Irish Banking Policy Post author By Philip Lane Post date June 3, 2010 Brian Lucey writes on this topic in today’s Irish Independent – distributed over three articles: Part I Part II Part III Categories In Banking Crisis Tags Irish banking policies 41 Comments on Irish Banking Policy ← May Exchequer Returns → The Lisbon Agenda: An Assessment 41 replies on “Irish Banking Policy” dont ask me why its in three pieces…. Jaysus Brian, quoting the New Testament? why don’t you stick on an afro and call yourself Julius whilst blasting the hell out of government policy. BTW I think the link to p2 is not working. Where’s the sale of Anglo’s deposit book? That was a 49bn windfall that would have let us wake from the nightmare. The latest silver bullet is a Resolution Scheme. Has any country retrospectively changed the rules for dealing with bank liabilities? If so and this can credibly be done let’s grab it. But my impression is that a Resolution Scheme is a shutting of stable doors, an attempt to fix things for future crises and as such is largely of academic interest as we face the impending funding cliff. It certainly is interesting that the EU are going cold on bank guarantee schemes but surely come September with the 70bn needing refinancing the banks are not going to be left on their own. There seems to be an implicit recognition that, in the absence of a rock-solid bank resolution process, the Government probably had little choice but to do what it did. And, even if such a resolution process had been in place, it’s not certain that it would have been able to deal effectively with a bank system resolution because the Government was confronted with the failure of almost the entire domestic banking system – even if it was presented at the time by the banks as a liquidity crisis. Furthermore, even if such a process were established now, it’s not certain that it could be applied effectively, given the commitments and decisions the Government has made since that fateful night in Sep. 2008. Brian is justifiably enraged by the immorality of imposing this burden exclusively on all taxpayers – I prefer citizens and residents as all are being impacted by this burden. However, the buck has to stop somewhere and citizens on three successive occasions, in free and fair elections, delegated their utlimate authority to public representatives who elected and maintained in power successive governments that, by sins of omission and commission, brought about this inevitable collapse. And the main opposition parties found themselves either unwilling or unable to tackle the rottenness at the core of the elaborate edifice these successive governments had constructed. The inevitable and unfortunate conclusion is that all citizens will have to bear this burden until it is finally resolved – and Governor Honohan seems to accept this conclusion in his interview with Bloomberg. While Ireland stays on on-side with the European Commission and the ECB it appears that the required liquidity and solvency support will be forthcoming, but the final bill will have to be discharged over time by Irish citizens. We also need to note that the mood music in Germany has changed. Citizens who continuously elect governments that behave stupidly must pick up the tab. It appears that this is being accepted in Ireland with some sullen resignation, but, equally it appears this harsh fact has not penetrated the consciousness of the other PIIGS. One would expect that this would provoke a huge popular demand for changes in governance that would prevent governments imposing these excessive burdens on citizens, but of this there is little evidence. Perhaps there is a resigned acceptance of utlimate governance by the EU institutions. @ Brian re resolution schemes being “standard tools in most advanced economies” – eh, wasn’t that the problem, they WEREN’T standard tools in a lot of countries? For example, the UK had to bring in their resolution regime AFTER the crisis began, and Hank Poulsen spoke frequently that the US didnt have the tools in place to wind down the operations of a large, complicated financial institution in an orderly manner, hence the rushed takeover of Bear and the disastrous collapse of Lehmans? The other key ingredient for a successful resolution regime is the presence of a large safe competitor to offload the failing banks’ business to (BNP in France, JPM/BoA in the US for those operations which were simple enough to be wound down), something which does not exist in the Irish banking sector either back then or right now. Yes, you are entirely right that we both badly need one now and its truely bizarre that its not in place yet, but lets not kid ourselves into thinking that we were the only country to not have one in place or that one in place now would suddenly solve