Go back to the punt

Euro or eurno?

  • Esperanto is my middle currency - keep the euro
  • For all its faults the punt was dead easy to manipulate
  • Ich bin ein doughnut - I’ll have what the Kaiser wants
  • Something else for the weekend sir?

0 voters

There are a number of stories circulating about tensions in the euro area about the currency. Chief protaganist of the euro break-up thesis is Ambrose Evans-Pritchart of the Telegraph, but here is another piece using many of the same arguments from Marketwatch.

Leaving aside that the theory seems to originate in London, which makes me think its a hedge fund “jolly good idea that they could make loads of money from”, does the idea have any merit?

Has anyone heard of any of these tensions that seem to be tearing our proud currency asunder? All I can see are the usual grumbles of politicians with an independent central bank that they wish they’d set up with looser core goals, but didn’t for good reason.

Trichet has been a star so far, I have confidence that both himself and his Bundesbank friends will not sacrifice the prudent to bail out the speculators and shysters. If I was in the US at this moment I’d be spitting blood and I’m glad that our politicians and Central Bank don’t have control over our currency.

In many ways it suits politicians to have a target, it’s easier than them having to tell their populations that rates are going to have to go up. It’s the private conversations that matter.

Well its the Torygraph and he has to grandstand to its loopier readers.

Having said that the paper does carry some very good articles but ignore its business editor . He is a ranting little englander, thats all.

It sells copy , especially to Torygraph readers, it also distracts them form the ongoing woes of the Mayfair hedge funds and City banks.

I did type Torygraph first, but in the interest of ‘balance’ (or ‘hiding your bias’ as its also known) I struck it out.

Personally, I think they’re still sort about the whole Northern Rock thing!

our debts will remain denominated in Euro.

Multinationals here like the fact that they can sell from the Irish subsidiary to the rest of Euroland sans currency risk, thus no hedging costs. Alter that, you alter the rationale to come here in the first place.

That’s for starters, I think that’s quite enough info for our lads to decide against.

If for no other reason, we should have kept the punt because having your own currency imposes certain restrictions and discipline on the gang of crooks and chancers we are pleased to call a Government. Until that day when we get sane politicians in charge of this country, being part of any currency union is just far too dangerous for us, as we have spent 5 years years finding out.

It all comes back to good governance. If Ireland was well-run, we’d be better off in the Euro. Because Ireland is so badly run, we’d have been better off staying out.

We’ll probly get thrown out long before our politicians decide to leave. The unaccountability and handy ability to pin the blame for their cock-ups on the ECB suits our kleptocratic parasite class.

better off out.

At the time of its creation I said that I would outlive the Euro (in it prsent form). Nothing since has caused me to alter that view.


The 48A could take a hand in that prediction. Have you accurately priced in risk? :wink:

Never a truer word spoken,so far Trichet has been a legend and role model to the responsible and prudent.

Better off out? I’d love to see our interest rate if we were not in the Euro, somewhere north of Iceland’s I’d imagine.

fxstreet.com/fundamental/int … tes-table/

Yes, and without the stupidly low interest rates that were completely inappropriate for our economy over the last 7 years, we wouldn’t be in this mess now.

Your point, neatly filleted.

but there is no guarantee that our economy would ultimately be any better off either. It’s a more complex system than that wouldn’t you agree?

Either way, at least one economist in one English newspaper has been yammering on about how the euro is a failure for the life of the currency so far. It’s not that they mightn’t have a point, it’s that they are ultimately very, very predictable.

shrugs no guarantees in this life, is there?

I think we can all agree it is most unlikely the bubble would have been quite so excessive if interest rates had been 7-8% for the last 7 years. It was petering out naturally in 2001 before Greenspan gave it a wrap of speed and a bottle of JD.

All the rest is down to good governance I suppose, so we’d probably still be in a mess after 11 years of Bertie’s misleadership. Just a different mess from this one :laughing:

Actually I would hazard to say that the mess, such as it exists, could have been avoided or limited by using the tool of banking regulation ie banning dilution of traditional loan criteria which is one of the key issues that’s going to cause grief in Ireland. It would also have been avoided with a little more analytical thinking on the part of the market participants.

In other words, low interest rates are low interest rates; it’s what you do with them that matters. Solely blaming their existence is an abdication of responsibility.

As a consumer of many many foreign goods, I’m very happy we have a strong currency at the moment. But long run I have no idea if it will be good or bad for us.

We’d be in a different type of mess: one where microsoft and all the other MNCs had bailed out of Ireland owing to this instability of its currency against the Euro.

The cost of having to hedge against shifts in the Euro-punt rate would eliminate the benefits for them of our low-tax regime.

Why do you think they haven’t totally upped sticks to the former communist part of the EU? Because they’re happy being in the Eurozone, not the zlotyzone.

Two points:

  1. if the country had been properly run through the 90s we wouldn’t be so ridiculously over-dependent on FDI in the first place. We’d have spent some effort building indiginous exporting industry instead of begging for jobs from the US.

  2. If the country was properly run there’s no reason why the Punt should be inherently unstable against the Euro

I’ll keep yammering on about the appallingly bad governance of Ireland until people start getting the damn point. We shouldn’t be in the current mess, or your alternative mess, if our political class had a bloody notion how to do their jobs.

There’s a very ancient yiddish proverb that goes “if my grandmother had balls she’d be my grandfather”.

I don’t want to seem too snarky though, I do take your point.

I didn’t realise that exiting the Euro through a wormhole was possible.

Now if we could just get the ECB into a DeLorean.