Debt forgiveness - an economic happy story

subway · 11-11-2010 12:55PM

thebigbiffo wrote: »

you're a lecturer in english literature i take it?

what a fine example of how to outline your complex and intricate argument...

wasnt mad on wasting time with you.
no one forced you, I'm not interested in givng you any of my money, you're not a charity case you're a scrounger.

that's what your asking here.

thebigbiffo · 11-11-2010 01:00PM

TheZohan wrote: »

Let's say you bought a house in the 90's for 150k, sold it for 300k during the boom and bought a new house for 350k and now that new house is worth 300k today.....do you want to bail out the people that made a profit by selling but are (on paper) in negative equity?

Or do you just want to help out brain dead people like Alison, first time buyers, who went ahead and bought at crazy prices when they were told it was a bad idea?

i dont think the suggestion is for an all encompassing forgiveness of everybody in negative equity and i certainly wouldn't stand by this proposal should it aid people who made vast profits and can afford their mortages (like myself).

unfortunately, yes. as much as i dislike that crazy bint she would be the type of person who would benefit from this in the short term...but seriously, you have to get by personal feelings on the matter and look at the bigger picture. more money in the economy instead of straight to bank vaults and international investors = steady growth + more jobs + less taxes + less savage budgets etc etc etc...

these economists that put their name to this article are smart guys and were by no means cheerleaders for the boom - they know what they're talking about and i for one (when i put aside petty begrudgery at how people will have their debt lowered) think the proposal makes sense...

GreeBo · 11-11-2010 01:04PM

thebigbiffo wrote: »

if you were married with 2 children and wanted to live an average lifestyle in your community or close to work you had no choice but to buy at boom prices. people either ignore this, convieniently forget it are not aware of it because the circumstances never applied to them.

Did these people just wake up one day with a partner, 2 kids and no home?
No they didnt. The decided that they wanted to live in a certain area in a certain style of house and live a certain lifestyle. They also chose to ignore what might happen if they had to take a pay cut or lost a job.
Do we give all ostriches this payout too?

cursai · 11-11-2010 01:05PM

thebigbiffo wrote: »

i dont think the suggestion is for an all encompassing forgiveness of everybody in negative equity and i certainly wouldn't stand by this proposal should it aid people who made vast profits and can afford their mortages (like myself).

unfortunately, yes. as much as i dislike that crazy bint she would be the type of person who would benefit from this in the short term...but seriously, you have to get by personal feelings on the matter and look at the bigger picture. more money in the economy instead of straight to bank vaults and international investors = steady growth + more jobs + less taxes + less savage budgets etc etc etc...

these economists that put their name to this article are smart guys and were by no means cheerleaders for the boom - they know what they're talking about and i for one (when i put aside petty begrudgery at how people will have their debt lowered) think the proposal makes sense...

THESE ECONMISTS made a 'PROPOSAL', not a concrete answer to the crisis for people. Also half of these ECONOMISTS are pandering for publicity and to sell newspaper articles. DAVID MCWILLIAMS(for instance) does not care about peoples financial troubles..only his own, which the papers are paying for!

thebigbiffo · 11-11-2010 01:05PM

cursai wrote: »

I whilst people like me have nothing to show for it.

this is what its really about

subway wrote: »

wasnt mad on wasting time with you.
no one forced you, I'm not interested in givng you any of my money, you're not a charity case you're a scrounger.

that's what your asking here.

looks like you cant read properly either. i'm not asking for anything, i was very clear in my posts that i would not or could not be expected to benefit from this - i have eyes and ears and a sense of perspective whilst you dont have the capacity for sound argument, just the capacity for cheap insults.

keep them to yourself if you dont mind.

11-11-2010 01:07PM

Cookie_Monster wrote: »

+1 sure if you can get it for your house why not car too.
I didn't buy a house at the stupid prices they were going for, can I have some free money for being sensible about property?

To put towards the losses on the BMW ? :pac:

Wicklowrider · 11-11-2010 01:10PM

cursai wrote: »

You cant get a fiesta for a 80 km commute to work everyday!

And IMO that says it all.

