Tag Archives: Brian Lenihan

Banana Nama – 2

Sorry, but I can’t let this topic go.

The Government’s NAMA has bought €77 billion worth of loans from the banks. The property relating to these loans is worth €47 billion, but we’re paying €54 billion for them. We’re told that it’s not a bailout, that NAMA will pursue the developers for their loans just as diligently as the banks would have. And I’ve no doubt that Brian Lenihan believes that.

Ok, let’s keep it simple.

A property company, Balls of Brass Limited, borrowed €1.5 million from AIB to buy a property. This property is now worth €1 million. We have bought the loan from AIB for €1.15 million, to reflect “long term economic value”.

Next week Balls of Brass goes into liquidation. It is entitled to do this, indeed obliged to, as it is hopelessly insolvent. Its only creditor, which is us, gets legal ownership of its only asset, the property which is worth €1 million.

And we’ve just paid €1.15 million for it.

And that’s the end of it. The company is in liquidation – effectively deceased – so there is no-one and nothing left to pursue. The company has met all its legal obligations by handing over its asset to its creditors. No-one has done anything legally wrong.

But we’ve just lost money, unless the Government intends to hang on to the building in the hope that prices will rise. What if they keep falling? At what stage does NAMA lose its nerve and sell for even less than the €1 million it’s supposedly worth now? 

Bank share prices surged on Thursday after the figures relating to NAMA were released. You can see why.

Yet Another Birthday

first-birthday

This blog is one year old today.

I can now celebrate the day I was born (my birthday), the anniversary of the day I got my pacemaker (Tinman’s birthday) and the anniversary of the day I started this (my blog birthday).

This means I have more birthdays than the Queen.

Therefore I’m entitled to have an Honours List.

mary-hanafinThe MBE (Miserable Bastard Entity): From a lengthy list of contenders (honourable mention here to Education Minister Batt O’Keeffe) I’ve chosen Social Welfare Minister Mary Hanafin, for the decision to scrap the bonus payment to Welfare Recipients at Christmas. She keeps saying that at least she didn’t reduce the rate, but scrapping the bonus week IS a 2% cut, and her refusal to accept that is typical of the type of word manipulation that Ministers are still using, failing to see that it’s this type of crap that’s so infuriating the electorate. Anyway, she’s altered the entitlement of pensioners to medical cards, and shortened the length of time for which you can collect Jobseekers Benefit, so she has reduced benefits, no matter what she says.

michael-fingletonThe OBE (Obnoxious Banker Entity): Yet another category in which the shortlist is actually a long list. Brian Goggin, outgoing Chief Executive of Bank of Ireland for example, for bemoaning the fact that his salary fell to below 2 million last year, and for the fact that, although he has retired as Chief Exec, he’s remaining on the staff of the bank till June, so he’ll qualify for his full pension. Seanie Fitz, of course, for single-handedly bringing our banking system to its knees through his reckless and quite frankly corrupt business practices at Anglo Irish Bank. The honour goes to Michael Fingleton though. The fact that he tried to pay himself a €1 million bonus despite having presided over a loss of €243 million shows that he has no understanding of what a bonus should actually mean, and was simply using Irish Nationwide as his own piggy-bank. The fact that Irish Nationwide facilitated Seanie Fitz in hiding his Anglo Irish Loans from the stock market is another shining example of the ethical standards of this man.

yelena-1st-birthdayThe CBE (Cute Babe Entity): Ah, Yelena. It’s been over three months since I’ve thought of an excuse to post a picture of her, but she is far from forgotten in my heart, and now that the athletics season is returning you can expect to see lots more photos of her midriff. Or sometimes her bum.

The Nighthood (Because they’re blood-sucking vampires): The politicians of this country, for clinging with their vampire teeth to their outrageous collection of benefits, add-ons and expenses, while all the while telling us that we must all accept the pain together. Chief among them though is Brian Lenihan, for continually trying to give the impression that they are actually taking cuts when in fact they are doing no such thing.