all our woes overnight. “The Credit Institutions (Eligible Liabilities Guarantee) Scheme 2009 which is made on foot of Section 6(4) of the Credit Institutions (Financial Support) Act 2008 states that we would pick up the tab in the event of the bank being unable to….. The banks are probably not able to pay these debts; therefore there is a massive potential liability, equivalent to a decade or more of tax take, owed by us to the international capital markets.” Is BL confusing the original Guarantee with the extension thereof? If not, will the lay reader likely end up confused? Is this not scare mongering? It appears to go far beyond Morgan Kelly’s figures of possible losses. If everything went so pear shaped that it all became due (perhaps nuclear war in Ireland) then won’t the calculations become defunct? Also, do we really owe all this money to “the international capital markets”? Don’t we owe a lot of it to central banks and Irish citizens/depositors? @ zhou “is this not scaremongering?” The whole piece makes Gene Kerrigan’s Sindo Soapbox sound balanced. I guess BL is smarting from MK’s week in the sun. Well, he has seen MK and raised him. Will he succeed in getting that ultimate trophy, a rebuttal from the DoF? Possibly Lenny is poring through the Bible for clever rejoinders, even as we speak. Jesus wept! @Zhou, Your observations – and queries – are valid. Imo the focus should be on the net exposure of the Exchequer – and, ultimately, of Irish citizens – i.e., the amount by which liabilities exceed assets (and, perhaps, taking account of how much of this we owe to ourselves). However, I’m sure you recognise that, while there is such a lack of transparency (much of it, perhaps, understandable) about the value of assets, it is easier to simply tot up the liabilities. That said, there is considerable uncertainty about the extent to which NAMA will “wash its face” and any money that will be thrown into Anglo (how ever cleverly managed) is a dead loss. This is an unfortunate, but unavoidable, burden on the economy for the next 10-15 years, but it is simply paying for the extended clean-up after the party. Ireland will just be a poorer, slimmer and more sober pretectorate of the EU. Smartin from MK’s week in the sun…? Eh, no. Not really. Maybe BWII you know more about what goes on in my head than I do? You raise in interesting point as to whether others can know us better than we know ourselves. @ Paul Hunt We voted for them so live with it? Are you serious? How about all those under 18 at the last election? Those who want an election now? Those who believe in a days work for a days pay? Those who aren’t part of the gombeen classes and lost out in the ‘boom’ years. In any event I never saw ‘Drive the country in to the ground’ in any of Fianna Fail manifestos. @ BL “senior bonds (the debt equivalent of really really safe shares)” …what does this statement mean. Also am I correct in assuming that you loss forecast nowstands at 10x tax revenues=300bn. Pehaps you would be so kind to produce a similar spready to that produced by Dr Kelly. @All The thread is titled Irish Banking Policy and I can sum the government’s approach in a familiar two words, COVER UP. “The judge in charge of the Commercial Court has urged Anglo Irish Bank to consider at the highest level and as a matter of urgency whether it wants to continue to claim legal professional privilege over certain electronic documents seized by the Director of Corporate Enforcement as part of his investigation into the bank. Mr Justice Peter Kelly said it was a curious state of affairs that the State-owned bank, was claiming privilege over material in relation to an investigation being carried out by an officer of the State. He said this was delaying the investigation. The bank was entitled to claim privilege, he said, but he believed it should reconsider ‘at the highest levels’ whether it was wise, prudent or sensible to do so.” http://www.rte.ie/news/2010/0603/anglo.html Curious state of affairs? Not at all. As with the HSE the Government’s policy is ALWAYS to cover up. Investigation over in a few months? I doubt it. When are the party leaders going to jointly right to Appleby as the banking crisis investigation is surely of vastly greater importance than the Moriarty Tribunal? @All As I say, maintaining the cover up is the government’s standing policy. I wonder will their successors be any different: “Opposition parties said next week’s sitting would not follow the normal run of business. They say there would be no oral questions to ministers and no votes taken. It is, the Opposition said, a muzzling of parliament.” http://www.rte.ie/news/2010/0603/politics.html @Celtic Phoenix, I’m afraid I’m being deadly serious. The only things standing between Ireland and sovereign default are