help the recovery. The cost in the long run, may not be as bad as many assume.

    Mad Men's Don Draper : What you call love was invented by guys like me, to sell nylons.



  • Closed Accounts Posts: 9,364 ✭✭✭ei.sdraob


    del88 wrote: »
    These people partly payed your wages for the last few year and most could afford them when they had a job.

    actually only a subset of those are

    the ones who are/were employed in export sector generating real wealth


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  • Moderators, Entertainment Moderators, Politics Moderators Posts: 14,568 Mod ✭✭✭✭johnnyskeleton


    silverharp wrote: »
    RTE radio seem to be trying to undermine the financial regulator at the moment. This morning they had Matt Cooper on in favour of a bailout for borrowers and now have just heard McWilliams say the same thing. his "logic" being that if they get bailed out they will spend money.

    I ain't no big city economist or nuthin', but surely if the goal is to get people to spend more money in order to stimulate consumption, the maximum return is obtained by giving this money to those who spend the most. People who are behind in their mortgages will use the money to pay off their debts and they will be conservative about their future spending because they have learned a harsh lession.

    If the sole objective is to increase consumption, give it to students and other feckless young people. The real reason for such a bailout is because that demographic is a large voting group, and also is the demographic to whom most of the media analysts sell their papers/programmes/books to.

    So it makes sense for them to champion this cause from a pure game theory perspective, but the idea that it is done to increase consumption in the wider economy is bunkum.


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    ei.sdraob wrote: »
    actually only a subset of those are

    The ones who are/were employed in export sector generating real wealth
    That's why i said "partly paid for".....tax receipts from stamp duty ,prsi from trades men,vat from building materials and corporation tax from harvey norman and spar shops selling breakfast rolls all allowed the government to keep other taxes low which the people who worked in the export sector all benefited from.
    It's all been one big pyramid scheme with the young mortgage holders been expected to take the full hit when we all got fat ....


  • Registered Users, Registered Users 2 Posts: 1,428 ✭✭✭MysticalRain


    I wasn't a builder, developer, auctioneer, landlord or civil servant during the boom. So I saw very little benefit from it myself.

    Talk the the greedy developer you bought your over-priced house from or your mortgage lender. Don't come cap-in-hand to me looking for money because I haven't got any. I'm already completely broke and struggling thanks in no small part the greed and stupidity of the "I had to get on the property ladder or else/Bertie-made-me-do-it" brigade.


  • Registered Users, Registered Users 2 Posts: 43,313 ✭✭✭✭K-9


    I ain't no big city economist or nuthin', but surely if the goal is to get people to spend more money in order to stimulate consumption, the maximum return is obtained by giving this money to those who spend the most. People who are behind in their mortgages will use the money to pay off their debts and they will be conservative about their future spending because they have learned a harsh lession.

    If the sole objective is to increase consumption, give it to students and other feckless young people. The real reason for such a bailout is because that demographic is a large voting group, and also is the demographic to whom most of the media analysts sell their papers/programmes/books to.

    So it makes sense for them to champion this cause from a pure game theory perspective, but the idea that it is done to increase consumption in the wider economy is bunkum.

    Fair points, but these people we are talking about would be the middle classes of the next 10-20 years, the parents of the next generation and kids cost big money! Less disposable income there will affect the economy.

    Anyway, what I suspect may happen over the next few years is, just like the last 2 years, events will make some sort of package a necessity. Interest rates are rising already, by banks themselves to generate capital and this is before ECB increases that will come next year probably. People that are finding it hard now and complaining will find themselves crucified over the next few years. The objections raised here maybe overcome by the necessity to do something.

    On your above point, I'd be sceptical of returning to the consumerist, high spend model that got us in this mess. These cases would be different as the people we are talking about would be the new poor in this country. Fur coat and no knickers being the term I'd use, seeing as I can't think of another one!

    Mad Men's Don Draper : What you call love was invented by guys like me, to sell nylons.



  • Closed Accounts Posts: 2 HORRO53


    Lets be honest here in the time of the boom every body was encouraged to buy a house and for the 1st time in a generation people could do this.

