"Debt sharing will be good for the economy": nonsense?

JimiTime · 06-09-2011 03:59PM

Monty Burnz wrote: »

I've yet to see anything resembling a coherent argument that it would be economically beneficial.

As compared to what though? As i said earlier, I'd be more of the opinion that we need certainty. The certainty is what will benefit the economy, but figure wise may not ad up. However, if we introduce a solution, we'll never have any idea of what would have happened had we NOT introduced it. We need to stop hearing the whisperings of more taxes, increased rates, mortgage relief etc. We need a concise, clear solution. Yes I have a vested interest, but I think the goal should be to keep people in their homes. Whether this means debt for equity, or an entitlement to live in the home, but not to profit from it etc that is another debate.

We cannot IMO continue to play by normal rules. These unprecedented times will send shockwaves into the future for many a year, maybe even through many generations. Not only will house prices never recover, but we should not want them to, and legislate to prevent such things occurring again. In doing so though, you can't simply ignore the many who got stung in the process. Those who didn't get stung may feel the pinch for a while, but you have the capacity to recover, and the fact that house prices are going to be so low etc you get the benefit of that. Those of us lumbered with this negative equity etc, could likely never recover. Our children may suffer, and with the introduction of more uni fee's etc, it could be a generational nightmare. I can honestly say, that I'd be the same if i was on the other side of this fence, that being, better we all take a pinch than some getting hung.

ei.sdraob · 06-09-2011 04:02PM

JimiTime wrote: »

Yes I have a vested interest, but I think the goal should be to keep people in their homes.

The goal should be to stop listening to vested interests :rolleyes: they got us here in the first place

JimiTime · 06-09-2011 04:07PM

ei.sdraob wrote: »

The goal should be to stop listening to vested interests :rolleyes: they got us here in the first place

Shut up with the soundbytes will ye:rolleyes:

ei.sdraob · 06-09-2011 04:16PM

JimiTime wrote: »

Shut up with the soundbytes will ye:rolleyes:

Soundbytes is all that's being shoved down our throats by vested interests (yet again) :rolleyes:

Go eat some cardboard

Godge · 06-09-2011 04:25PM

JimiTime wrote: »

As compared to what though? As i said earlier, I'd be more of the opinion that we need certainty. The certainty is what will benefit the economy, but figure wise may not ad up. However, if we introduce a solution, we'll never have any idea of what would have happened had we NOT introduced it. We need to stop hearing the whisperings of more taxes, increased rates, mortgage relief etc. We need a concise, clear solution. Yes I have a vested interest, but I think the goal should be to keep people in their homes. Whether this means debt for equity, or an entitlement to live in the home, but not to profit from it etc that is another debate.

We cannot IMO continue to play by normal rules. These unprecedented times will send shockwaves into the future for many a year, maybe even through many generations. Not only will house prices never recover, but we should not want them to, and legislate to prevent such things occurring again. In doing so though, you can't simply ignore the many who got stung in the process. Those who didn't get stung may feel the pinch for a while, but you have the capacity to recover, and the fact that house prices are going to be so low etc you get the benefit of that. Those of us lumbered with this negative equity etc, could likely never recover. Our children may suffer, and with the introduction of more uni fee's etc, it could be a generational nightmare. I can honestly say, that I'd be the same if i was on the other side of this fence, that being, better we all take a pinch than some getting hung.

Wait a minute, from reading your posts, you have a job, you are currently paying your mortgage. OK, you have very little left over and you are in negative equity. You will not qualify under any sort of debt forgiveness scheme.

Even the most ardent proponents of a debt forgiveness scheme would limit it to those who have no jobs, are living in a modest family home (assume they mean no more than a three bedroom semi-detached urban or three-bedroom small bungalow rural) and bought at the top of the market and are now in negative equity. You fail on the first point.

The reason debt forgiveness has become so popular is that there are thousands and thousands of people out there who believe they would be entitled to benefit from it. In reality, because of the cost as well as the potential damage to the economy, the number to benefit would be quite small.

