I have had this idea floating around in my head for a few days - any reasons why it might/might not work? This is it:
Issue the €54bn NAMA bonds directly to the adult population of Ireland. (Or in their names) Absolutely even distribution, with no exceptions. Then, along with the current conditions which attach to the proposed NAMA bonds,
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How would people pay the State for the NAMA bonds? Would I be forced to lend cash to the State, in return for the NAMA bonds?
The people acquire an asset, NAMA bonds, but pay for it in cash to the bond issuer, the State?
Hi Indian
NAMA will be issuing bonds to the banks.
The banks will have these bonds as assets instead of doubtful loans.
NAMA will pay interest on these bonds
They will be able to raise ECB money using these bonds as security.
There is no role for the citizens in this, as far as I can see.
As I understand it, the ECB commitment to provide money against these bonds only runs for six months. They may or may not choose to continue to honour the bonds in future.They will be able to raise ECB money using these bonds as security.
As I understand it, the ECB commitment to provide money against these bonds only runs for six months. They may or may not choose to continue to honour the bonds in future.
I think it is more that the ECB are only committing to providing unlimited repo operations for the next six months (the exceptional measures that they have brought in for the crisis). After this, the NAMA bonds will be looking for repo either at the more limited ECB mechanism (the standard repo operations the ECB performs to add liquidity as required) or on the interbank markets.As I understand it, the ECB commitment to provide money against these bonds only runs for six months. They may or may not choose to continue to honour the bonds in future.
Thanks for clarification.I think it is more that the ECB are only committing to providing unlimited repo operations for the next six months (the exceptional measures that they have brought in for the crisis). After this, the NAMA bonds will be looking for repo either at the more limited ECB mechanism (the standard repo operations the ECB performs to add liquidity as required) or on the interbank markets.
NAMA bonds are sovereign debt. They have a marketable value. They are therefore eligible collateral for ECB repo operations. They are no different to any other sovereign debt that any eurozone state issues. There is no special deal. The ECB are not specifically bailing us out, they are bailing out all the eurozone governments. Most eurozone governments are at least stabilising. The ECB will withdraw their exceptional measures.
The government takes all property development loans into NAMA at the market value...there is circa €115 bn of mortgage outstanding therefore this would cost the government €23bn.
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