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Archive for December, 2009

Derivative positions of the Banks?????

Let’s give away big two banks


 

Article from David Mc Williams

http://www.davidmcwilliams.ie/2009/12/27/let%e2%80%99s-give-away-big-two-banks

This time last year, this column predicted that Anglo Irish Bank would be nationalised within weeks. That came to pass in late January. At the time, the mainstream view was that Anglo could limp on, but this was codswallop.

The reason for the nationalisation was simple: no one was paying big depositors to stay with Anglo. They simply were not being paid for the reputational risk of being associated with such an outfit.

My argument on the eve of 2009went as follows: ”Despite capital injections and much hot air about the ‘culture of Anglo’, the bank will still go bust and will be nationalised. This is likely to happen in the next few weeks. To save you listening to the usual hindsight in February, here’s a bit of foresight and this is what is likely to happen in the next few weeks.

Corporate depositors – institutions that had kept large deposits with Anglo – will, in the new year, decide that there is no point in keeping money with this bank when they can, just as easily, keep their cash with one of the two big banks. The question they’ll ask themselves is ‘why should I keep my cash in Anglo?’ They are not being paid for specific Anglo risk.”

Anglo was nationalised on January 16.

Now the question for the next few months is whether our big two banks will face a similar crisis of confidence. How will the big hole in their capital bases be addressed, a hole which will widen due to a new wave of mortgage default in 2010?

Will big corporate depositors start to ask why they should keep their money in Bank of Ireland and AIB?

The risk that the banks will have to be nationalised – or something close to it – is now very real. The government draws a distinction between 100 per cent nationalisation and holding a majority stake, but either way we, the taxpayers, are taking control. Let’s put a date on it.

February is my guess. What’s yours? The underlying logic for this is primarily because no one will touch the Irish banks with a bargepole.

Regular readers will know that this column has argued time and again that the scam that is the National Asset Management Agency (Nama) deals only with €90 billion of the €400 billion total loan book the Irish banks have. This rest of their loan books will atrophy in the months and year ahead.

Last Wednesday, the head of AIB declared to shareholders that he had no idea how much capital the bank would need. This would hardly inspire confidence. But it is clear when you examine how this bank blew its balance sheet that the non-developer proportion of its loan book will be negatively affected by increased levels of unemployment, lower incomes, a falling population and ongoing negative equity.

It is clear now that the state is likely to have to introduce a ‘Nama 2’ to deal with mortgage defaults. Anyone with a passing knowledge of economics knows that the bad debt cycle lags behind the economic cycle and becomes apparent only when the banks stop rolling up interest and when people realise they can’t pay now and have no real prospect of paying in the future.

Against this background, the state has to decide whether it can – or would want to – back all these debts by injecting capital and raising the national debt. A more sensible course of action is to realise how bad the situation is and get an accurate figure from the banks about how serious the bad debts will be.

If our debts are 10 per cent of the loan book, the banks need to find €40 billion. If debts are worse – say,15 per cent of the book – the figure goes to €60 billion. The state simply can’t afford this, nor should it have any business worrying about it.

A smarter approach would be to do a deal with the major creditors of the bank – the big bondholders who have billions of euro invested in the banks. Tell them how much we can afford to pay and suggest they should get their acts together now because the guarantee runs out in ten months. In ten months, they will get nothing because the banks will be bust, so do they want to do a deal?

Nothing focuses the mind of a creditor more than the sight of a debtor refusing to pay. The depositors would, of course, be protected, but the bondholders – who got a better return on the basis of taking a risk – should not be.

Even if we did a deal with the creditors, would we be out of the woods? No, because there remains the huge problem of deleveraging, which itself drives the bad debt cycle. Over the past year, with the aid of huge extensions of credit from the European Central Bank (ECB), the banks have managed to avoid the massive deleveraging which has to happen here.

The contraction of credit in the bust is the counterpoint of the expansion of credit in the boom. Put simply, in the boom, our banks borrowed from whoever they could to force credit into the economy. So, in banking parlance, they borrowed ‘short’ (in the short term, from three months out to five years) to lend ‘long’ (lending this money out for 30-year mortgages).

When the market shut down last year, they had to go to the ECB to make up the shortfall – and the shortfall was enormous. The banks’ loans-to-deposit ratios hit 160 per cent in 2008.

Therefore, we will see a huge fall in the amount of credit in the Irish system over the coming years. This could be as big as €100 billion, unless someone else comes in and plugs the gap. Think about the scale of defaults when this comes to pass.

The market knows all this, which is why no one will lend money to the Irish banks on a normal basis until they know everything. The problem is that, once things become apparent, large depositors might just start to take their cash out as they did with Anglo a year ago.

In this scenario, the government would have to nationalise. But it doesn’t have to get that bad for the government to be compelled to nationalise. Further downward movements in the bad debt outlook will require new capital and, if it won’t come from the market, it will have to come from the government .This is likely before St Patrick’s Day.

But does it have to be like this? No, obviously not. The best course of action now would be to give away both main banks free to a European bank, which would deal with the big creditors. This, in a sense, would allow the banks to ‘go bust’ by admitting they were worthless, and by giving the new owners the deposit bases and the branch network free. In return, the new owner would issue its own paper to pay the old creditors at some deep discount, maybe 90 per cent. Problem solved, and we start again. This is what would happen in normal business.

It is called capitalism, and it is our only way out. Otherwise, we will tie ourselves in knots trying to borrow from tomorrow to pay for yesterday.