    And at the time every body was working and i believe could afford to pay for their homes

    And you did'nt see the government telling people to stop buying they were taking in record stamp duty so why would they?

    There is no real quick fix for this issue if 70,000 home were given back to the banks what would they do with them and in the long run the taxpayer would end up paying fot them anyway.

    Myself and my wife both lost our jobs and are finding it very hard to pay for our home.

    And i hope that the people who claim they got it right by waiting for the crash
    don't find them selves in the horrible situation of unemployment its very easy to claim "i told you so"


  • Registered Users, Registered Users 2 Posts: 1,428 ✭✭✭MysticalRain


    del88 wrote: »
    That's why i said "partly paid for".....tax receipts from stamp duty ,prsi from trades men,vat from building materials and corporation tax from harvey norman and spar shops selling breakfast rolls all allowed the government to keep other taxes low which the people who worked in the export sector all benefited from.
    It's all been one big pyramid scheme with the young mortgage holders been expected to take the full hit when we all got fat ....

    It was mostly borrowed, not "paid for". It would have been real wealth that we could all have benefited from if the government had focused on building a sustainable export-led economy instead of funneling it into a get rich quick scheme that ultimately benefited a few elites and indebted the rest of us.


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    I wasn't a builder, developer, auctioneer, landlord or civil servant during the boom. So I saw very little benefit from it myself.

    Talk the the greedy developer you bought your over-priced house from or your mortgage lender. Don't come cap-in-hand to me looking for money because I haven't got any. I'm already completely broke and struggling thanks in no small part the greed and stupidity of the "I had to get on the property ladder or else/Bertie-made-me-do-it" brigade.

    The so called "I had to get on the property ladder or else/Bertie-made-me-do-it" brigade are young families that bought houses to live in and you paid low taxes (if you worked) off the back of the price they paid for their house.....you benefited from that.


  • Closed Accounts Posts: 2 HORRO53


    Yes i could not agree more i think this issue will get worse before it gets better!


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    It was mostly borrowed, not "paid for". It would have been real wealth that we could all have benefited from if the government had focused on building a sustainable export-led economy instead of funneling it into a get rich quick scheme that ultimately benefited a few elites and indebted the rest of us.
    Your dead right....I'm not saying i seen this whole mess coming but it always amazed me when the papers talked about Ireland (back in 2007) being the riches country in the world when our exports where average....


  • Registered Users, Registered Users 2 Posts: 1,428 ✭✭✭MysticalRain


    del88 wrote: »
    The so called "I had to get on the property ladder or else/Bertie-made-me-do-it" brigade are young families that bought houses to live in and you paid low taxes (if you worked) off the back of the price they paid for their house.....you benefited from that.

    They weren't all young families. You had plenty of teachers with properties in Bulgaria and as well as Ireland. The same crowd who mercilessly tried to extract every last penny out of me in rent during the boom years, and now they want to take even more for me now that their get-rich-quick scheme has gone tits up.

    I worked in the tech industry, so I benefited from the 1990s tech boom, not the post 2001 property bubble. All the property bubble did for me was divert valuable investment away from our industry, and drive inflation up so day-to-day living was more expensive for me than it otherwise would have been.

    Ireland had low taxes before the property boom. My taxes are now going to be raised to pay for the property debacle.


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  • Registered Users, Registered Users 2 Posts: 14,569 ✭✭✭✭cson


    del88 wrote: »
    The so called "I had to get on the property ladder or else/Bertie-made-me-do-it" brigade are young families that bought houses to live in and you paid low taxes (if you worked) off the back of the price they paid for their house.....you benefited from that.

    Riddle me this; unless the poster you quoted was hitting well above the second band, he'd have derived no tangible benefits through taxation that I'd see. If I remember correctly; the higher rate was lowered by a whopping 1% to 41% during the Ponzai Years [2001-2007] whilst first band/VAT/CGT/CAT remained unchanged. I'm open to correction on this but please for arguments sake outline how that poster would have benefitted from low taxes, I'm intrigued.


