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

[armaghniac]

Priceless!

Priceless perhaps, but already posted twice before.

[Bogball XV]

It's quite probable that he will find himself Leader of the Opposition after the next election and Enda had better smarten up.

he has less to lose than most in that his ministerial pension won't be as significant as the rest of the cabinet, but I have heard that health issues will preclude his even standing.

It would be shocking if he his party voted him in with his record over the last 2 years, twice voted europe's worst finance minister and more tellingly, his record proves that this is probably the case.

[Zapatista]

he has less to lose than most in that his ministerial pension won't be as significant as the rest of the cabinet, but I have heard that health issues will preclude his even standing.

It would be shocking if he his party voted him in with his record over the last 2 years, twice voted europe's worst finance minister and more tellingly, his record proves that this is probably the case.

He said on RTE last week that he'll definitely be standing. I think the selection convention is this week or next week.

OK, he's not a very reliable source but I think he's right on this one.

[Bogball XV]

he has less to lose than most in that his ministerial pension won't be as significant as the rest of the cabinet, but I have heard that health issues will preclude his even standing.

It would be shocking if he his party voted him in with his record over the last 2 years, twice voted europe's worst finance minister and more tellingly, his record proves that this is probably the case.

He said on RTE last week that he'll definitely be standing. I think the selection convention is this week or next week.

OK, he's not a very reliable source but I think he's right on this one.

he's deluding himself then, i find it all a bit bizarre tbh.

[muppet]

It is a slow day in a damp little Irish town. The rain is beating down and the streets are deserted. Times are tough, everybody is in debt and everybody lives on credit. On this particular day a rich German tourist is driving through the town, stops at the local hotel and lays a €100 note on the desk, telling the hotel owner he wants to inspect the rooms upstairs in order to pick one to spend the night. The owner gives him some keys and, as soon as the visitor has walked upstairs, the hotelier grabs the €100 note and runs next door to pay his debt to the butcher. The butcher takes the €100 note and runs down the street to repay his debt to the pig farmer. The pig farmer takes the €100 note and heads off to pay his bill at the supplier of feed and fuel. The guy at the Farmers ' Co-op takes the €100 note and runs to pay his drinks bill at the pub. The publican slips the money along to the local prostitute drinking at the bar, who has also been facing hard times and has had to offer him "services" on credit. The hooker then rushes to the hotel and pays off her room bill to the hotel owner with the €100 note. The hotel proprietor then places the €100 note back on the counter so the rich traveller will not suspect anything. At that moment the traveller comes down the stairs, picks up the €100 note, states that the rooms are not satisfactory, pockets the money and leaves town. No one produced anything. No one earned anything. However, the whole town is now out of debt and looking to the future with a lot more optimism. And that, ladies and gentlemen, is how the bailout package works.

The way I see it the rich German lends €100 to the Irish hotel-owner at 7%. The apparently delighted Irish Hotel owner uses the money to pay off a €100 debt he had with his Portuguese Butcher at 6%. The Butcher thinks this is great and gives the €100 to his Greek Pig Farmer to pay off a debt he had at 5%. The Farmer gives the €100 to an English Publican to pay off a debt he had at 4%. He gives it to a bankrupt Irish bank to pay a debt the publican got at 3%. The Bankrupt Irish banks gives it to the original German to pay of a debt he got at 2%. The German then finds another Irish hotel-owner and lends it out again at 7%.

Lian Brenihan the head of the Irish hoteliers, who are now all bankrupt, insists he did nothing wrong and that all of his 'European partners agree with this assessment'.

[seafoid]

http://notesonthefront.typepad.com/politicaleconomy/2010/12/the-creepy-is-in-the-detail-which-the-government-didnt-reveal-social-welfare-rates-will-fall-by-4-percent-exc.html

This is how Deloitte breaks down the millionaire's budget. They will pay €11,936 more on income tax and PRSI. However, under the Universal Social Charge, they pay €34,931 less than under the Health and Income levies which the Charge replaces. That really puts the 'Social' in Universal Social Charge.

