AIB’s Penny Stock Mystery

http://www.bloomberg.com/news/2011-08-03/allied-irish-anomaly-makes-rescued-bank-europe-s-fifth-largest.html

I think it kinda works like NAMA. Ye know keep most of the stock off the market. 😀

For current figures see:

http://www.ise.ie/Prices,-Indices-Stats/Equity-Market-Data/EquityDetails/?equity=502

Some clown bought them for €0.08 today!

How does the ISE list the market cap at €41bn and yet it is only 0.2% of the index.

All of a sudden the ISE is a €20trn market!! Those Davy/Bloxham guys deserve their bonuses after all.

@Seafoid
Which goes to show you can fool some of them all of the time……

@ Karl

How you keeping?

I had been holding AIB shares since they were €20. Got to the stage where there was no point in selling. Then this recap thing happened and I did these exact same sums. No way could AIB shares be worth 11c given the 99.8% dilution so I dumped them all at last. They subsequently fell to 3c so I felt sort of vindicated but now back at 8c., makes no sense at all.

I

@Grumpy
Maybe it’s Micky N talking up his book. In the euphoria today anything is possible. bank of America up 10% today despite the questions being raised about them shifting dodgy derivatives from ML to the FDIC insured bank.
And some European banks up 20% despite the need for recapitalizations.
Funny times indeed.

Is someone suggesting, if only vaguely, that prices as determined on the margin are not, when extrapolated, a true estimate of value/worth?

Don’t tell the traders/accountants/banks/risk committees/actuaries. It might cause a crisis of confidence in both the eurozone and the USA.

Hell, it might even cause contagion to spread, instead of doing whatever it is contagion normally does.

Accrding to John Fitzgerald in yesterdays’s IT:

“The banks have moved from being a liability to an asset on Ireland’s balance sheet”, said Prof FitzGerald, “the Government would sell them in time to get a return for the exchequer.”

“The banks are now our biggest assets,” he said. “Getting our money back from the banks is key to debt sustainability in the long term.”

http://www.irishtimes.com/newspaper/finance/2011/1027/1224306561503.html

Wouldn’t it be more adult to discuss this and whether it is accurate or not, and, if accurate, what are its implications, instead of the schoolboy-level of discussion in the thread so far?

@John TheOptimist

President Higgins says Hi John!

The comment from the member of the board of The Central Bank of Ireland is noted; and filed for posterity or should that be … er .. austerity.

@David O’Donnell

President Higgins says Hi John!

JTO again:

At last, Sarkozy has found another Head-of-State he can look down on.

Shares in manufacturers of platform shoes soaring.

Entirely predictable that the alliance of the Dublin 4 media and the border region criminal classes would produce the desired result.

However, the real shocker is Dublin by-election. FF on way back up.

@Actuary

Surely if you want to have an important discussion, the most important and topical would be to discuss why the governement is going to give away €700m of our money next week to bondholders who were given any sovereign guarantee.

Meanwhile, Greek sovereign bondholders have voluntarily accepted a 50% cut in the value of their bonds.

JTO again:

I am not a bondholder, but my savings in an Irish bank are looking more and more secure, and attracting a nice real rate of interest, while the suckers who moved their savings to the UK are getting a massively negative rate of interest.

But, the real question is: will these bondholders be willing do purchase Greek bonds in the future? Suckers if they are.

Gentlemen if I may ………….?

@ JTO

The only reason you have anything left in an Irish Bank is that the ordinary hardworking taxpayers of Ireland are paying for it.

The only ones being taken for suckers are the Irish people – paying for the security of your deposit.

As for the Bondholders – if there is a market they’ll sell.

‘the border region criminal classes’ – to who’s benefit was the cheque written for John? FF asked him for it via SG. You really are priceless.

🙂

“The banks have moved from being a liability to an asset on Ireland’s balance sheet”, said Prof FitzGerald, “the Government would sell them in time to get a return for the exchequer.”

The banks, the craythurs. Only a mother could love them.