  • Registered Users, Registered Users 2 Posts: 43,313 ✭✭✭✭K-9


    It was mostly borrowed, not "paid for". It would have been real wealth that we could all have benefited from if the government had focused on building a sustainable export-led economy instead of funneling it into a get rich quick scheme that ultimately benefited a few elites and indebted the rest of us.

    The Govt. fanned the bubble no doubt, but far more importantly the banks did, with 40 year mortgages and interest free "investment mortgages". We'll find the money to bail these "rogue traders" out but not the poor mugs that the banks didn't carry out proper due diligence on. That seems to be the attitude that prevails now, not much change from the Celtic Tiger there then, look after numero uno.
    del88 wrote: »
    The so called "I had to get on the property ladder or else/Bertie-made-me-do-it" brigade are young families that bought houses to live in and you paid low taxes (if you worked) off the back of the price they paid for their house.....you benefited from that.

    That is a fair point. Very few marched or protested when taxes were being decreased, roads being built, public services improved. Most preferred to moan about the Govt. not doing enough.

    Mad Men's Don Draper : What you call love was invented by guys like me, to sell nylons.



  • Registered Users, Registered Users 2 Posts: 1,428 ✭✭✭MysticalRain


    del88 wrote: »
    Your dead right....I'm not saying i seen this whole mess coming but it always amazed me when the papers talked about Ireland (back in 2007) being the riches country in the world when our exports where average....

    Yes, the same papers that were pimping houses in their property section. Like the saying goes, don't believe everything you read in the papers...


    Although that is a somewhat unfair characterization. I read plenty of those articles myself at the time. If you read through to the end of those articles, you would have come across a comment from a German or Scandinavian economist pointing out the fact that most of Ireland's so-called "wealth" was tied up in property.


  • Moderators, Entertainment Moderators, Politics Moderators Posts: 14,568 Mod ✭✭✭✭johnnyskeleton


    Taxipete29 wrote: »
    People need to wake up to a harsh reality, more and more homeowners are going to just walk away from their houses. You cant lock them up and you cant get blood from a stone. The best case is banks get a small monthly payment and should the debtor ever come into money, the bank gets it then. Worst is person has no job, can afford no payments and all bank gets is what it can sell the house for.

    I am not in favour of a bailout. The idea that "they made their bed let them lay in it" is all very well until you realise there really isnt a whole lot you can do to someone who posts back their keys and tries to walk away. Reality is long-term some sort of scheme like the negative equity loan scheme proposed a couple of weeks ago will have to be put in place.

    People walking away from debt = taxpayer bailing out the bank.

    In other words like it or not we are going to be bailing out the little guy. Its more to do with us( taxpayers) getting a good deal or just getting shafted as usual.

    I'm all for the type of debt forgiveness which means someone gives up their house and other assets and after a period of time starts again. It is part of an efficient market clearing system.

    I'm not in favour of people getting a bailout and still keeping their houses (which they probably don't deserve relative to someone who may have been more prudent).


  • Registered Users, Registered Users 2 Posts: 1,136 ✭✭✭del88


    They weren't all young families. You had plenty of teachers with properties in Bulgaria and as well as Ireland. The same crowd who mercilessly tried to extract every last penny out of me in rent during the boom years, and now they want to take even more for me now that their get-rich-quick scheme has gone tits up.

    I worked in the tech industry, so I benefited from the 1990s tech boom, not the post 2001 property bubble. All the property bubble did for me was divert valuable investment away from our industry, and drive inflation up so day-to-day living was more expensive for me than it otherwise would have been.

    Ireland had low taxes before the property boom. My taxes are now going to be raised to pay for the property debacle.

    I agree with most of what you say....but that was not the fault of the young families that belived the politicians and media to a degree(who made bucket loads of money from property supplements i might add).


  • Registered Users, Registered Users 2 Posts: 1,428 ✭✭✭MysticalRain


    K-9 wrote: »
    The Govt. fanned the bubble no doubt, but far more importantly the banks did, with 40 year mortgages and interest free "investment mortgages". We'll find the money to bail these "rogue traders" out but not the poor mugs that the banks didn't carry out proper due diligence on. That seems to be the attitude that prevails now, not much change from the Celtic Tiger there then, look after numero uno.
    .
    The main banks were of systematic importance to the economy. If they went down, then the rest of the economy went down with them. That wasn't the case with angle and nationwide of course. That was a complete waste of money. But there is no point in pouring good money after bad.

