What will happen if Ireland is Kicked out of Europe

bobbiw

It was noted today in the independent that there has been calls for Ireland and Greece to be removed from the euro zone because of the worse economic situation they find themselves in.

What will happen if Ireland is kicked out, bear in mind that I would say there would be about a 99% chance that would have happened if Lisbon wasnt agreed to.

So does Ireland go back to the stone age with no european support and would it go back to punts?

omahaid

I would imagine the EU would collapse if that happened. Any country can come into difficult financial circumstances, so if the EU kicked out Ireland then all countries would feel that the same could happen to them.

bobbiw

omahaid wrote: »

I would imagine the EU would collapse if that happened. Any country can come into difficult financial circumstances, so if the EU kicked out Ireland then all countries would feel that the same could happen to them.

The issue is that Ireland is in the most catastropic state of all the European countries even behind greece and it going to need massive bailouts to keep it afloat in the coming years. Much like Iceland going backrupt (the country)

All countries in europe in order to be part of europe have to have a certain debt to income ratio, if that falls then they are removed or can be.

It is being called for right now!

brianthebard

bobbiw wrote: »

It was noted today in the independent that there has been calls for Ireland and Greece to be removed from the euro zone because of the worse economic situation they find themselves in.

#

Link to article? Depending on who said what the meaning of your statement could vary greatly. We know that David McWilliams suggested this policy, which is different to an official of the EU suggesting it.

What will happen if Ireland is kicked out, bear in mind that I would say there would be about a 99% chance that would have happened if Lisbon wasnt agreed to.

There would be a 100% chance that such a thing would have been impossible if Lisbon hadn't been passed.

peasant

Ireland -> Irceland -> news for one day -> end of story as far as the rest of the world is concerned

bobbiw

http://www.independent.ie/business/irish/standard-bank-ireland-may-exit-euro-region-in-2010-1972016.html


Again I am not asking will it happen, we can all debate that till it does or does not.

I am asking what would be the result if it did.

Peanut

Probably worth clarifying that this is speculating about leaving the €uro Zone and not the EU.

It would take a lot, lot more than a financial crisis to even consider a country being forced out of the EU, it would be unprecedented.

Rujib1

Sobering thought!!!

But, assuming for one minute that it will happen, how best to hedge / protect ones wealth such as it is against such an event.

seclachi

That is the EMU and not the EU, the people contemplating it are not a part of the EU or EMU. I also interpreted pull outs (as opposed to removals) to be something done voluntarily by the country involved. Honestly, I think its very unlikely the EMU would kick a country out, the whole point is cooperation and kicking a country out at the first sign of trouble sends alot of bad signals.

In my eyes the EU is trying to get towards being something like the United States, and in order to that they need to draw alot of different country's together, many of which arent so sure it will work. If they see Ireland and Greece getting drop kicked out for not performing to standards they will be certain it`s not going to work. They are also accepting alot of eastern european countrys whos economys are far worse than Ireland's or Greece's.

View

This isn't going to happen. In the EU Treaties, all the member states (bar Denmark and the UK which have opt-outs) agreed to introduce the Euro as their currency. The only question for those not yet-in is when will they introduce the Euro.

There is no mechanism for a member state to be kicked out of Euro in the treaties. Likewise there is no mechanism for a member state to decided to leave the Euro and (re-)introduce its own currency.

There would need to be a new EU Treaty (to rewrite the existing EU Treaties) in order for this to happen. The chances that anyone is going to sit down and write such a Treaty is pretty much zero at the moment. After all, they'd probably suspect it'd fail in an Irish referendum over fears that the Treaty introduced an EU Army, conscription etc etc

jhegarty

They can't kick us out, so a non question.

Count Dooku

bobbiw wrote: »

It was noted today in the independent that there has been calls for Ireland and Greece to be removed from the euro zone because of the worse economic situation they find themselves in.

What will happen if Ireland is kicked out, bear in mind that I would say there would be about a 99% chance that would have happened if Lisbon wasnt agreed to.

So does Ireland go back to the stone age with no european support and would it go back to punts?

It will bring incomes of public servants and welfare recipient to reasonable level
Government can print as much money as public services want. They will earn millions, which will cost nothing.
At the same time export-oriented companies probably will link salaries of their staff to hard currency, as it is done in Eastern Europe and other countries of third world or pay in euro. It will be good motivation for people to work for export, rather then for domestic market.
It means that nobody will look for quick bucks on Irish market. Everybody will try to find opportunity to export something. Country has negative balance, even with export bigger then import, mostly because due repatriation of profits by MNC’s and overspending on welfare and public services payroll bill .
Punt will fix it.
Nobody has balls to reduce PS and welfare bill, country needs a mechanism when those bills will reduce themselves

ei.sdraob

Rujib1 wrote: »

Sobering thought!!!