Better to come clean now, face the music and start again. This is what we would do if a sweet shop went bust; banks are no different.

Comment

I wouldn’t bet any of the top European banks taking on these two toxic banks now David

What about their huge losses on their derivative positions

Before anybody starts to deny that the Irish banks have exposure, why then would the

National Treasury Management Agency be advertising for a Derivatives Valuation Service Provider to NAMA see following link

http://www.e-tenders.gov.ie/search/show/search_view.aspx?ID=AUG125404

Page 15 of the draft NAMA legislation says that the definition of a “credit facility” includes instruments such as”a hedging or derivative facility.”  Section 56, starting on page 46, then defines eligible assets for purchase by NAMA as a range of different types of “credit facilities” as well as “any other class of bank asset (Derivatives) the acquisition of which, in the opinion of the Minister, is necessary for the purposes of this Act.”

source http://www.irisheconomy.ie/index.php/2009/08/20/nama-to-purchase-derivatives/

This is all gobbledygook to allow the State to step in and cover the Banks catastrophic Derivatives positions

In 2003, legendary investor Warren E. Buffett called derivatives “weapons of mass destruction.” Buffett predicted that the complex financial instruments would morph, mutate, and multiply “until some event makes their toxicity clear.” The failure of Lehman Brothers may have been the disaster he imagined.

We haven’t even begun to get a picture of the mess the banks are in!

Cowen & Leinhan are still going around with their heads in the sand!

Stop this slaughter now!

 

Denmark’s hidden shame!.

The sea is stained in red and in the mean while it’s not because of the climate effects of nature.

It’s because of the cruelty that the human beings (civilised human) kill hundreds of the famous and intelligent Calderon dolphins.

This happens every year in Feroe Iland in Denmark . In this slaughter the main participants are young teens.

WHY?

A celebration, to show that they are adults and mature!

In this big celebration, nothing is missing for the fun. Everyone is participating in one way or the other, killing or looking at the cruelty “supporting like a spectator”

Is it necessary to mention that the dolphin calderon, like all the other species of dolphins, it’s near extinction and they get near men to play and interact. In a way of PURE friendship

They don’t die instantly; they are cut 1, 2 or 3 times with thick hooks. And at that time the dolphins produce a grim cry like that of a new born child.

But he suffers and there’s no compassion while this magnificent creature slowly dies in its own blood

Stop this slaughter now!


We will send this mail until this email arrives in any association defending the animals, we won’t only read. That would make us accomplices, viewers.

Take care of the world, it is your home!

Assine contra essa crueldade:

Sign Against this cruelty:

1.- Ana kARINA Rivas (m) Mexico DF

2.- Carlos Enrique Bulle-Goyri. DF

3.- Alejandra Nabarro ( Mexico Cuernavaca )

4.- Esteban criz mejia. Mexico DF

5.-ANDREA GONZALEZ ALVAREZ ( MEXICO )

6.-González Alvarez Victor Rodrigo

7.-Ines Garcia Perez (México)

8.-Stella Morales (México)

9.-lgarcia (México)

10.-Leticia Cuéllar (México)

11.-Salma Urbina Aguilar (Quintana Roo, México)

12.-DIANA LUCELLY POOT PUC (quintana roo, mexico )

13.-Josue Acero Gonzalez ( Quintana Roo , Mexico )

14.-Micaela Medina ( Argentina )

15.-sofia bidondo( Argentina )

16.- Ma. Marta Soruco ( Argentina )

17.- Cyntia Mariela Roitman ( Argentina )

18.-Aldana Martínez ( Argentina )

19.- Adriana Salomon ( Argentina )

20.-fernando valussi( argentina )

21.-MARIANELA SANCHEZ( ARGENTINA )

22.- Leyes Alberto Fabian ( Argentina ).-

23.- Augusto Patricio Mateos ( Argentina – Chaco )

24.- Maria Alejandra Bury ( Argentina – Chaco )

25.- Claudio Alexis Agnesio ( Argentina – Chaco )

26.- Cesar Abel Falcon(Argentina-Chaco)

27-MARIANA GOMEZ MARTINEZ

28-SILVIA CLAUDIA GIMENEZ

29-NELIDA BEATRIZ MARTINEZ

30-MARIA ESTHER URSU

31- NATHIA JUDKEVICH ( Argentina )

32-MARINA JUDKEVICH ( Argentina )

33-MARIANA JUDKEVICH (Aregentina)

34- Bogado Espinoza, Lorena Abi ( Argentina )

35- Ortiz, Natalia Muriel ( Argentina )

36- Marcelo Rodrigues de Rezende (Sorocaba-Brasil)

37- Thais Chenchi Santana (Sorocaba-Brasil)

38- Lilian Yoshie Kato ( Sorocaba – Brasil)

39 – DIOGO CRISTO ( Sorocaba – Pindorama – Gaya )

40 – DANILO GOMES ( Sorocaba – Cidade de Mentiras)

41- Tiago Holtz Guerreiro (Sorocaba- Brasil)

42 – Laura Nunes Garcia Vieira ( Sorocaba – Brasil)

43 – Anderson Schmitt Junkes (Jandira – Brasil)

44 – Eronides Santos Filho (Jandira – Brasil)

45 – Suzana Lopes Ribeiro ( Jandira – Brasil )

46 – Paulo Henrique Ferreira (Cotia/SP Brasil)

47 – André Luiz da Fonseca Roberto ( Carapicuiba/ Brasil )

48 – Jean Paulo Camargo Costa (CARAPICUIBA/ BRASIL)