And finally, for running our country into the ground with his throw-money-at-everything-approach to government, for accepting handouts from anyone willing to give them to him, for allowing his poor secretary to attend a tribunal and try to back up the lies he was telling about never having lodged sterling into his account, for then attacking the tribunal when they exposed these lies, for finally trying to explain the money away by saying he won it on horses, and for his overall contribution to increasing the level of contempt and distrust with which politicians and therefore politics itself are held in this country, Bertie Ahern is being made a Dame, because, well, there is nothing like him.

Then Read This, Brian

The six o’clock news has just ended.

Bryan Dobson has just said to the Minister for Finance:

“Finally, there’s an enormous amount of public anger at all of this, at the way the banks have behaved, at the level of regulation that they’ve been subjected to, at the way people like you have discharged your responsibilities and people in positions of political leadership, and from nobody have we heard an admission that yes, we got it wrong and we’re sorry, we screwed up”.

Brian the Speed-reader

Brian the Anger-Resistant

Brian Lenihan’s answer (and thanks to Sky Plus’s pause-&-rewind-live-TV facility for all this, it’s not just for replaying the penalty we were given against Georgia last night and laughing our heads off , you know) started:

“Well, I’ve been trying to repair this since last September and I have to say that while I’ve received some public anger over the budgetary decisions – I understand that – I haven’t had any public anger in relation to what has to be done about the banks…”

(Sigh).

Then allow me.

anglo-irish

A Bank Built on Bull

Last September the people in charge of our banks came running to you crying because the big bad investors were withdrawing their deposits, and there was a danger that they might all collapse. The one most at risk was Anglo Irish Bank, a bank with no on-the-street profile, no public branches, no day-to-day cheque book facilities, who had grown moderately large purely by lending huge amounts of money to a small number of  investors and property developers. You decided that we, the Irish people, would guarantee that any money deposited with these banks would be repaid.

Among the people Anglo Irish lent money to was its own Chairman, Seán Fitzpatrick, to whom it lent sums ranging from €122 million to the €84 million he still owes now. Seánie hid this from the public each year by borrowing the same sum from Irish Nationwide for a few days at the end of each financial year, so that on September 30th the annual accounts showed that he owed nothing. Around the time that you were giving the guarantee on our behalf your Financial Regulator, the egregious Pat Neary, discovered that this had happened, but somehow you weren’t told till December, according to, well, you.

Sean the Disappointing

Sean the Disappointing

When it all came out Seánie resigned, and you said you were “disappointed” by his behaviour.

It now turns out that at year-end this year Anglo Irish gave €7 billion to Irish Life & Permanent, who put it on deposit in … Anglo Irish. This meant that in its accounts this year it was able to show customer deposits at €7 billion more than they really were. No matter what crap is talked by the banks about it being “normal inter-bank lending”, this was fraud. I can see that, and so ought you .

This was discovered last October by the very accountants you sent in to examine the affairs of Anglo Irish. They reported it to your Department, who deemed it serious enough to notify (oh God) the Financial Regulator, but you didn’t read that part of the report.

In simpler terms, Brian, coz I realise you have the attention span of a newt when it comes to reading stuff, you bailed out a bank that was so riddled with corrupt practices that its Balance Sheet has been nominated for the Booker Prize for Fiction, at the very time when you were thinking up a Budget taking Medical Cards from over-70s, denying anti-cancer injections to 12-year old girls and targeting disadvantaged schools.

Pat the Pensioned

Pat the Pensioned

The dreadful Pat Neary was finally shamed into resigning in January. He got a €630,000 severance payment and gets a pension of €142,000 a year. As a reward for incompetence that takes some beating.

As for the ILP “deposit”, according to you, the “specific character of  this transaction was explained to me in the middle of January by my officials”. I’m surprised they could find words small enough. Anyway, for many of us this would have been the final straw, and we’d have decided to let Anglo Irish collapse & rot in its own filth, but to you it was one of the factors that persuaded you to nationalise it. You now knew that absolutely no trust could be placed in any of the financial reports from Anglo Irish, but decided that we, the public, would take it on, dodgy debts and all.

You called in the Chief Executive and Chairwoman of ILP to give them a damn good talking to. When? In January, when your officials spelled out what they’d done? Er, no,  today, after the Press found out about it.