Of course you could. People in this country used to do more than that on honda 50's before we got soft. One good thing about this recession is there is an outside chance we will be become Irish again.

thebigbiffo · 11-11-2010 01:12PM

GreeBo wrote: »

Did these people just wake up one day with a partner, 2 kids and no home?
No they didnt. The decided that they wanted to live in a certain area in a certain style of house and live a certain lifestyle. They also chose to ignore what might happen if they had to take a pay cut or lost a job.
Do we give all ostriches this payout too?

did i say they didnt choose anything. whats your point.

if you lived your life expecting your job to be gone in the morning the country, continent and world wouldn't have much of an economy to save now would it.

our capitalist society (you know, one of the only systems that's proven to work for the most people) insists you buy stuff from the money you earn or the whole thing breaks down - it's happening now, but we're so caught up in the individual that seeing whats good for the herd is impossible.

cursai wrote: »

THESE ECONMISTS made a 'PROPOSAL', not a concrete answer to the crisis for people. Also half of these ECONOMISTS are pandering for publicity and to sell newspaper articles. DAVID MCWILLIAMS(for instance) does not care about peoples financial troubles..only his own, which the papers are paying for!

cant stand mcwilliams myself to be honest but opinion and a free media is what makes democracy work regardless of who benefits.

11-11-2010 01:13PM

Wicklowrider wrote: »

And IMO that says it all.

Of course you could. People in this country used to do more than that on honda 50's before we got soft. One good thing about this recession is there is an outside chance we will be become Irish again.

Indeed, a Fiesta and every other car on the road today in serviceable condition is more than capable of a 50 miles spin twice a day.

drdeadlift · 11-11-2010 01:14PM

**** like this will split the country down the middle.

I am one of the few people who chose not to buy a house,they seemed over priced.But for some odd reason young Irish people had a fire up their asses to get on the property ladder,i couldn't understand that urge,i think a medal of success came with it.

And i am not going to pay for some clowns mistake.

cursai · 11-11-2010 01:14PM

thebigbiffo wrote: »

this is what its really about

looks like you cant read properly either. i'm not asking for anything, i was very clear in my posts that i would not or could not be expected to benefit from this - i have eyes and ears and a sense of perspective whilst you dont have the capacity for sound argument, just the capacity for cheap insults.

keep them to yourself if you dont mind.

Your taking my answers out of context! No direct personal attacks here. When i say 'you', i mean your argument and what it represents.
Anyway. Its about equality and fairness. The car loan argument still stands. Thats €6000 euro i could be spending in the economy. Why should i not get the same treatment...because my loans are TOO small!

subway · 11-11-2010 01:14PM

thebigbiffo wrote: »

looks like you cant read properly either. i'm not asking for anything, i was very clear in my posts that i would not or could not be expected to benefit from this - i have eyes and ears and a sense of perspective whilst you dont have the capacity for sound argument, just the capacity for cheap insults.

keep them to yourself if you dont mind.

its a public forum, so ill post comments as a i like, use the report button if you feel upset.
i laughed at your "no choice but to buy" comment as its one of the most stupid things i've read in a while.

so tell me, (since you pretend to want to give your money to other people), how does it benefit the economy for me to handover my savings and future earnings to someone else to pay their mortgage.
how is it better for the economy for them to have more spare cash and me to have less?

and to be upfront with you, my opinion of you (and all the others that are calling for this) is that you do want to get money off the mortgage yourself. whether you use mental gymastics to fool yourself or not with doublethink.

to give you my opinion on what should be done, its quite simple, reform bankruptcy.
cant pay? give it all up and start again. same as everywhere else. not this stupid, let the idiots keep the crap they can't afford / paid too much for and socialise the cost

cursai · 11-11-2010 01:19PM

RoverJames wrote: »

To put towards the losses on the BMW ? :pac:

Wrong Mazda 6 02!