49 – Rodrigo de Jesus Ferreira (Jandira – Brasil)

50- Bárbara Tabain Seslija de Sá (Jandira – SP – Brasil)

51 – Ana paula Morina Ferreira (Barueri – SP – Brasil)

52-Bárbara Louise (São Paulo-SP-Brasil)

53-Diego Lima (Carapicuíba-SP-Brasil)

54 – Wanda leila de Oliveira marra ( Osasco – SP –Brasil )

55 – Joilva Duarte (Osasco-Brasil)

56 – Patricia M. Dias ( São Paulo – Brasil)

57- Eduardo M. Dias ( São Paulo – Brasil)

58 – Wagner R. Franco (São Paulo – Brasil)

59- Ruth Cristina Serafim (São Paulo – Brasil)

60- Thiago Silva (São Paulo – Brasil)

61 – Cristiano S. de Moraes (Rio de Janeiro – Brasil)

62 – Kelly Lopes Dias (São Paulo – Brasil)

63 – Fábio Ferreira / São Paulo – Brasil

64- Fábio Araujo / São paulo – Brasil

65- Marcia Stevaux/ São Paulo – Brasil

66 – Débora Gisele Ferraz – Brasil

67- Andrea Alexandre de Carvalho

68 – Adilson dos Santos Pinto (Cruzeiro SP)

69 – Francisco ReZende (Lorena-SP)

70- Mislane Souza Prates( São Paulo-Brasil)

71 – Janderson Dutra (Rio de Janeiro-RJ – Brasil)

72 – CECÍLIA SANTOS (SÃO PAULO) – BRASIL

73- KÁTIA I. SANTOS ( SÃO PAULO ) – BRASIL

74- Maria L Lima – (Rolândia – Brasil)

75 – Marilise G.Z. Solle (Rolândia-Brasil)

76- Luis Fernando Silva de Almeida (Rolândia Pr- Brasil)

77- Adriana Amaral de Souza (Rolândia Pr – Brasil)

78 – Carlos Alberto Ferreira do Amaral (Rolãndia PR – Brasil)

79 – Lilian Carla de Souza Gonzalez ( Londrina – Pr. – Brasil)

80 – Ailton Valdivino da Silva – (Uberlândia – MG – Brasil)

81 – Heliza Piosiadlo (Uberlândia – MG – Brasil

82 – Patrícia Cordeiro ( Joaçaba-SC-Brasil)

83 – Danielle Argenton (Herval D’ Oeste – SC – Brasil)

84 – Valdirene Soares ( Joaçaba – SC – BRASIL )

85 – Luiz Sérgio Belló – Joaçaba SC Brasil

86- Eduardo Wieser -SC- Brasil

87- Julio Pancera ( Navegantes , SC – Brasil)

88- Fredi Goede ( Pomerode , SC Brasil)

89 – Mario L.Fanton

90 – Valério Littig ( Curitiba – Brasil )

100-cassia cavalheiro

101 – Paulo Terumitsu Ishii [ Curitiba – Paraná – Brasil]

102- Caroline Niro ( Curitiba – Paraná – Brasil

103-Alexandre Batista(Londres-Inlaterra)

