The Final Countdown - Speculation on Irish bailout EU/IMF

It’s time for RTE to try something like this…

Christ, is it that much? What exactly is that 130 bn? I know the banks lend it from the ECB against a favorable rate. But what are they doing with it. 130 bn?? I am sure it is not sitting in some account. Can someone explain me in few lines the mechanics?

As far as I can judge it, I think the Irish government have one over the EU. They can sit back and try and get a good deal. I really detest that attituide though. Having received and benefitted so much from EU and now really on life support from ECB etc… and then not take ones responsibilty as a grown up mature member of the EU. It really is a cultural difference with continental Europe. This holding up your hand for so long and then when it comes to it, try and screw that hand. I havent seen that anywhere north of the Alps.

But… if rest of Europe do not realize what (political) Ireland is made of and what their norms and standards are, they are ridiculously naive and dont deserve better. So good luck Brian, I pay tax in this country now after all. And it makes for good conversation with the folks back home. :smiley:

Another thoughtful piece from Ed Harrison (who has been pretty on top of the Irish situation since the guarantee): … light.html
(Courtesy FTAlphaville)
He ends with:

Actually, it may be worse than that, there’s also 34.5 bn of Irish Central Bank debt… :nin

That room to wriggle and bargain is limited. A continued run on the banks with ordinary depositors in panic mode would see demands for immediate action. As usual in Ireland events would move from crisis to catastrophe without any intervening steps.

Yeah, I don’t think other european politicians are under many illusions. I don’t doubt that local politics and european administrative politics is any cleaner elsewhere. See Mr. Juncker’s comments yesterday.

Bailing out the state is one thing. FF have managed to stiff the Irish taxpayer for the bogey banks. However stiffing all of Europe for the Banks is maybe one big ask too far. I would understand the issue with it. It does look like its an ECB rescue operation at this stage more than anything else.

Yoganmahew, to summarize debt to ECB,
a 100 bn to Irish private banks for which State is more or less responsible in case they go to the wall
b 20 bn in Irish sovereign bonds
c 34.5 bn to Irish Central Bank

How much of that is unusual as in would for instance the Belgium Central bank have borrowings with ECB. Or would ECB have bought Belgium bonds (sounds more like chocolate by the way…)?

What arrangement is there for the 100 bn? How was it lend in the first place? Is there a payment plan in place to pay it back? How on earth will they pay back 100bn…

The 100 bn is, I believe, borrowed on scheduled repo operations. I think the maximum duration of these is six months? It was due to disappear (exceptional liquidity support) early next year, but I think that is unlikely now.

Well, b) only really applied to Greece, Portugal, Spain and Ireland. The ECB now holds about 20% of outstanding Irish sovereign debt. I don’t think the figure is as high for anyone else.

You’d have to look on the Belgian Central Bank website to find out what the level of borrowings of their banks is. Note the “you”. Luckily Flemish, like Dutch, is also nothing like German, so it won’t be easy for you :confused:

I think it is unusual enough that so much is on tic. We are accounting for some 35% of borrowings from the ECB (I thnk). I’d say that’s outsize enough…

Time for the ECB to panic!

Sorry I’m really confused with all the billions being thrown about but does the 100bn include the banking loans that went into NAMA, the ones that are unlikely to be recovered - Anglo/AIB/BOI and the rest? Does some of our sovereign borrowing (+taxes) go to pay NAMA for the loans that we are taking off the banks books and is this why our sovereign debt is so entangled with our banking debt or have I got it all wrong?

No, it doesn’t include loans that went into NAMA, though it may include loans that have yet to go. Some of it is undoubtedly NAMA bonds that have been repo’d.

No, NAMA bonds are not officially included in our sovereign debt.

The guarantee is the reason the two are entwined.

Bás, led’ thoil, a Bhriain. Agus tóg na bastúin eile go hifreann leat.

I’m not that keen on the racist aspects displayed in relation to Germany on this site but I do firmly believe that Angela Merkel is playing a double game in all this and I think it would be in the Governments interest to expose this. It’s very simple to do - publish the list of bondholders (or if you are to cowardly to do it arrange for it to be leaked) - the partial lists that we’ve seen (from gavins blog and others) suggest that Germany and Austria feature heavily. Merkels desire for us to burn the bondholders in the future but not now stinks - why not now Angela? - is it because they’re your people now and you need to give them time to get out? If you take a kindlier view that she is making the comments to set the scene for a ‘bond-fire’ in the current instance but can’t do so for domestic political reasons then we should help her. Or we could plead ignorance and say ‘Oh you were right about that Angela - we’ve just done it - Oh sorry! you didn’t mean now, you meant later? Ah crap! I’ve gone and done it anyway’

On another point - anyone in this country who is rubbing their hands at the prospect of the collapse of the Euro should think again - doing so will expose us all to the interest rates that we see on the bond markets - that is our true base rate at the moment. So think 10% mortgage interest and what that will do to the economy.

I would rather the real rate and all that entails. The sooner we get there the better.

Low interest rates created the problem. We’d be much better off with higher interest rates, less borrowing and more saving.

Breaking news: Statement from Finland stating that they are in opposition to the German proposal to force Ireland to avail of a bailout. … s-info.php

Tóg go bog é! :open_mouth:


Shit, the wheels have come off.

So much for the bargaining strategy.