Tipp Man · 11-11-2010 01:21PM

The economists are making far too little of the moral hazard element of this. If this was implemented it would create one of the biggest ever divides in our society, because morally it is completly wrong

They are also way overblowing how much positive effect this will have on the economy, this will cost billions but I think we would never see that money back in the economy

cursai · 11-11-2010 01:22PM

RoverJames wrote: »

Indeed, a Fiesta and every other car on the road today in serviceable condition is more than capable of a 50 miles spin twice a day.

Okay fine. But i got this car because i wanted a decent car. I can afford it, its the ONLY loan i have. Its a SMALL manageable loan. Should I get my loan dropped?

11-11-2010 01:30PM

cursai wrote: »

Wrong Mazda 6 02!

Have a look at my post again, then have a look at who I quoted, then have a look at their signature for the Bimmer for sale

Then withdraw your wrong comment

thebigbiffo · 11-11-2010 01:32PM

cursai wrote: »

Your taking my answers out of context! No direct personal attacks here. When i say 'you', i mean your argument and what it represents.
Anyway. Its about equality and fairness. The car loan argument still stands. Thats €6000 euro i could be spending in the economy. Why should i not get the same treatment...because my loans are TOO small!

no i was quoting subway with that answer - he/she got personal.

but yeah your right really: the amount is too small...

subway wrote: »

its a public forum, so ill post comments as a i like, use the report button if you feel upset.
i laughed at your "no choice but to buy" comment as its one of the most stupid things i've read in a while.

so tell me, (since you pretend to want to give your money to other people), how does it benefit the economy for me to handover my savings and future earnings to someone else to pay their mortgage.
how is it better for the economy for them to have more spare cash and me to have less?

and to be upfront with you, my opinion of you (and all the others that are calling for this) is that you do want to get money off the mortgage yourself. whether you use mental gymastics to fool yourself or not with doublethink.

to give you my opinion on what should be done, its quite simple, reform bankruptcy.
cant pay? give it all up and start again. same as everywhere else. not this stupid, let the idiots keep the crap they can't afford / paid too much for and socialise the cost

yep, using insults to get your point across is perfectly acceptable as long as i dont report you - you're so childish i wouldnt allow you on the internet without supervision tbh...and btw: you still haven't outlined what you found so hearthily amusing about the 'didnt have a choice to buy' comment? i'm assuming you wouldnt have the capacity to argue the point so i'll leave it with you.

first, how in hell would your life savings be affected? your future earning would go up as the economy improved...i'm sure you havent a clue what you're talking about now...it's better for the economy for anyone to have spare cash, this isn't about 'you' or 'them'...

dont psycoanalyse me based on my agreement with newspaper article - another example of gross immaturity and stupidity on your behalf.

on bankruptcy you are correct - for once

turbot · 11-11-2010 01:32PM

Instead of debt forgiveness... I think a smarter approach could be "debt compassion".

This means the country doesn't take responsibility for their individual debts, (i.e. being paid off via long term taxes) but seeks to structure their finances to allow them to survive and progress.

For example, just like foreign workers have to pay emergency tax until they are officially registered, I think the tax bands should be restructured for people who are bankrupt, to give these individuals the ability to live well, albeit less luxuriously, and pay their dues over a sustained period of time. For example, if 20% was added to their upper rate of tax, and earnings above €100k a year were taxed at 75%, most people would still be able to maintain a reasonable standard of living. I think this debt compassion tax structure should allow them to earn their way out of whatever they owe, if possible.

This way, a sustained tax take over time will be possible to help offset the costs of government borrowing to deal with such bad debts. This also gives people a simple and clear structure, and an no income penalty until their income exceeds the bottom tax band.

I think this is the compassionate approach, allowing people to live well, albeit less luxuriously, while they are as responsible for their actions as is feasible.

thebigbiffo · 11-11-2010 01:37PM

turbot wrote: »

Instead of debt forgiveness... I think a smarter approach could be "debt compassion".

This means the country doesn't take responsibility for their individual debts, (i.e. being paid off via long term taxes) but seeks to structure their finances to allow them to survive and progress.

