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Two notch downgrade for Irish bonds

  • 05-11-2009 10:23am
    #1
    Diarmuid
    Registered Users, Registered Users 2 Posts: 3,981 ✭✭✭


    Big, bad news for Ireland.

    Two important points
    1. Next time you hear someone saying that we should spread out the cuts to 2017, realise that the cost of this has just got a lot more expensive
    2. The three card trick of moving NAMA's debt off balance sheet will make not one whit a difference to the cost of the debt. Bond markets will treat Ireland's bonds as if the NAMA debt is on balance sheet. This should come as no surprise to anyone who thought about this in a critical manner, to the FFers it might come as a shock to find Frank Fahey doesn't have a clue what he is talking about.


Comments

  • #2
    Diarmuid
    Registered Users, Registered Users 2 Posts: 3,981 ✭✭✭Diarmuid


    And naturally, AIB-owned Goodbody's is still in full spin mode:
    "The positive thing that you can take from this is that they kept the outlook stable which is probably more important," Goodbody analyst Dermot O'Leary said.

    "This downgrade is maybe the last after a series of downgrades if the government sticks to its policy," Mr O'Leary said.

    Does anybody take what O'Leary says seriously anymore?


  • #3
    jimmmy
    Closed Accounts Posts: 2,539 ✭✭✭jimmmy


    Diarmuid wrote: »
    Big, bad news for Ireland.


    Two important points
    1. Next time you hear someone saying that we should spread out the cuts to 2017, realise that the cost of this has just got a lot more expensive
    2. The three card trick of moving NAMA's debt off balance sheet will make not one whit a difference to the cost of the debt. Bond markets will treat Ireland's bonds as if the NAMA debt is on balance sheet. This should come as no surprise to anyone who thought about this in a critical manner, to the FFers it might come as a shock to find Frank Fahey doesn't have a clue what he is talking about.

    We are already paying 1.25 or 1.5% more to borrow money than Germany, for example, are we not. From what I remember the ECB told our govt earlier this year it would have to impose spending cuts of at least 4 billion this year + another 4 billion next year. I wonder , as the situation has got worse, and the govt may struggle to achieve even this, what the effect will be on our rating + ability to borrow money in the years ahead.


  • #4
    optocynic
    Closed Accounts Posts: 755 ✭✭✭optocynic


    jimmmy wrote: »
    We are already paying 1.25 or 1.5% more to borrow money than Germany, for example, are we not. From what I remember the ECB told our govt earlier this year it would have to impose spending cuts of at least 4 billion this year + another 4 billion next year. I wonder , as the situation has got worse, and the govt may struggle to achieve even this, what the effect will be on our rating + ability to borrow money in the years ahead.

    The ship is sinking... but the Public sector don't care.. they have all the lifeboats (For now!)

    To save ourselves.. to save the country.. we need to break the backs of the unions.. or we will never be competitive again!


  • #5
    Diarmuid
    Registered Users, Registered Users 2 Posts: 3,981 ✭✭✭Diarmuid


    Can we steer this discussion away from the public sector specifically? Plenty other threads for that..


  • #6
    optocynic
    Closed Accounts Posts: 755 ✭✭✭optocynic


    Diarmuid wrote: »
    Can we steer this discussion away from the public sector specifically? Plenty other threads for that..

    Why?
    The Public Sector.. or spending is where we need to start the process!
    Do you not agree?


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  • #7
    Diarmuid
    Registered Users, Registered Users 2 Posts: 3,981 ✭✭✭Diarmuid


    optocynic wrote: »
    Why?
    The Public Sector.. or spending is where we need to start the process!
    Do you not agree?
    I agree, but we have established and/or discussed that in about 10 other currently running threads! It would be interesting to discuss how this will cost us (in figures) if we do achieve the 4bn in cuts this year, if that's enough, if we don't make the cuts what will happen, where that will leave us in 5 years etc...


  • #8
    optocynic
    Closed Accounts Posts: 755 ✭✭✭optocynic


    Diarmuid wrote: »
    I agree, but we have established and/or discussed that in about 10 other currently running threads! It would be interesting to discuss how this will cost us (in figures) if we do achieve the 4bn in cuts this year, if that's enough, if we don't make the cuts what will happen, where that will leave us in 5 years etc...

    Where we will be in 5 years?
    Do you remember the 80's?
    That is where we will be, only worse, because we have all gotten used to the lifestyle of 2 cars, flat screens, and SkyPlus!
    There is a real problem with EVERYONE living beyond their means. Prices have to fall, hence salaries have to fall (in all sectors). And to save us, and encourage a market.. we need to cut tax, all tax.

    Look at Macedonia, and average monthly wage of 500euros, and an educated workforce! Where would you invest? There, or here, where the bully-boy unions have the cowards by the cajones!?

    If the government blink now with the unions, in 5 years, I will not be living here. It will not be worth my while to work here. And that is sad and infuriating!


  • #9
    ei.sdraob
    Closed Accounts Posts: 9,376 ✭✭✭ei.sdraob


    Diarmuid wrote: »
    , to the FFers it might come as a shock to find Frank Fahey doesn't have a clue what he is talking about.

    :D that guy has a huge conflict of interest when it comes to property

    he has no issues saddling everyone with more debt just so his property portfolio doesn't loose value

    theres a word for that "scumbag"


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