the EU institutions – and their support for the PIIGS is stretching them to breaking point (Karl Whelan’s post on the ECB’s purchase of sovereign bonds provides an example of these strains). The then Chancellor Kohl sold the Euro to the Germans on the basis that the Growth & Stability Pact would impose the necessary fiscal discipline on the PIIGS and they would behave like Germans. German voters reluctantly accepted this, but without their consent being sought or granted. And German fund managers were content to invest their pension funds in the PIIGS. German voters are now hopping mad that they were duped and are damned if they are going to bail out the profligate PIIGS – even if, to an extent, they are bailing out their own pension funds. All of this has opened up a huge fault-line between the EU elites and, in particular, German voters. The EU elites have always sought to pursue the EU project without bothering to secure popular consent. French and Dutch voters signalled their annoyance at this exclusion by their rejection of the EU Constitution in 2005. German voters are finding their voice now – and I doubt that many German, French or Dutch voters were entirely happy at being forced to swallow the EU Constitution repackaged in the Lisbon Treaty. Chancellor Merkel is now being forced to deal with the legacy of this decade of deception. To ensure continued German popular support for the EU institutions the PIIGS must take, and be seen to take, their medicine. It would not be in Ireland’s interest to impose any further demands on, or to thumb its nose at, the EU’s institutions – who now exercise ultimate economic, fiscal and monetary sovereignty over Ireland. This, unfortunately, is the new harsh reality and it no longer matter a whit whom Irish voters elect once they obey the dictats from Brussels and Frankfurt. @Tull “Also am I correct in assuming that you loss forecast nowstands at 10x tax revenues=300bn.” no, youd be wrong there. Read it again….guarantee=CONTINGENT liability. If there banks fold, we are told time and time and time again that they will have to have repaid their total liabilities. Thats in teh hundreds of billions. Note that this is not the same as their net losses. But, you knew that… @ BL I am not sure what new info this article conveys. Sure, due to the stupidity of the the govt in letting Anglo into the guarantee, 2bn of the 20billion odd has been transferred over to fill the hole. You would want to be on Mars for the last year not to know that. If all banks go bust during the lifetime of the guarantee, the contingent liability is 10x 30 ..we all know that. Your article contains no new assessment of the likliehood of this. Is it non trivial or 100% Lastly, still not sure what a really really safe share is? “The banks are probably not able to pay these debts; therefore there is a massive potential liability, equivalent to a decade or more of tax take, owed by us to the international capital markets.” Sorry but that is just an attempt to grab headlines. Probably implies something is likely to happen. Are you saying it is likely that none of the banks will be able to pay their debts? @ Paul Hunt I was taking issue with what you implied here: ‘However, the buck has to stop somewhere and citizens on three successive occasions, in free and fair elections, delegated their utlimate authority to public representatives who elected and maintained in power successive governments that, by sins of omission and commission, brought about this inevitable collapse..’ i.e. I am not in the ‘we elected them so we’re all to blame’ camp. @All Poster Libero on another forum points out that the Government can resolve the legal privilege issue: “The Minister has open to him a far more effective course of action than making polite requests of the couple of public interest directors…Under Section 3 of the Anglo Irish Bank Corporation Act 2009, the Minister can do this: “The Minister may give a direction in writing to Anglo Irish Bank requiring it to do or refrain from doing anything the doing or refraining from doing of which is, in the opinion of the Minister, necessary or expedient in the public interest, subject to regulatory requirements.” Anglo Irish Bank Corporation Act 2009, Section 3″ http://www.irishstatutebook.ie/2009/en/act/pub/0001/sec0003.html#sec3 Remember, FF told us forcefully that the bankers ruined the country. They were as bad as Cromwell in their effects, worse in their motivations. Why doesn’t the government pick up a pen and order the release of these documents? We all know why. @Celtic Phoenix, Point duly noted, but there has to be some collective responsibility for allowing this “tyranny of faction”. My point is that sovereignty, in some important respects, has been ceded and, once ceded, is difficult to regain. Is