@ JTO

I never moved a penny to the UK John, I am far from bitter and I leave the TV to the good wife.

Now, would you like to address the points made in paragraphs 1,2,3 &4?

@ KD

I believe he takes investment advice from a DUP supporting Free Presbyterian (What relevance that had to investment I don’t know) advisor who works for the Ulster Bank (RBS) Donegal Sq. East in Belfast.

This person advised him to move his funds to the RoI (I am open to correction on that but 99% sure that is what he said).

@ KD

and if it was with Ulster Bank, as an Irish-domiciled subsidiary of RBS, it is covered by the Irish deposit protection scheme (ie the 100k one).

@Ordinary Man

This person advised him to move his funds to the RoI (I am open to correction on that but 99% sure that is what he said).

JTO again:

Almost, but not quite correct, Ordinary man.

He didn’t advise me to do it. I told him that I wanted it to be done, and he naturally did what I asked him to. He was a bit sceptical at first.

But, no need to be making out that the entire government policy since 2007 has been done for my benefit. I merely made a correct call about what was likely to happen. The reality is that the vast majority of people in Ireland with accounts in Irish banks left them there, while only a minority moved them abroad in the great panic. Those who left them there have been rewarded.

@ JTO

John if you don’t mind I will take your points, as I believe they arise, rather than per paragraph. I hope that may bring more clarity as to my position to any interested readers ( apologies for the lack of brevity), but more importantly yourself.

JTO
‘If your savings are in Ireland, then you are benefitting every bit as much as I am from the fact that Ireland did not default or devalue. If your savings are abroad, it is just sour grapes to be complaining that policies were enacted to protect the value of savings that were left in Ireland.’

Ordinary Man
What relatively little ‘savings’ I have on deposit RoI are in An Post John. Well below risk threshold and to be frank, relatively unimportant in the grand scheme of things from a personal perspective. So no sour grapes there.

JTO
‘I’m afraid that that is what governments are supposed to do. If those who had left their savings in Ireland had lost them, nobody would ever have left their savings in Ireland again. It was never a matter of whether or not the government would have the intention of ensuring that people who left their savings in Ireland would see them protected, but whether or not the Irish economy would prove strong enough for them to be able to succeed in doing so. It turns out that it was, which is why my modest gamble has paid off and why those who thought otherwise and moved their savings to the UK have lost out.’

That’s complicated John but bottom line – b*****ks. Not the one of them that should have been in control had any control, government, regulator or investor – had any idea what they should have been doing 12 – 18months before the s**t hit the proverbial. That just doesn’t stand up.

JTO
‘But, I am glad to hear that you are not one of them.’

I am not the point John – it’s the ordinary people of Ireland and capitalism are the point. I go by the rule of risk and reward. I don’t always win, but I am happy to take it on the chin if I lose – it’s just game we play. I don’t expect anyone else to cover my risk unless I am paying for insurance and last I heard the banks were not paying insurance to the Irish taxpayer to cover their risk.

JTO
‘Regarding FF’s cheque, it was perfectly legal fundraising. How is a political party supposed to know the history of everyone who contributes to it during a fundraising drive? FG, Labour and SF are all considerably richer than FF at present. Are they all certain that none of the many who have written cheques for them have a criminal record?’

I agree. But lied for no reason, was it an instinctive response when under pressure. Could he not deal with the pressure John? Would you employ a anyone who could not take the pressure? The only person he fought back against was a woman the next day ( who had made a fool of him by asking a simple question any business person in country could answer). Is this the type of person, representative of a party (sic) who could maintain the best interests of the people and defend The Constitution? Doubt it.

JTO
‘However, the main issue now is that, knowing his background, the Dublin 4 media, RTE in particular, conspired with the convicted one to take out the candidate whom they disapproved of.’

At the indulgance of the moderators and with apologies to all.

From what I seen MMcG just exposed his hypocricy – he lied almost as a reflex action and seemed suprised that no one svallowed it. Again not to mention the lady from Stillorgan.

JTO
‘On this occasion, RTE didn’t need to fabricate the same sort of smear, although I am sure that they would have done, had it proved necessary to achieve the right result.’

