Nationals favour loan waiver

I'm not even sure I believe such bailouts work, either in the short term or the longer term.

Perhaps the extra money in the economy will only fuel inflation, and the longer term cost of either paying back the money (assuming it was a loan, as it is in most cases) or through reduced government spending might negate the positive effects (if any) of the bailout in the short term.

However economic measures of this magnitude have never been tried before, so all we can do is wait and see.

To me it's more of question of politicians' logic:

Something must be done.

This (ie a bailout) is something.

Therefore it must be done.

I think bail outs cannot be judged out of context..and solution i believe is owned by mAcroeconomic policies...

After all, it may be an initiative for the welfare of the people after which better measures will be in place to minimise probabilty of being put in the same situation..if the move will be ever made anyway.

Actually, I'm not defending the survey.

I wrote that you need about 400 before a sample becomes close to accurate. This survey used about 10% of that number, so its accuracy would be minimal. I'm sorry I didn't point this out more directly, I just assumed that anyone reading what I wrote would know that 400 is a bigger number than 40.

Also, I don't at any point 'defend' the economic policies of the US. I just highlighted the differences, and went on to say that there is considerable reluctance across the broader population to accept the reasoning that banks et al should be bailed out because they are 'too big to fail'. It's not a policy I agree with, but I'm not an economist.

What I do know about economics is that on the whole, people respond to incentives. So, if the part of the population that gets into unmanageable levels of debt receive handouts from the government, while the part of the population that is careful with their money and lives within their means receives no money from the government, then there will be an incentive for everyone to get in to debt buying things that they cannot afford. I think this would have terrible consequences to the local economy, and yes, I would disagree with this.

And on a final note, bailing out people in debt is not economically stimulating, since by definition you are giving them money to pay down debt. Therefore this money will never enter into the economy and so won't provide any boost. Bailouts work (at least according to Keynes) by introducing more money to be spent on more goods or services, which has a trickle down effect through the economy. There is debate about what this multiplier is, or even if it exists at all. However if you give money to people and they put it straight into the bank, there is no multiplier at all, and hence no additional economic stimuls.

I'll just say I'm against this. People who were sensible in the loans they took, and repaid most of them would hate it, so would people with no loans.

I would agree with "free money" at a fixed rate, without encouraging the people with huge loans.

fubar..

save the statistical classes u have been fed..i am really surprised that you still defend this survey!

probably you need to speak to market analysts and see thier confidence in statistical studies when dealing with humans especially when a sample does not represent population..

I question your schooling systems fubar..honestly..since you come from a country that undoubtedly caused the biggest financial crisis we see today..and yet..you still defend western policies?

Assuming this move will be made by qatar government, how in the hell could you compare with western countries' initiatives while not knowing whether Qatar government is doing it as an economic booster or to help the people just for helping people which is something usual whether you agre or not??

be reliable in your judgement. Shame to know something in paper and fail to translate it to real life application or at least understand the gap between the two.

keep extrapolating!

Nice 'sample size' analysis fubar. It does my head when people argue against survey results by saying that "it's not representative because they didn't ask everyone".

Surveys are, by definition, generalizations. That's the point - they extrapolate information from a sample to be reflective of the broader population.

Typical research firms use a sample size of approximately 400, using the formula s = (z / e)2 where s is the sample, z is the confidence you are seeking and e is the acceptable error. If weighting is reliable, you can confidently extrapolate the data from such a small sample to within +/- 3%. Curiously, surveys don't get much more accurate by using larger and larger samples.

I think what is clear from the survey is the general notion that nationals in debt have some expectation that the government will step in and bail them out.

The article doesn't hint that the government is considering such a move, but it does seem to suggest that members of the national population are expecting it.

Other western countries have adopted similiar economic stimulus pacakges, but the differences are crucial:

1 - the goal of the package is to stimulate the broader economy

2 - the money is not means tested or targeted at people in debt, it is given in equal amounts to all eligible tax payers

One very disturbing similarity has been the willingness of western governments to bail out failing banks/insurers/car manufaturers etc, with the dubious reasoning that such institutions are 'too big to fail', causing considerable public outrage, and justifiably so.

guys..

The survey included 40 citizen and Qataris are nearly 200,000 + and no way can be generalised. Additionally, how assuring is this article that this move will be made?

yet, most of you cast concrete opinions and show some human instincts based on something that is not reliable yet!

additionally, keeping up with the jones is not something that all qataris do. Since this term exists in UK, it means in exists everywhere and i don't think it is relevant here anyway.

Tallg, thanks for a good term to use lol new information.

The point is why should people who got in to debt be given money to pay off the loans, when no such provision is being suggested for nationals who didn't spend the money in the first place.

Wouldn't it be more fair just to give them all a lump sum payment?

It's effectively rewarding imprudent behavior, and penalising sensible risk taking. In the long run it will just encourage all nationals to spend money they don't have so that when they go in to debt the government will feel obliged to pay off their loan.

Aye Aye The Qataris get Water and Electricity for Free, Dont pay any Tax, neither do they have to pay any other taxes/fees slapped on Expats, Loan Waiver would I be surprised.. Is it not thier national right?

they have all the help from their government.

what we got from ours. Only promises

It is their country and wealth. One thing the Qataris have over all of us. Their government at lease takes care of their own citizens.

I remember a news article a while back saying how some Qataris had taken out huge loans (back when the banks still gave them) in order to go on their summer holidays, because it was important that they were seen to be going to a nice place.

I guess it's the same with cars - it's considered important by some to be seen driving the latest model or whatever, even if it means taking a loan you can't afford to buy it.

In the UK we call it "keeping up with the Jones'.

Moral hazard is alive and well then.

it happened in Kuwait as well!!

I agree Tallg.

When you see the piss poor family that went a bought a new 2009 Land Cruiser and spent hundreds of thousands on a wedding being bailed out for their stupidity, while the sensible family living within their means get nothing, you'd be a bit pissed off.

But then again, this is the country that doles out money to various families based solely on their surname while people who work hard and contribute to society have to make their own way in life.

"dgoodrebel will always be the rebellious good one"

silly actually, it happens only in Qatar, what if they manage to pull it off?

No, of course not. But it sends completely the wrong message.

maybe they will read this and hurry on out to the malls and the new car showrooms!

Would anyone turn down such an offer ?

And what about the Qataris who have been sensible and didn't borrow beyond their means?

If this waiver goes through they'll be kicking themselves that they didn't get themselves into debt up to their eyeballs!

I'd be interested to know what our resident Qatari QLers think of this.

Hey. Hats off to them if they can pull it off..

Perhaps Brown and Co need to learn from this..

Why couldnt I have been borne a Qatari..... :)

Brin

It's actually hard to put into words exactly how ridiculous this is.

of no consequence whether it be work, loans or driving.

Can't say I blame them, if I could get away with all that lot and have no penalties against me it would be great...

I love the subtext of this statement:

Fahad Al Balouchi, backing Al Suwaidi in his call for state support, said there was a need to ensure that limited-income Qatari families repaying huge bank loans had enough left with them each month so they could run their households comfortably.

No need to ask how or why 'limited-income Qatari families' sought, and were granted 'huge bank loans'...

- "Would you like free money?"

- "Yes."

What a shocker.