Banks ARE lending, just not freely or irresponsibly

I have read several articles in this week in our  national papers and in them the authors said ‘banks are not lending’ and in one it was implied that this was somehow wrong. A point of order must be raised, firstly, it’s not wrong and secondly they actually are lending, just not freely or irresponsibly.

The frustrating thing is that even after all of the fallout, all of the crashing property prices, all of the international crisis news, that so many people still don’t get it. Cheap credit and easy lending is what go us here to begin with, we won’t fix the Irish economy with more mortgages being freely available.

Lobbyists take note: While you might strong-arm or influence the Government (I don’t know which method lobbyists use but either way they are effective) into supplying money for mortgages via recapitalisation or Homechoiceloan or any other plan, the fact is that reasonable people will not sign up to it, they will buy when …

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Trade Unions and recessions, why they should not be considered.

Trade Unions, by definition are not academic organisations dedicated towards finding working solutions for the economy, rather they are protectionist in nature, specifically towards their members, which is why I am constantly surprised by the media leverage they achieve in various ‘solutions’ they arrive at for the current crisis.

To put it simply, Trade Unions are to economic progress as Kryptonite is to Superman. The wage deflation required to restore a working status-quo in our nation will not be achieved with increments, or guarantees of high wages, rather the inverse is true, now more than ever there is an argument for removing the minimum wage and allowing employment to find its own level, alternatively we can tax ourselves into oblivion and support artificially long dole queues and public spending.

‘Artificially’? How? Simply put, there are many people now who would likely show up to work for eight Euro an hour, and there are perhaps employers who would be happy to pay this to them, but the minimum wage …

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What is Negative Equity?

The easiest way to describe this is to first decribe what equity is. Equity in a property is the difference between the value of the property and the mortgage one it. If you owned a house that is valued at €300,000 and the mortgage on it is €187,000 then you have equity of 37.6%. or a Loan to Value of 62.4% (add your equity to your LTV and it will be 100%).

So now that we understand equity as being the value versus the mortgage where the value is greater then you just apply the inverse to understand negative equity. Negative equity is where the value of the property is less than the mortgage on a property. Lets take the same example, except we’ll swap around value and mortgage amount. If you had a property with a mortgage on it of €300,000 and the value was €187,000 then you are in negative equity to the tune of €113,000. What does negative equity do to you?

It means that you probably can’t sell your property, …

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