Default on ECB debt and be European pariahs?


#1

Should we default on the banks ECB debt?

  • Yes and cry freedom
  • No it would be lead to a complete collapse and the end of the world

0 voters

Merkel and the ECB are only interested in saving German and French banks and throwing the pigs to the wolves.

To save our skin should we not just change our gov, give them to the wolves, and the new gov formally defaults on the eCB debt? What will they do, bomb Dublin?


#2

Mcwilliams on Vincent browne was basically saying that Merkel was inadvertently telling us to default. Look after number 1 he says.


#3

So you reckon we close the deficit this year then?


#4

im sure teh wave of patriotism and forcibly converting peoples deposits into patriot bonds will save the day assuming there are any deposits still left

anyway we could also go down the road of the FED/zimbabwae and print til the cows come home


#5

Well, some likely effects:

  1. Laws ‘punishing’ tax haven shopping; taxing profits in the country they are made in; effectively an end to Irish service MNCs. Don’t doubt that the bigger countries would do this. They are spoiling for a fight on it.
  2. An end to credit. This would be a hard landing for the economy, IMO. Much as I think our banks should have been left to fend for themselves, it is too late.
  3. As Morgan Kelly says, we are reliant on the kindness of strangers. Shagging their daughter/son/wife/husband, eating their dog, shitting in their car. Probably not the best idea.
  4. The IFSC would probably disappear as the fear of confiscation of assets would spread.
  5. Foreign banks would probably up and run too for the same reason.
  6. The losses would have to be made up by the other eurozone governments. They would be looking for their money back. They are likely to look to any funding that Ireland currently receives. There is still quite a lot of it.
  7. I have to laugh at 'pinsters who spend their time about deadbeat borrowers and welfare queens thinking it is a good idea to turn the country into a deadbeat…

#6

well im glad u found something to laugh about

kindness of strangers means the best u are going to get is up the ass without the vaseline

far from being a deadbeat , a default would show we are not the wimps the 2 brians have led europe to believe. the country should not be destroyed for the sake of irish/french/german/british banks. anybody who kicks up against that has my vote


#7

Serious?
They shouldn’t be our debts. I’m presuming we played ball to save German/French banks. So if we now burn the ECB who loses?


#8

Everyone other taxpayer in the eurozone who has to make up the loss to the ECB…


#9

Whats that old chesnut - owe the bank a million and you’re in big trouble, owe them a billion and they are in big trouble.

Maybe its time we realised what a powerful position we are in and consider giving the two fingers to Europe and play them off against the IMF.

Either way, those that chose to invest in bonds in this country need to realise a loss. This is not making us a deadbeat, but realising that the investment is just about worthless.
Hell, even the ECB have to take a significant hit as I don’t think there is any doubt that the EU overlords demanded we pay back the bondholders but financed it through the ECB.

Whatever happens, this country will NOT run out of cash. Simply put, not a chance in hell. We are part of the IMF and they will step in if need be.
I say walk over to the wall, put out hand on the plug and threaten to pull it unless we get what we want.

Europe can not afford for us to go nuclear as it could be the end of the pretty little Europe project.


#10

And to be completely naive about it, can’t they just hit the print button?
Is the ECB a for-profit enterprise?


#11

Well, that would be my preferred solution at this stage given that the PIGS owe money to the non-PIGS so both stand to lose. Losses all round, managed by the ECB with the ECB making up its loss in funny-money.

It is not popular, even amongst the Keynsians - it is fine to generate inflation expectations, fine to QE, not fine to magic up money. I don’t quite understand some of the distinctions, but that appears to be the way it is. With a fiat currency, it should be possible to do provided the amounts aren’t too large.

Indeed, it would be the ultimate competitive devaluation…

Yes and no. It is not planned as a money making enterprise - some years it makes profits, others it makes losses. If it has distributable reserves, they are distributed to the national governments in the ECB according to their shares in the ECB. So when the ECB makes money, we get a profit.