Not one person in any bank (including the one we now own), in the Finacial Regulator’s Office or in your Department has actually been sacked yet. Needless to say, you have neither resigned or been sacked. The smug smirk on your face when this was suggested in the Dáil today truly was a picture that told a thousand words, many of them crude enough to be understood even by you.

You say you haven’t had any public anger, yet in the Sunday Business Post of just four days ago Peter McLoone of  Impact said “People are angry at the unfairness of this measure when the bankers and property speculators who caused this mess are being let off scot-free”.

Tinman the Pissed-off

Tinman the Pissed-off

In case you don’t have time to read papers, perhaps you can at least look at the pictures. Today’s Irish Times has a photo of Dublin Bus drivers outside the Department of Transport yesterday with placards saying “Billions for bankers – P45 for Bus Drivers”.

Make no mistake, Brian, the public are angry over all this. Very angry.

You are useless, and should go.

One Tough Cookie

The Irish Times on October 4th reported this on its front page:

THE GOVERNMENT and Central Bank will seek up to €2 billion in charges from the Irish banks and building societies covered under the State’s bank guarantee.

However, the banks will be pressing to cap the charges at about €1 billion, or €500 million over each of the two years of State protection cover.

And on October 16th, unnoticed in the middle of the Budget rows, it reported this:

THE 11 BANKS covered by the State guarantee scheme will pay €1 billion over two years to be covered by the deal, it emerged yesterday evening when details of the scheme were published.

Well done, Brian Lenihan. Excellent negotiating skills there.

Here’s a man who really knows how to drive a hard bargain. Good to know that he stuck the banks for every cent that he possibly could.

Like he did with you and me.

When the Levy Breaks

A spokesman for the Department of Finance says that the new €200 parking levy will apply to “civil Servants and members of the Oireachtas, as well as ordinary citizens”.

Leaving aside the unspoken implication that civil servants and members of the Oireachtas are Extraordinary Citizens, here is a short tale to illustrate how well that’s likely to go.

One day last week I had to walk along Bow Lane, near St Stephens Green. There is a small waste management facility there run by Waste Management Services, the waste disposal section of Dublin City Council. Across the narrow lane there are 7 or 8 “Pay and Display” parking spaces. As I walked by I noticed that all but one of the cars parked there had a flourescent Waste Management Services yellow jacket fitted over the steering wheel, like a tea-cosy. None of the jacketed cars had a ticket displayed.

As I wasn’t able to do what I’d set out to do that day, last Monday I’d to go there again. Again all but one of the spaces was occupied by cars sporting bright yellow jackets on their steering wheel, in case case fitted so that the words “Waste Management Services” were clearly visible. Again none of the cars had a parking ticket.

Clearly then the jackets act as a Membership Card, telling the Council clampers that these cars are not to be touched.

We’ve been told that we commuters shouldn’t drive into the city centre, both to cut traffic jams and to leave spaces free for shoppers, but council workers are permitted to drive their private cars into the very heart of the city, and to take up a whole street full of spaces all day just yards from the Grafton Street shopping area. And they pay nothing for this.

So good luck with applying the parking levy to civil servants, Brian.

The Sound of One Brain Clapping

Fianna Fáil’s standing ovation for Brain Lenihan after his Budget speech reminded me of Stalin, who used to shoot the first delegate to stop clapping at party conferences.

Lenihan brought in a tax payable by everybody, no matter how poorly paid, took medical cards away from over-70s and raised the cost of clothing, toys, electrical goods, etc in the month before Christmas, and they gave him a standing ovation.

Jesus, I thought, is there ANYTHING they won’t stomach?

Then I remembered how they all stood by when Burke and Lawlor were given senior roles in Governments, backed Bertie when his tales to the tribunal grew taller and taller, and how they welcomed Bev Flynn back into the fold (perhaps she’ll be patriotic enough now to pay the balance of what she stuck RTE for).

And I thought, no, of course there isn’t.

Brothers in Arms

Announcing today that the new 1% levy (i.e., tax) would be payable by all citizens, including those not earning enough to actually qualify to pay Income Tax, Brian Lenihan said:

“We realise the solidarity it demands of all taxpayers. But there is too much at stake: we all have too much to lose by not taking action now. This levy will allow all income earners to contribute in a proportionate manner to the restoration of order and stability to the public finances.”