Tigger · 06-09-2011 04:31PM

so what people are saying is that its better for the economy of ireland if we don't pay off our personal debts and that we pay for that by not paying off our state debts

well obviously if a person or a country has less than no money and they then get to not pay that back then they are better off but i don't think it works like that

if ireland was a net producer of goods a manufacturer of something then i can see how we could spin up an economy but we aren't

Godge · 06-09-2011 04:38PM

johnnyskeleton wrote: »

How can you increase A's income by decreasing B, C and D's income to a lesser extent. It's a zero sum game, so you would have to take say €100 from each of B, C and D's income in order to increase A's income by €300, all other things being equal.

Of course all other things are not equal, and you have to consider the effect on spending (and consequently earnings) by B, C and D when their taxes are increased to decrease the taxes or subsidise A. To calculate this, you have to have an idea as to what A, B, C and D's respective marginal propensity to consume is, and their position on the laffer curve.

In laymans terms, if the scheme means that A's increase in spending per euro is greater than B, C and D's decrease in spending, then there will be a net increase in spending. However, I believe that a person in A's position is less likely to spend (being still in debt and in any event once bitten twice shy) than B, C and D (presumably solvent / prudent individuals) per euro. I also believe that if A is given a handout, he is less inclined to work and earn an income and if B, C and D are taxed more they are also less inclined to work and earn an income.

So on an intuitive level, the net effect of a debt forgiveness scheme will be to dampen overall spending and possibly also result in a net decrease in taxes / earnings in the economy. I may be wrong, but it would take an impirical analysis or at least some anaylsis based on existing statistics to show otherwise.

The question therefore is who to believe? Am I right that it will negatively affect the economy, or are the commentariat right that it will somehow magically benefit the economy?

Well, neither of us are inherently right. But they are the ones proposing the scheme and because they are proposing it, it is for them to prove that it will either help the economy or at least not damage the economy. That they haven't done so to date is not due to mere ommission, it is because they know that an impirical analysis will almost certainly prove that it is a bad idea.

Thankfully, the EU and IMF will put manners on the greedy majority. At the risk of quoting Maggie Thatcher, socialism works well until you run out of other people's money.

you have put it much more eloquently than I did earlier in the thread.

One thing we are not considering is the "moral hazard" effect on the economy. If we bail out borrowers once and force banks, in particular the foreign banks such as NIB and Ulster Bank to pick up the tab, they will be reluctant to lend in future and if they do lend will add a premium to the interest rate they charge borrowers. This will have a long-term negative effect on the economy as it will lower investment levels.

ei.sdraob · 06-09-2011 04:44PM

Godge wrote: »

you have put it much more eloquently than I did earlier in the thread.

One thing we are not considering is the "moral hazard" effect on the economy. If we bail out borrowers once and force banks, in particular the foreign banks such as NIB and Ulster Bank to pick up the tab, they will be reluctant to lend in future and if they do lend will add a premium to the interest rate they charge borrowers. This will have a long-term negative effect on the economy as it will lower investment levels.

Moral hazard aside, any "help" from Irish state owned banks could drag the EU on the subject of unfair competition

dvpower · 06-09-2011 04:56PM

Monty Burnz wrote: »

It seems that the debt-sharing brigade are now claiming that sharing the debts of those who bought poorly during the bubble is going to somehow give a boost to the economy.

On the face of it, this is arrant nonsense. Would any advocate of debt sharing please explain the mechanism whereby it would increase spending and boost businesses?

I wouldn't call myself an advocate of it but I can see some advantages in a very limited debt forgiveness scheme.

The issue of negative equity (or more accurately the issue of people who simply have no ability to service their mortgages) isn't going to go away by itself.

As long as it persists, it will be a drag on consumer confidence. I have an expectation that, at some point, I'm going to have to pay in higher taxes for some kind of a debt forgiveness scheme.
As long as the hit I'm going to have to take is unclear, as long as there is uncertainty, then I'm not going to spend what money I do have.

ei.sdraob · 06-09-2011 05:01PM

dvpower wrote: »

I wouldn't call myself an advocate of it but I can see some advantages in a very limited debt forgiveness scheme.

