RE: New Zealand is thinking of going all Cyprus (Full Version)

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JeffBC -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:15:12 AM)

quote:

ORIGINAL: DesideriScuri
The question is, who were the guilty? Who were the truly innocent? What would those "lumps" have been and who would have paid them? And, on first blush, I completely agree with you. The devil being in the details, though, we might not agree completely.

Well, "guilty" in this case is a bit tricky since they paid the politicians to change the laws first. Still though, there is absolute guilt in the US that is going unprosecuted even today. But just to clarify my non-legal position:

The Guilty: The bankers, the insurers, the ratings agencies, the regulators, and the executive branch of government. Following the money works here.
The innocent: The low level investors/depositors... basically "normal people". Possibly some of the high level investors too. I'd need to see real investigations there.
The Lumps: There's no way to unwind this without it hurting all the way around. All of us need to feel the pain. Ideally those who most benefited from the fraud would be doing the most to help fix it (eg: taking their lumps) but all of us would need to be sucking it up.



mnottertail -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:17:44 AM)

quote:

ORIGINAL: Yachtie


quote:

ORIGINAL: mnottertail

Well, cyprus hasnt made the final book yet, and spain hasnt a choice, it is Britians Florida.



The government might not. Not so sure about the people though. I wonder just how deadly a bunch of pissed off Basque's would be?


Bout the same as last time, oh, you don't remember that?  Thats about how memorable it will be.



vincentML -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:17:52 AM)

quote:

Should banks have been leveraged 43:1? Should that have been allowed? The banks that weren't leveraged that much would fare better. Wouldn't allowing them to have crashed also taught that lesson? If a bank can't stand on it's own two feet without having to rely on The Fed, wtf is going on? Isn't The Fed supposed to be the lender of last resort? And, did a business grow too quickly to not be able to meet payroll without financing it?

It was a failure of the Fed and the SEC and whatever other bodies regulate the banks. The banks who were less leveraged would have also gone under because of the credit squeeze. And so would most businesses. No bank can stand on its own two feet when mortgage loans tied in investment bundles are crashing in value. It is not for nought it is called a banking "system."

You may wish to be bitter in hindsight. All well and good. But wishing the collapse of our financial system just to spite the banks is beyond the pale.



Yachtie -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:31:13 AM)

quote:

ORIGINAL: vincentML
But wishing the collapse of our financial system just to spite the banks is beyond the pale.


No one wishes that, but neither do many want to see the banks survive at all costs (TBTF) so as to maintain the status quo / re-inflate the bubble.

Like Iceland, we have a choice.



vincentML -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:41:57 AM)


quote:

ORIGINAL: Yachtie

quote:

ORIGINAL: vincentML
But wishing the collapse of our financial system just to spite the banks is beyond the pale.


No one wishes that, but neither do many want to see the banks survive at all costs (TBTF) so as to maintain the status quo / re-inflate the bubble.

Like Iceland, we have a choice.



Well, that's what DS seemed to be saying. Did I misread him?

I believe I agreed that they should be properly regulated.

Iceland bailed out its banks in a similar fashion and with help from the IMF. They did not just let them sink.
http://en.wikipedia.org/wiki/2008%e2%80%932011_Icelandic_financial_crisis




mnottertail -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:46:03 AM)

Yeah, it is the rock and hard spot,the bankers deserve some prison time or something, but the full faith and credit of America (et al) is how it works, you cant have a country run up debt and decide not to pay bills, the people gotta know the bank is sound, the government gotta know the bank is sound and the international community gotta know the bank is sound, or what is the alternative? 



JeffBC -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:48:45 AM)

quote:

ORIGINAL: mnottertail
the people gotta know the bank is sound, the government gotta know the bank is sound and the international community gotta know the bank is sound, or what is the alternative? 

I don't know. But the plain facts of the matter are that the banks are NOT sound and the people running them are crooks. That's the reality of this situation. I just want to deal with it rather than sweep it under the rug or, even worse, paying them for their crimes.



Yachtie -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:49:39 AM)

quote:

ORIGINAL: vincentML

quote:

ORIGINAL: Yachtie

quote:

ORIGINAL: vincentML
But wishing the collapse of our financial system just to spite the banks is beyond the pale.


No one wishes that, but neither do many want to see the banks survive at all costs (TBTF) so as to maintain the status quo / re-inflate the bubble.

Like Iceland, we have a choice.