His approach is to try and persuade us that “we’re all in this together, eh chaps?”. It tries to evoke a wartime spirit, in that, while we can’t actually fight the recession on the beaches, we’ll do the next best thing and fight it in the wallets.

It’s nice of him to ‘allow’ all income earners to contribute. The more cynical among us may say that by raising the rate of VAT 4 weeks before Christmas he is ‘allowing’ us all to contribute in any case, but such cynicism would surely be denounced as unpatriotic by the Churchillian Brian.

So here we all are: workers on the minimum hourly wage, part-time workers, schoolkids working in shops at weekends, students working a couple of nights in pubs, trainees on FAS schemes, all chipping in merrily to help get our good old country back on its feet.

And those availing of special tax reliefs and exemptions? Er, well, they’ll be paying the levy too.

In many cases it’ll double the amount they are paying.

Bail-Out Banking for Dummies

A Guide for the Rest of Us!!

Once upon a time someone (let’s call him a Depositor) lent Tinman 100 euro.

Tinman didn’t keep this money for himself. He decided to lend it on to another person (a Developer) who wanted to invest it in a Crackpot Scheme (literally – he wanted to invest in selling cracked pots, some sort of Olde Worlde Decor craze, apparently). The idea seemed strange, but the boom was on, people would buy anything (rumour had it they’d buy bottled water while it was bucketing down outside), and the Developer promised he’d pay it back, so Tinman could pay the Depositor, and everyone would be happy.

But one day the boom stopped. People stopped paying good money for bad crap, and the bottom fell out of the crackpot market (and, in many cases, out of the pots themselves). Word began to circulate that the Developer might struggle to repay Tinman, though Tinman assured everyone that all was OK.

But one Monday evening the Depositor called to the door. He wanted his money back now. Tinman rang the Developer, only to be told that he was as broke as his pots (his exact words were “I haven’t a pot to piss in”). Tinman relayed on this info, and the Depositor suggested he say goodbye to his kneecaps.

Uncle Brian

Uncle Brian

Suddenly Tinman remembered his rich Uncle Brian. He had largely ignored Uncle Brian and the rest of his relations over the years, tending to laugh at them if they asked him to do anything, but this was a crisis, and, as I’ve heard it said somewhere quite recently, blood is thicker than water. Also, that side of the family are known to value a dig-out when it’s needed. Off he went to Uncle Brian’s to argue his case in a calm, professional manner. Tinman knocked at the door, and Uncle Brian opened it.

“Ohsweetjesusyouhavetohelpmeorimfuckedaltogetherpleasepleasepleaseprettypleaseforgodssakegiveusafewbob”, he argued calmly and professionally.

“I won’t give you money,” said Uncle Brian, and Tinman’s heart (which he’d got from Oz) sank. “I’ll do better than that. I’ll guarantee that if the Developer doesn’t pay you, I’ll pay the Depositor myself.”

Tinman’s heart rose again, as did the Depositor’s. “Sure, if I know you have the money, I don’t need it right now. In fact, here’s another 100 euro. Don’t spend it all in the one shop.”

And Tinman didn’t. He lent it to the Developer. “Pay it back when you can,” he said, “and don’t worry, if you can’t pay it back, I’ll write it off as a Bad Debt. Sure I’ve no incentive to collect it at all now.”

And so they all lived happily ever after. Not only did the depositor give even more money to Tinman, but he got all his friends to do it too, as they all knew that they had found the safest place of all for it. And Tinman found lots of the developers’ friends to lend it to, as they all knew that they had found the man with the least reason for putting pressure on them to repay it.

Soon every Depositor in the whole world had lent their money to Tinman, knowing that Uncle Brian would repay them if Tinman couldn’t. By this stage Tinman was lending money to drunks at Luas stops to buy cans of Dutch Gold. Not too much of the money was being repaid, but he had a varied loan portfolio, so he was Ok.

Now buy my book!

Now buy my book!

And was Uncle Brian worried? Not at all. Because, if anything went wrong (though he couldn’t see how it could) he wasn’t actually going to repay the money himself.

He knew four million other people who were going to do it for him.