104-udson bergues de almeida

105 – Inês Calazans, Alemanha

106 – Anabela Martins – Portugal

107 – Luisa Sequeira – Silves / PORTUGAL

108 – Alzira Rodrigues – Silves / Portugal

109 – Cremilde Ribeiro – A.. de Pêra / Portugal

110 – Augusto Miguens – Elvas / Portugal

111 – Natália miguens – Elvas / Portugal

112 – Manuela Santos – Carcavelos / Portugal

113 – Carla Santos – Oeiras / Portugal

114 – Maria Carlos Barreto de Carvalho – Carcavelos / Portugal

115 – Eliete Mendes – Lisboa / Portugal

116 – Conceição Oliveira – Lisboa / Portugal

117 – Mariana Domingues – Portugal

118 – Joana Murtinha – Portugal

119 – Filipa Almeida – Portugal

120 – Iolanda Fontes – South Africa

121 – Kalen Viljoen – South Africa

122 – Wendy Golding – South Africa

123 – Inge Strugnell – Botswana

124 – Philippa Lee – Botswana

125 – Ilse Swart

126 – Miche de beer

127 – Celeste Smit

128 – Jeneane Fourie

129. Stefnie de Beer (SA) Human beings ? How can we call ourselves that !

130 Corné van Staden

131 Anna-Marié van Staden

132. Sheralee Scott ( South Africa )

133 Bev Hindmarch ( South Africa )

134. Ian Pardy (SA)

135. Dominic Porter (SA)

136. Carl Bennett (SA) Sick Bastards!!

137 Dieter Rossler South Africa uncivilised idiots

138. Vigie Naidoo, Johannesburg South Africa (how far western man??)

139. Rodney Reddy S.A. — lily-livered, sure they’l never dare try this with some tiger or bull sharks

140. Mira Naidoo, Johannesburg South Africa (shameful specimens called humans)

141. Rocco Steffannelli, Bari Italy (senseless killing)

142. Christian Hoffer, Mank Austria (Neanderthals!)?

143. Sarah Caine (SA)

144. Lorraine Caine (SA)

145. Elaine Caine (Sa)

146. Lorraine Isaac (SA)

147. Ronnie Isaac(SA)

148. Angelique Mason(SA)

149. Alysha Isaac (SA)

150. Mary Joe Emde (SA)

151. Nalisha Gangadien SA)

152. Charlene Gangadien (SA)

153. Cordelia Soobramoney

154. Nicholas Soobramoney

155.. Gabriela Pillay

156. Sarah Pillay

157. Jaeden Chetty

158. Sam Chetty

159. Dean Prinsloo

160. Nicole Pillay

161. Janine Geldenhys

162. Noeleen Pillay

163. Vigie Naidoo, Johannesburg South Africa (Nordic barbarism!! – Climate Change?- go figure?)

164. Colette Boyd

165. Tanya Scheffel

166. Rob Armstrong

167. Megan Adriaanzen – Jhb S.A. This is the most appallingly, disgusting thing I have ever seen!!!

168. Gareth Adriaanzen

169. Aldorette Swanepoel

170. Steve Maree – Durban , South Africa

171. Karen Robjant – and they are supposed to come from a civilised country – very sick people

172 Gerhard Janse van Rensburg – Durban South Africa

173 Keagen Janse van Rensburg – Durban South Africa

174 Trent Janse van Rensburg – Durban South Africa

175 Graham Robjant – Durban South Africa

176 Tamaryn Robjant – Durban South Africa

177 Beryl Robjant – Durban South Africa

178 Joan Austin – Durban South Africa

179 Simone Heijmans-Durban South Africa

180 REMON HEIJMANS-DURBAN SOUTH AFRICA

181 RENTIA HEIJMANS-DURBAN SOUTH AFRICA

182 RICKIE HEIJMANS – DURBAN SA

183 LEANIE HEIJMANS – DURBAN SA

184 JACKIE HEIJMANS – DURBAN SA

185 KEANU ROBERTSE – DURBAN SA

186 MALISSA ROBERTSE – DURBAN SA

187 BRIGITTA STEYN –DURBAN SA

188 MATTHEUS STEYN –DURBAN SA

189 MARCEL HEIJMANS-DURBAN SA

190 WOUTER HEIJMANS-DURBAN SA

191 EMIEL HEIJMANS-DURBAN SA

192 PASCALLE CLOETTE -DURBAN SA

193 EDWIN HEIJMANS-DURBAN SA

194 JESSICA HEIJMANS – DURBAN SA

195 LEN CLOETTE – DURBAN SA

196 GEOFFREY CLOETTE –SA

197 Janice Wittrup SA

198 Tempest Hindman (Aus)

199 Gary Hindman (Aus)

200 Eben van der Watt (UK)

201 Jeandre van der Watt (UK)

202 Armand van der Watt (UK)

203 Jetro Smith ( UK )

204 Morne du Preez ( UK )

205 Joey Wasiliew ( USA )

206 Willie Olivier, Cape Town (uncivilized barbarians)

207 Andre’ Groenewald, Durban (SA)

208 Chris Goldmann Carvoeiro, Portugal

209 Gary Fonternel – Australia

210 Simon Lewis – Australia

211 Scott Wetherall – New Zealand

212 Jeremy Cusiel – Perth

213 Victoria Verity – Perth

214 Karen Stockin – New Zealand

215 Monika Merriman- NZ

216..Linda Jennings Sydney , Australia

217. Margaret Burgess , New South Wales , Australia

218 Merrill Duffy Australia

219. Margaret Ward – Australia

220 Sandy Jones, NSW Aust

221 Jacqui Bright N.S.W. AUST.

222 Penelope Chambers, Qld , Australia

223 Kim Grant, Sydney , Australia

224 Pua Soliola, Sydney , Australia

225 R’Chee Saipele, Auckland , New Zealand

226 Kim Watts, Auckland , NZ

227 Jenny Korff

228 John Baker, Auckland , New Zealand

229 Paul Baker Auckland New Zealand

230 Jocelyn Dutton Auckland New Zealand

231 Michael Dutton Auckland New Zealand

232 Susan Mann Auckland New Zealand

232 Brian Mann Auckland New Zealand

233 Philip Harris Auckland

234 Eden Moss, Auckland , New Zealand

235 John Moss Auckland New Zealand

236 Pat Moss Auckland New Zealand

237 Mel Orange, Wellington , New Zealand

238 John HOLLAND , South Australia

239 Pauline Macdonald South Australia

240 Helen M south Australia

241 Deidre Coulthard Sth Australia (gee some humans can be sick-bastards alright…..you wonder what planet they come from??…..WE ARE DOOMED!!)

242. Veronica Coulthard , South Australia (sick alright, poor dolphins)

243. Rachel Salmon , South Australia , Australia (how can anyone be called a human to do such senseless acts to such beautiful creatures!!)

244. David Salmon , South Australia , Australia

245. Deb Frank , South Australia , Australia …….absolutely disgraceful!

246. Kathrine Kosmina , South Australia , Australia …words fail me!!!

247. Leanne Mudge , South Australia , Australia

248. Sandra Martin

249. Linda Raison , South Australia , Australia

250 Peter Dorsett, South Australia

251. Helli Meinecke , South Australia

252. Clair Marslen , South Australia

253. Frank Aarts , Australia

254. Deanna Dorward , Australia

255. Thea Aarts , Australia

256. Margie Aarts , Australia

257 Maree Bath , QUeensland , Australia ..

258 Jennifer Walker , Queensland , Australia

259 Jan Deacon, Queensland , Australia – so very very sad!

260 Judy Dixon , Queensland , Australia – unbelievable

261 Susan Jenkin, currently NT, Australia .

262 Del Aulich, Melbourne , Australia- This is unacceptable- must be stopped!w

263 Judith Shapland Melbourne Aust: Who the hell are these so called human beings I am outrages that this should be happening as a global community we need to ban together to stop it!!!!!!!!