anyone else getting 404’d on Parts II and III? @Paul Hunt The government were in possession of the facts. They knew there had been a run away lending bubble. FF know the property market like no one else. So did they tell voters in 2007 there were serious problems ahead? No. “IRELAND will be a debt-free nation and will have a radically overhauled tax system if Fianna Fáil are re-elected to Government Speaking at the launch of the document entitled Securing Prosperity: The Next Steps Forward, the Taoiseach Bertie Ahern committed FF to “virtually eliminating” the national debt by 2012. “He added that maintaining budget surpluses, a declining Government debt and a net debt burden of less than 3% of GDP by 2012 were FF’s key priorities. If Ireland ever faces into a global economic downturn, we will act prudently as before. We will deliver this country through any downturn with health fundamentals intact — that is, to maintain the lowest employment, lowest taxes and highest growth in Europe,” said Mr Ahern.” http://archives.tcm.ie/irishexaminer/2007/04/17/story30612.asp Courtesy of poster Contemporary on The Pin. The soverignity of Ireland may have been ceded, but not as a result of anything her citizens freely choose. So I’m not in the collective responsibilty camp either. The average citizen doesn’t owe anything to Germany or the ECB for the recent bond buying or future potential bailout. Our citizens shouldn’t have to pony up for a poor economic systems that don’t even get Taylors rule right. In the same way I don’t blame the working poor of America for the sub prime mortgage mess. They lent the cheap money to our banks, our banks lent it to some, some bought Germany cars and/or sold/bought houses with it. I don’t see what any of that has to do with the average citizen of Ireland that wasn’t involved in the ‘boom’. Unless of course we’re going to socialize the future gains of Capitalisms too. @Celtic Phoenix, I struggle with this “average citizen” idea. There are no innocent bystanders at this car crash. For good or ill, modern societies are comprised of competing interest groups. In broad terms governance involves reconciling these competing interests in a way that accords with some generally acceptable idea of the public or national interest. Governance failed in the PIIGS during the last decade. Indeed, given their history, it is arguable that there was any effective form of governance in the PIIGS excluding Ireland. As a result there was considerable popular acceptance, if not explicitl support, for increasing governance by EU institutions. My sense is that many Irish citizens are making a rapid transition to this stance. It is ironic, but depressing, that EU institutions are more tender of the interests of Irish citizens than those they have elected. This is typical bickering after a fraud. The banks were to be an engine of masssive growth for Ireland. But no one at the controls seemed to realize that there are downsides to a bubble or if they did, they did not realize that there was a bubble in Ireland. The banks’ bonus structure was sound in time of expansion but not in a bubble. Their job was to shovel out money. The government’s job was to govern that and ensure it was never unsound. The government failed, outrageously! Some members may have been corruptly involved with bank(s). CJH certainly was! What penalty did he suffer? In fact, he got away with it and his accomplices are still doing well. There is no need for these leopards to change their spots! This blog has helped expose some issues, but it is like the Queen of England in official Constitutional theory, it can advise, warn or admonish those who execute the power of Parliament, only. No power. Except that of reason. Continued investment of public money into a broken money machine, a Wizard of Oz, has to be done sensibly. The lack of Opposition shows that there is a consensus at work in Ireland. One that needed to wake up but is more alert now! Banks are now treated with a little more circumspect regard. Their very success brought this mess! The FIRE sectors will be devastated for decades, in Ireland. The requirements on the banks will be different for some time to come. Their policy now is to become solvent! Those involved were stupid not to see what was predicted elsewhere. I favour investigation as a means of establishing the need for an effective anti-corruption body. Perhaps, if such a body were to be established with only a forward looking remit, it would be possible to allow the stupid an honourable retirement? No investigations? No bodyguards either. Thanks Philip for linking this – I will look forward to having a read over the weekend. Thanks also to Brian Lucey for putting together all of the scripts. BOH. @ BL, There is one question I have. I know that we