Well, that's what DS seemed to be saying. Did I misread him?

I believe I agreed that they should be properly regulated.

Iceland bailed out its banks in a similar fashion and with help from the IMF. They did not just let them sink.
http://en.wikipedia.org/wiki/2008%e2%80%932011_Icelandic_financial_crisis




Iceland is in economic recovery with lower unemployment rates than Europe, and its President says “let the banks go bankrupt”, speaking at the annual World Economic Forum in Davos, Switzerland (23-27 January, 2013.)

In an impromptu interview with the Al Jazeera News Network’s Stephen Cole, Iceland’s President Olafur Ragnar Grimsson explains that his country was able to rebound from the worldwide financial crisis better than all other countries that faced the same problems, by doing just that, allowing the failing banks to go bankrupt.

He says “we did not follow the traditional, prevailing orthodoxies. We introduced currency control. We let the banks fail. We provided support for the poor. We did not introduce austerity measures on a scale you see in Europe. And the end result 4 years later, Iceland is enjoying progress and recovery very different from the other European countries that suffered from the financial crisis.”


However, instead of following the prevailing neoliberal economical wisdom, Iceland did the opposite. Instead of bailing out the banks, it brought charges against many involved. The banks were nationalized.


We have a conflict here. Wiki versus Icelandic President.



JeffBC -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:53:56 AM)

quote:

ORIGINAL: Yachtie
However, instead of following the prevailing neoliberal economical wisdom

OK, poli-sci check again.

Is "neoliberal" really right here? Or is it really something like "new world order". Because honestly, at least in the states, both parties seem hell bent on paying the crooks and punishing the victims. It seems to me there's a "radical" element in both parties that is sort of fed up with it.



mnottertail -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:55:45 AM)

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a3Zf1f9IBUWg&refer=europe

The truth is somewhere in between, even your own citation says they nationalized the largest of the banks (we should do that here then, no?) and they got some big cash influxes from the IMF.

It didnt just happen on January 2013 we all been in the dumps for alot longer than that.




Yachtie -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:56:30 AM)


quote:

ORIGINAL: JeffBC

quote:

ORIGINAL: Yachtie
However, instead of following the prevailing neoliberal economical wisdom

OK, poli-sci check again.

Is "neoliberal" really right here? Or is it really something like "new world order". Because honestly, at least in the states, both parties seem hell bent on paying the crooks and punishing the victims. It seems to me there's a "radical" element in both parties that is sort of fed up with it.




Not sure how the Icelandic President interprets it. My guess is from his political lexicon, not necessarily ours.



mnottertail -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:59:33 AM)

http://www.bloomberg.com/news/2012-11-27/icelandic-mortgage-bank-hff-needs-government-bailout.html

http://www.huntingtonnews.net/30143

And they forgave mortgage debt, so.........if we did that?



JeffBC -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 8:59:37 AM)

quote:

ORIGINAL: mnottertail
The truth is somewhere in between, even your own citation says they nationalized the largest of the banks (we should do that here then, no?) and they got some big cash influxes from the IMF.

I know the neocons won't like this but I'd be all in favor of:

Nationalizing the major banks, credit ratiing institutions, and other pieces which enabled this and should have failed.
Throwing the executives in prison wherever possible and/or seizing as much of their assets as we can manage under "the law" which I'd be happy to rewrite for this circumstance.
Then, when we've got all this in the hands of the government we can break them up and do whatever else needs to be done to fix it.

Sadly, none of that is going to happen because our politicians, democrat and republican alike, are paid by those very same banks. Even if we did do so, what government agency would get hold of this? Given that all the agencies responsible for the situation were equally guilty and many of those people should be thrown in jail also it's a bit unclear where you turn to.



Yachtie -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:00:32 AM)

quote:

ORIGINAL: mnottertail

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a3Zf1f9IBUWg&refer=europe

The truth is somewhere in between, even your own citation says they nationalized the largest of the banks (we should do that here then, no?) and they got some big cash influxes from the IMF.

It didnt just happen on January 2013 we all been in the dumps for alot longer than that.





Come on MN, of curse it didn't just happen... yada yada... he was speaking at the World Economic Forum in Davos, Switzerland (23-27 January, 2013.). He said what they did.

They let the insolvent banks FAIL.

That is how I remember it, and I'm far from one to correct the man.



