Madam, - I wonder how much the Finnish expert is being paid for his financial report, because I, as a small business man would have done it for nothing.
We all know who are responsible for the ruination of our country. If I was compiling the report I would name the bankers, the regulators, and the government ministers responsible. I would then recommend that their pensions and lump sums be withdrawn, have them arrested and have them tried for treason. - Yours, etc,
LONAN BURKE, Carrick-On-Suir, Co Tipperary.
Madam, - In light of the Nyberg report, could I suggest that the story of the emperor's new clothes by Hans Christian Andersen form part of the core curriculum in both primary and secondary schools henceforth? - Yours, etc,
DIANA WHITE, Sion Road, Glenageary, Co Dublin.
Madam, - The Nyberg report is the culmination of a six-month investigation into practices at government-guaranteed financial institutions over a six-year period. Highlights of the report focus on many social psychological concepts such as groupthink and herd mentality. The lack of critical debate within society is also mentioned. The failure of the banks to realise the colossal size of loan amounts is noted.
Many of these failings have previously been identified in academic research on risk management and risk perception. My own research (published in The Irish Times, October 15th, 2010), which was not government-funded, reached similar conclusions. Individual bias such as optimism, irrational exuberance and invincibility were evident across the risk management practices within the banks.
Mr Nyberg's report is the third government-backed investigation into banking practices which led us to where we are now. We now have ample analysis of the problem and identification of its root causes. It is up to the Government and the Central Bank/Financial Regulator to introduce measures to provide appropriate mandatory training for those in authority in financial institutions, to carry out regular audits of risk management and to review the regulatory system with particular reference to risk management. - Yours, etc,
VICKY MENZIES, Charleville, Churchtown, Dublin 14.
Madam, - The report by Peter Nyberg highlights nothing new in the context of how real estate bubbles occur, it merely puts it into the context of the Irish market. A working paper by Richard Herring and Susan Wachter of the Wharton Financial Institutions Center highlighted all the various attributes that can contribute to a real estate bubble. Among these were: the role of the optimist at the beginning of a property boom and throughout; the role of non-financial variables - in Ireland's case the various tax incentives and capital allowances; and finally, the role of banks (within this they identify a number of additional causes including disaster myopia). This essentially means that it has been one or more generations since the last property crises occurred, resulting in shortsightedness and the belief that property values will always go up.
The paper went through a number of case studies including Japan, Sweden, the Boston commercial market and Thailand. All of these booms and busts had traits similar to Ireland's. Highly competitive lending, availability of credit, the belief that there was a lack of supply, were all in evidence. Entitled Real Estate Booms and Banking Busts: An International Perspective, it was written in 1999, close to the start of our boom. Unfortunately, herd mentality results in ignoring what has gone before and the voice of the minority who contradict common opinion. Ireland can now join the long list of property collapses and various other asset bubbles, but given time there will inevitably be more additions.
JEFFREY HOARE MIAVI Assoc. RICS, Brighton Hall, Foxrock, Dublin 18.
Madam, - So, we were all to blame for the crash.
I, along with millions of fellow taxpayers, was constantly updated by Finance officials as to how much money was coming in and from whence it was coming.
All of us sat around the Cabinet table and decided how much we were to spend for the next year.
Please, Mr Nyberg, do not add insult to injury. - Yours, etc,
Emeritus Professor JOHN M SIMMIE, Furbo, Co Galway.
Madam, - In light of the Nyberg report on Ireland's banking crisis, the regulatory authorities in Ireland should be encouraged to follow in South Africa's world-first footsteps and require all listed companies to prepare integrated reports, connecting material financial and sustainability information. Stakeholders could then make an informed assessment of the long-term sustainability of a business and how the sustainability issues pertinent to the business have been incorporated into its strategic direction, which is not currently possible from the traditional annual reports we all got used to.
Is this not the perfect opportunity for Ireland Inc to show its willingness to apply the latest best practice? - Yours, etc,
VINCENT HIBBERT, Ireland South Africa Business Association, Camac Close, Inchicore, Dublin 8.
Madam, - With all the bad economic news hitting us day in day out, my belief is that until the Government starts to make some hard decisions we will continue the slide into economic chaos. I haven't seen one hard decision made as yet. Get a move on. - Yours, etc,
ENDA TREACY, Killalane, Skerries, Co Dublin.
A chara, - The Nyberg report was just another waste of public monies: it failed in its duty to name people responsible. We have one particular bank, namely AIB, which in the short period of 25 years failed in its duties twice and yet we still pour public money into it. - Is mise,
PAUL DORAN, Monastery Walk, Clondalkin, Dublin 22.
Madam, - Did Mr Nyberg not realise that we had a change of government here in Ireland and that it was not necessary to keep the names of Ahern, Cowen and Lenihan out of his report? - Yours, etc,
DERMOT MORRISSEY, Willsbrook Way, Lucan, Co Dublin.
Madam, - In time-honoured tradition, in a self-proclaimed nation of great writers,the Irish Government has had a report written, at acost to us taxpayers of €1.3 million, to tell us what we already knew about our property bubble.
It sheds no new light but, in a novel take on avoiding naming names, it blames us all for the boom-to-bust cycle! Like with many reports written over the decades, space will be found on some governmentshelf for it to rest undisturbedamong its countless cousins (the National Spatial Strategyto name but one).
