When an Irish CEO can’t give shareholders value.

I write today regarding the CEO of Irish Life & Permanent TSB, Dennis Casey. He is an articulate and educated individual and driven as well, he has led the company to profitablity for many years. However one of his latest moves is to reduce broker commissions in the coming year, this decision was met with a lot of hostility by the broker market. The basis for it is apparently because of huge losses in the subprime market in the USA, but are the out of state investment decisions of any bank really the concern of anybody other than the banks themselves? No, of course not, but the fallout is passed on it seems.

People might talk about broker greed but it pales in comparison to bank greed! The proposal means that brokers can potentially lose the money they earn as a commission if the loan is changed any time in the first five years, and the average loan is currently lasting about five years so brokers will never be able to remain liquid because they will never know if a …

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When an Irish CEO can't give shareholders value.

I write today regarding the CEO of Irish Life & Permanent TSB, Dennis Casey. He is an articulate and educated individual and driven as well, he has led the company to profitablity for many years. However one of his latest moves is to reduce broker commissions in the coming year, this decision was met with a lot of hostility by the broker market. The basis for it is apparently because of huge losses in the subprime market in the USA, but are the out of state investment decisions of any bank really the concern of anybody other than the banks themselves? No, of course not, but the fallout is passed on it seems.

People might talk about broker greed but it pales in comparison to bank greed! The proposal means that brokers can potentially lose the money they earn as a commission if the loan is changed any time in the first five years, and the average loan is currently lasting about five years so brokers will never be able to remain liquid because they will never know if a …

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You Can’t catch me, I’m the Lynngerbread Man

Banks Chase Lynn’s Foreign Assets. I want to start by saying this is a classic example of throwing good money after bad if you ask me (not that anybody sought my opinion or anything).

Why? There are a few things to consider, and first and foremost I would say that currently banks need to concentrate on getting profitable and doing what they do best which is make money, because there is a financial sector crisis going on and initiating litigation abroad will simply dilute their efforts and get them in the papers for all the wrong reasons. what does a shareholder or mortgage holder from one of these institutions think when their bank is only mentioned in the press because they got ripped off? Its a PR nightmare, damned if you do damned if you don’t.

They are (apparently) chasing properties in Luxembourg, Portugal and Bulgaria. The latter country being a hotbed of corruption. I know a Dublin based solicitor who won a family law case awarding custody to the mother (based in Ireland) from the father (who had …

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You Can't catch me, I'm the Lynngerbread Man

Banks Chase Lynn’s Foreign Assets. I want to start by saying this is a classic example of throwing good money after bad if you ask me (not that anybody sought my opinion or anything).

Why? There are a few things to consider, and first and foremost I would say that currently banks need to concentrate on getting profitable and doing what they do best which is make money, because there is a financial sector crisis going on and initiating litigation abroad will simply dilute their efforts and get them in the papers for all the wrong reasons. what does a shareholder or mortgage holder from one of these institutions think when their bank is only mentioned in the press because they got ripped off? Its a PR nightmare, damned if you do damned if you don’t.

They are (apparently) chasing properties in Luxembourg, Portugal and Bulgaria. The latter country being a hotbed of corruption. I know a Dublin based solicitor who won a family law case awarding custody to the mother (based in Ireland) from the father (who had …

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90,000 Mortgage job losses

CNN have reported that there were 90,000 mortgage industry job losses in 2007, I know of one of them, my old room-mate in Chicago Maurice Mulroe. He is a father of two and was in the industry for a decade, then one day he walks into work and out of the blue is told to go home ‘it’s over’. It took him 7 months to find another job that his skillset could qualify him for, and even low paid jobs were being hotly contested by the new wave of skilled redundancies.

Often redundancies are in industries that are mainly unskilled or manual but the Mortgage Crisis in the US has put people with college degrees, years of expertise and experience out in the cold, and that was part of what gave early January’s increase in the unemployment statistics.

The same thing has happend (albeit to a lesser degree) here in Ireland, Fresh Mortgages entered the market during 2007 and they were a good bunch of people, good at what they did too but then they …

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China might have the muscle but where are the brains?

