I’m not an expert but I attempt to blog here about it
http://colmbrazel.wordpress.com/2009/08/27/another-fine-mess/

Can I draw your attention to Annex 4 of http://ec.europa.eu/competition/state_aid/legislation/impaired_assets.pdf

Proposed legislation for NAMA flies in the face of nationalization safeguards recommended by IMF and the detailed safety clawback, risk sharing safety methods supported by the EU mentioned in above doc.

Ahearne ignores just about every good authority there is out there on helping to solve the mess.

rgds

Colm

Look at the doing away with rates on homes. Firstly we paid it as a 1% levy in vat and now we are paying it twice with the waste, water etc charges. (double payments)

The health levy is another one that was supposed to be for a year or two? (double payments)

Car tax is supposed to pay for the building, upkeep and maintenance of the roads?
Instead it’s wasted on so many other things that are already paid for the TAX PAYER. (double payments)

All we have to do is look to recent history to see how we were screwed before.
For e.g.: in the 80’s when the TAX PAYER saved Road Stone! How did they pay us back? By Road Stone been given a lucrative contract that allowed them to TAX us for the use of a bridge that we the TAX PAYER had paid for in spades by contributing to their survival when they going to the wall.

The Irish Life Insurance Company like wise was bailed out by the TAX PAYER and once again the payback was increased premiums.

Why should things be different now? We’re screwed again and there is nothing that we can do about it. As with everything in the past we complain about it over a pint and come up with great ideas to sort it all out that will blur with the haze of the hangover the next morning. Exactly in the same way we have rallied around every cause, 2 what can I do about it?
“IT’S JUST THE WAY THINGS ARE”
Well guess what it’ll always be “JUST THE WAY THINGS ARE” because we as a nation are too damn lazy to get up off our arses.
Some day some one will sort it all out and “WE’LL ALL LIVE HAPPILY AFTER”
We’re a joke and once again we don’t see ourselves as the laughing stock of Europe.

I say forget about nama bitching and nationalising the banks. Lets nationalise the government instead and then maybe we’ll get the country on the road to recovery that won’t cost not just us, our children and our grand children dearly. (OH I FORGOT THE GOVERNMENT IS ALREADY NATIONALISED. SURE DOESN’T EVERY DEPARTMENT HAVE ITS OWN DICTATOR?)

Minister for Finance Brian Lenihan has said“Nama” will pay a price for the loans which reflect the long-term economic value of the properties – in other words, the agency will pay the banks the market value plus a certain premium. This has to be unconstitutional
http://www.machholz.wordpress.com

surely we the people have the right to vote on any government measure that will enslave us as a nation for the remainder of my life and that of my children

to put it another way Let’s say a sale of Mr. Liam Carroll’s nets €20 million, for a building on which there is a €100 million loan. How can Nama defend paying much more than €20 million for it?

this is exactly what MR. Brian Cowen and Lenihan are trying to do and the Green Party are supporting this criminal attempt to bail out crooked bankers and unscrupulous developers

In fact, the Greens’ position is not unlike the banks’, as it happens. Both know that they are facing enormous potential losses in terms of Dáil seats.

In both cases, they have an interest in postponing an event that would crystallise those losses – in the banks’ case, liquidation and fire sale of the developers’ loans and their assets, and in the Greens’ case, a general election.

The Greens in government believe that, distasteful as it may be, there is no alternative to saving the banking sector. They also understand that this may be the ruin of their party. The local and European elections were a pretty clear signpost in this regard.

But the Greens also believe that, if they can avoid an immediate general election, give the Nama plan some time to work, give the several Green initiatives some time to bed in, and maybe even give the economy some time to recover, they may get some credit for doing what they believe to be the right thing.

Supporting a measure that will enslave me for the rest of my life and that of my children will never be right

We need a General election so that the people can decide themselves no other way will be acceptable!

Assuming that this levy will be on the banks, does this not answer a lot of our concerns?

If you know a bank is insolvent, why give them an asset to destroy when you might need it for your pending redundancy? So, we tell all and sundry that we have confidence in the system…. and get them to give such assets telling them that we will guarantee it.

To do so without ruining our own borrowing capacity we have to get the big swinging whatevers, that rate government loans, convinced that we won’t ever need to pay out on the guarantee. So we need stringent rules.

But we can let our banks lend to one another and pretend that this is a deposit….We call it flexibility. It is not corruption. It is flexibility and weraing the green jersey.

Banks are all lent out and economic activity is declining, so fewer loans will be made (although there may be refinancing, putting less profit into the banks) but we need all the banks we started with otherwise the ratings agencies will think we are careless….. and then the cat will be out of the bag…game over!

that said, i still think that outright nationalisation is the best route for the entire irish banking system.

Its a bad plan.

What is the point of insisting on these capital ratios for banks that have explicit and specific government guarantees?

Holding a lot of capital will help a bank entering a downturn, but high capital requirements are lethal for banks that do not have such a cushion when we are in such a depression. The requirements make things worse so I’d like to know what benefit they bring right now?

“If the crystallisation of losses at any institution requires additional capital the State will insist on participation by way of ordinary shares in the relevant institution.”

This has to mean that the pricing decision for asset purchase will not be based on how much capital the banks need.

Indeed, given what analysts are saying about the likely recoverable value of the loan portfolio, we should be speaking of this as an asset purchase plus equity injection plan.

Lets look at it another way. Current market cap of the two main banks is approx €2bn (I’m allowing for tomorrows bounce).

let’s say their share of the €80bn is €55bn. (Is Anglo included in this?)

So to allow the NAMA pay a reasonable 40c in the €, and using Karls formula above, where X now = bank capital

(X-33)/195 = 0.08 makes X=48.6. So the banks will have to raise an extra €21.6bn of equity.

If the banks choose this route, then, at tomorrow’s prices the only way out seems to be nationalisation.

Guess it all comes down to a political decision. Which is the least worst road, over pay for the assets, nationalise the banks or allow them to go bust.