264 Deborah Chubb

265 Ray Robinson, Melbourne , Australia . This will not stop until our tears of outrage mingle with the blood of these beautiful creatures.

266 Christina Higgs Melbourne Australia. Unbelievable and so horrible, this has to stop.

267 Diane Beck, Mansfield Australia

268 Christine Davis Redcar England

269 Maureen Tosh, Redcar, England

270 Sandra O’Shea, Nunthorpe England.

271 Moyra Gibb, Kirkcaldy, Scotland

272 Alan Gibb, Kirkcaldy, Scotland

273 Margaret Smith, Kirkcaldy, Scotland

274 Ian Smith, Kirkcaldy, Scotland

275 Anne Ward,Edinburgh, Scotland

276 G V Ward, Edinburgh, Scotland

277 D Johnstone, Sanquhar, Scotland

288 Janet Brown Edinburgh, Scotland

289 morag mccall ,scotland

290 Laura cowan Aberdeen Scotland

291 Marx Murdoch Aberdeen Scotland

292 vicki keraghan invergordon scotland

293 Mieke Horsburgh, Invergordon, Scotland

294 David Horsburgh, Invergordon Scotland

295 Moira Adam, Blackisle, Scotland.

296 Claire Russell, Daviot, Inverness, Scotland

297 Heather Sutherland-Fraser – Black Isle, Scotland

298 Alison McMillan – Inverness, Scotland

299 Gillian MacAskill, Nairn, Scotland

300 Lesley Moore, Nairn, Scotland

301 Davy Orr, Inverness, Scotland

302 Eleanor James, Johnstone Scotland – Once again males (not men) prove how cruel and idiotic they are. I’m ashamed to be human.

303 Dot Spragg. England

304 Barry Spragg. England

305 Sally Moorey, England

306 Paul Wallace, England

307 Trudi OConnor, England

308 Elaine Grayson, England

309 Elaine Whitehead, England

310 Lynn Chapman, England

311 John Moutrey, England

312 David Webb, England

313 Trevor Clayton, England

314 Paul Bowring, England

315 Paul and Jackie Edwards, Shropshire, England

316 Jeremy and Marie Ransom

317 Chris Barrow

318 Aileen Robertson, Edinburgh, Scotland

319 Nina Porter, Inverness-shire, Scotland

320 Margaret Le May, Nairn, Scotland

321 Iain & Kirstine McKenzie,iEast Linton, Scotland

322 Jim Merry,Dunbar,Scotland

323 Ken Riva, Livingston,Scotland

324 Brenda Riva, Scotland

325 Graham Parker, Scotland

326 Anne Morgan Scotland

327 HJ Kerr

328 T M Birch Wales

329 Charlie Kavanagh Ireland

330 Thomas Clarke Ireland
www.thepressnet.com

331  Lauren Clarke   Wicklow Town /Ireland

332 Stephen Clarke   Wicklow Town /Ireland

Anybody who loves the sea cannot ignore this cruelty; this is truly shocking behaviour coming from the country that hosted the world’s largest climate change conference.

 Shame on Denmark!

I call upon the Minster of the environment Mr John Gormely and the Irish Government to immediately call upon the Danish Government to ban this barbaric activity

No sane person could condone this slaughter

Please help stop this madness!

The Firing of the New Central Bank Governor

The Firing of the New Central Bank Governor

The calling by the new central bank governor Mr. Paddy Honohan for a “nine eleven type commission investigation into the banking crisis” is totally unforgiveable and accordingly he should immediately stand down. His position is supposed to be politically neutral. This act by the governor is a sign as to how desperate the Central Bank’s position has become. As everyone knows the best form of defence is attack. If his ploy does not work he is finished.

Every astute financier knows that the responsibility for the disaster lies squarely in the court of the Central Bank. Their man ran the Financial Services Regulatory Authority. They allowed the Irish banks use the “originate to distribute” mortgage model (see article below: Note 1). They allowed Irish financial institutions to operate with no regard to realistic underlying property valuations. They allowed intra-banking loans, sometimes in the billions, to shift between golden directors without disclosure. This same “regulator” fines and closes down poor struggling insurance brokers, mortgage brokers and financial advisors for minor regulatory oversights. Mr. Honohan, a World Bank and Trinity College insider knows this and is thus no stranger to cynical hypocrisy.

However, not everybody knows that the Irish Central Bank, now part of the European Central Bank, is a privately owned franchise. The appointment of the Governor is “independent” of our Parliament. The process seems democratic but this PR stunt is a ruse. The Central Bank is beyond our National control under the present arrangement. This state of affairs should not be allowed continue. The World banking franchise, of which Ireland is a small branch, is also privately owned and is based in Switzerland. The Global brand of this private corporation is called the Bank for International Settlements (BIS). It was to BIS that Alan Greenspan was flying when the Twin Towers were hit on 11th. September 2001. Is this why, ironically, Honohan is calling for a 911 type enquiry?

A sovereign people have the natural right to issue sovereign currency and sovereign, interest free, credit. Argentina solved its “debt crisis” by walking away from its dollar debt obligations to Uncle Sam’s banks. This action destroyed private dollar institutional assets but saved a Nation and a people from ruin. It took great courage. Is it time the Irish government realised such courage and understood their true power options?