#12

Irish government bonds tumbled for a 13th day yesterday on mounting concern the nation will be forced to restructure its finances, extending the longest losing streak in at least three years. The 5 percent security maturing in October 2020 slipped 1.65, or 16.5 euros per 1,000-euro face amount, to 74.09.

Yields on 10-year Irish bonds are the highest since the advent of the euro in 1999, and the premium over German bunds is more than seven times what it was two years ago. Ireland’s budget deficit as a share of gross domestic product was the highest in the 16-nation euro area at the end of 2009.

“We are monitoring the situation in Ireland on a permanent basis,” European Commission President Jose Barroso said in Seoul yesterday. Europe has “all the necessary instruments in place” to offer financial help “if necessary,” he said.


#13

It’s something I would really like to know more about too.

Sure, many would have an ideological bias that governments should be the ones to spend money - through which they can promote their held industrial strategy, and build industrial competitiveness on a national basis. (But look at what government strategising and directing did with the FIRE economy! (finance, insurance, real estate). And listen to the likes of Eamon Ryan with his green and smart economies. - Pure madness imo).

I can understand too that divesting money from countries and communities and people comprises a big monetary stick with which to enforce new and better economic behaviour. ie. work more, work for less, don’t be awarding plum governmental contracts for easy work to your buddies, get rid of the corrupt payments, get rid of the inflated salaries, get rid of the tax breaks, become more competitive, and all the rest (although I would say that the Keynesian model allows the government easy street to continue, and redirects the monetary stick squarely onto ordinary working people and the vulnerable)

But the question then occurs - if certain powers (and people) understand that they CAN solve many problems by printing up some new money from thin air (as per this paper for example), then that entails that these people are keeping a secret from the rest of us - and that they are hiding this information so that they can enforce and reinforce the economic behaviours that they deem necessary (and may well be to the good in certain aspects?).

Beyond the school textbook stuff, the reality is we don’t get real inflation (not talking about hyper or wild inflation which is a different phenomenon) until means of payment increases more rapidly than the total output of goods and services. I think it’s obvious that with the end of such things as equity release, easy access to credit, shrinking pay packets, increased taxes, and all the rest, that means of payment is on a one way road downwards.

Hard to know what is going on.


#14

Intro

“In 1996, in a documentary called “The MoneyMasters”, we asked the question why is America going broke. It wasn’t clear then that we were, but it is today. Now the question is how can we get out of this mess. Foreclosures are everywhere, unemployment is skyrocketing – and this is only the beginning. America’s economy is on a long, slippery slope from here on. The bubble ride of debt has come to an end.

“What can government do? The sad answer is – under the current monetary system – nothing. It’s not going to get better until the root of the problem is understood and addressed. There isn’t enough stimulus money in the entire world to get us out of this hole.

“Why? Debt. The national debt is just like our consumer debt – it’s the interest that’s killing us.

“Though most people don’t realize it the government can’t just issue it’s own money anymore. It used to be that way. The King could just issue stuff called money. Abraham Lincoln did it to win the Civil War.

“No, today, in our crazy money system, the government has to borrow our money into existence and then pay interest on it. That’s why they call it the National Debt. All our money is created out of debt. Politicians who focus on reducing the National Debt as an answer probably don’t know what the National Debt really is. To reduce the National Debt would be to reduce our money – and there’s already too little of that.

“No, you have to go deeper. You have to get at the root of this problem or we’re never going to fix this. The solution isn’t new or radical. America used to do it. Politicians used to fight with big bankers over it. It’s all in our history – now sadly – in the distant past.

**“But why can’t we just do it again? Why can’t we just issue our own money, debt free? That, my friends, is the answer. Talk about reform! That’s the only reform that will make a huge difference to everyone’s life – even worldwide.
**
“The solution is the secret that’s been hidden from us for just over 100 years – ever since the time when author L. Frank Baum wrote “The Wonderful Wizard of Oz.”


#15

Fuck them, we could grow stuff here, potatoes, weed etc, we’d be feckin rich in a couple of years, party capital of the world XD
We could tell the french fishermen to fuck out of our waters too, we’d do allright on our own IMO. Eire is sustainable, the EU is not!