The issue of negative equity (or more accurately the issue of people who simply have no ability to service their mortgages) isn't going to go away by itself.

As long as it persists, it will be a drag on consumer confidence. I have an expectation that, at some point, I'm going to have to pay in higher taxes for some kind of a debt forgiveness scheme.
As long as the hit I'm going to have to take is unclear, as long as there is uncertainty, then I'm not going to spend what money I do have.

What we need (and what will have to be implemented under IMF/EU) are bankruptcy laws. If there is no way of paying then you are declared bankrupt and loose the asset.

What some want as is obvious from so many threads now, is to keep their houaw and socialise (some) of their debt onto others. That is why so many people find whole thing disgusting, all while the people in real need are being sidelined by those who can shout louder.

johnnyskeleton · 06-09-2011 05:08PM

Grumpypants wrote: »

I presume you have a job,
I presume that job involves a product or service,
I presume your employer sells that product of service to customers,
I presume those customers need money to buy that product or service,
I presume the less customers with money = less of that product or service can be bought,
I presume the less your boss sells the less money he makes,
I presume the less money he makes the less he can pay you,
I presume when it gets to the stage that he can't pay you he will let you go,
I presume this is common place in the private sector,

If we give the customers more free money they can buy your product or service,

If more people buy your bosses product he makes more money
You get a raise,
He hires a helper,
You both are working so that = double the tax income, never mind the VAT
More tax means we can pay for more health care etc.

I presume that a lot of the companies currently struggling to survive sell rubbish that was all the rage in the celtic tiger but is of little or no use to consumers during a recession.
I presume that if these companies are allowed to fail the market will reduce rents and wages such that we can start to rebuild the economy by making useful stuff that people actually need/want.
I presume that giving free money to consumers will not make them revert to their celtic tiger spending habits.
I presume that if it does, this is not exactly desireable.
I presume that the rest of the companies that are currently struggling are doing so because of high taxes, high rates, high utilities, high staff costs, high everything, really.
I presume that if we want to keep jobs, we should encourage successful companies by lowering the tax burden on them, rather than giving free money to the unproductive companies so that they can keep producing unnecessary and unwanted items at an artificially high price.

johnnyskeleton · 06-09-2011 05:17PM

Godge wrote: »

One thing we are not considering is the "moral hazard" effect on the economy. If we bail out borrowers once and force banks, in particular the foreign banks such as NIB and Ulster Bank to pick up the tab, they will be reluctant to lend in future and if they do lend will add a premium to the interest rate they charge borrowers. This will have a long-term negative effect on the economy as it will lower investment levels.

That plays too easily into the politicians hands. "He talks about moral hazard! There's a hazard that the children of Ireland will be eating cardboard for generations if we don't bail out their parents. How is it moral that we take that hazard" etc.

But yes, the alternative reading is that the only way that debt forgiveness could increase spending is if the people we bail out are the most spendthrift of all, who are not paying their mortgage now but spending it on consumer items, and if we releive their debts they will spend even more on consumer items and borrow more to do so.

dvpower · 06-09-2011 05:17PM

ei.sdraob wrote: »

What we need (and what will have to be implemented under IMF/EU) are bankruptcy laws. If there is no way of paying then you are declared bankrupt and loose the asset.

What some want as is obvious from so many threads now, is to keep their houaw and socialise (some) of their debt onto others. That is why so many people find whole thing disgusting, all while the people in real need are being sidelined by those who can shout louder.

That’s the problem as long as we leave it hanging – people will assume that we’ll end up bailing out yet another group of reckless idiots.

The reality (I hope) will be something very limited, that only someone in really desperate debt would want to apply for. That means that you lose your home and other assets and that there is a reasonable period before you are allowed to accumulate more assets.

MysticalRain · 06-09-2011 06:03PM

johnnyskeleton wrote: »

Thankfully, the EU and IMF will put manners on the greedy majority. At the risk of quoting Maggie Thatcher, socialism works well until you run out of other people's money.

I see the whole debt forgiveness malarky as Communism meets Idiocracy where the financially reckless people are rewarded, and the financially prudent people are punished. I can't see that working out too well for the country in the long run.