can chat to one another and say, the Irish banks were completely clueless, skill-less and lacked foresight etc. But honestly, how large is the risk for any lending institution. How fine is the line really between reckless lending, and getting it right. I think in general, if we ignore the Celtic Tiger bubble years for a minute, I think the line is a lot finer than many people understand. BOH. @ Brian ‘I know that we can chat to one another and say, the Irish banks were completely clueless, skill-less and lacked foresight etc….How fine is the line really between reckless lending, and getting it right’ No dispute. We need business, and business needs credit. For the avoidance of confusion, as the lawyers say, the relevant charge in this case is ‘bankruptcy for profit’, aka ‘looting’. That’s when the interests of the executives diverge from the interests of shareholders. Suck out value and leave debt. Stiglitz didn’t get his Nobel for nothing. Principal-agent problems and assymetry of information are the big stories in modern economics. Ignorance is no defence in law. One other thing. I find the risk-taking entrepreneur ideal hard to marry up with the fact that most Irish business people seem to be conservative and thoroughly risk avoidant. I suppose it is a struggle between old money and new money, where new money has to take gambles, but I am happy to be educated by those who have played the game. @ Paul Quigley, I am not authority or scholar on economics, but I can say two things. I will remain open to correction however, as I am not a full time scholar on this. I think it is widely believed there is a conflict that develops between old money and new money – this in turn goes on to create many of the bubbles we see. For instance, my understanding of the American West has been, the democrats were the ranchers. The republicans were the towns folk who saw ways to invest money to gain a return. The simple term ‘return on investment’ has a deep meaning within American society I think, that goes further than mere economics. It is funny the way that republicans are painted today as being somewhat ‘conservative’, standing up for the establishment and so on. If anything the roots of republican-ism in the United States were the very opposite. Granted that business eventually won out over landed wealth in the US. So in that sense, republicanism has something to do with the now encumbant ‘business class’. But back on my point about how booms are generated. What I noticed during the Celtic Tiger was that wealth which had been accumulated over long periods, over decades in Ireland, shrunk very much during the boom years. It didn’t literally shrink, but it shrunk relative to the amounts of credit then available. This had an interesting cultural dimension to it. It was the fact that people in Ireland during the boom years, could quickly sell their assets again, and generate profits. As asset prices continually increased. Gaining credit was a way to generate ‘real’ money, through speculation. While people who had savings witnessed the real purchasing power of that ‘old’ money depreciate the longer the credit bubble lasted. If you like, there was a kind of warfare going on to diminish the older wealth and to replace it with a newer kind. My experience during the Celtic Tiger in Ireland, was that people viewed themselves like the towns folk in the old American west. They viewed themselves as the ‘risk takers’, who gained a return on their investment. The bankers who offered them credit lines viewed themselves as financial advisors, making it happen. Everyone felt good about themselves for a while. The only people who did badly in the entire equation, were those people who had accumulate their wealth over decades and saw its buying power fall through the floor. Then as the asset bubble bursted again, we notice who borrowed excessively, and though who lent excessively, trying to dis-associate themselves from the mania that was the Celtic Tiger. They are trying to blame everyone that they were led into it, and couldn’t have known. The Celtic Tiger has come full circle. It was always going to. What we are left with is a ghost town, and that is where the bank’s capital is stored, as Morgan Kelly would say. The global investors have realised that fact, and charge us for new lines of credit accordingly. But my question still remains the same. How fine a line is it between ‘reckless lending’ and getting it right. To refer to Morgan Kelly’s point again, and bearing in mind the notion of a cultural conflict between old and new wealth – the capital hasn’t disappeared. It simply hasn’t been stored in very useful places. Similarly, a state body like FAS made some awful decisions where to invest its cash flow as well. That cash flow, which had been provided by the