The Big Bailout of the Eurozone (Another crisis coming? - Seriously)

[highorlow]

The Irish Government just accepted a deal to sell Ireland to bailout Europe.

This is bigger than the 1916 rising.

Ah Jasus calm down.

Well we have learned one good lesson from this and that is not to believe for one minute any word that comes out of any economist ever again.

Constantibe, Lucey (who has gone into hiding since his double counting the other week, imagine an economist that can't even count correctly?), McWilliams the whole god dam lot of them all of whom just love the sound of their own voices have exaggerated the whole thing.

The banks will be back making money in 6 months time and this contingency fund will start to get paid back.

Some awful gibberish OTT speculative crapology been spouted in the papers and elsewhere over the last few weeks, including that NY Times article. Horseshit of the highest order.

Who borrowed from the banks who borrowed from the other banks only you me and everyone else who got in on the binge so too right we have to pay it back.

How the f**k anyone can say defaulting is good is a madman, i.e. if you gave a loan to Joe Bloggs of say 30 euro and he didn't pay you back and a few weeks later came running looking for another 30 I'm dam sure you would tell him where to get off.

People need to wise up and in the words of a famous Cork man ' get over it' and cut the self deluded self pity that the like of Fintan o'Toole and co are coming out with and we need to dust down and get the country back rolling again which we can do. It's all beginning to be a bit tiresome at this stage.

[Zapatista]

Actually when I think about it i'm wrong. We didn't sell Ireland. We are paying them 5.83% on an 85bn loan to take Ireland. Now that's a bad deal.

[highorlow]

Actually when I think about it i'm wrong. We didn't sell Ireland. We are paying them 5.83% on an 85bn loan to take Ireland. Now that's a bad deal.

Oh for crying out loud. I'm putting on a hot whiskey!

[bcarrier]

Well we have learned one good lesson from this and that is not to believe for one minute any word that comes out of any economist ever again.

Wrong: This man has been predicting the future since 2006.

http://www.thepropertypin.com/viewtopic.php?f=19&t=33265&hilit=+morgan+kelly+week

The banks will be back making money in 6 months time and this contingency fund will start to get paid back.

You are on your own there. Thats one hell of a big assumption to make given all we know about the state of the economy, their mortgage books and the withdrawals of deposits.

Some awful gibberish OTT speculative crapology been spouted in the papers and elsewhere over the last few weeks, including that NY Times article. Horseshit of the highest order.

Because it doesnt suit you ? What bit is horseshit.

Who borrowed from the banks who borrowed from the other banks only you me and everyone else who got in on the binge so too right we have to pay it back.

How the f**k anyone can say defaulting is good is a madman, i.e. if you gave a loan to Joe Bloggs of say 30 euro and he didn't pay you back and a few weeks later came running looking for another 30 I'm dam sure you would tell him where to get off.

The bank debts arent the countries debts. The market is punishing Ireland for taking them on.

[BennyHarp]

jez benny thats an old one . actually i heard one of the fine gael senators suggest that the state buy 1 million plane fares from ryanair who he said would sell the seats at 7 euros each which we could give to tourists for free. i was surprised that fine gael senators were capable of such ideas very innovative for a change

I know, thats why i apologised if it had been posted before as i couldnt be bothered reading through all the pages in this thread.

[Zapatista]

Ah Jasus calm down.

Well we have learned one good lesson from this and that is not to believe for one minute any word that comes out of any economist ever again.

Constantibe, Lucey (who has gone into hiding since his double counting the other week, imagine an economist that can't even count correctly?), McWilliams the whole god dam lot of them all of whom just love the sound of their own voices have exaggerated the whole thing.

The banks will be back making money in 6 months time and this contingency fund will start to get paid back.

Some awful gibberish OTT speculative crapology been spouted in the papers and elsewhere over the last few weeks, including that NY Times article. Horseshit of the highest order.

Who borrowed from the banks who borrowed from the other banks only you me and everyone else who got in on the binge so too right we have to pay it back.

How the f**k anyone can say defaulting is good is a madman, i.e. if you gave a loan to Joe Bloggs of say 30 euro and he didn't pay you back and a few weeks later came running looking for another 30 I'm dam sure you would tell him where to get off.

People need to wise up and in the words of a famous Cork man ' get over it' and cut the self deluded self pity that the like of Fintan o'Toole and co are coming out with and we need to dust down and get the country back rolling again which we can do. It's all beginning to be a bit tiresome at this stage.

That you Brian?

If the lesson you learnt is -  not to believe for one minute any word that comes out of any economist ever again - then I worry about you.