JimiTime · 06-09-2011 06:14PM

Godge wrote: »

Wait a minute, from reading your posts, you have a job, you are currently paying your mortgage. OK, you have very little left over and you are in negative equity. You will not qualify under any sort of debt forgiveness scheme.

Due to PTSB's rate rises (5 since may), and probably more on the way, then when our TRS is up, thats game over. If PTSB get brought in line with other state banks, then its a non issue for us. However, if not, it'll be default plain and simple. i still say a write down is whats best for this country in the long run though. Though all the amateur economists just think that is just someone looking for a free ride. *shrugs* Nothing i can do about the cynicism I suppose. IMO though, just hit the big red button now. Let the banks take the hit, which alledgedly was accounted for in the stress tests, and on top of that take a proportion of any future profit on any qualifying home. I don't see the point in bringing moral hazard into the debate at this time. Moral hazard became meaningless about 60 billion euro's ago.

And before the soundbyters chime in, that is NOT a 'free gaff', its a house that has had a portion of its debt written off. The remainder of which is still being payed.

Even the most ardent proponents of a debt forgiveness scheme would limit it to those who have no jobs, are living in a modest family home (assume they mean no more than a three bedroom semi-detached urban or three-bedroom small bungalow rural) and bought at the top of the market and are now in negative equity. You fail on the first point.

that can change in an instant.

The reason debt forgiveness has become so popular is that there are thousands and thousands of people out there who believe they would be entitled to benefit from it. In reality, because of the cost as well as the potential damage to the economy, the number to benefit would be quite small.

I think some sort of debt for equity scheme is the way forward myself. Though i don't think its one size fits all. A single guy in a one bed apartment will require a different solution to the family who never planned on moving.

Debtocracy · 06-09-2011 06:14PM

Monty Burnz wrote: »

On the face of it, this is arrant nonsense. Would any advocate of debt sharing please explain the mechanism whereby it would increase spending and boost businesses?

It reduces the chances of a large proportion of people abandoning their debts. If people were helped out, they would feel a stronger obligation to pay off their debts.

Rule 1 of being a good parasite (or bank) is to keep your victim alive.

Godge · 06-09-2011 06:40PM

JimiTime wrote: »

Due to PTSB's rate rises (5 since may), and probably more on the way, then when our TRS is up, thats game over. If PTSB get brought in line with other state banks, then its a non issue for us. However, if not, it'll be default plain and simple. i still say a write down is whats best for this country in the long run though. Though all the amateur economists just think that is just someone looking for a free ride. *shrugs* Nothing i can do about the cynicism I suppose. IMO though, just hit the big red button now. Let the banks take the hit, which alledgedly was accounted for in the stress tests, and on top of that take a proportion of any future profit on any qualifying home. I don't see the point in bringing moral hazard into the debate at this time. Moral hazard became meaningless about 60 billion euro's ago.

And before the soundbyters chime in, that is NOT a 'free gaff', its a house that has had a portion of its debt written off. The remainder of which is still being payed.

that can change in an instant.

I think some sort of debt for equity scheme is the way forward myself. Though i don't think its one size fits all. A single guy in a one bed apartment will require a different solution to the family who never planned on moving.

By default, I assume you mean bankruptcy and you lose the house and start again? In which case, why are you different to someone with a lower income - say just above minimum wage - who could not afford to buy their own house and has been living in council housing? Why should you get a taxpayer contribution towards owning your own house?

swampgas · 06-09-2011 06:46PM

JimiTime wrote: »

[ ...]

Yes I have a vested interest, but I think the goal should be to keep people in their homes. Whether this means debt for equity, or an entitlement to live in the home, but not to profit from it etc that is another debate.

[...]

Sorry to harp on about this, but it really isn't your home until you have paid for it - i.e. bought it with cash or paid off the mortgage.

You can live somewhere else. Moving house is not the end of the world. What most people consider "their house" is only theirs as long as they pay the mortgage, that's it.

</nitpick>

Grumpypants · 06-09-2011 06:48PM

Monty Burnz wrote: »

What?