Irish taxpayer. Whether you look at state bodies or banks, neither had enough respect for the capital they had a social responsibility over. BOH. @ Paul Hunt The average citizen. Those that didn’t take part in the property pyramid scheme. Those that went about their day. They were told there was a ‘boom’ on and to be happy about it or ‘Go commit suicide’. In practice, all it meant to them was goods and services were more expensive. @ Celtic, In practice, all it meant to them was goods and services were more expensive. That is about the size of it. Having said that, there will always be the impulse from society to play some ‘three card trick’ to try and displace encumbant wealth from its position, in one fast and violent move. I would like to believe some deeper cultural motivations exist behind it, within a society, than just a property pyramid scheme. But maybe I try to read too much into it. BOH. @ Celtic, Traditionally in Ireland, if you think about it, there was a very antagonistic relationship between youth and age. Namely in the case, where youth had to emigrate and older members of society remained here. The equation was altered during the Celtic Tiger, in the fact that youth remained on this island for the first time. But the antagonism between youth and age, was carried on just the same, and re-invented in a most awful form. Where you had youth who were willing to just borrow and borrow. To say to older generations, look at us. We can borrow! I think there are many societal and cultural factors like that, lurking about in our national closet. BOH. @ Brian You have raised a whole slew of issues there, all of which tend to illustrate the fuzzy boundaries of the economics dsicipline, and its proximity to history, politics, social psychology and other so-called soft sciences. * the economic history of the US is part of European economic history, in which the bourgeoisie/business class/middle class (Liberal party in Britain) came to take power over aristocracy and landed wealth (Tories). The Great Transformation by Karl Polanyi (1947) is a very readable classic. * speculation is the partner of accumulation, and plays a central role in modern, complex, highly differentiated economies. Framing Finance by Alex Preda (2009) is a very timely and well referenced analysis of what exactly Mr Market is and does. * not sure that you can say that old money saw its buying power diminish dramatically. This is not Weimar. The cuteness of Greenspan’s great Moderation was that consumer price inflation was held in check, while profitable bubbles emerged in specific asset classes, including property. * we took such a hit from the property bug because property still ‘matters’ too much in Ireland. Our banks always insisted on property as security, or otherwise simply placed their funds on deposit in London. They starved ordinary SME’s down through the decades, and then jumped into bed with every developer in sight. ‘Safe’ investing was bum investing. * David McWilliams has provided a snappy social analysis of popular consciousness during the boom. It’s high time some of our sociologists and social psychologists got stuck in. The social discipline for the handling of wealth takes generations of bourgeois upbringing. Deferred gratification, portfolio management etc. As a people, we were never in that league, and probably never will be. There are many kinds of society, so it’s not the end of the world. All the commments above, and articles themselves, are very much appreciated. Time will tell whether the banks and the economy are ‘on the way to being fixed’, but social responsibility is going to be a hot topic one way or another. @ Paul, You have raised a whole slew of issues there, all of which tend to illustrate the fuzzy boundaries of the economics dsicipline, and its proximity to history, politics, social psychology and other so-called soft sciences. This is the real danger, and it makes full, extensive exploration of the issues impossible in practice given this internet kind of medium. However, what Karl Whelan, Philip Lane and the many others at the Irish economy have managed to established firmly, is a dedicated time-liner of developments as they occured over the past number of years. I listened to a Robert Shiller lecture recently, where he noted most of the ‘big stuff’ in the financial world happened back in the 1930s in the US. But there has been a lot more change in the past couple of years, than there has been in the period between now and the 1930s. That is very counter intuitive. Because we are more used to a narrative, which describes this wonderful technological advance and progress throughout the first world, and many parts of the developing world, like some kind of steady march, throughout the 20th century. BOH. @ Paul Quigley, * we