I wrote about inflation in china before and how it might affect their economic growth, in fact it may prove to be their economic Achilles heel.

now the BBC have reported that the Chinese Government has come up with a novel way of curbing inflation (get a reporter from the Economist & FT over there quick!). They will fine retailers if they raise their prices… What ingenuity! Why didn’t somebody think of this before? I wonder if they will also fine them for not having any stock after they become unable to purchase anything because they will not be able to make any mark up on it?

Here’s the scenario:Mr. Chang buys pork for €5 and would normally sell for 6 or 7, but now pork costs 6 or 7, he can’t mark this up, so Mr. Chang stops selling pork, that doesn’t mean demand disappears, it means demand will actually rise due to scarcity and will result in demand pull inflation. The Chinese Government probably didn’t think of that aspect …

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Gazundering, or Reverse-Gazumping

As the property market gets a bit more bearish you can expect a new word to enter news columns and it is ‘Gazundering’ or ‘Reverse-Gazumping’.

First of all we’ll explain Gazumping which happened when we were in our property bull market (the one that clearly ended in 07′). To gazump a person you would basically make an offer on a house that his higher that what the seller went ‘sale agreed’ at, so if you saw a house you wanted and it was already gone you would call up the estate agent and offer more than the current buyer did, doing this is unethical but not unthinkable, and the estate agent is in a bind because if the client found out they got a better offer and were not told about it they might not be too happy about it!

However, most sellers would be happy to honour their word and go through with the first buyer, but then there are those that just want more cash. When you buy a property you generally sign a contract but the contract …

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Hillary takes New Hampshire

Its clear that I am a big fan of Barack Obama, I nearly want to start a rumour that he’s Irish and his name is O’Bama and then everybody else here would like him too…

Anyways, Hillary took New Hampshire, Pollsters and pundits got it really wrong on this one! Mind you it was a 39 to 36% lead and not nearly as impressive as Obama’s Iowa performance but it has made me think about something.

Bill Clinton was my favourite president (Other than George Washington) and Hillary got eight years of indirect experience during that time, she’s a very bright and well versed lady and she certainly knows the pains of the Oval Office, more importantly you get Hillary you get Bill, its one of the only ways to bring him back into the domain of decision making because he cannot serve as president again. Behind every great man is a woman, and sometimes behind every great woman there is a man, isn’t the 21st century great that way!

One issue I do have is that Hillary Clinton cried …

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Arabs making headway with equality.

Not long ago I had a proper rant about the state of Arab nations because I read how a woman in Saudi Arabia was raped and her attackers got less jail time than she did (yes, they sent her to jail after being gang raped) and she also got 200 lashes, this is totally out of sync with my world view.

Today however I am reading the Middle East Times and see that the UAE are going to have women as judges soon, being a judge is one of the most important social offices available and is the reserve in almost every nation of the most intellectually sharp, it is also a good breeding ground for politicians and political advisors, so perhaps the UAE are going to lead the way in seeing that women can do a job just as well (and often better) than a man will, I would also bet that because they are aware of the huge burden they bear in terms of womens rights and how their performance will reflect on it that they will do …

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Geopolitical risk and the terror in your pocket

One thing you will hear more about this year is ‘geo-political risk’ and it spans many sectors and countries. One example that instantly jumps to mind is Nigeria and the Niger Delta. Oil hit $100 a barrell and this was blamed on ‘geo-political risk’ because of the likes of MEND who are the ‘movement for the emancipation of the niger delta’ (mentioned in a previous post), anyways, they go around bombing pipelines etc. and this causes panic in the market.

What… me worry? (famous line by Alfred E. Newman of MAD Magazine) something that really bothers me is things like oil at a hundred dollars a barrell because of a ‘supposed fear’ in the market, for every time something happens that threatens oil has there ever been an actual hold put on supply? (other than in the 70’s and we can’t really compare the new millenium to the way it was back then)

So basically the oil industry has a permanent choke hold on prices because all they have to do is prepetually cry wolf!

watch a film called ‘who …

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