Irish Moral Hazard Organisation (IMHO)


Been met with the usual apathy from my work colleagues.

One is not arsed reading it because it is “too long”. I said sure sign it anyway. But he doesn’t like signing when he hasn’t read it. I said isn’t that what you did when you voted for your political party in the last election i.e. you never read their manifesto you just voted for who you knew.

He didn’t disagree.


Thanks, sorted, description added now.


Is this to become a popular movement or political party IMHO or are you happy to work remain within the bounds of the playful but none the less serious satirical activity?


Emotive language takes away from the real message. If you are too strong with it like a rant (along the same lines as where’s my Nama, kids kicked onto the street etc). It needs to fundamentally logical. The unfairness of a situation is somewhat irrelevant in my opinion - what is relevant is the effect such proposal will have on taxpayers, interest rates, the banking system… I’m not very knowledgeable in this regard but if you could demonstrate that the proposal will have a negative impact on the economy overall you’re on to a winner.


At this stage that entirely depends on the number of signatures received for the letter. If we gather a significant number in a short space of time then would be prepared to step it up to be more pro active politically; on the other hand if the reaction is generally apathy, then there is little point in doing much further.

Basically for now we want to see how many people share our view.


So popular movement next, then political party?

How many is we?


Definitely not a political party. This is emphatically not an attempt for an individual to carve out a new political career. It is a simply a mechanism to allow our voices be heard.

We are at time of writing 95 like minded individuals!


It cannot be ruled out as a potential but the probability is low for now as you have outlined.


Well done on this letter.

I agree with some of the caveats others have posted, but I have signed as I broadly agree with the sentiment. I’m not sure why “we, the undersigned” must be a bastion of calm logic when faced with cereal box eaters and the voluntary homeless who want to be closer to their mams, but plenty have offered suggestions about some of the emotive language, and I’m happy that generally the letter will take shape over the coming days around the central points.

Kudos. Some pretty good momentum thus far.


I also feel that as those making the case for write downs deal solely in emotive language, “the family home” “homeless children” etc etc it seems odd that an opposing argument is weakened by emotive language.

But I do take the point that it is unnecessary and unhelpful, and perhaps will dissuade some from signing so I have watered it down, mainly the first paragraph:

*When it was just clearly self interested parties dominating the media about writing off their debts whilst retaining their assets, those of us who believe in paying our debts and living within our means could simply dismiss them as hopelessly optimistic, only likely to be taken seriously by those with similiar vested interests.

However it beggars belief that our Taoiseach and Finance Minister now appear to agree with these people, and are considering using taxpayers funds to pay the mortgages of those who cannot or will not pay them for themselves:*

I have also removed the reference to financially illiterate further down.


Maybe try to deconstruct their emotive language then, ask why the ‘family home’ of someone who hasn’t paid their mortgage in years is being paid for by others who put off having families until such time as they could provide a home for their own family? Ask why the ‘family home’ of families who’re only renting gets neither security of tenure or subsidy?


and focus on the SVRs too…


I oppose the subsidisation of mortgages by the state but there is just too much in that letter in terms of assumptions and analysis that different people will disagree with.

e.g., I am not concerned to make sure that people lose their homes, I think the banks should make a commercial decision on what to do with their commercial agreement. To make them do something else is to interfere with the market. There is no such thing as bankruptcy where you keep your home. The reason foreign banks are not entering the market is not because of any perceived difficulty enforcing mortgages. Not everybody who is in default was imprudent - many lost their jobs. Many were prudent by nature and tried to stay well within their means, but did not understand the nature of the bubble.

If you want to get support then you should formulate a simpler proposition, i.e. the State should not further subsidise the banks by paying towards mortgage debt and the state should not subsidise individuals by paying towards mortgage debt. I agree with that.

I also support a reform of the bankruptcy laws to shorten the bankruptcy period to allow borrowers to put a gun to the bank’s head and say go ahead and bankrupt me and take the property. This would lead to banks having to sh*t or get off the pot and would reactivate the market (very belatedly).

I don’t agree with a campaign to force banks to foreclose rather than restructuring loans. I think there is an very unpleasant sentiment underlying such a campaign. I know where it comes form but I think that those calling for others to be punished should examine the real psychological reasons for their position.


While I respect your position, and I’m in favour of deals that make sense and don’t cost the taxpayer, let’s not get away from the idea of moral hazard. How can we expect to avoid more property bubbles if we don’t enforce the idea that “you may lose your home if you do not keep up with repayments”, if we leave the idea that “this might be a bubble, but hey, as long as I make a decent stab at the payments, I won’t be classed as won’t pay, and someone will help me keep my home”


The problem is that we don’t really know to what extent banks are currently under political pressure regarding repos, and in which direction that pressure is being applied. For all we know govt are talking out of both sides of their mouths, preaching in public for no family home repos whilst quietly pressuring the banks to foreclose.

The Central Bank looked independent when it brought in the new lending limits, but as some on the Pin (and BB on AAM) have pointed out, they may make little difference. … es.192006/

The worst possible alternative interpretation is that the CB brought in rules which it knew would make little difference to prices, and that Noonan et all also knew this (and possibly collaborated on the design) but used it as an opportunity to side with the common people whilst simultaneously pressuring banks to repo.


Wall of text.


The page needs a few short quotes, soundbites or bullet points making the key arguments. The letter should be relegated to another page rather than being the first thing seen.

Also “The Irish Moral Hazard Organisation (IMHO) are a group of like minded individuals who are pro mortgage contracts being enforced i.e either you pay the mortgage or you lose the house.” is deeply unappealing to most. Mention “losing the home” and you immediately drum up sympathy. A better formula would be to say that the group is against the taxpayer subsidising people who can well afford to pay.


Can I agree with both of the above?
No. Ah well…

The solution needs both fairness and transparency.
Fairness should not be for non-payers or negative equity buyers only - there are payers, positive equity and renters to consider too.
And transparency should avoid political or friend of the bank manager favouritism.

I am still waiting for FG to refund my losses on Eircom shares:


Increase the mention of strategic defaulters, property gamblers looking for no-lose bets and buy-to-letters pocketing rents etc. These are at the higher end of the mortgage offender scale. There will be some sad cases at the other end of the scale.
It’s easy to allow yourself to be portrayed as callous when countered with stories of ‘Pampers on the street’ as Ivan Yates put it.


IMO letting morality or fairness into the argument leads to failure since you’re surrendering to subjectivism.

A banking system in which banks cannot repossess is not viable. We need a viable banking system, therefore banks must be allowed to repossess through the courts.

I don’t want anyone making a moral decision about (for instance) whether a mother with four kids whose partner has fecked off leaving her with an underwater mortgage and no ability to work should be evicted. How about if her partner hasn’t fecked off but is working minimum wage/jobbridge? How about if they have only one child who is a teenager? How about if their house is only in a little bit of negative equity? How about if they are married pensioners and one has cancer? Completely impossible to legislate for this stuff.

It should be a pure legal/commercial decision with banks doing what’s in their own best interests and the state’s role limited to making the law, providing free high-quality legal and consumer advice and social supports to cushion the impact.


What he said.

The alternative is some sort of government appointed “repo panel” that got to pick winners and losers for the debt forgiveness lottery. Impossible to administer, expensive and inevitably corruptible - no thanks.

Markets pick winners and losers, governments support those who end up in housing need for whatever reason.

No moral judgement needs to come into it. That is a canard thrown out by those with a massive vested interest in an insane scheme like this being implemented.

We need to have a viable banking system and we really do need it soon.