• Yes (30.91%)
  • No (55.69%)
  • Don't Know (8.8%)
  • Not Voting (4.59%)
beeftotheheels Registered User
#121

Panrich said:
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.


1. Do you realize that the PN's are actually our cheapest source of funding at the moment? Cheaper than the EFSF/ IMF loans. Probably not, most people don't, they just harp on about the excessive interest rate on those notes and miss the point that that "interest", in so far as it is excessive, ends up in an entity we own and so comes back to us.

2. The ECB didn't move on the PNs. The Irish Government did that all on their own, nothing to do with the ECB throwing us a crumb. No crumbs were thrown.

Panrich Registered User
#122

beeftotheheels said:
1. Do you realize that the PN's are actually our cheapest source of funding at the moment? Cheaper than the EFSF/ IMF loans. Probably not, most people don't, they just harp on about the excessive interest rate on those notes and miss the point that that "interest", in so far as it is excessive, ends up in an entity we own and so comes back to us.

2. The ECB didn't move on the PNs. The Irish Government did that all on their own, nothing to do with the ECB throwing us a crumb. No crumbs were thrown.


Does that mean that we can use the same mechanisms to defer the payments every year? That has not been widely reported.

recedite Registered User
#123

Scofflaw 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

The most macro of controls come from Frankfurt; the ECB base interest rate and recent increases in the capital reserve requirements of banks (one of their more enlightened policy decisions).
The role of our financial regulator has been evolving as has the Irish central bank and even the ECB policy itself, but they are all interconnected.
For example Governor Honohan was to the fore when the IMF came to town, and when the option of defaulting on the Anglo bondholders was withdrawn from us by the ECB. He acted as mouthpiece for the ECB, not for the Irish citizen.
Heres a short speech from Axel Weber discussing macroeconomic imbalances in the the EU which, together with excessive lending by banks, are IMO at the heart of the problem.

The same applies in other fiscal and policy areas; property tax, water charges, septic tank registration... all prescribed externally and with specific timescales. But our politicians are allowed to negotiate the finer details and pretend that they are in control. You can't entirely blame one crowd or the other; the initiatives lower down the scale are home-grown.

beeftotheheels Registered User
#124

Panrich said:
Does that mean that we can use the same mechanisms to defer the payments every year? That has not been widely reported.


No, because the "deferral" of payment required that cash exit the system so the plan is, that ultimately BoI will be the source of the cash, for which it will be paid. BoI does not have limitless cash.

There was huge political pressure on the Government to achieve the unachievable. So they fudged it. But they can't fudge it every year.

People need to accept what is possible, and what is impossible. What is fact and what is fancy.

A renegotiation of the PNs in a manner that will significantly reduce our debt is fancy unless the Spanish situation causes a fundamental change to the way the EU is built.

Panrich Registered User
#125

beeftotheheels said:
No, because the "deferral" of payment required that cash exit the system so the plan is, that ultimately BoI will be the source of the cash, for which it will be paid. BoI does not have limitless cash.

There was huge political pressure on the Government to achieve the unachievable. So they fudged it. But they can't fudge it every year.

People need to accept what is possible, and what is impossible. What is fact and what is fancy.

A renegotiation of the PNs in a manner that will significantly reduce our debt is fancy unless the Spanish situation causes a fundamental change to the way the EU is built.


It's hard to blame an ordinary citizen for being fanciful when we were fed headlines by the minister of finance and the governor of the central bank that a deal on these notes was not only acheivable but imminent. We were told that his deal was going to be worth billions to the taxpayer over the next x number of years. The fact that the promised deal was snatched from our grasp leaves a bitter taste and an air of being sent to the corner by the ECB for bad behaviour. That is not conducive to getting people onside for voting for more austerity.

beeftotheheels Registered User
#126

Panrich said:
It's hard to blame an ordinary citizen for being fanciful when we were fed headlines by the minister of finance and the governor of the central bank that a deal on these notes was not only acheivable but imminent. We were told that his deal was going to be worth billions to the taxpayer over the next x number of years. The fact that the promised deal was snatched from our grasp leaves a bitter taste and an air of being sent to the corner by the ECB for bad behaviour. That is not conducive to getting people onside for voting for more austerity.


But that's just the point.

The ECB's ability to negotiate anything meaningful here is pretty much zero. Zilch. So we cannot blame them for not making a deal they could not make.

Our issue is exclusively with our Government talking up a deal, and our press for reporting so blindly.

We're not voting on more austerity by the way, we have to balance our books which or whether,a balancing exercise which will be made more difficult if our cost of funding increases due to rejecting the treaty.

beeftotheheels Registered User
#127

Regardless of what one thinks of the CRAs, S&P are suggesting that we could be facing a down grade if we reject the referendum.

http://insider.thomsonreuters.com/link.html?cn=uid7017&cid=711656&shareToken=Mzo5ZmQ0NGQ1NS1kMjYxLTQxMzQtYTZhMS1mZDBhODdiNjQwM2E%3D

A little food for thought for those who think that there would be no negative repercussions to voting no.

dunphy3 Registered User
#128

beeftotheheels said:
A reluctant yes from me. Don't like the treaty on a European level, don't see that it will change anything for Ireland in the short to medium term other than possibly precluding us from accessing the ESM which could itself then necessitate drawing on the ESM. And a No vote could reverse the gains in political capital we've been making at a European level.

