Here\’s the idea –

at present there is approx. 40 -50 bln euros in irish private pension funds. These are funds that allow the individual to divert part of their pretax income towards their retirement with the caveat that they cannot draw down the money without a tax liability until they are 65. So here\’s my idea. We allow people to take money from their pensions account with no tax liability provided the amount is paid off any existing debts that they might have. This does 2 things: it implicitly recapitalises the banks and also increases disposable income in a very significant way. lets say you are 35/40 years of age – you take the 100k from your retirement account and pay off your mortgage, immediately increasing your monthly income in a significant way. This will boost output and increase employment.

The second step is to nationalise the banks. So now you have a near fully / properly capitalised bank that the state has bought for buttons. The bank is kept in public ownership for a few years and then sold back to the private sector when asset values increase. The profits from the sale and running of the banks are subsequently used to replenish the initial pension sale outlay. The basic premise of my idea is that if we have reserves we should use them. I see this as a means of paying down short term liabilities with long term assets.

All comments are welcome

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