[karlth]

Originally Posted by Scofflaw

10xGDP? I can't help but think what you mean there is the balance sheets of the Icelandic banks. Irish debt is currently a bit north of 100% of GDP, not 1000%!

Well you are number one here.

Ireland's banks had balance sheets 3.5 times GDP, which meant that Ireland could in theory, if it was lucky, if the gambles paid off, etc, stand over its banks, whereas Iceland couldn't under any circumstances do so and had to face that fact immediately. [/QUOTE]

The main problem we faced was that the banks debts was in foreign currency. We could have handled a lot if the banks had borrowed in icelandic kronas, unfortunately they didn't. So, as you said, we had to cut the rope.

Ireland's debt is/was mostly in its own currency but alas not one you can print your way out of with unlike the US and Japan.

[Scofflaw]

Originally Posted by andrew

I said at worse that the treaty does nothing. I actually think it does do something, in that it's a step toward fiscal union. If it was clear what people wanted instead of this treaty (like, if everyone was in support of fiscal union, or deposit insurance) then I might support the 'go back to the drawing board' view, but as it stands it seems like there's no reason to actively oppose it. At worse supporting it brings no benefits, while saying no brings unambiguous harms in terms of funding (as Scofflaw has pointed out) and yet more uncertainty.

The choice in this referendum keeps being summarised as "damned if you do, damned if you don't". It's really more like "meh if you do, bleh if you don't".

cordially,
Scofflaw

[Scofflaw]

Originally Posted by karlth

Well you are number one here.

Um, yes. That's the entirety of all debt in Ireland, though, not public debt, and doesn't tell you what assets correspond to the debt. Debt figures by themselves are kind of meaningless, particularly the ones used by journalists in a "top 10" list.

Having said that, we do have huge net household and business debt problems as well as public debt.

Originally Posted by karlth

The main problem we faced was that the banks debts was in foreign currency. We could have handled a lot if the banks had borrowed in icelandic kronas, unfortunately they didn't. So, as you said, we had to cut the rope.

Ireland's debt is/was mostly in its own currency but alas not one you can print your way out of with unlike the US and Japan.

On balance, you were probably lucky it was obvious it couldn't be done.

cordially,
Scofflaw

[karlth]

Originally Posted by Scofflaw

Um, yes. That's the entirety of all debt in Ireland, though, not public debt, and doesn't tell you what assets correspond to the debt. Debt figures by themselves are kind of meaningless, particularly the ones used by journalists in a "top 10" list.

I'm wondering whether the high external debt number is due to the many international companies that have their headquarters in Ireland.

[karlth]

Originally Posted by Scofflaw

On balance, you were probably lucky it was obvious it couldn't be done.

Trust me, it was far from obvious at the time. The IMF reps almost had a heart-attack.

[Scofflaw]

Originally Posted by karlth

I'm wondering whether the high external debt number is due to the many international companies that have their headquarters in Ireland.

Basically, yes:

Ireland had a Net International Investment Position liability of €134 billion at end-June 2011

Ireland’s stocks of foreign financial assets stood at €2,544bn at the end of June 2011 - down €15bn from the end-March level. The corresponding stocks of foreign financial liabilities (€2,679bn) decreased by €35bn in the same period. As a result Irish residents had an overall net foreign liability of €134bn at 30th June 2011 (see table 1a).

Monetary financial institutions (MFIs), which consist of credit institutions and money market funds, had foreign assets of €839bn at the end of June 2011 - down €29bn from the end of the previous quarter. Over the same period their foreign liabilities decreased by €27bn to €785bn (see table 2).

Other financial intermediaries (OFIs) which largely consist of investment funds, insurance companies and pension funds, asset finance companies and treasuries, had assets and liabilities of €1,439bn and €1,362bn, respectively at the end of Q2 2011. The corresponding net asset position of €77bn was up €26bn on the previous quarter. This increase was driven largely by a re-classification of certain Investment fund liabilities from non-domestic to domestic.

The foreign assets of General Government (which includes the NPRF) fell from €10.2bn to €4.6bn in the quarter while liabilities increased from €95.1bn to €98.3bn in the same period.

IFSC enterprises accounted for a very high proportion of the overall foreign assets and liabilities within the commercial financial sector (i.e. MFIs and OFIs). At the end of June 2011, IFSC assets abroad amounted to €2,039bn or 89 per cent of the commercial financial sector’s foreign assets (and over 80 per cent of Ireland’s total foreign assets); IFSC liabilities at €2,008bn represented almost 94 per cent of the commercial financial sector aggregate (and almost 75 per cent of Ireland’s total foreign liabilities). IFSC enterprises therefore showed a net asset position at the end of June 2011 of €32bn.

Non-IFSC commercial financial enterprises accounted for €239bn or 9% of total foreign assets; corresponding liabilities amounted to €139bn or 5% of total foreign liabilities - see table 2.

http://www.cso.ie/en/media/csoie/rel...une%202011.pdf

IFSC enterprises accounted for 75% of Ireland's total foreign liabilities. So figures like the one in the Top 10 list, claiming debt per person in Ireland is c. €440k, really are entirely meaningless.

cordially,
Scofflaw

[recedite]

Originally Posted by karlth

Living here in Iceland I'd like to say that travelling abroad with a highly devalued currency and currency restrictions is no fun at all, so purely on that account I'd say be thankful for the Euro.

