With all this talk of defaulting and so on, it’s probably worth thrashing this one out…

What is the difference between the ESFS and the IMF? Are these options or are we gonna have to go to both? Or are they the same thing?

I’ve heard that the IMF becomes a priority creditor but the ESFS does not - does this make a difference? I’ve also read somewhere that defaulting and going to the IMF will allow us to renege on some debts, whereas utilising the ESFS will mean we do not. Is this true?

If there is an option, we will undoubtedly take the wrong one, but what would the correct one be?

Isn’t the ESFS part funded by the IMF?

The brother was telling me last night that the IMF have form in confiscating 10% of the money held in all accounts of the client country as a way of extracting their fees. He said the may do this on day one of a three/five year plan or they may do it on the 276th day of year two or four or whenever it suits them really. Bottom line is that it will come as a surprise. It certainly surprised me to hear of it. Anyone know anything about this or is it bull?

I don’t know, but I call bullshit. Where the exchange rate is floating, the IMF will call for a devaluation, which might have the same effect vs. a foreign currency basket, but the IMF are not required for that to happen.

That’s rubbish.

You are welcome to take a chance and see Pill.

this is the second or third post i’ve read today that basically suggests deposits should be moved out of Ireland.

People are getting hyped out of proportion. Yes it means tough budgets for years and it means a lot of government revenue will be spent in servicing debt but it does not mean that we are Argentina.

Just wait for it, there will be posts now accusing you of being borderline racist because you’re suggesting these things can only happen in latino countries and not in english-speaking western-style democracies.

I’ve said it before, this site can be a pretty useful source of information and thoughtful analysis but some of the natives can go a bit wild with their speculation.

Default is looking extremely likely, yes. Massive, blunt, cuts in publc expenditure will follow. Deposits will NOT be seized. If someone can find an IMF document stating the opposite (they are all online, plans and outcomes for each intervention) then I will retract.

But until then, tone it down lads, you look silly.

What part of money stolen continues to be stolen, country stolen, fraud, theft of billions, fight of billions, did you think it would ever get this bad but and it did, do people not get?

They’ve left you with two choices. Fear or Greed. Which is it to be? They love it went people order both form the menu., it makes them feel all warm and fuzzy on the inside.

Is there any precedence for the IMF getting involved in an OECD (I dont want to use the word “developed”) country? I have been doing some reading up on them lately, in particular Mr Stigliz’s “Globalization and its Discontents” and from what I gather, their only clients have, so far, been eh, developing countries…

Silly! We went past silly years ago its desperate and grotesque and its not like the movies. Nothing is impossible therefore you can not rule out the possible but you might prefer to deal in the probable but as I said nothing should ever be ruled out its time lines and credibility but if you can get your head around those. You are laughing.

So why did 65 Billion leave the country a few years ago? Where those depositors being silly?

As I’ve said elsewhere, I intend to move some funds to Luxembourg (in case we are not in the Euro in the future, despite the fact that I beleive there will be no Euro break-up although Germany may quit). So why am I going to do it - anxiety (pure and simple). However, I’m moving for devaluation reasons not confiscation reasons.

They were called into the UK in 1976, long time ago I suppose.

What’s silly is to assume there won’t be domestic defaults before there are international ones. An international default (of whatever form - interest holiday, principal writedown) is a last resort. Before that happens we’ll see a default on domestic obligations. The increase in retirement age to 68 is already one of these.

The areas I’d be reluctant to pay into here would be:

  • solidarity bond (though there is some durational safety)
  • NTMA bonds through An Post
  • any fixed term yoke with the banks, not so much for the capital, but for the interest (PTSB are trying to address this with their interest up front bond)

It is far more likely that:

  1. Interest will not be delivered at all, at the agreed rate, or on time.
  2. Principal will not be delivered on time or in cash form.
    than it is that there will be no repayment.

Nonetheless, these would be considered events of default internationally.

THe IMF may not be able to seize deposits but they seem to be able to dictate when & how much you can manage your own Bank account if I read correct

And on page 4 of this document -

IS that not the same thing in a way?

The first instance you give above is definitely the same thing. However it was done by the Argentinain govt. not by the IMF.

I think we need some clarity here.

  1. Ireland is not Argentina!
  2. Ireland is in the EU, Argentina isn’t
  3. The irish govt. is subject to EU law
  4. Ireland is a 1st world country with a long history of the rule of law. Argenina is a third world country with a long history of military dictatorships (little or no rule of law).
  5. When we default the relevant decisions will be made mostly by the EU not by the IMF.

When discussing scenarios all the above should be taken into account.


What Ireland is going through is unprecedented. Look at the size of the banking bailout relative to GDP, look at the collapse in GDP/GNP, look at the horrific unemployment, look at the collapse of credit. I don’t recall anyone saying that we are definitely going Argentina. What people are saying, is that there is a *possibility *of something bad happening.

You’re assuming that the Germans have the stomach to bail out the PIGS and that we remain within the Euro.

I’m not entirely sure it is the same thing, in that the measures involved a deposit freeze to save a debased currency and a run on banks. Our banks are already insolvent but guaranteed and the currency cannot be debased, at least not by Ireland. I believe that we’re safe from these measures because of membership of the single currency and the level of interconnection between the EU’s financial institutions.

But I certainly acknowledge that you’ve made a greater contribution that just throwaway statements regarding seizure, euro collapse or whatever you’re having yourself.

You’re takin the piss with that one arent you? I mean lets be honest since the Brits left we as a nation have been f***ed over by whoever manages to lie their way into Merrion Square (well at least for the last decade or so) and come on ‘rule of law’ how about rule of benchmarking and similar payoffs.