I've tried to explain this as simply as I can. Let's cut out the emotive nonsense about being able to afford milk - nobody will starve in this country, whatever happens.

But you seem to think that your neighbour will have extra money that appears magically out of the air. He won't. The money will have appeared out of your wallet. You seem to think that this does not matter and that you want your neighbour to have extra money. I admire that view, but I don't share it.

Fortunately a system is already in place to help you help your neighbour: pick up the phone, and give St. Vincent De Paul a chunk of your salary every month - they will see that it gets to your neighbour. Meanwhile, I and others will try to do the best that we can with our salaries. That sounds fair, doesn't it?

They will have extra money, it doesn't appear out of the air it is from their wages same as yours, its just at the moment a large % of their wages goes on paying increased taxes and a huge mortgage. Remove the mortgage and they free up that money to spend.

You seemed fixed on this idea that the tax payer has to pay them, ignoring that vast numbers of these people are tax payers. The same tax payers that paid for your free education, your free Health care, your roads, your other infrastructure. How about you pay back what you have siphoned off from them and put it towards paying a few of their bills.

Monty Burnz · 06-09-2011 07:03PM

Grumpypants wrote: »

They will have extra money, it doesn't appear out of the air it is from their wages same as yours, its just at the moment a large % of their wages goes on paying increased taxes and a huge mortgage. Remove the mortgage and they free up that money to spend.

You seemed fixed on this idea that the tax payer has to pay them, ignoring that vast numbers of these people are tax payers. The same tax payers that paid for your free education, your free Health care, your roads, your other infrastructure. How about you pay back what you have siphoned off from them and put it towards paying a few of their bills.

I'm sorry - I've tried very hard to explain this to you as simply as possible, but I guess not everyone can be expected to be able to grasp everything. I actually can't make things any simpler, so rather than start being rude to you out of sheer frustration, I'll recommend you re-read the points that have already been made on this thread, and suggest you look up terms like 'zero-sum game'. I'll just say that your understanding of the situation is riddled with logical holes at present.

hmmm · 06-09-2011 07:17PM

Grumpypants wrote: »

How about you pay back what you have siphoned off from them and put it towards paying a few of their bills.

Can the rest of us "get our tax back" so we can put it towards our pensions and other investments that have also fallen in value?

keith16 · 06-09-2011 07:28PM

JimiTime wrote: »

As compared to what though? As i said earlier, I'd be more of the opinion that we need certainty. The certainty is what will benefit the economy, but figure wise may not ad up. However, if we introduce a solution, we'll never have any idea of what would have happened had we NOT introduced it. We need to stop hearing the whisperings of more taxes, increased rates, mortgage relief etc. We need a concise, clear solution. Yes I have a vested interest, but I think the goal should be to keep people in their homes. Whether this means debt for equity, or an entitlement to live in the home, but not to profit from it etc that is another debate.

We cannot IMO continue to play by normal rules. These unprecedented times will send shockwaves into the future for many a year, maybe even through many generations. Not only will house prices never recover, but we should not want them to, and legislate to prevent such things occurring again. In doing so though, you can't simply ignore the many who got stung in the process. Those who didn't get stung may feel the pinch for a while, but you have the capacity to recover, and the fact that house prices are going to be so low etc you get the benefit of that. Those of us lumbered with this negative equity etc, could likely never recover. Our children may suffer, and with the introduction of more uni fee's etc, it could be a generational nightmare. I can honestly say, that I'd be the same if i was on the other side of this fence, that being, better we all take a pinch than some getting hung.

Housing bubbles are not unprecedented. They have happened the world over many times in the past and will always happen in countries that don't have the foresight to prevent them.

This country is an absolute basket case. And yes, I can absolutely ignore the people who 'got stung' (ridiculous phrase - implies some sort of innocent accident took place), what if the growth in house prices had continued (ridiculous to think they would have), do you think those on the property ladder would be reaching down to those less fortunates to help them on?