And at the risk of totally creeping you out, the ESRI estimates that there will be no wage-growth next year. However, non-wage income (rents, dividends, interest, and self-employment) will grow by 29 percent. So those very high non-wage earners can look forward to not only an increase in their incomes, but tax breaks on top of that.

Truly, a millionaire's budget.

[whiskeysteve]

Some budget. Welfare cut whilst cowering away from decisive action against the gross public sector inefficiences.

Muppet must be delighted with the number of quangos cut 

A cowardly and indecisive budget that has maintained the institutionalised gombeenism at the top for the brief while yet.

A disgraceful preservation of their status quo, IMO

[muppet]

Some budget. Welfare cut whilst cowering away from decisive action against the gross public sector inefficiences.

Muppet must be delighted with the number of quangos cut 

A cowardly and indecisive budget that has maintained the institutionalised gombeenism at the top for the brief while yet.

A disgraceful preservation of their status quo, IMO

Did the budget mention any of them being cut?

[Bogball XV]

Some budget. Welfare cut whilst cowering away from decisive action against the gross public sector inefficiences.

Muppet must be delighted with the number of quangos cut 

A cowardly and indecisive budget that has maintained the institutionalised gombeenism at the top for the brief while yet.
A disgraceful preservation of their status quo, IMO

As I said earlier, I think it was a budget that was formulated with people who actually vote in mind.
Given that, I find it unbelievable that the new govt will not introduce their own effort immediately on taking office.  This budget has no need to be in place for any more than 6-8 weeks. 

[Zapatista]

he's deluding himself then, i find it all a bit bizarre tbh.

He's been deluding us for years

[whiskeysteve]

Some budget. Welfare cut whilst cowering away from decisive action against the gross public sector inefficiences.

Muppet must be delighted with the number of quangos cut 

A cowardly and indecisive budget that has maintained the institutionalised gombeenism at the top for the brief while yet.

A disgraceful preservation of their status quo, IMO

Did the budget mention any of them being cut?

untouched as far as I know.

Aye BB, even after losing all credibilty they are more intent on ringfencing supposed FF powerbases that everyone knows will have to be tackled sooner or later. They know this themselves, yet resist taking on difficult/fundamental change in order to preserve a core vote and instead kick the man whose down already, they lost his vote so f**k him.

[muppet]

Note the article is in the Guardian.

http://www.guardian.co.uk/business/2010/dec/08/allied-irish-banks-pay-bonuses-despite-bailout

Allied Irish Banks to pay €40m bonuses despite bailout
Stricken Allied Irish Banks says court case forces it to give out bonuses while Ireland's taxpayers suffer

Allied Irish Banks sign on Grafton Street, Dublin. About 2,400 bankers will cash in. Photograph: Peter Morrison/AP
Stricken Allied Irish Banks is preparing to hand out €40m (£34m) of bonuses next week – despite being on the brink of receiving another emergency bailout from the Irish government.

As many as 2,400 bankers in its Dublin capital markets division are to receive the payments on 17 December under agreements struck with the bank in 2008.

The bank, 19% owned by Ireland's taxpayers but expected to reach 95% state-ownership, had originally been blocked from making the payments under one of the government's bailout programmes.

But legal action by a trader, John Foy, over a deferred €161,000 bonus awarded in 2008 has led the bank to conclude it will need to pay bonuses to many of the staff to whom they were awarded for that year. The bonuses are being handed out at a time when the government is instigating four years of tax rises and brutal cuts to benefits. The most austere budget in the country's history was passed this week.

European banking regulators are also meeting in London tomorrow to try to agree a new set of European-wide rules on how bonuses should be structured to avoid paying them when they suffer losses after taking on too much risk. The rules will require bonuses to be deferred over three years and clawed back if losses are made

Once the Committee of European Banking Supervisors makes its announcement, domestic regulators across Europe will have to race to implement the rules if they are to meet the January 1 deadline that Europe has demanded.

Given the Foy judgment last month, AIB says it has little option but to honour the 2008 bonus awards to staff "as per the contractual entitlements arising from the business's performance in 2008".

Ireland's central bank has told AIB it needs to raise a further €5.2bn by the end of February though this is likely to come from the €85bn International Monetary Fund-European Union rescue package rather than the private sector. This will take the bank almost entirely into state ownership.