Paddy Honohan and his gang should be shown the door for a start. Control of the Central Bank and its regulatory responsibilities should be made sovereign again as it was in 1922 under the new Irish Republic. The people who caused the disaster cannot be trusted to steer the Nation towards a fair and equitable resolution. All should be changed, changed utterly.

Note 1.     (Published Article from the Internet, May 2009).

The “Sub-Prime” Crisis Understood:

The “Originate to Distribute” Basle

Banking Model Created the Banking Crisis

 

In an attempt to comprehend the current “credit crisis” I decided to try to investigate its underlying causes. To my dismay I discovered that the situation did not come about by accident but was actually conceived and planned by the International Banking Fraternity in Basel, Switzerland, in 1998.

The tsunami of credit that burst onto the scene after this “Basle Accord” helped save America from a 2001 recession, enabled it to fund a war, sleep walked Europeans, politically, into the Euro Zone and attempted to copper fasten the artificial state called the European Union. This crisis is no accident it was premeditated and internationally agreed.

If you don’t believe the pre-meditation involved please read the quote below from the Wall Street Journal, Nov. 27th. 2007:

“In 1998 the Basle Accord created the opportunity for regulatory arbitrage whereby banks could shift loans off their balance sheets. A new capital discipline that was designed to “improve” risk management led to a PARALLEL BANKING SYSTEM whose lack of transparency explains how the market started to seize up.

The “originate-to-distribute” model REDUCED THE INCENTIVE for banks to monitor the CREDIT QUALITY of the loans they pumped into collateralized-

loan-obligations and other structured vehicles, the rules failed to highlight contingent
credit risk……With Basle II, the question is just how the markets will evolve over the next 20 years…. as the new accord will require banks to hold LESS CAPITAL”.

American history has shown that many of its great leaders saw the danger in granting banking institutions too much power over the destiny of a nation. The Basle I Accord and now Basle II indicate just how fundamentally the International Banking Groups have lost their moral compass and altered old standard banking rules. Through sleight of hand i.e. “off balance sheet accounting” they allowed the financial structure of the world to become totally unstable and risk prone. If one was cynical one would actually come to believe that in 1998 future failure was built into the matrix; failure which only the strongest and the most astute could survive.

The end result will be systematic institutional deflation on a worldwide basis. Even though cash is being pumped into the major institutions the multiples of “off balance sheet” credit are now historic, thus the corporate inflation has already occurred. What we will now experience going forward is dept collapse and with it falling mortgage issuance and restrictive commercial funding. Here in Ireland business activity has almost come to a standstill and everybody is holding their breath wondering what the next crisis will be. The only saving grace is that things are not much better in Italy, Germany, France or Spain and is actually much worse in Scotland, (where the bank of Scotland failed) England and Greece. This crisis is truly global.

As institutional deflation (due to collapsing systematic credit) and social inflation (due to the panic demand and circulation of currency) spreads around the globe those who are left holding excess negotiable resources will be in a very powerful position to soak up value assets for pennies on the dollar. Regular folk will not be able to participate in this bonanza because for them the banking credit system will be closed with nothing to offer but foreclosure and frustration. The majority will in a defensive survival mode while the privileged few will be in full scale acquisitive attack. Such was the case in the last depression. How history is repeating itself. Those who instigated the “off balance sheet” travesty knew exactly what they were doing. My advice is if you cannot beat them join them. Friends go to cash and the physical money metals as soon as you can. Contract your business and life-style expenses. Network and co-operate within a real community for the exchange of goods and services that sustain authentic life. Communities should learn how to issue local based, bearer-negotiable, split-barter, exchangeinstruments of agreed value; otherwise known as money. (Most people do not fully understand that money, in essence, is a social contract based on human trust and mutual benefit). Educate yourself regarding Social Credit. This “crisis event” is going to get much worse before it gets better folks. There will be short periods of reprieve but the reality of the problem is so serious and fundamental that it will take years, maybe decades (as in Japan), to work through, even with a R.T.C. (B) type solution. But perhaps it is true that “every cloud has a silver lining” and that “every problem bears within it the seeds of a greater opportunity”. Maybe finally after ninety five years the good people of the United States will awake from their media induced trance and realise that too much power was usurped by an elite on the 22nd. December 1913 when the privately owner Federal Reserve Bank was illegally formed.

Peaceful, proactive and constructive community must reassert its primacy over immoral, selfish and destructive institutionalism.

I will end with a quote which I think is most relevant:

“Now I come to my last statement. I regret ending on what is, I suppose, such a pessimistic note– I’m not personally pessimistic. The final result will be that the American people will ultimately prefer communities. They will cop out or opt out of the system. Today everything is a bureaucratic structure, and brainwashed people who are not personalities are trained to fit into this bureaucratic structure and say it is a great life–although I would assume that many on their death beds must feel otherwise. The process of coping out will take a long time, but notice: we are already coping out of military service on a wholesale basis; we are already copping out of voting on a large scale basis. I heard an estimate tonight that the President will probably be chosen by forty percent of the people eligible to vote for the forth time in sixteen years. People are also copping out by refusing to pay any attention to newspapers or to what’s going on in the world, and by increasing emphasis on the growth of localism, what is happening in their own neighbourhoods.

Now I want to say good night. Do not be pessimistic. Life goes on; life is fun. And if a civilization crashes, it deserves to. When Rome fell, the Christian answer was, “Create our own communities.”

