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Archive for June 6th, 2012

Fifteen months ago, the community of Ballyhea just south of Charleville in county Corkstarted a weekly protest march against the payment of bondholders in bust Irish banks, using citizens’ wealth to fund the payments. Since then they have been joined by Charleville and each week there are alternating marches in Charleville and Ballyhea. In addition, there have been protests online and offline that included a cycle/run/walk/crawl from Ballyhea to the Dail in Leinster House to hand in a petition, a fast, a sit-down protest on the main Cork-Charleville road as well as Facebook campaigns, the Bondwatch Ireland website which lists all bonds payable in Irish banks and a blog.

Who are these people? Meet them and it will take you about half a minute to recognise that they are “ordinary” people from an “ordinary” community who are standing up against the sucking out of money from our society to pay the debts of banks. No ego, no vanity, no hedge funds shorting the Irish economy, just ordinary people whose protest has made them extraordinary.

The original focus of the campaign was against the payment of bondholders in bust Irish banks, but that war is to an extent lost with the banks having now repaid much of their bonds. There are still considerable sums outstanding, including €640m in unsecured, unguaranteed senior bonds at what was Michael Fingleton’s Irish Nationwide Building Society, which will be paid in full on 26th June, 2012. INBS has thus far received a €5.4bn bailout from Irish citizens and taxpayers. The main focus of future protest though is likely to be on the extant €28bn of promissory notes. Anyone with a sense of ethics can see the injustice.

Yesterday a group of the protestors flew from Knock in county Mayo to Frankfurt-Am-Main in Germany, home city of the European Central Bank (ECB). Last night at midnight, they attached a proclamation – available here –  to the doors of the bank, in a manner reminiscent of Luther’s nailing of his proclamation to the doors of Wittenburg. It might sound elaborate but the point being made is simple – citizens should not have to foot the bill for failed banks, it’s just plain wrong. As plain wrong as it was to sell Indulgences in the 16th century.

 

This morning, the group handed their proclamation to Governor of the Central Bank of Ireland, Professor Patrick Honohan as he made his way to the monthly ECB meeting to set interest rates. Professor Honohan, friendly and receptive as always, took the document which it is hoped will be shared in this morning’s meeting.

Will the protest make any difference? Will the be-suited executives at the ECB in their glass-and-steel skyscraper take a blind bit of notice of a small community from a place they’ve never heard of? Maybe not, but then again, Martin Luther made his point across a continent. And he didn’t have the Internet.

The extraordinary group in Frankfurt today comprises Diarmuid O’Flynn Fiona Buckley-Fitzpatrick Rob Fitzpatrick Cathleen Queally-Moloney Pat Moloney Phil Ryan Frances O’Brien Pat O’Brien Diarmaid O Cadhla Donncha O Briain Vicky Donnelly Richard Chapman Damian Moylan Hugh Mellerick Lynette O’Farrell. You can keep abreast of the group’s activities today and see photographs by following @ballyhea14 on Twitter.

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Yes the title above is meant to be sarcastic after NAMA’s recent sales in Corkwhere it sold one major land-bank with marketing apparently confined to sticking a “for sale” sign up in a field and another €100m 450-acre land-bank was sold without the property ever coming onto the open market. At least the Edward Square shopping centre is to be fully marketed by joint selling agents DTZ and DNG, according to Jack Fagan’s report in today’s Irish Times. The asking price for NAMA Top 10 developer, Gerry Barrett’sGalway city centre shopping “enclave” which comprises just eight stores is €27m, but that price represents an initial yield of 8.6%. We should at least be thankful that this property is coming on to the open market…

Today from 5.45pm, there will be a debate in the Seanad on Senator Mark Daly’s bill aimed at forcing NAMA and the IBRC to produce comprehensive lists of property for sale and then to publish sale prices after sales are concluded. The Bill is available here with commentary. The Bill was first introduced before Christmas 2011 and is just now getting its first airing, it is likely to be shot down but that shouldn’t detract from the legitimate and important issues the Bill tries to address. Fianna Fail Senator Daly from Kerry – pictured below –   has spoken out before and suggested shenanigans at NAMA in its disposal of property below market value to people associated with the defaulting developer, but has thus far refused to provide details, even using his privilege in the Seanad.

 

NAMA is disposing of an average of €750m of property each month EVERY MONTH by reference to original loan values. In most cases, it is the developer or receiver that is selling the underlying real estate asset or the loan. But each of these sales represents an individual asset, an individual buyer and seller, it is not as if NAMA is selling litres of milk, kilowatts of electricity or cubic feet of gas. And what external oversight is there of these disposals, most of which are below the value of the outstanding loan and accordingly involve a loss for the Irish taxpayer? NAMA says that it has the Comptroller and Auditor General on site keeping an eye on its activity including disposals. “What”, you might ask “does the CAG know about domestic and international loan and property sales?”

The Bill is problematic because NAMA will have commercial and contractual reasons for not disclosing information, not to mention the confidentiality requirements laid down by the NAMA Act. But at the same time, NAMA is crystallising tens of billions of losses for the Irish taxpayer and we know next to nothing about these losses. The NAMA accounts are so top-level and so distorted by accounting convolutions that we can discern very little – NAMA has made a lifetime profit of €300m from disposals so far of its best and most liquid assets, and that’s about as much as you’ll get, though there is a modest attempt on here to track NAMA sales.

The debate in the Seanad will be reported here over the next day or two. It behoves those who object to the Bill to suggest workable alternatives. The debate amongst the 60 senators who each cost us €65,621 per annum plus allowances, expenses, pension and other perks can be viewed live online at the Oireachtas website and it might be an opportunity to see just how valuable this organ of Irish government is, and whether or not it is an unnecessary undemocratic luxury as some claim, or a valuable store of wisdom, expertise and lifelong experience as others claim in defence.

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