Like the treaty Collins signed it is a stepping stone.

what political capital??????? its all about money,noting else. i am voting no.

beeftotheheels Registered User
#129

dunphy3 said:
its all about money,noting else. i am voting no.


That would be the money we can't borrow from the ESM if we vote no?

The bond offering we will be less likely to get away later in the year if our ratings get cut again because we voted no?

Please explain to me how voting no helps us with our cashflow because I'm really not seeing it?

FreudianSlippers Registered User
#130

Well, I think the comment from Standard & Poor's yesterday should open the eyes of the "No" camp. It should be the final nail in the coffin for the fantasy that we will be able to get money elsewhere if we do not ratify the treaty.

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Scofflaw Registered User
#131

FreudianSlippers said:
Well, I think the comment from Standard & Poor's yesterday should open the eyes of the "No" camp. It should be the final nail in the coffin for the fantasy that we will be able to get money elsewhere if we do not ratify the treaty.


It won't, though, because the idea that we'd get money from anywhere else has always been a fantasy. If you make that sufficiently clear to someone who wants to vote No, they move over to saying that it would be better to have no funding access anyway, because it would force the government to default/balance the budget overnight. When you point out that no Irish government will choose to do the former, and that the latter would be devastating to the economy, they move back to pretending we can get funding from somewhere else.

Having said that, I do agree we would get funding from elsewhere, perhaps even by a roundabout route from the ESM - but it would need to be a heck of a roundabout route, because it's not legally possible for the ESM to lend to us if we haven't ratified the Fiscal Treaty. What logically follows from that, for me, is Ireland having to negotiate a fresh bailout, from the same group of lenders, in addition to their ESM commitments. And what logically follows from that is a bailout with far more stringent conditions attached than ESM funding.

cordially,
Scofflaw

5 people have thanked this post
Obair979 Registered User
#132

Anyone thinking about voting yes in the upcoming referendum should reflect carefully on the ECB's attitude to making changes in the Anglo promissory note. It is clear the ECB has no empathy or concern for citizens in Ireland and what they may be going through. The ECB's only concern is that the 'numbers' stack up. Do you want an organization like that controlling Ireland's fiscal policy? Sadly, farmers and businesses will put their cash cow ahead of their country's sovereignty.

1 person has thanked this post
beeftotheheels Registered User
#133

Obair979 said:
Anyone thinking about voting yes in the upcoming referendum should reflect carefully on the ECB's attitude to making changes in the Anglo promissory note. It is clear the ECB has no empathy or concern for citizens in Ireland and what they may be going through. The ECB's only concern is that the 'numbers' stack up. Do you want an organization like that controlling Ireland's fiscal policy? Sadly, farmers and businesses will put their cash cow ahead of their country's sovereignty.


You do realise that this post is on a par with asking a catholic priest to acknowledge Jesus was not the son of God and then berating them for failing to do so?

The ECB is a construct of the Treaties. It can only do what it is permitted to do by the treaties.

Just as a Catholic priest must believe in Catholicism or else be incapable of doing their job, the ECB must fulfill the role of the ECB as defined by the treaties. Compassion is not part of that job description, a prohibition on State financing on the other hand, very definitely, is!

2 people have thanked this post
Obair979 Registered User
#134

beeftotheheels said:
You do realise that this post is on a par with asking a catholic priest to acknowledge Jesus was not the son of God and then berating them for failing to do so?

The ECB is a construct of the Treaties. It can only do what it is permitted to do by the treaties.


Just as a Catholic priest must believe in Catholicism or else be incapable of doing their job, the ECB must fulfill the role of the ECB as defined by the treaties. Compassion is not part of that job description, a prohibition on State financing on the other hand, very definitely, is!


Like I said, farmers will put their cash cow ahead of their country's sovereignty. That's the problem Ireland made by entering a monetary union. The fact that so many of us in the real world can see the link between austerity and collapse of the economy yet the Germans still think of it as the only solution. The fact that debt burdens are increasing means that eventually these debts will become unrecoverable and banks will finally have to take their losses.

Will the dutch tolerate a technocrat leader being imposed on it by Germany? I think not. Private debt burdens in the Netherlands are very high and need to come down substantially for the economy to be sustainable. That means write-downs and probably destruction of the current banking system. Lets see how they deal with vulture funds running their banks. The best option is for the banks to be allowed to collapse writing off much of the debts and the government nationalizing the retail bank networks and starting afresh. Let the overseas operations be sold off for the creditors.

I support Francois Hollande's pledge for an expanded ECB mandate. The irrational fear of hyperinflation is unwarranted and unjustified because bond purchases can be sterilized by the central bank to eliminate the side effects. The Maastrict Treaty was founded on the basis there would be no financial or sovereign debt crisis. Good in theory but completely out of touch with reality.

And that's why the ECB should become involved because they have unlimited firepower. You wouldn't need to pay contributions if the ECB was given a bigger role. It's laughable how you are suggesting the rescue fund will do its job when clearly it isn't even a drop in the ocean! Sovereign risk is influenced by a central banks policy - there is a limit to the amount countries can do on their own. Austerity is damaging growth and thus requiring more bailouts. Stimulus helps to seed a growth foundation for the private sector.

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Scofflaw Registered User
#135

Obair979
Austerity is damaging growth and thus requiring more bailouts. Stimulus helps to seed a growth foundation for the private sector.


While these are true taken entirely on their own, they ignore any possible consequences of creating the money to provide the stimulus (whether by QE or debt writedowns).

cordially,
Scofflaw

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