Prof Carroll Quigley

Third Oscar Iden Lecture

Georgetown University 1978


Umar Farouk Abdulmutallab

US aware ‘Nigerian prepared for terror attack’


Umar Farouk Abdulmutallab has been charged over the incident

The US was aware that “a Nigerian” in Yemen was being prepared for a terrorist attack – weeks before an attempted bombing on a US plane.

ABC News and the New York Times have reported the story, but the source of the intelligence is unclear.

Umar Farouk Abdulmutallab flew from Lagos to Amsterdam before changing planes for a flight to Detroit on which he allegedly tried to detonate a bomb.

President Barack Obama has said security failures were unacceptable.

He has said a systemic failure allowed Mr Abdulmutallab, a Nigerian, to fly to the US despite family members warning officials in November that he had extremist views.

 

 

taken from the BBC

Why the hell didn’t they stop him before he got on to the plain then?

Accidentally killed by U.S. troops

KABUL — An Afghan government investigation into the deaths of 10 civilians in the country’s east found they were dragged from their homes and shot dead by foreign troops, the president’s office said Wednesday.

The dead included eight school students aged between 13 and 17 years old, a statement from President Hamid Karzai’s office said.

International forces based in Kunar province, where the alleged incident took place, told government investigators “they were unaware of the incident”, the statement said.

“A unit of international forces descended from a plane in the Narang district of Kunar province and took 10 people from three homes, eight of them school students in grades six, nine and 10, one of them a guest, the rest from the same family, and shot them dead,” the statement said, quoting the head of the investigating team.

Reporting from Kabul, Afghanistan – An Afghan presidential delegation looking into reports that up to 10 civilians were accidentally killed by U.S. troops earlier this week said today that it had so far confirmed at least eight deaths — all schoolboys ages 12 to 17.

That contradicts initial findings by the NATO force regarding Sunday’s strike in Kunar, a remote northeastern province. Western military officials earlier reported nine killed, all adult males and all insurgents, and said today that the incident remains under investigation.

comment

At the same time we see on sky news that the number of British service personnel killed in Afghanistan to date is 244,

107 were killed in this year alone.

Yet more than 2,000 civilians have accidentally being killed this year, according to United Nations figures — the highest number since the start of the war in 2001

There are no reliable figures for the actual Taliban fatalities and causalities, but the estimated run into the thousands!

There is something rotten about all this


NATO cannot hope to win this WAR

Not with accidents like this apparently happening all over the place in Afghanistan

These actions are only bringing more recruits to the Taliban

Anyway I thought NATO was supposed to be fighting AL-Qaeda and why is Bin Laden still at large?

Why is NATO even in Afghanistan?

Killing civilians is wrong no matter what spin you put on it

People in England should ponder over this when they stand in the streets and welcome their dead soldiers from Afghanistan.

You must keep asking the British Government why they are supporting this WAR on Afghan Civilians


 

The next bubble

By KENNETH P. GREEN

In the aftermath of the Copenhagen Climate conference, it is clear that the United Nations-driven process is a bust, and that any similar process requiring economic suicide and massive wealth transfers will go nowhere. It is long since time to drop this charade, take the question of climate change out of the hands of the U.N., and implement more reasonable policies.

Fostering the resilience of societies around the world in case climate disaster strikes would be a start. Central to this process is for governments to stop making things worse, as they do when they subsidize risk-taking.

 

Read full article at following link http://online.wsj.com/article/SB40001424052748703278604574623731619386544.html

Comment

This goes to prove that the climate change conference in Copenhagen was deliberated scuppered by the powerful vested forces in the large financial corporation’s around the world.

They see this as a new milk cow that they must control and make money

An estimate of $200.000.000. 000.00 US will be in the kitty for the year 2010 alone!

Trading in carbon is now expected to be the biggest money making market in the coming years

Are we looking at the next bubble?

With this kind of money sloshing around no wonder the Big Boys want to control this new racket

We are the suckers that will have to pay the tab eventually

I am surprised that they have not come out and slapped a new global tax on everybody, supposedly to help the poorer countries to pay for their carbon footprint

The first of these world taxes has being mooted as in a financial transaction tax to help the World Bank to build up its reserve’s

By the end of the 2012 we will be accustomed to a whole new era of worldwide taxes being levied on every world citizen

One can’t help but wonder whether or not this whole financial meltdown was in fact deliberate in order to hasten the development of a world wide body with tax raising abilities

Who does this benefit?

JINGLE MAIL, JINGLE MAIL


by Richard Benson
Benson’s Economic & Market Trends
December 23, 2009

Jingle All The Way,
Oh what fun it is today,
To just walk away!

Jingle Mail (also known as strategic mortgage default) is the happy-sounding phrase used by banks and mortgage servicers to describe homeowners who simply walk away from their homes and mail the keys back to the bank. The banker can hear the keys jingling in the envelope from a distance so even before it’s opened, he knows that for this loan the jig is up. Jingle Mail appears to be the new fad of giving over this holiday season, and next year many more of our neighbors will be seen mailing back keys. For a high percentage of the ten million homeowners with material negative equity, thought will turn to action even if they can afford to make the mortgage payment, because Jingle Mail can put a lot of money in their pockets!

Why are homeowners willing to walk away even if they afford it? First, the government’s program for mortgage loan modification is an abject failure. To date, only a small percentage of home loans have been put on trial modification and of those that actually go to final modification, a very high percentage re-default and foreclose anyway. This program is not working because neither the Obama Administration or the banks or Fannie Mae/Freddie Mac, are willing to face cutting the principal owed on the mortgage balance to a realistic number. Second, Jingle Mail can be very profitable!