We should probably count our blessings that at leastwe have been spared a tribunal of inquiry, for now. - Yours, etc,
MARK DALY, Trees Road, Mount Merrion, Co Dublin.
Madam, - I note that the Nyberg report has criticised the role of external auditors for facilitating our banking disaster.
In a similar vein, new houses and apartments all over the country were subject to market valuation reports by registered valuers prior to purchase. Throughout the boom, these "experts" pocketed €120-plus for a five-minute house visit where no effort was made to truly value the property.
While it has been argued that Irish families in negative equity have fallen on the sword of their own decisions, they were misled and betrayed at every level of the house buying process.
When will we see action against all of these professionals and an acceptance that the "negative equity generation" are not entirely responsible for the position they find themselves in? - Yours, etc,
Dr MARK MCCARRON, Rue Du Bon Pasteur, Lyon, France.
Madam, - No! Mr Nyberg. I did not cause the banking collapse. At the inception of the euro I spoke out against the incongruity of linking disparate economies. Throughout the "Celtic Tiger" years I was in favour of counter-cyclical policies for fiscal policy and government expenditure.
About 14 years ago, I even had the temerity to meet a government minister (the late Seamus Brennan) and implore him to cease the madness of property taxation schemes, such as Section 23 relief. Of course, I know nothing of economics; perhaps in simple terms Mr Nyberg could once again explain how I caused the banking collapse. - Yours, etc,
BRENDAN CHAPMAN, Trimleston Drive, Booterstown, Co Dublin.
Madam, - The report on the causes of Ireland's banking crisis criticises the "herd mentality" and "the unhindered expansion of [ Ireland's] property bubble financed by banks using wholesale market funding" (Front page, April 20th).
The seeds of such arrogant and avaricious self-destruction were eloquently foreseen centuries ago by Dáibhí Ó Bruadair, last of the bard poets (d. 1698), made redundant by destructive forces of investors and invaders who took over his land and culture in the 17th century: "I saw profoundly illustrated the obstinacy of the Irish mind and its connection with the past. The once proud men of this land have swapped giving for gaining, culture for crop." The payment to two senior Bank of Ireland executives of bonuses of nearly €1 million (Home News, April 18th) might provoke the unemployed and defaulted homeowners and taxpayers to cry out against those who "have swapped giving for gaining" with the lament of Ó Bruadair: ". . . And no one cared even as much as half the half of a hang/ For the song or the singer, so here is the end of the tale?/ . . . I had hoped to live decent, when Ireland was quit of her care,/ As a bailiff or steward perhaps in a house of degree, /But the end of the tale is, old brogues and old britches to wear, /So I'll sing no more songs for the men that care nothing for me."
(D'aithle na bhfiledh n-uasal, Dáibhí Ó Bruadair. Michael Hartnett, trans. 1986) - Yours, etc,
ROBERT F LYONS, Wallace Street, Kennebunkport, Maine, US.
Madam, - We are in the season of Lent. It is appropriate that the Irish people should accept responsibility for the sins of the past and our part in the "national speculative mania" of the boom. However, in the same spirit of sackcloth and ashes, should not the European banks take some responsibility for their "speculative mania"? After all, as Mr Nyberg might put it, nobody forced them to lend recklessly to the Irish banks. - Yours, etc,
RONAN B TOBIN, Chalfont Park, Malahide, Co Dublin.
Madam, - The predictable hand-wringing and expressions of angst by our political leaders at the award to Colm Doherty will do nothing to assuage the perception by the general public that our elected representatives are toothless when it comes to putting the interests of the ordinary citizen above that of the corporate elite. The Nyberg report also misses the point in trying to paint a picture of collective responsibility rather than getting to the real root cause:, the cronyism at the heart of Irish society. - Yours, etc,
BARRY WALSH, Church Road, Blackrock, Cork.
Madam, - The Nyberg report merely confirms what a former minister for finance had already told us: "We all partied". Brian Lenihan, you stand vindicated. - Yours, etc,
PAUL DELANEY, Beacon Hill, Dalkey, Co Dublin.
Madam, - The Nyberg report seems to extend a fool's pardon to the economics profession for their near universal belief in a "soft landing" to the property bubble. Leaving aside the question whether any real scientist should be happy with a fool's pardon on what was maybe the most crucial evaluation of their professional lives, the exact implications of a "soft landing" are, I think, not fully appreciated by the general public.
If a "soft landing" had occurred (and it has been argued there is in fact no such thing in the history of property bubbles) all those who bought in the bubble would still be in negative equity at the end of the bubble, it would just happen so slowly that they might not realise it because of normal inflation. In other words, all those economists knew full well that average house prices always return to a multiple of three or four times average earnings, so if you bought a house at the peak at eight times average earnings, it was always only going to be worth half of that (at best), long before the end of the mortgage.
Simply believing in the implausible possibility of a "soft landing" does not exonerate those professionals who encouraged people (or stayed silent), as they bought houses at the height of the bubble.
It is as urgent to have an inquiry into the activities and the silence of the economics profession, as it is to have an inquiry into the actions and lack of action of the various accountancy houses. - Yours, etc,
TIM O'HALLORAN, Ferndale Road, Dublin 11.