Richard Portes writes on this topic at the WSJ: the article is here.
Month: April 2011
FT Alphaville has an interesting article on this type of product: you can read it here.
Lehigh University organised a conference on the Irish economy last week: the presentations are here.
NAMA Chairman Frank Daly gave a speech this morning and the following excerpt is going to get a lot of attention.
NAMA is currently exploring ways in which it could further facilitate the provision of liquidity into the market by providing staple finance for commercial deals and also by exploring options on the residential front. Following the PCAR2 exercise we would, for example, be interested in talking with the two Pillar banks to see how we could work together to move things along in this area. At a time like this, it is imperative that NAMA is creative in terms of identifying solutions to get the market moving.
I’m obviously completely missing something here. Why does this need “exploration”? Why does it have to involve the Pillar banks which are supposed to be shrinking their property loan portfolios, not adding to them?
Here’s a two step guide to selling a NAMA property without needing banks to provide finance:
1. Have a competitive auction.
2. The winner gets offered the option of either paying in full in cash or getting term finance from NAMA, i.e. they pay back the amount they bid (less cash put down) over time including interest.
What have I missed? And why didn’t NAMA operate like this from the start?
The graph below shows projected nominal GDP for the European periphery (plus Germany as a benchmark) over 2007 to 2016, based on the IMF’s new World Economic Outlook database. (Indexed to 2007=100.) It shows that Ireland is projected to return to its 2007 nominal GDP in 2016. While Ireland is projected to be the fastest-growing economy between 2010 and 2016, its initial decline between 2007 and 2010 is far greater than in the rest of the periphery.