Here’s why Jingle Mail makes so much more sense than continuing to pay an inflated mortgage. Think about your average high-end homeowner. Let’s call him Joe. A few years ago, Joe listened to Alan Greenspan and took a huge amount of money out of his house with an adjustable rate or option ARM mortgage. If he bought that house for $900,000 with an option ARM mortgage of $850,000, since most of his interest has been accrued, his mortgage balance has now risen to $1,000,000, while his house has fallen in value to $600,000, leaving it worth $400,000 less than his mortgage balance. Ouch! His situation is crystal clear: He can pay forever, and never own the house!

If he walks away, he makes a quick $400,000 of principal he will never have to pay! Then, if his million dollar mortgage adjusts to a current 6 percent interest payment, he saves the $5,000 a month in interest charges (or $60,000 a year) until foreclosure. Finally, Joe saves the $15,000 in property taxes by not paying them. (Now that the bank owns the house, they can pay the taxes.) Next, he notices a house just like his down the block can be rented for $3,000 (a savings of $2,000 a month), but he decides there’s no rush to move out and rent. This translates into a first year gain of $475,000 with $75,000 of that amount in real cash that Joe didn’t need to spend. Between principal forgiveness and cash savings, he can pocket a small fortune and for the cost of a single postage stamp, mailing back the keys is one heck of a self-help economic stimulus program.

Because it can take an inordinate amount of time for a bank or mortgage lender to foreclose, for accounting purposes the bank will almost always favor delaying foreclosure, as they pretend the homeowner will eventually honor the loan. But if a bank takes too many losses, the FDIC will take them over and the banker will lose his cushy job. Over the next year, you can count on the banks to become complicit in extending their loans, giving Joe a lot of time before he gets booted out of the house. Indeed, it’s common for a homeowner who stops paying the mortgage to live rent free for up to a year or more!

Sure, Joe’s credit rating may suffer for a year or two, and in some states the bank might chase him for the deficiency balance on the mortgage. But in the real world, if Joe pockets the money or pays down his credit cards in a short period of time, his credit rating will eventually go back up. If Joe wants to be a home owner again, in two or three years he can save up enough for a 20 percent cash down payment! (Think about how much you could save if you didn’t have a mortgage and could cut your monthly housing costs in half by not paying interest and taxes.) If the bank chases Joe, he’ll soon discover that his bad mortgage debt will be sold to debt collectors, and he’ll eventually be able to settle for pennies on the dollar.

Certainly, not every homeowner is hundreds of thousands of dollars upside down on their mortgage and not everyone is going to save this amazing amount of cash. But then again, a lot of people are worried about making the car payment and feeding their families, so cash-strapped households won’t hesitate for a minute to resort to desperate measures by walking away and potentially saving $10,000 or more a year. They certainly weren’t responsible for causing this near depression, and they need to survive this economic downturn.

How expensive will Jingle Mail be? Well, rumblings out of the US Treasury suggest that taxpayer support for Fannie & Freddie may have to be raised from a potential $400 billion to $800 billion in losses. The extra $400 billion in estimated losses on government-sponsored prime mortgages is a combination of lingering unemployment and Jingle Mail! Next in line will be jumbo mortgages that are beginning to look catastrophic because the bigger the house the bigger the mortgage, and the higher the taxes. In 2009, mortgage foreclosures will total about four million. In 2010, the total could easily be 4.5 million, with 1.5 million or more Jingle Mail-style defaults. The banks will be rocked by several extra hundred billions of credit losses from people who can afford to make their payments. These additional losses will catch the banks by surprise. Meanwhile, the FDIC and US taxpayer will suffer big time as bank failures reach new levels. When the dust settles, the US taxpayer will once again get stuck with the gigantic bill.

The morality of Jingle Mail has two sides: As a taxpayer, it scares me to death and encourages me to buy more gold, so I’m not stuck paying the massive government inflation tax to pay for it all. And, yes, in a perfect world, people who sign loan documents should honor their obligations even if it means they made a bad decision; they should be held accountable. But we don’t live in a perfect world, and the average Joe is being held to a higher moral standard and asked to pay up, while Wall Street and big business get a free ride on Joe’s back. Remember, it was the former Fed Chairman, Alan Greenspan, who told the American people there was no housing bubble. We listened and did what he said.

When it comes to stiffing creditors, Joe can clearly see that business is in the vanguard of strategic default. GM, Chrysler, Merrill Lynch, Fannie Mae, Freddie Mac, and AIG stuck it to the American taxpayer big time long before a strategic mortgage default ever crossed Joe’s mind. Then, there is Wall Street, where the taxpayers get the losses and the speculating bankers get the mega bonuses. What a den of thieves!

From the point of fairness and equality, Jingle Mail starts to look like an honest grass roots movement for the little guy like Joe, to get his life and finances in order. The honest, conservative, middle-class American got played for a sucker by the subprime homebuyer and the house and commodity speculators. The Wall Street fat cats who made it all so easy kept what they stole, and then got bailed out. The government has done nothing for Joe. Isn’t it his turn to fight back?

For 2010, the populist song running in my head has the same haunting refrain and amoral lyrics as the 1975 Paul Simon classic song:

50 Ways to Stiff Your Banker

You just slip out the back, Jack
Make a new plan, Stan
You don’t need to be coy, Roy
Just listen to me
Hop on the bus, Gus
You don’t need to discuss much
Just drop off the key, Lee
And get yourself free!

 

Could this be the year we see

Jingle Mail

Come to Ireland with a vengeance?

 

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