[Declan]

Gene Kerrigan: A bailout? This is more like a stitch-up
There is a very good reason our Taoiseach was slow to accept the EU/IMF deal, writes Gene Kerrigan


Sunday November 28 2010
Let's say a few words in defence of Brian Cowen. Just a few -- despite the bloody awful time we're going through we haven't entirely lost our minds. We're well aware that Ahern, McCreevy, Harney, Cowen and their cronies took a thriving economy for a joyride and crashed it. And for over two years Cowen and Lenihan have stubbornly continued the right-wing policies that caused the economic apocalypse.

However, Cowen appears to have been getting a bad rap on this "IMF bailout". The story is much more complex. For a start -- we're not being bailed out, we're being stitched up. And it's not so much the IMF that's doing it, it's our European "partners".

Over that weird week in mid-November, Cowen denied the bailout rumours (though EU sources confirmed that bailout talks were under way). The Government deliberately misled the citizens. For a few days, the media seemed as puzzled as it was aghast. At this time of crisis our philanthropic European partners were offering us tens of billions, and Cowen didn't want to accept their generous offer. Was he mad? Bringing in the IMF and the EU (through the European Financial Stability Facility) was humiliating, infuriating -- but it was a way out of an impossible crisis.

The supposition was that Cowen didn't want the shame of being the Taoiseach who brought in the bailiffs. Much more likely, he and Brian Lenihan understood the stitch-up being prepared. They resisted the "bailout" for very good reasons. Typically, they misled us about what was going on, instead of bringing public scrutiny to bear on the events.

Who is being bailed out?

Yes, idiot Irish bankers loaned billions to idiot Irish developers, with the blessing of idiot Irish politicians. The resulting credit bubble eventually and inevitably burst -- and the developers (and many mortgage holders) can't pay back the loans, so the banks are insolvent.

And the collapse of the property market deprived the Exchequer of revenue it had come to depend on, causing a huge government deficit. But that's just part of the picture.

That money with which the banks gambled came from somewhere. In recent years, Europe was awash with cash, money saved by prudent citizens of stable economies. Idiot German and French and UK bankers needed someone to borrow that money and pay interest on it. They were delighted to pump countless billions into the vaults of the idiot Irish bankers. With the blessing of idiot EU politicians, bureaucrats and regulators.

They did so with the same recklessness with which the idiot Irish bankers poured the billions into the pockets of the entrepreneurial gobshites who built the luxury hotels and the trophy buildings and the ghost estates that now lie idle.

It's now clear that Cowen and Lenihan's suicidal blanket bank guarantee wasn't just a product of their idiocy. They were under pressure from their EU mates to ensure that no bank failed.

The idiot German and French and UK bankers wanted their money back. The idiot Irish bankers couldn't pay. So, Cowen and Lenihan agreed that the gambling debts of the private banks would be paid by the citizens. In the words of Commissioner Olli Rehn (who approved of this shabby course): "Sovereign debt has not been at the origin of the crisis. Rather, private debt has become public debt."

Lenihan excuses loading the debt onto us by claiming, "We all partied". It was as if the crisis arose from the moral failure of a people -- rather than a failed economic model, casino capitalism.

Yes, we partied -- by buying homes at prices set by corrupt banks and rapacious developers. By taking minimum wage jobs and clothing our kids. By saving for our children's education. There was lunacy, but the vast majority of us worked and saved and spent in line with our means -- we didn't gamble.

For two years, Cowen and Lenihan have put increasing loads of debt on our backs, slashing services and benefits we spent a lifetime building up through our taxes. And now -- the "bailout". From (as the RTE cheerleaders like to put it) our EU "partners", who are "coming to our rescue".

So, our EU "partners" are giving Cowen access to €85bn, at usurious interest rates. Part of that money will be given to Irish banks, to bail out the German, French and UK banks -- and those billions will be added to the citizens' debt. By 2014, we may be paying over €8bn a year in interest.

This isn't a bailout or a rescue, this is a hold-up.

The economic collapse is an EU problem. The private banks are in trouble. The euro is in trouble. Our membership of the euro makes our sovereign deficit problems worse (and I don't see that Cowen and Lenihan had a realistic choice in this). We can't devalue the currency and the Government's room for manoeuvre is limited.

We are not being bailed out. This is an EU-wide piece of financial engineering. It is being arranged in order to get the German, French and UK banks out of the hole they dug for themselves, and to save the euro. Charging any interest above a nominal rate is profiteering.

The general election -- it doesn't matter. One group of fearful, deferential politicians will be replaced by another. The four-year "plan"? Dead within days of being published. All that remains of it is the slashing and burning that will kill the old, betray the young and penalise low and middle earners. Taking another €15bn out of the economy will undercut any chance of growth. On top of that, paying between €2.5bn and €8.4bn a year in usurious interest on the fake bailout would beggar us.

Will the citizens tell the bankers and their politician friends to bugger off? I'd like to think so, but the signs are that currently the 'fighting Irish' have all the

pluckiness of a bald, bound and stuffed turkey being slid into an oven at 180 degrees, gas-mark 4.