Wage cuts are no fun either. At least a devaluation is fair, ie everyone including the politicians and civil servants get to share in it.
When you suffer wage cuts you tend to rule out the foreign holidays, so the strong euro is little consolation.

Fair play to Icelanders for putting the ex Prime Minister on trial BTW
Even though he was let go, it shows they are not untouchable. Nobody here has been brought to account of course.

Originally Posted by Scofflaw

How little any of this had to do with the euro is illustrated by the recent call by the Deputy Governor of the Central Bank for the institution of "macro-prudential controls" in Ireland.................
There is not a single measure in there that could not have been instituted a decade ago.

The Irish central bank is little more than a local branch of the ECB, and when the chips are down it takes its orders from Frankfurt, not Dublin.
You seem to be trying to distance the bank from the euro, but you might as well say the euro is nothing to do with the ECB.

[andrew]

Originally Posted by recedite

The Irish central bank is little more than a local branch of the ECB, and when the chips are down it takes its orders from Frankfurt, not Dublin.
You seem to be trying to distance the bank from the euro, but you might as well say the euro is nothing to do with the ECB.

As far as I'm aware, the Irish Financial Regulator (at the time, now it's combined with the Central Bank) had and has plenty of scope to regulate the financial sector. They just didn't. It's not that the ECB were saying not to because of the euro, the Financial Regulator just completely failed to do it's job properly.

[beeftotheheels]

Originally Posted by andrew

As far as I'm aware, the Irish Financial Regulator (at the time, now it's combined with the Central Bank) had and has plenty of scope to regulate the financial sector. They just didn't. It's not that the ECB were saying not to because of the euro, the Financial Regulator just completely failed to do it's job properly.

Remind me again. Who appointed the Financial Regulator?

[Dirk Gently]

Originally Posted by andrew

the Financial Regulator just completely failed to do it's job properly.

People keep saying this. The regulator done exactly the job he was appointed to do (keep out of the way and don't interfere.) If the regulator regulated they would have removed him and appointed another one who didn't regulate. Regulation didn't suit the ideology of the times. The position was an on paper only position.

[andrew]

Originally Posted by beeftotheheels

Remind me again. Who appointed the Financial Regulator?

What do you mean; given it was an entire organisation, it wasn't a single person who was appointed. As in, it was and is a subset of the central bank, but between 2003 and 2010 there was so little interaction between the two bodies that they can't really have been considered a single entity.

Either way, while the ECB have taken control of monetary policy,my point is that the ECB doesn't (to my knowledge) get involved in financial regulation, and so if the Financial regulator didn't regulate, it's our fault and not the ECB's or Europe's.

[K-9]

The Irish Central Bank regularly gave warnings to banks about lending criteria, I can remember a warning about people getting deposits for houses from Credit Unions as far back as 1998 or so. The regulator didn't check out or enforce these warnings.

[beeftotheheels]

Originally Posted by andrew

What do you mean; given it was an entire organisation, it wasn't a single person who was appointed. As in, it was and is a subset of the central bank, but between 2003 and 2010 there was so little interaction between the two bodies that they can't really have been considered a single entity.

Either way, while the ECB have taken control of monetary policy,my point is that the ECB doesn't (to my knowledge) get involved in financial regulation, and so if the Financial regulator didn't regulate, it's our fault and not the ECB's or Europe's.

Sorry. You took an ironic rhetorical question too seriously.

Correct answer is the FF led Government of the day who we elected.

[Scofflaw]

Originally Posted by recedite

The Irish central bank is little more than a local branch of the ECB, and when the chips are down it takes its orders from Frankfurt, not Dublin.
You seem to be trying to distance the bank from the euro, but you might as well say the euro is nothing to do with the ECB.

Er, no. Or, rather, what? I don't see what those comments have to do with anything I said.

Surely if the Irish Central Bank "takes its orders from Frankfurt, not Dublin", the the Deputy Governor calling for macro-prudential controls is something that is attributable to Frankfurt - in which case a bit more of Frankfurt's way is something we could have done with a decade ago.

I don't think that's something you mean, though I'm not sure what you do mean, of course.

Are you arguing that despite the identified failures of the Irish Financial Regulator, nothing that happened was anything to do with anybody here really? That does seem to be a belief in some quarters, or at least something that gets claimed, and it might be what you're claiming here?

slightly baffled,
Scofflaw

[Panrich]

I'm unsure how to vote on this at the moment. I see that we are backed into a corner but the fact that we are being treated as fools in all this is nauseating.
The promissory notes fiasco was the main one for me. The way that we were thrown a few crumbs to defer this years payment was designed purely for the purpose of getting more yes votes on the table. The fact that we have no prospect of acheiving anything worthwhile long term has not been given equal column inches.
This latest news on selling our state assets and being allowed to keep up to half is another kick in the gonads and yet is being reported as a triumph. This is at the same time that the Troika is reporting that we are comfortably meeting our targets without any firesales.