Did you actually read what you have written here?

JTO
‘He didn’t advise me to do it. I told him that I wanted it to be done, and he naturally did what I asked him to. He was a bit sceptical at first.’

I stand corrected. Tell us John, did you do it as a great act of patriotism or was it purely in you own self interest? I know the answer but in case others have missed it (I personally have no problem with your answer).

JTO
‘But, no need to be making out that the entire government policy since 2007 has been done for my benefit. I merely made a correct call about what was likely to happen. The reality is that the vast majority of people in Ireland with accounts in Irish banks left them there, while only a minority moved them abroad in the great panic. Those who left them there have been rewarded.’

As I have endevoured to explain to you before John, not every movement of capital (including working capital) is for the pittance of interest paid by a bank from an entrepreneurial perspective.

As for those who have left it behind, it is always at risk if you cannot hold it in your own hand – that is why they pay you interest.

Have a great weekend and my apologies for any spelling mistakes, the length of this post and thanks for the foreberance of the moderators if I have strayed too deeply into the realms of politics.

But, I am glad to hear that you are not one of them.’

@Ordinary Man

I am going away for the weekend, so I am unable to answer all your points now. But, you are wrong on your first point, where you say:

“What relatively little ’savings’ I have on deposit RoI are in An Post John. Well below risk threshold and to be frank, relatively unimportant in the grand scheme of things from a personal perspective. So no sour grapes there.”

Your savings in An Post will have been earning a nice positive rate of interest. Congratulations! Someone (and I know many in N. Ireland) with savings in the UK Post Office will have been seeing similar savings eroded away by inflation. You are a wise man for keeping your savings in An Post, rather than moving them to the UK Post Office.

If Ireland had gone bust, your savings would not have escaped losing value just because they are in An Post. The bust would have been accompanied by Ireland exiting the euro and having a massive devaluation, as many economists argued for. Then, you would have seen a huge loss in value in your savings. One prominent economist argued for Ireland to exit the euro and have a 70% devaluation. Think what that would have done to the real value of your savings in An Post. It would also have eroded the real value of your income as well.

Regarding Sean Gallagher, he was simply taken out. He was a member of a perfectly legal political party at the time, any activities he carried out were perfectly legal and for the benefit of that party, in just the same way that members of other parties do. The media cynically tried to present it as him being corrupt and on the take, for which not one scrap of evidence was presented. There is not the slightest suggestion that he did anything illegal or immoral. It was only corrupt if one believes that capitalism itself is corrupt and that all businessmen are automatically corrupt, which obviously some people on here do (although I don’t know if you are one of them). Having said all this, however, a small part of me does have a sneaking admiration for Martin McGuinness. He character-assassinated Gallagher with deadly precision. A real professional hit. Northern ruthlessness at its finest, for which southern softness was no match. An uncharitable person might easily think that Martin had done similar before, although I’m sure he hadn’t.

Geez John the Op.

Gallagher took 700k from BES investors then screwed them with directors salaries, charging the co. 200k on his and his partners personal 2000k building for rent, taking money out as an interest-free directors loan, and moving the ownwership of patents from company ownership to personal two partners ownership.

@Dermot

You are simply taking as your starting-point the month at which sterling hit bottom. It had fallen by about 25 per cent between June 2007 and January 2009, and then it stabilised. So, the Irish, that converted their euros into GBP between June 2007 and January 2009, will have taken a huge hit. It is true that sterling stopped falling v the euro in January 2009 and has been stable since. However, UK inflation has been much higher in that time, and the Bank of England just a few weeks ago announced its intention to print oodles and oodles of money in the next few years, so another fall in sterling v the euro is extremely likely, although obviously I don’t know the precise date on which it will occur (if I did, I’d be a millionaire).

if you are not living there, then the only relevance of the inflation rate is how it affects the exchange rate.

so, given that the exchange rate has remained fairly stable whilst some have expatriated deposits, it is fairly safe just to compare directly nominal deposit rates is it not?