The "Bailout" That Is In Actual Fact A High-Interest Loan, Not Free Money.

[bennocelt]

The FAI are just the sporting wing of FF. Plus ca change....

Wrong its the Gah, the FAI are just the poor relations, the wannabe FFs

[Macy]

Stupid, but not surprising, if some FFers denied the meetings were taking place. A lot of ostrich behaviour going on.

You have to listen to the BBC to find out whats happening in Ireland.

If it wasn't clear before, it is now a matter of when we get a bail out. Lenihan and Cowen are just desperately trying to delay until after first Donegal and then a general election so it doesn't happen on their watch. Party Interest now beats Eurozone interest too! Beggars belief that so many were fooled by Lenihan.

[Mr A]

This article seems to explain the situation pretty clearly. Effectively we have been getting bailed out via funding for our banks on a very large scale for some time now.

http://www.bbc.co.uk/blogs/thereport...e_plug_on.html

[Macy]

This article seems to explain the situation pretty clearly. Effectively we have been getting bailed out via funding for our banks on a very large scale for some time now.

It all comes back to the bank bailout. FF and the Greens, and various right wing commentators like to make it about the deficit, but it's all about the banks. FFS even the increase in the correction from 7.5bn to 15bn is mainly interest for the bank bailout (6 bn is interest payments). Cheapest bank bailout in the world, ever.

[peadar1987]

Wrong its the Gah, the FAI are just the poor relations, the wannabe FFs

Fine Gael?

[culloty82]

The Guardian site's now saying that the EU ministers will hold a press conference at 7, but since Lenihan only arrived at 5.25, it could well be delayed.

[shakermaker1982]

Could Ireland threaten to pull out of the Euro? Is there a mechanism to do so? Let's face it the country is ****** whatever it does but having control over interest rates and being able to manipulate its own currency to help with cost of exports/imports must be a consideration at this desperate stage? I know it would spook the rest of Europe but Ireland is on its last legs and I can see the EU making an example out of Ireland if it does continue to bail them out.

[jinxy lilywhite]

not really but we should do.
we cannot survive with a strong euro and need to leave so we can have fiscal independance and give ourselves a chance as you suggested.
Germanys fear though is that they need a strong euro and if we try to leave, the greeks, portugese, spanish and Italians will want to leave too.
they'll keep us in so the others won't be able to leave.

[Mr A]

If we leave wouldn't we face the same issue as Iceland when it's interest rates jumped up to like 18% or something?

Also.. our debts would still be in euro.

[jinxy lilywhite]

it probably would but staying in a strong euro is just as bad as 18% interest rates because we have to export our products to survive.
it is a damned if you do and damned if you don't scenario and there is no quick fix solutions unfortuneately.

[Mr A]

But our exports are doing pretty well aren't they?

[jinxy lilywhite]

they are doing quite well but with a weakened currency we'd be doing better.
To be honest Mr. A, I would have limited knowledge of economics but in the past if we encountered a difficulty like this we'd devalue the £. This would make our exports more cheaper and more competitive while imports would become more expensive.
Germany is doing ok and wants the strong € because it has a mortal fear of inflation because of the 1920's and the effects that caused. In our situation we'd like a little bit of inflation to kick start the economy and confidence back to the consumer.

My statement here though is fully open to welcome corrections

[mypost]

We can't, and won't leave the Euro. Once you're in these agreements, you stay in. It's not an a la carte job.

Having our own currency means it becomes vulnerable to 'runs' by investors and speculators. We have some shelter from that within the Euro, and more countries are signing up to it each year. Without the Euro, we'd be where Iceland was in 2008. Hung, drawn, and quartered.

[OneRedArmy]

Could Ireland threaten to pull out of the Euro? Is there a mechanism to do so? Let's face it the country is ****** whatever it does but having control over interest rates and being able to manipulate its own currency to help with cost of exports/imports must be a consideration at this desperate stage? I know it would spook the rest of Europe but Ireland is on its last legs and I can see the EU making an example out of Ireland if it does continue to bail them out.

Our debts would still be denominated in Euro. So no matter how much we devalued the real cost of debt would remain the same. Having control of interest rates is feck all use when nobody will lend to you.

[John83]

Yeah, whatever about in general, now seems like a terrible time to consider that idea. Whatever currency we set up would promptly collapse.

[dahamsta]

We should've left the euro and left the banks to die when this whole thing kicked off. Two birds, one stone. We won't do any of that, of course, but at this stage I'd like to leave Europe and cut corporation tax to 10% or less for 10 years. I generally hate cutting taxes, but screw it, screw them.

[Macy]

We went from punt to euro, so no technical reason we couldn't go the other way.

Whether it would be good idea is a different matter - I wouldn't be at all convinced. Maybe the bubble could've been avoided to some degree with control of interest rates (no guarantee, given the way McCreevy/ Cowen didn't use the tools they did have to try and control it, so why would they have used interest rates?). Similarly, it's two years ago that we may have benefitted on the way down, but if Lenihan/ Cowen had still lumbered us with Anglo would it have made that much difference? Own currency or not, we'd still have needed capable "leaders", which we clearly don't have.

[bennocelt]

We can't, and won't leave the Euro. Once you're in these agreements, you stay in. It's not an a la carte job.

Having our own currency means it becomes vulnerable to 'runs' by investors and speculators. We have some shelter from that within the Euro, and more countries are signing up to it each year. Without the Euro, we'd be where Iceland was in 2008. Hung, drawn, and quartered.

And their economy is growing at the moment with lower inflation and unemployment that us, and no bank bailouts suffocating them too. Yeah we are the example to follow - not!

[OneRedArmy]

We should've left the euro and left the banks to die when this whole thing kicked off. Two birds, one stone. We won't do any of that, of course, but at this stage I'd like to leave Europe and cut corporation tax to 10% or less for 10 years. I generally hate cutting taxes, but screw it, screw them.

How would the country raise money in that case?

And their economy is growing at the moment with lower inflation and unemployment that us, and no bank bailouts suffocating them too. Yeah we are the example to follow - not!

.....and a lot of fish.

[Spudulika]

Anybody see Newsnight tonight? I was stunned by the growing anti-Irish sentiment that has been building all day. Even when broadcasting outside the Queens gaff they were getting digs in on UTV, BBC etc. When the BBC journo shouted out after Lenihan "When will you end this chaos?" it looked like a cringeworthy paper thin imitation of Michael Moore. At least Michael Moore was being held back, Lenihan gave interviews to BBC, ITV, RTE etc just 3 metres away, yet the Newsnight crew wanted to make it a nasty slap at the man. The Chancellor claimed the UK need a strong Ireland for exports, that it's important to keep us alive, BBC are looking to stir the siht.