Sorry I am answering later than the two days I said. Let me start congratulating you by answering as an adult, and not as usually in Latvia. Have you perceived that, usually, when there are some altercation, even in the academic field, the opponent tries to disqualify who said the matter in question, in order to make his/her argument more powerful? Have you perceived that, in many cases, the person trying to disqualify his/her opponent usually doesn’t have anything to say. It is somehow like Delfi, Apollo and other portal’s mental commentators do. I am not saying that’s your case…

Anyway, I don’t think the people caring for Parex now is guilt about anything. Let’s say, for example, Nils Melngailis. I am truly convinced he is a nice man, doing a nice job. I am convinced, he may have a similar opinion than you in this matter. And I see things as you do too.

My point is that politicians are lying. They tried to sell the idea that Parex’s case is the most normal in the world. That all the process is clean. And that the state is going to receive all the money back. Even some of my colleagues are basing their analysis on this hope. So, nothing to do with people who is in Parex now, like Melngailis.

And about not providing calculations, there are some things that we don’t need to calculate. Or, to calculate, we need real variables, to not say nonsense. However, History exists to help us understand what happened in the past, to try to foresee the future. The similar experience in this cases, (i.e. Latin America), shows that I do not need to calculate to make the affirmations I did. But about the Delfi and other portals’ commentators, I think most of them are sick people.

Thank you for coming back. Sorry I just read your comment today. I was in New York giving a lecture at New York University about Latvia’s current economic situation. I’ll answer you in the next two days.

I just added the option to follow comments. It is between the comments’ box and the captcha.

Janis

I do not know the details of Nomura/government/Bank’s management plans, but my understanding of reasonable government exit would be:
a) healthy part of the bank, which is ‘normal’ retail/corporate operation with reasonable business model, etc., which could be sold in foreseeable future for the amount invested by the government, largely equity i think;
b) rotten part of the bank, which should be worked out over reasonable period of time in line with real estate market possible recovery, etc. (say 5,7,10 years). For this part I would assume the workout strategy should incorporate reasonable ratio of faster cash vs. more recovery. Saying that the rotten bank is worth 0, is the same as saying that Swedbanks huge non-performing mortgage portfolio is worth 0, etc. It would definitely involve some loss. The extent of it unknown to me.

To summarise I would like to point out, that I do not claim that government will get full investment back. I doubt that anyone acutally believed it, when the investment was made, and historically/now government worldwide understand that there is certain price to be paid if you choose to save the financial sector (to save or not to save, would probably be focus of separate discussion). I just wanted to emphasize that providing no calculations/reasonable estimates and just claiming that whole investment will be lost does not make any more sense than people in Delfi writing comments, that ‘large salaries are evil, and all people that get large salaries should be hanged’.

inetnum: 193.178.176.0 – 193.178.183.255
netname: PAREX
descr: Parex Bank Corporation
descr: Riga, Latvia
country: LV

I think I don’t need to say anything more. However, I’ll do it.

First, I don’t call myself an economist. I have a bachelor degree in Economics, and a Master in Economics. Please note that we are talking about Economics and not about financing, or marketing, or banking sciences. But Economics, with a big ‘E’, in the sense used by Friedman, Hayek, Stigler, Keynes, Adam Smith, Schumpeter, among others.

Second, let’s see your argument’s rationality: you say weak conclusion for somebody calling himself an economist. Doing this, you are trying to say that the arguments are weak, at the same time you’re trying to say I’m a bad economist, thus my arguments are weak, forming a circular argumentation. Let’s break it. Not only my argument is correct, as I am a good economist. On contrary, you, a Parex worker, would not be trying to mine my arguments. It is exactly because you know I am right (or maybe because you believe in Santa Claus), you are so aggressively trying to undermine my argumentation, which yes, is not brilliant. Any individual with basic knowledge of Economic History could have the same insight. The problem, however, is not about its weakness or not. But that it is true, and that’s why you’re so anger.