The bubble was driven by greed and the rat-race to get on the mythical ladder, but guess what? The ladder has come tumbling down. Don't be dragging anyone left standing on their own two feet into your mess :mad:

Grumpypants · 06-09-2011 07:46PM

Monty Burnz wrote: »

I'm sorry - I've tried very hard to explain this to you as simply as possible, but I guess not everyone can be expected to be able to grasp everything. I actually can't make things any simpler, so rather than start being rude to you out of sheer frustration, I'll recommend you re-read the points that have already been made on this thread, and suggest you look up terms like 'zero-sum game'. I'll just say that your understanding of the situation is riddled with logical holes at present.

Well Monty you actually haven't tried to explain anything at all, all you have done is repeated the same line "where does the money come from, thin air?" and "how will it help the economy?" without offering any explanation as to why it won't help. They are both questions. Questions rarely are explanations. I know you keep repeating the question how is taking money out of the tax payers pockets going to help but you seem to lack the understanding of long term debt.

Tell you what your method is the method that we have been using for the last 4 years and it seems to be working, as it is clear to see the economy is going from strength to strength, that in itself should be validation enough for you way of thinking.

Also your lack of understanding of a society and a tax system beggars belief.

Grumpypants · 06-09-2011 07:53PM

hmmm wrote: »

Can the rest of us "get our tax back" so we can put it towards our pensions and other investments that have also fallen in value?

Well no because you have already received your tax back as pensions are tax deductible. You will also receive further tax back when you retire in the form of a state pension. But Monty doesn't think that's fair as why should the tax payer foot the bill for your pension.

I on the other hand understand you have paid more than enough tax into the system and can reap some reward when you need it, this is a good idea for a society.

keith16 · 06-09-2011 07:55PM

Grumpypants wrote: »

Well Monty you actually haven't tried to explain anything at all, all you have done is repeated the same line "where does the money come from, thin air?" and "how will it help the economy?" without offering any explanation as to why it won't help. They are both questions. Questions rarely are explanations. I know you keep repeating the question how is taking money out of the tax payers pockets going to help but you seem to lack the understanding of long term debt.

Tell you what your method is the method that we have been using for the last 4 years and it seems to be working, as it is clear to see the economy is going from strength to strength, that in itself should be validation enough for you way of thinking.

Also your lack of understanding of a society and a tax system beggars belief.

I think those who are looking for debt forgivness are the ones who have the problem understanding long term debt.

martin8591 · 06-09-2011 07:57PM

When I was kid I was brought up to help out others when I could.
I am amazed that people are so blinkered and mean to other citizens where they are hopelessly in debt.
Note the word hopelessly it means that barring a miracle they have no hope of getting out of the debt burden of negitive equity and loss of income.
I see this line of thought especially among public sector workers who have been cosseted from the storms of recession.
Debt forgivenes or call it what you like is going to be diifficuklt and some will profit from it but as a society we must confront it and get it out of the way.
I'd rather my neighbour get my tax euros than the banks

Monty Burnz · 06-09-2011 08:03PM

Grumpypants wrote: »

Well Monty you actually haven't tried to explain anything at all, all you have done is repeated the same line "where does the money come from, thin air?" and "how will it help the economy?" without offering any explanation as to why it won't help. They are both questions.

Indeed. They are both questions, which should prompt your brain to think of the obvious answers. And the answers are that the money that is supposed to boost the economy will be sucked out of the economy first, and that it won't help at all for very obvious reasons.

Grumpypants wrote: »

Questions rarely are explanations.

They aren't explanations if you don't have the will or ability to try to answer them. Have you heard of the Socratic method?

The Socratic method (also known as method of elenchus, elenctic method, Socratic irony, or Socratic debate), named after the classical Greek philosopher Socrates, is a form of inquiry and debate between individuals with opposing viewpoints based on asking and answering questions to stimulate critical thinking and to illuminate ideas.

It's supposed to help you figure out things by yourself. It hasn't worked here for some reason.

Grumpypants wrote: »

I know you keep repeating the question how is taking money out of the tax payers pockets going to help but you seem to lack the understanding of long term debt.