    Despite the sob stories, most people will eventually pay off their mortgages even if it takes them 40 years to do it. At least then they will learn some sense of fiscal responsibility from the experience.

    The socialist in me has no problem caring for the genuinely needy in society. I have no problem paying extra taxes to fund someone's dole if they lose their job. I just draw the line at bailing out the kinds of people who earned a lot more money than I ever did and would still be genuinely well off if they had behaved bit more responsibly.


  • Registered Users, Registered Users 2 Posts: 43,313 ✭✭✭✭K-9


    cson wrote: »
    Riddle me this; unless the poster you quoted was hitting well above the second band, he'd have derived no tangible benefits through taxation that I'd see. If I remember correctly; the higher rate was lowered by a whopping 1% to 41% during the Ponzai Years [2001-2007] whilst first band/VAT/CGT/CAT remained unchanged. I'm open to correction on this but please for arguments sake outline how that poster would have benefitted from low taxes, I'm intrigued.

    Through increased tax credits and in particular, the increased 20% tax band, particularly if a 2 income family.

    VAT actually was increased during the bubble, affecting Construction in particular, the 12.5% rate became 13.5%. CGT and CAT largely remained unchanged, some improvements here to reflect the bubble prices, no changes there, which brought in increased revenues. Stamp Duty revenue definitely did massively increase as did VRT.

    The whole problem was our philosophy in taxes was low direct taxes, including PAYE, PRSI and Corporation tax which was used to increase VAT, VRT, Stamp Duty etc. receipts. Which is why we are in the mess we are in with such a huge deficit compared to others. We became dependent on spending taxes which is why we have a double whammy when unemployment hit and companies got hit by the recession.

    Mad Men's Don Draper : What you call love was invented by guys like me, to sell nylons.



  • Registered Users, Registered Users 2 Posts: 14,569 ✭✭✭✭cson


    del88 wrote: »
    I agree with most of what you say....but that was not the fault of the young families that belived the politicians and media to a degree(who made bucket loads of money from property supplements i might add).

    I see populist Ireland still retains its remarkable ability for apportionment of blame whilst taking absolutely no responsibility itself. Sure it could never be our fault could it? :rolleyes:


  • Registered Users, Registered Users 2 Posts: 43,313 ✭✭✭✭K-9


    The main banks were of systematic importance to the economy. If they went down, then the rest of the economy went down with them. That wasn't the case with angle and nationwide of course. That was a complete waste of money. But there is no point in pouring good money after bad.

    Despite the sob stories, most people will eventually pay off their mortgages even if it takes them 40 years to do it. At least then they will learn some sense of fiscal responsibility from the experience.

    The socialist in me has no problem caring for the genuinely needy in society. I have no problem paying extra taxes to fund someone's dole if they lose their job. I just told line at bailing out the kinds of people who earned a lot more money than I ever did and would still be genuinely well off if they had behaved bit more responsibly.

    I'd usually agree with you, indeed 6 months ago, I'd probably have posted the exact same.

    I do think, in certain defined cases, definitely restricted just to first time buyers at the most, i.e. very importantly excluding investors and people who traded up to a 3,000 sq. ft. house to keep up with the Jones, there are cases that a debt reduction scheme may offer Long Term Economic benefit.

    I stress Long Term. We've had enough Short Term measures!

    Mad Men's Don Draper : What you call love was invented by guys like me, to sell nylons.



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  • Registered Users, Registered Users 2 Posts: 1,428 ✭✭✭MysticalRain


    del88 wrote: »
    I agree with most of what you say....but that was not the fault of the young families that belived the politicians and media to a degree(who made bucket loads of money from property supplements i might add).

    Well I'm afraid it is their fault. That's where the lessons our parents taught us about personal responsibility come into play. It wasn't like somebody put a gun to their heads to force them to sign on the dotted line. They fell for the oldest trick in the book by being gullible enough to believe what the politicians and the media told them.


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