Bank of Ireland is also racing to raise €2.1bn of fresh cash to avoid falling into majority state control. The government owns a 38% stake and the bank today tried to start generating better quality capital by offering to exchange its existing low quality securities for securities guaranteed by the government.

BoI will be hoping for takers of its so-called liability management exercise as the more money it can raise from private investors the lower the level of bailout funds it will need from the government.

Bankers are receiving much of the blame for forcing Ireland to take international assistance and implement the austerity budgetary measures. But while the public is expected to endure years of pain, the package of measures to save €6bn in the coming year were welcomed by the European commission. An EC spokesman described the budget as "tough and ambitious". and part of the programme needed to allow Ireland to be granted €85bn of rescue funds.

"It is an ambitious and indispensable tool for the redressment of the situation. There is the right balance between revenue and expenditure measures," the spokesman added.

[seafoid]

That story is not in the Irish Times. I wonder why. 

Selected comments from decent English people

•    RonJB
8 December 2010 7:35PM
I'm starting to think my definition of a bonus is wildly inaccurate.
It's either that, or the bankers are a bunch of selfish amoral &*^(^^&%*(%'s.

•    lovol
8 December 2010 7:37PM
if ever bankers should hang their heads in shame this is the time! What sort of hard faced bastard goes to court over this? the man is a total disgrace...if he had one shred of decency he would refuse to accept it! Dear God what a twisted world we live in!

•    drabacus
8 December 2010 7:43PM
There was nothing stopping the Irish government putting a windfall tax on bonuses in yesterday's budget, court case or no court case.

•    teaandchocolate
8 December 2010 7:49PM

If this isn't the final straw that cracks Ireland into all out bleedin' war then I don't what would do it.
I'm not even Irish and I'm furious!
€40m What for? For being brilliant at their jobs? Come on now, pull the other one.

•    Danden
8 December 2010 7:49PM
161,000 euros is a hell of alot of money compared to the minimum wage in Ireland (Which is about to be decreased and taxed) The problem with people like Foy is that they just cannot see the wood for the trees. If he had any honour whatsoever he would recind his entitlement to this payment. Having said that, his employer promised him this money and has a contractural obligation to pay it.
The Irish banks made alot of promises back then that they just couldn't keep. Promises that have had deep and damaging ramifications not just in Eire but far beyond. How many heads have rolled? Who has been held accountable?
Or are they just all lining their pockets like Foy?

•   BeaucoupLeftism
8 December 2010 9:07PM
Today I listened to story of a blind person who is worried about having enough money to feed his guide dog. The bill comes to about 60 euros a month. His welfare payment has been reduced due to this banking crisis. I'm so f**king angry right now. This Foy and the other bankers who accept this bonus are not men. Shame on you.

[seafoid]

http://www.irishtimes.com/newspaper/finance/2010/1209/1224285100507.html

IRISH BANKS repaid €68.8 billion to senior bondholders and €1.4 billion to subordinated bondholders as their full debt fell due under the two-year blanket guarantee which ended in September, Minister for Finance Brian Lenihan has said.
This meant that no bondholder had to share in the €60 billion recapitalisation costs of the domestic banks.
"As is normal practice when bonds mature, they are repaid – in this instance all were senior bonds and all were Government guaranteed. Furthermore, under Irish law senior debt obligations rank equally with deposits and other creditors," said Mr Lenihan.

[muppet]

http://www.irishtimes.com/newspaper/finance/2010/1209/1224285100507.html

IRISH BANKS repaid €68.8 billion to senior bondholders and €1.4 billion to subordinated bondholders as their full debt fell due under the two-year blanket guarantee which ended in September, Minister for Finance Brian Lenihan has said.
This meant that no bondholder had to share in the €60 billion recapitalisation costs of the domestic banks.
"As is normal practice when bonds mature, they are repaid – in this instance all were senior bonds and all were Government guaranteed. Furthermore, under Irish law senior debt obligations rank equally with deposits and other creditors," said Mr Lenihan.

And receivers of large bonuses evidently.