took such a hit from the property bug because property still ‘matters’ too much in Ireland. There is a cultural factor which exists in Ireland, that if you acquire a house and pay for it, there is not much more one needs to do with one’s life. But in terms of looking at solutions to move forward. Here is one suggestion I would like to offer. I heard comments like these reguarly during the boom years. At the height of the first phase of the Celtic Tiger, the ‘young people’ were deemed to be doing well financially, if the pubs were crowded on a Thursday night. As time went on, the pubs were only crowded on a Friday night. As time went on further, the pubs were only crowded on Saturday night. As time went on further, the pubs were never crowded at all. It was analysed by mature types I knew in Dublin, this was an economic barometer. If the weekend started on Thursday night, then ‘the young people’ were earning a lot of money. Presumably, by this theory, if things were really good, the pubs would be crowded every night of the week. We would run out of days in the week, and we would have to work like Joseph Stalin, to establish a new calendar, with enough days in the week to monitor the progress of the Celtic Tiger boom. If you look at the above as a piece of social history of the boom years, you will see what underlies it, is a very strong level of contempt for ‘the young people’. Young people were no deemed to be a component of the society. Ireland was merely a play ground for young people to partake in. But beyond that, there was no clear roadmap for the building of a society, which included young people are active participants. That was the heaviest legacy of the 1950s, 1960s, 1970s and 1980s, which weighed down upon the Celtic Tiger for its decade or so of prosperity. There was a strong conflict rather than a cooperation between youth and maturity. One not willing to budge to accomodate the other. One trying to out maneuvre the other. First time buyers of property in competition with ‘speculators’ from the mature age groups. The underlying theme is an under-developed sense of ‘inclusion’ as a society in Ireland. Which spills over and had identifiable consequences, when we look at the economic boom and how it played out on the island. BOH. @ Brian ‘The underlying theme is an under-developed sense of ‘inclusion’ as a society in Ireland’. Yep. It follows that our unresolved problems of social integration and social inclusion need every bit as much thought as the economic issues. The knee bone is connected to the thigh bone… @ Paul, Yeah, I have come to appreciate that. BOH. @ Paul, Before I go, I remembered something which might be useful. It derives from my own background in architecture. The last time Herman Hertzberger, an architect from the Netherlands spoke in Dublin, I heard him talk about an competition he was asked to judge. He looked at some of the competition presentation boards, which had been discarded by the other judges. They had short-listed about half a dozen or so, which would receive a prize, commendations and hang in an exhibition. Herman picked out one presentation board from the ‘loser’s pile’ and asked to have it included in the exhibition, though it wasn’t in the running for a prize. The reason was, Herman said, the competition entry he picked out demonstrated an appreciation for landscaping which was suited to young people of a certain age. The competition entry had been dis-qualified by the judges, because it didn’t quite follow the brief. Herman observed that the traditional Victorian notion of manicured gardens and grass lawns was in denial of the fact, kids at a certain age want to be dynamic. They want to run, jump and play. Our environment is often set up in such a way as to deny kids (as members of society) an opportunity to partake in their favourite pastimes. You can read some more about the comments by Herman Hertzberger in a blog entry I wrote. BOH. http://designcomment.blogspot.com/2010/02/herman-on-form.html @Frank Galton – “Is anyone else getting 404′d on Parts II and III?” I thought for a minute there that “getting 404’d” was some kind of cool/slang/newspeak for something not getting through to/not communicating with you. As in “Jaysus, every time Lenihan speaks I just get 404’d.” … or “Cowen certainly 404’d that presentation.” … …but now I’ve had time to go and read the articles I see it’s just that the links aren’t working on parts II and III. @ Brian Woods II (what happened I?) ““Partly for this reason, it is currently proving cheaper in most cases for the FDIC to sell the whole deposit book and part of the assets of a failed bank to a strong competitor, rather than simply paying off the insured depositors.” Honohan Report p127. Will you tell him its impossible or shall I? Comments are closed.