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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 2:11 pm 
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So much for one big European family...

Its every country for themselves now!

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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 2:14 pm 
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whizzbang wrote:
So much for one big European family...

Its every country for themselves now!


I don't think the cute hoor plays outside Ireland.

It certainly helps the EU competition commission's work on this.


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 2:21 pm 
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blaker wrote:
Remarkably its taken a foreign VI to point out the problems with this

I dunno - this is starting to look like a cunning plan......

  • Possibility A: The 6 irish banks hoover up so much of the available deposits in the UK that the UK banks fold. Net result: UK has to print lots of sterling to refloat them, allowing the irish banks to buy up said sterling cheaply, and recaptialise themselves on the profit.
  • Possibility B: The 6 irish banks hoover up a lot of deposits, the government is forced to cancel or lessen the guarantee scheme by the EU, then the 6 banks go pop, but with far more loot in the kitty then they would otherwise have. Net result, irish depositors lose far less, thanks to sharing the losses with the UK.

Of course, there's always the chance that the UK offer the same protection, and the irish banks and taxpayer are both screwed.

Having bet the house on the property market up till now, who's surprised that the government has doubled down by betting the farm as well? Government default by 2012 it is.


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 2:21 pm 
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I reckon the British Government should sell down Northern Rock's assets and then deposit them in the Nationawide Building Society.


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 3:10 pm 
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blaker wrote:
No wonder the Brits are cheesed - check out Fingleton's comments

http://news.bbc.co.uk/2/hi/business/7643603.stm


I can not believe the neck of this guy! His bacon has been saved by the Irish tax payer and now he is using this as a selling technique into the UK market. As far as I am concerned we should do what is right for Ireland and not worry that the UK might get its nose out of joint but when you have this *anker running a marketing scheme based on this guarantee well then I can see why UK banks would be rightly pissed off.

Is anybody going to tell me that on foot of these comments, Fingleton has been told tha INBS is going to be wrapped up in the short-term and that he is out on his ear. Everyhting that I read and hear continues to reinforce the prospect that the government didn't offer this guarantee so that they could sort out Irish banking, they did it becuase they think the problem is international and only temporary, and shortly Ireland will be back in the business of selling houses.

Be afraid. We are fucked.

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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 3:18 pm 
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ray wrote:
Be afraid. We are fucked.

Whadda mean? We're fine. :x

The government may have made the taxpayer liable for the downside of the biggest stupidest property gamble in history, and we may be looking quadrupling the national debt to pay for it, and we may have a collapsing economy even if we do save the banks and development companies, but who cares? The government just tied all our ships together so one idiot captain can sink the lot, just to help save their crew.

It's BD for the developers and 8DD for the bankers, and XX for the rest of us.


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 3:32 pm 
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Mrs.YM had a thought. What if it is a cunning bluff to force the EUs hand to provide an EU wide scheme that would supercede the Irish one? Now, Mrs. YM didn't think there was that level of cunning available to the government to conceive of such a scheme, but could that be the effect of the scheme? It tides us over until Daddy comes along and grounds us, but keeps the bad boys away from our toy banks?


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 3:41 pm 
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yoganmahew wrote:
Mrs.YM had a thought. What if it is a cunning bluff to force the EUs hand to provide an EU wide scheme that would supercede the Irish one? Now, Mrs. YM didn't think there was that level of cunning available to the government to conceive of such a scheme, but could that be the effect of the scheme? It tides us over until Daddy comes along and grounds us, but keeps the bad boys away from our toy banks?


It was always likley that this would be superceded by an EU guarantee.

too many es


Last edited by Pill on Thu Oct 02, 2008 3:51 pm, edited 1 time in total.

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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 3:48 pm 
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Posts: 80
I assure you, we are grossly overestimating the intelligence and lateral thinking capabilities of our politicians.


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 4:24 pm 
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Why Ireland Will Destroy the Euro

http://www.cnbc.com/id/26986243

Quote:
Ireland's decision to guarantee all bank deposits will contribute to the demise of the single European currency, because it will erode the euro's credibility if it's allowed to go ahead, Hugh Hendry, chief investment officer and Partner at Eclectica Fund, told CNBC on Thursday.

The plan pledges to guarantee the liabilities of six Irish-owned banks totaling some 400 billion euros ($565 billion), more than twice the country's annual gross domestic product.

"The decision, if left to stand … my prophecy is it will bring down the currency. The euro is not a tenable currency if you have politicians making such decisions. The reality is there is no such thing as a free lunch," Hendry told "Squawk Box Europe."

"If I was German, I would say give me back my Deutschmarks," he added.

On Thursday, Irish lawmakers backed the plan and the government said it may be extended to foreign banks with retail units in Ireland, but it has raised questions in Brussels and London about competition and state-aid rules.

Promises of lavish spending such as this and others being discussed in Europe will erode investors' confidence, Hendry warned.



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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 4:32 pm 
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Nationalised

Joined: Mar 4, 2007
Posts: 8008
They love us really...

Quote:
Spanish slam Irish bank guarantee

Spanish Finance Minister Pedro Solbes said that he was "irritated"
by Ireland's bank guarantee decision

'Speaking as a Spanish citizen, I think it's a measure that
creates quite a deal of irritation,' he said


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 4:35 pm 
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Tattoo'd Lady wrote:
Why Ireland Will Destroy the Euro

http://www.cnbc.com/id/26986243

Quote:
Ireland's decision to guarantee all bank deposits will contribute to the demise of the single European currency, because it will erode the euro's credibility if it's allowed to go ahead, Hugh Hendry, chief investment officer and Partner at Eclectica Fund, told CNBC on Thursday.

The plan pledges to guarantee the liabilities of six Irish-owned banks totaling some 400 billion euros ($565 billion), more than twice the country's annual gross domestic product.

"The decision, if left to stand … my prophecy is it will bring down the currency. The euro is not a tenable currency if you have politicians making such decisions. The reality is there is no such thing as a free lunch," Hendry told "Squawk Box Europe."

"If I was German, I would say give me back my Deutschmarks," he added.

On Thursday, Irish lawmakers backed the plan and the government said it may be extended to foreign banks with retail units in Ireland, but it has raised questions in Brussels and London about competition and state-aid rules.

Promises of lavish spending such as this and others being discussed in Europe will erode investors' confidence, Hendry warned.



How long would it take government to cough up 50Bn without breaching stability pact rules?

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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 4:38 pm 
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bungaloid wrote:
How long would it take government to cough up 50Bn without breaching stability pact rules?

Considering they're going to be breaching said rules without coughing up anything, i'd say slightly short of forever.


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 Post subject: Re: Government to guarantee bank deposits/debt
PostPosted: Thu Oct 02, 2008 4:42 pm 
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And who is going to loan to us now?

Ireland - "Can you spare a dime?"

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 Post subject:
PostPosted: Thu Oct 02, 2008 4:50 pm 
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Joined: Jun 25, 2007
Posts: 125
Location: Dublin
From Moneyweek...

Quote:
The only problem will be is if the rest of Europe decides to follow Ireland's example. If all banks are 100% government-backed, then rather than focus on the creditworthiness of each bank, savers will focus on the creditworthiness of each government. And with Ireland's economy remaining one of the more highly exposed to tumbling property prices, savers might just call the Celtic dynamo's bluff.


http://www.moneyweek.com/personal-finance/what-you-should-be-doing-with-your-money-now-13729.aspx


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