For example, just like foreign workers have to pay emergency tax until they are officially registered, I think the tax bands should be restructured for people who are bankrupt, to give these individuals the ability to live well, albeit less luxuriously, and pay their dues over a sustained period of time. For example, if 20% was added to their upper rate of tax, and earnings above €100k a year were taxed at 75%, most people would still be able to maintain a reasonable standard of living. I think this debt compassion tax structure should allow them to earn their way out of whatever they owe, if possible.

This way, a sustained tax take over time will be possible to help offset the costs of government borrowing to deal with such bad debts. This also gives people a simple and clear structure, and an no income penalty until their income exceeds the bottom tax band.

I think this is the compassionate approach, allowing people to live well, albeit less luxuriously, while they are as responsible for their actions as is feasible.

i agree with this...

although i very much agree in general with the article and its sentiments i'm not so sure that 'total' forgiveness is the way to go. a ten year moratorium would be just as effective.

either way - i think the issue of possible mass defaulting needs to be addressed in some way asap because its going to be a huge issue in the next few years

cursai · 11-11-2010 01:38PM

RoverJames wrote: »

Have a look at my post again, then have a look at who I quoted, then have a look at their signature for the Bimmer for sale
Then withdraw your wrong comment

I don't understand?...................oh right Bimmer. Beamer NO?

Tipp Man · 11-11-2010 01:41PM

turbot wrote: »

Instead of debt forgiveness... I think a smarter approach could be "debt compassion".

This means the country doesn't take responsibility for their individual debts, (i.e. being paid off via long term taxes) but seeks to structure their finances to allow them to survive and progress.

For example, just like foreign workers have to pay emergency tax until they are officially registered, I think the tax bands should be restructured for people who are bankrupt, to give these individuals the ability to live well, albeit less luxuriously, and pay their dues over a sustained period of time. For example, if 20% was added to their upper rate of tax, and earnings above €100k a year were taxed at 75%, most people would still be able to maintain a reasonable standard of living. I think this debt compassion tax structure should allow them to earn their way out of whatever they owe, if possible.

This way, a sustained tax take over time will be possible to help offset the costs of government borrowing to deal with such bad debts. This also gives people a simple and clear structure, and an no income penalty until their income exceeds the bottom tax band.

I think this is the compassionate approach, allowing people to live well, albeit less luxuriously, while they are as responsible for their actions as is feasible.

so effectively the "rich" will pay the mortage for the person. The "rich" person pays extorionate tax rates will the person who can't meet their mortage pays no/little tax

You might as well just transfer the property to the "rich" person and let them pay the mortage, at least that way they are getting something for the payments

thebigbiffo · 11-11-2010 01:45PM

Tipp Man wrote: »

so effectively the "rich" will pay the mortage for the person. The "rich" person pays extorionate tax rates will the person who can't meet their mortage pays no/little tax

You might as well just transfer the property to the "rich" person and let them pay the mortage, at least that way they are getting something for the payments

i dont think thats what he's saying...

the suggestion as i understand it is that the government take your debts that you cant afford and then tax the s'hit out of you to get it back.

TheZohanS · 11-11-2010 01:46PM

Tipp Man wrote: »

so effectively the "rich" will pay the mortage for the person. The "rich" person pays extorionate tax rates will the person who can't meet their mortage pays no/little tax

You might as well just transfer the property to the "rich" person and let them pay the mortage, at least that way they are getting something for the payments

Don't be silly, the "rich" as you put it won't end up paying a red cent. They'll have their tax consultants that will find a loophole in this rather romantic idea and it will be them who benefit the most from this proposal.

turbot · 11-11-2010 01:50PM

Tipp Man wrote: »

so effectively the "rich" will pay the mortage for the person. The "rich" person pays extorionate tax rates will the person who can't meet their mortage pays no/little tax

You might as well just transfer the property to the "rich" person and let them pay the mortage, at least that way they are getting something for the payments

Tipp Man,

If there are 100,000's of people who are bankrupt, then as per the rules of bankruptcy, their assets pay off as much as possible. Beyond this point, people need a clear, fair, reasonable framework to survive and progress in life. I think this strikes a balance between allowing entrepreneurship, rewarding hardwork, and creating a structure where people can start again, while at the same time, ultimately taking responsibility for their actions and the consequences of those actions.