Yachtie -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:02:58 AM)


quote:

ORIGINAL: JeffBC

Sadly, none of that is going to happen because our politicians, democrat and republican alike, are paid by those very same banks. Even if we did do so, what government agency would get hold of this? Given that all the agencies responsible for the situation were equally guilty and many of those people should be thrown in jail also it's a bit unclear where you turn to.



Mayer Rothschild said it... something like "I care not who makes the laws when I control the money".



Yachtie -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:05:52 AM)


quote:

ORIGINAL: mnottertail
And they forgave mortgage debt, so.........if we did that?


Interesting question, and I have seen it bantered about here and there. Our situation and Iceland's are not wholly alike. It would be wrong to forgive some mortgages and not others. Not all banks are insolvent but for government infusion.




DesideriScuri -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:09:14 AM)

quote:

ORIGINAL: JeffBC
quote:

ORIGINAL: mnottertail
The truth is somewhere in between, even your own citation says they nationalized the largest of the banks (we should do that here then, no?) and they got some big cash influxes from the IMF.

I know the neocons won't like this but I'd be all in favor of:
Nationalizing the major banks, credit ratiing institutions, and other pieces which enabled this and should have failed.
Throwing the executives in prison wherever possible and/or seizing as much of their assets as we can manage under "the law" which I'd be happy to rewrite for this circumstance.
Then, when we've got all this in the hands of the government we can break them up and do whatever else needs to be done to fix it.
Sadly, none of that is going to happen because our politicians, democrat and republican alike, are paid by those very same banks. Even if we did do so, what government agency would get hold of this? Given that all the agencies responsible for the situation were equally guilty and many of those people should be thrown in jail also it's a bit unclear where you turn to.


I wouldn't like it because I don't trust Government to have the interests of the American citizenry.

Here's an interesting idea though... what happens if you put the ratings agencies on the hook for the ratings? If they rate shit as AAA and people buy the hell out of it and it turns out to be shit, the agency is on the hook in some way. Bet that increases the depth at which a ratings agency investigates before rating an investment.



mnottertail -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:30:41 AM)

Yeah, no..............they are rating the debt of the government today, these same fucksticks, and why anyone ever paid attention to them in the first place.........

I remember the hue and cry for seems like centuries, too much regulation, we need to let them oversee themselves, and the banks know whats best for the banks and regulation is hamstringing them........now ............

who were those masked teabaggers?  



JeffBC -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:36:03 AM)

quote:

ORIGINAL: DesideriScuri
I wouldn't like it because I don't trust Government to have the interests of the American citizenry.

Heh, you and I are in agreement about trusting the government. But my question to you is what WOULD you do? As it sits, the crooks who stole trillions are still in place stealing more. Are you content to leave them to just pillage and plunder until we have rebellion or do you have another thought?

quote:

Here's an interesting idea though... what happens if you put the ratings agencies on the hook for the ratings? If they rate shit as AAA and people buy the hell out of it and it turns out to be shit, the agency is on the hook in some way.

That isn't going to help. All that happens is exactly what we've seen. The corporation does evil things. The execs and shareholders take money out of the corporation as fast as it comes in (or faster LOL). Then when the corporation gets hit with charges it declares bankruptcy and the guilty walk away wealthy. Somehow we've have to make criminal charges stick. I suspect if they were looking at minimum 20 years in prison they might be motivated. Simply holding the corporation accountable does nothing.



DesideriScuri -> RE: New Zealand is thinking of going all Cyprus (3/20/2013 9:51:18 AM)

quote:

ORIGINAL: Yachtie
quote:

ORIGINAL: mnottertail
And they forgave mortgage debt, so.........if we did that?

Interesting question, and I have seen it bantered about here and there. Our situation and Iceland's are not wholly alike. It would be wrong to forgive some mortgages and not others. Not all banks are insolvent but for government infusion.


In 2007, the value of all mortgages in the US was $14.5T.

Mortgages on 1 to 4 family residences was $11.2T

If we had "forgiven" or "paid off" 1/10 of everyone's mortgages, would that have solved anything? what about 20% of all primary residence mortgages (ignores mortgages on second/third/etc. homes)? Would that have been enough to stabilize everything, without having to do anything else? What if Government took over everyone's mortgage payments until the Market pricing leveled out and then Government made a lump sum payment to drop everyone's principle down to that new Market price? For example, if mortgage Markets were overpriced by 25%, Government would have paid down principle on every mortgage by an average of 25%. Would that have solved things?



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