If Nama cannot realise our goals it should be replaced
The 'bad bank' is engaged in dangerous games of market manipulation and we are left with the tab, says James Fitzsimons
Published 22/05/2011 | 05:00
Nama chairman Frank Daly wants to encourage consumers to buy residential property on the basis that the price has found its floor. This is dangerous market manipulation. Brian Lenihan did something similar when he gave the bank guarantee in September 2008, and look where that got us. Only private funds should be allowed to take such risks with their own assets. Nama is playing with taxpayers' money and it needs to be reeled in.
If Nama can protect prospective buyers against market losses, why can't it use these resources to help the 50,000 people with residential mortgage arrears? According to the Central Bank, 63,000 mortgages have been restructured now. Flexibility is not the same as moral hazard. It's not the homeowner's fault that the economy collapsed, or that the banks cannot cope with these hiccups to their plans.
Wise consumers should buy when they are ready. They should not allow Nama to manipulate them. What Nama is doing is for Nama's benefit. If prices continue to fall, its losses will be higher and buyers will ultimately be better off.