I'm baffled as to how you think you can explain your lack of understanding by claiming that I don't understand something. I understand long-term debt very well thank you, which is why I don't have any. Can you explain why my inexplicable ability to understand the rather simple principle of long-term debt is in evidence in this discussion?

Grumpypants wrote: »

Tell you what your method is the method that we have been using for the last 4 years and it seems to be working, as it is clear to see the economy is going from strength to strength, that in itself should be validation enough for you way of thinking.

My method? What do you mean, 'my method'? The reason why the country is bankrupt is because the taxpayer was caught to pay the debts of others - the thing that I am opposing, and the thing that you are trying to argue in favour of. Can you not see this?

Grumpypants wrote: »

Also your lack of understanding of a society and a tax system beggars belief.

:rolleyes: Whatever. Hopeless.

swampgas · 06-09-2011 08:07PM

martin8591 wrote: »

When I was kid I was brought up to help out others when I could.

Me too.

I am amazed that people are so blinkered and mean to other citizens where they are hopelessly in debt.

The debt they willingly took on as grown adults? And from which they enjoyed the benefit of buying a property?

Note the word hopelessly it means that barring a miracle they have no hope of getting out of the debt burden of negitive equity and loss of income.

Which is why bankruptcy reform is so important.

I see this line of thought especially among public sector workers who have been cosseted from the storms of recession.
Debt forgivenes or call it what you like is going to be diifficuklt and some will profit from it but as a society we must confront it and get it out of the way.
I'd rather my neighbour get my tax euros than the banks

Feel free to hand over your own money - after tax - if you want to bail out your neighbour's foolish borrowing, just don't expect me to join you. I'm willing to help, but I don't fancy throwing good money after bad.

Grumpypants · 06-09-2011 08:42PM

Monty Burnz wrote: »

Indeed. They are both questions, which should prompt your brain to think of the obvious answers. And the answers are that the money that is supposed to boost the economy will be sucked out of the economy first, and that it won't help at all for very obvious reasons.

They aren't explanations if you don't have the will or ability to try to answer them. Have you heard of the Socratic method?

It's supposed to help you figure out things by yourself. It hasn't worked here for some reason.

I'm baffled as to how you think you can explain your lack of understanding by claiming that I don't understand something. I understand long-term debt very well thank you, which is why I don't have any. Can you explain why my inexplicable ability to understand the rather simple principle of long-term debt is in evidence in this discussion?

My method? What do you mean, 'my method'? The reason why the country is bankrupt is because the taxpayer was caught to pay the debts of others - the thing that I am opposing, and the thing that you are trying to argue in favour of. Can you not see this?

:rolleyes: Whatever. Hopeless.

Very simple scenario for you Monty explain this and i will quit the thread.

Take a person, they have worked and paid into the tax system €10,000 a year for the last 10 years. They now lost their job, they now have an income of 800 euro a month , they pay the bank 700 a month giving them 100 to spend a month. They have 1 asset the home, its worth 150,000 they own the bank 200,000.

Explain to me why paying 700 euro of tax payers money straight into the bank and letting 100 go into the economy is better than paying 800 euro into the economy?

Don't just say where does that money come from? that's been covered it comes from the tax intake.

JimiTime · 06-09-2011 09:08PM

keith16 wrote: »

Housing bubbles are not unprecedented.

In case you missed it, the crisis in the economic world is not a housing bubble, its a whole banking crisis which has crippled entire nations. So on top of a property colapse, we have austerity, wage cuts, very little light at the end of the tunnel and a currency and interest rate not controlled by our own country. I understand people are sick of paying for other peoples messes and greed etc. I don't like it myself, but myself, and many like me just wanted a place where our families could live. We have witnessed the main causes of this modern crisis walk away with golden handshakes and billions of euros pumped into the institutions at fault. WE are being hit too, only it is having a much bigger impact on us due to the boom time mortgages. I'm sorry you feel the way you do, but i can only say that me and many like me wish we had a crystal ball back in the day. We could have probably coped with the property prices dropping, but combined with everything else, its just like a merciless march against us.

i can only hope that people like yourself, if the anger subsides, that you realise that your anger is misplaced.

"Debt sharing will be good for the economy": nonsense?

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