So as The Big Biffo summarised, this would allow the government to take on the debts you can't pay (in the near term) anyway, and for anyone who earns more than the basic tax rate, tax you more until they get it back.

voxpop · 11-11-2010 01:52PM

cursai wrote: »

I don't understand?...................oh right Bimmer. Beamer NO?

Beamer = motorcycles
Bimmer = car

turbot wrote:

. For example, if 20% was added to their upper rate of tax

So you think its a good idea to tax everything over 35k at 60% :eek: Good way to kill off whats left of the economy

Bankruptcy rules should be changed to allow ppl to hand everything in and go back to 0.

turbot · 11-11-2010 02:00PM

voxpop wrote: »

So you think its a good idea to tax everything over 35k at 60% :eek: Good way to kill off whats left of the economy

Only tax those people who have gone bankrupt like this. I think this does the opposite - it allows people to live, work and spend in the economy, increasing taxes on expenditure that by definition are above average.

This means they can lead a reasonable life - though it will take longer for them to get rich, and they'll have to work harder - at least until they've cleared what they owed.

I think this is fairer than everyones taxes being raised uniformly, to cover the losses of people who've gone bankrupt. And it may lead to extra money in government as the economy recovers and some of those people earn more money...

Tipp Man · 11-11-2010 02:14PM

turbot wrote: »

Tipp Man,

If there are 100,000's of people who are bankrupt, then as per the rules of bankruptcy, their assets pay off as much as possible. Beyond this point, people need a clear, fair, reasonable framework to survive and progress in life. I think this strikes a balance between allowing entrepreneurship, rewarding hardwork, and creating a structure where people can start again, while at the same time, ultimately taking responsibility for their actions and the consequences of those actions.

So as The Big Biffo summarised, this would allow the government to take on the debts you can't pay (in the near term) anyway, and for anyone who earns more than the basic tax rate, tax you more until they get it back.

so let me get this straight, the banks takes over for example Jim's house, sells it, say there's a 100k left on mortage after sale. The government then pays 100k to bank to clear Jim's mortage. Jim then owes the government 100k in taxes which become due if he earns more than 36k. Where on earth is the incentive for Jim to work hard and be entrepreneurial (using your words) if he is going to have this huge tax bill facing him if is is successful?? There isn't any he will simply plod along trying to ensure he doesn't earn enough to make the tax due. He may even resort to the black economy to top up his income.

You have also completely forgotten 2 huge issues here.

1) there is absolutely no market for house sales at the moment so the option to sell isn't really there (you will also flood the market as the banks will sell for low money knowing they will get the remainder from the government. This will cause house prices to fall further thereby increasing the "problem" even more

2) the governemnt is currently borrowing about 20 billion a year to meet current expenditure (nothing to do with banks by the way) and you want the governement to borrow even more money so that Jim can be debt free. Money that I as a taxpayer will have to pay back along with the associated interest on it

Pure madness this is

cloneslad · 11-11-2010 02:16PM

They should have rented, sure buying an overpriced house is only dead money

Sofa King Great · 11-11-2010 02:33PM

To all the people who talk about having a "noose aroung their neck" in terms of debt... You were the ones who tied the knot by signing the loan agreements.

People also need to drop the idea of "negative equity" This is indeed a concept if you are a property investor. An investor invests in something. Everything in excess of what he puts in is his "Equity"

On the other hand, people who bought somewhere to live bought a "home" The home is to live in and not a source of equity or investment. Maybe if you go to sell your home in a few years and the loan exeeds the value then the phrase can be used.

th3 s1aught3r · 11-11-2010 02:41PM

Isnt it heartwarming the way people who didnt buy during the boom for whatever reason (saying they knew what was happenning is probably rubbish) have so much sympathy for those who did. Comments like "you should have known what you were getting into" and "I have no sympathy" are quite common here.
This selfish attitude of Im alright Jack is everywhere. Whatever happened to Christian Ireland, is it dead, are we now just self centered **** who only think about ourselves ?
Ps: I didnt buy either, but I dont want to dance on the graves of those that did