It's time, says Fine Gael's Leo Varadker, to "play hardball" with our European "partners". What's hardball, Leo? "Burn the bondholders," says Leo. No, son, that's not hardball. That's what should have happened as a matter of course. The bondholders gambled, they lost.

Hardball -- well, our "partners" have pretty much closed off all the safe options. We're left with -- what? Maybe calling Merkel and Sarkozy and Cameron into a room and telling them that for the foreseeable future every EU treaty adjustment will go to an Irish referendum, and it will be lost.

The European project has at its heart some laudable aims, albeit corrupted by a lack of democracy and a surfeit of economic extremism. But perhaps the extremism wins, and perhaps the EU project is over.

Or -- if we want to go ballistic altogether -- we could always pick an island (Inishvickillane would be my choice), put it on eBay and invite the Chinese, the Iranians and the North Koreans to bid. Let's see how much Merkel and Obama between them would come up with to head off that prospect. Bids start at €85bn.

And that, Leo, would be hardball.

[Hereiam]

The above piece makes alot of sense. On another note does it bother people in the south to see the brits on the tv going on about how they don't want Ireland to fail. This would sickin the hole of any irish man. They claim to be giving Ireland 3 bilion at 5.8% but they borrowed this money at 2% themselves on the bond market. So they make money on it no matter put in the eyes of the world they are the good neighbours. They really are a sneaky bunch.

[bcarrier]

I posted this on the pin ...interest rate from EU is over 7% imo.

A couple of bits from peston on bbc blog

Quote:
The interest rate being charged by the EU will be around 6%, whereas the IMF will charge just over 3% for the first three years and 4% for the subsequent three years.


Quote:
The total British contribution to the rescue of Ireland can be seen as €7.8bn (£6.6bn) - consisting of a direct loan of €3.8bn, plus exposure equivalent to 4.5% of the IMF's €22.5bn loan (or €1bn) and 13.5% exposure to the European Financial Stability Mechanism's €22.5bn contribution (€3bn).


and earlier

Quote:
As I understand it, the German finance minister, Wolfgang Schauble, is arguing that Ireland should pay a higher interest rate of around 7%.


I am trying to reverse engineer the 5.83% blended interest (if drawn now) figure :

If we leave out the 17.5bn coming from our own reserves bailout fund is 67.5 Bn...let us assume UK/Swedish money is at same rate as EU funds so

22.5BN (1/3 of total ) from IMF @ 3% (per Peston) plus 45BN from EU/BR/SW @ 7.25% = 5.83% blended rate.

It looks like Wolfgang got what he wanted.

[Donkeywalloper]

The deal is done, and the europeans seemed to have got what they wanted (a more stable euro)

"A €25bn contingency fund is also available if they require more money in the future.

Bank of Ireland has said that it will seek to raise almost €2.2bn of capital by February in a move that would bring the bank close to nationalisation.

Meanwhile, global markets are beginning to feed through their reaction to Ireland's loan facility.

The Irish banking shares are stronger this morning.

Shares in AIB are up over 7%, while Bank of Ireland has gained over 19% and Irish Life and Permament soared almost 35%.

Overall the Dublin market is up over 1.5%, while other European markets are also stronger. "


The circus quickly moves on, but ultimatley they have slowed the domino effect on Portugal and more importantly spain being brought into the equation.

Feck you Ireland policy has prevailed and the family silver has been hocked at a level whereby it will never be retrived. We ( irsh government) agreed it , the citizens have to pay for it and all the while not one off the greedy bastards that caused this has appeared before the courts, those incompetent are still in the same industries recieving huge rewards for their risk taking.

The whole thing stinks

[bcarrier]

http://www.irishtimes.com/newspaper/finance/2010/1129/1224284371238.html

[highorlow]

Good man Gene. You are ranting and adding nothing to the recovery process.

Yet another self interest to sell papers. Gene forgot to mention the 44% idiot population that voted FF, plus the fact that the rest of Europe had the low interest rates during the boom but chose not to get into a gorge fest.

This whole thing sounds like a big bloody moan by the Irish people and we are all beginning to sound like spoilt kids where everyone else is wrong except ourseleves. People need to get real and have a good look at themselves. It would remind you of a kid let into a ice cream parlour and everything is free and he pigs out and then blames the shop keeper for leaving the door open.

[quoteBecause it doesnt suit you ? What bit is horseshit.

][/quote]
The whole article. Anything to do with or anyone that says 'burn the bondholders' does not know what they are talking about.

[bcarrier]

Do you see no difference between bank and sovereign bondholders high or low ?

[highorlow]

Do you see no difference between bank and sovereign bondholders high or low ?

If any of our banks default on the senior bondholders then where in gods name will any future good bank in this country get there hands on cash?

[bcarrier]

New banks will fill the gap. It has happened in Iceland already. If you accept that subordinate bondholders should take a haircut it is only a small step.