Debt forgiveness is "none of our business" anymore

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mark12

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Anyway, why do we even care anymore, all future losses in our Banks are covered by the ESM European Stability Machanism.

The Germans have finally approved this for all future losses in European banks, so we are not liable for current mortgage debts anymore, the issue now, is we still have to pay for the old banking debts.

Whoever defaults or gets debt forgiveness from now on is none of our business.
 
It's extraodinary how Journalists and financial experts are always behind the curve.

Debt forgiveness and mortgage defaults are none of our business, all mortgage debts in Irish Banks are covered by the ESM, so the Irish taxpayer is not liable from now on, i would understand if the journalist was looking for German or French members of the public who are now responsible for all our mortgage debt.
 
What part of ''none of our business'' do you not understand?

The EFSF/ESM will pay for all our future mortgage defaults, i don't care anymore, this discussion should be held by German, French, Dutch and Finish taxpayers, not us, we should only care about the 64 billion we have injected in our zombie banks.
 
I have moved these points from three separate threads so the point which mark raises can be separately teased out.
 
mark12 said:
Anyway, why do we even care anymore, all future losses in our Banks are covered by the ESM European Stability Machanism.

The Germans have finally approved this for all future losses in European banks, so we are not liable for current mortgage debts anymore, the issue now, is we still have to pay for the old banking debts.

Whoever defaults or gets debt forgiveness from now on is none of our business.
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Of course it is our business! We are EU citizens just like everyone else in the 27 member states and as such our future is bound to making a success of the union. The idea that we can disengage and walk away is nonsense.
 
Mark12 I don't know whether you are being tongue in cheek but in case you are being serious, this is what is going to happen in the future.

Once the ECB becomes entirely comfortable that it has full regulatory control and oversight of a bank and is satisfied that there are no legacy black holes which have already not been filled by national governments then it is prepared for the ESM to provide future recapitalisations.

Once the ECB/ESM has taken on this responsibility any debt forgiveness which is not driven by the bank's commercial interests will need to be funded by direct fiscal transfers from the taxpayer. No way can the government force debt forgiveness on the ECB, no more than can it do so now on the 54% of our mortgage market which is not owned by the taxpayer.
 
Sorry you should inform yourself better, the ESM has now been approved by all EU member states, it's purpose is to prevent any other country from from doing what we have done to ourselves, putting good taxpayer's money into dead banks, as this is a proven disaster.

Instead, this ESM fund will cover any future potential losses in any European bank without affecting the Sovereign Debt.
I think we all agree that our banks, as well as the Spanish, Greek and Portuguese banks, will need much more money soon because a lot of people stopped paying mortgages, not only in Ireland but in all these countries.

The Government has made clear that there will be no blanket debt forgiveness but, it is happening naturally anyway ie people going to the UK, others on interest only, some not paying at all.

These future losses will be legitimate comercial banking losses that will qualify for ESM assistance, so this time we won't have to pay for it, so why are we discussing this, is my question.
 
Oh you weren't tongue in cheek:rolleyes: Which of the following two scenarios are you espousing:

A) We may as well forgive all the bank debts whilst we still own them as we have a German guarantee that they will pick up the losses.

or

B) This is out of our hands - none of our business, as the Germans will not allow us to do anything which undermines their guarantee to bail out future bank losses.

(A) would be delusional. (B) may have some substance.
 
mark12 said:
Instead, this ESM fund will cover any future potential losses in any European bank without affecting the Sovereign Debt.
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What it actually says is that monies advanced by the EMS will not be counted in the calculation of national debt, in other wards an accounting entry!

I have gone through the documents establishing the ESM and I can not see any reference to your assertion that monies advanced will not have to be repaid. Please provide us with a reference.

Also, keeping in mind that as the state is the major shareholder in the banks, it will ultimately be held responsible for any monies advanced to the banks.
 
The thing is, we as a country are like many of the bankrupt households, we are not able to pay back Billions more in mortgage defaults, so what will happen is, our banks will be taken from us by the ESM, Europe is well aware that this will happen, that's why they want guarantees as they will effectively pay for our mortgage defaults.

I'm not for official debt forgiveness, the government will never do that or they would not qualify for ESM assistance, but a lot of the ''can't/won't pays'' will be forgiven, but we won't have to pay because we ourselves are a ''can't pay''.

We will lose our entire banking system but again, we were never able to manage it anyway.
 
mark12 said:
all future losses in our Banks are covered by the ESM European Stability Machanism.
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But what about when the banks in ireland start turning the screws on mortgage holders by increasing interest rates to get themselves out of a loss making situation. Itll be our problem then.

mark12 said:
The EFSF/ESM will pay for all our future mortgage defaults,
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You are mixing up losses and mortgage defaults, this isnt what the ESM is there for. In any lending situation there are always some monies that wont be paid back, the ESM is just there to stop goverments funding banks/covering losses. It doesnt mean if your neighbour defaults that your bank wont start charging you more in interest to cover it.

It also says if the bank can be funded by bonds that the bank cant use the ESM which is the effect the ESM should have in the long run.
 
Mortgage Defaults = Bank Losses you are the one mixing things. Where else can the bank be losing money?

Well if they increase interest rates to compensate for defauters they will only create more defauters so not in their best interest i suppose.
 
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