But, assuming for one minute that it will happen, how best to hedge / protect ones wealth such as it is against such an event.

dont keep money in irish banks

timo87

As the nun said to the sailor;

Pulling out's a dodgy business

Count Dooku

View wrote: »

This isn't going to happen. In the EU Treaties, all the member states (bar Denmark and the UK which have opt-outs) agreed to introduce the Euro as their currency. The only question for those not yet-in is when will they introduce the Euro.

There is no mechanism for a member state to be kicked out of Euro in the treaties. Likewise there is no mechanism for a member state to decided to leave the Euro and (re-)introduce its own currency.

There would need to be a new EU Treaty (to rewrite the existing EU Treaties) in order for this to happen. The chances that anyone is going to sit down and write such a Treaty is pretty much zero at the moment. After all, they'd probably suspect it'd fail in an Irish referendum over fears that the Treaty introduced an EU Army, conscription etc etc

There is no mechanism for expelling Ireland from Euro – true
But
a) EU can impose penalties on Ireland for mismanagement of public finances. 15 Bn penalties will be good reason to leave Euro
b) ECB will close external borrowing for Ireland by issuing warning that ECB will not recognize Irish state bonds

strathspey

View wrote: »

Likewise there is no mechanism for a member state to decided to leave the Euro and (re-)introduce its own currency.

You'de better believe there is. Each country's Euro bank notes have a designated serial number, specifically so that in the eventuality that a country did leave the Euro, that country's bank notes could be quickly taken out of circulation. Ireland's bank notes are designated with a 'T' and Germany's are designated with a 'X'. It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

ei.sdraob

strathspey wrote: »

You'de better believe there is. Each country's Euro bank notes have a designated serial number, specifically so that in the eventuality that a country did leave the Euro, that country's bank notes could be quickly taken out of circulation. Ireland's bank notes are designated with a 'T' and Germany's are designated with a 'X'. It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

ouch

looks in the wallet

seclachi

Count Dooku wrote: »

It will bring incomes of public servants and welfare recipient to reasonable level
Government can print as much money as public services want. They will earn millions, which will cost nothing.
At the same time export-oriented companies probably will link salaries of their staff to hard currency, as it is done in Eastern Europe and other countries of third world or pay in euro. It will be good motivation for people to work for export, rather then for domestic market.
It means that nobody will look for quick bucks on Irish market. Everybody will try to find opportunity to export something. Country has negative balance, even with export bigger then import, mostly because due repatriation of profits by MNC’s and overspending on welfare and public services payroll bill .
Punt will fix it.
Nobody has balls to reduce PS and welfare bill, country needs a mechanism when those bills will reduce themselves

Any who would be stupid enough to let the government change there euros into punts ? I know if I got even a sniff that this would happen I`d be straight down the bank and withdraw the lot in euro notes. The sole purpose of the punt would be devalued. Devaluation works because its a "hidden" paycut, but switching currency and then cutting its value will basically be theft in peoples eyes.

Count Dooku

seclachi wrote: »

Any who would be stupid enough to let the government change there euros into punts ? I know if I got even a sniff that this would happen I`d be straight down the bank and withdraw the lot in euro notes. The sole purpose of the punt would be devalued. Devaluation works because its a "hidden" paycut, but switching currency and then cutting its value will basically be theft in peoples eyes.

But government will blame market forces, when everybody will blame government
If government doesn’t have balls to introduce all necessary cuts, devaluation of currency is the easiest solution

Rujib1

Count Dooku wrote: »

But government will blame market forces, when everybody will blame government
If government doesn’t have balls to introduce all necessary cuts, devaluation of currency is the easiest solution

Bbbbbbb,Bertie, was finance minister when we had to devalue the punt!!!

But, as we all subsequently found out, Bertie didn't have balls.
At that time he hadn't the stomach to impliment cuts, reforms or restructurs.
When he became taoiseach, he continued on the same path. Pandering to the beards.

Little Acorn

bobbiw wrote: »

It was noted today in the independent that there has been calls for Ireland and Greece to be removed from the euro zone because of the worse economic situation they find themselves in.

What will happen if Ireland is kicked out, bear in mind that I would say there would be about a 99% chance that would have happened if Lisbon wasnt agreed to.

So does Ireland go back to the stone age with no european support and would it go back to punts?

Forgive me if I'm wrong,but I thought that no country could be "kicked out" of the EU. I read during the Lisbon Treaty campaign, that in order for that ever to happen,there would have to a unanimous vote from every member country.
So that would actually include the country in question aswell.
For example,I couldn't see Ireland voting for itself to be removed from Europe unless they wanted to be.
I know that a country can hold a referendum in their own country on whether to remain in the EU or not,but I don't think they can be forced out.
Here's a link regarding voluntary withdrawal referendums held in countries:
http://en.wikipedia.org/wiki/Withdrawal_from_the_European_Union
As I said,I could be wrong.I'm just assuming that the information was true.

seclachi

Count Dooku wrote: »

But government will blame market forces, when everybody will blame government
If government doesn’t have balls to introduce all necessary cuts, devaluation of currency is the easiest solution

They`ll never do it, all it will cause is a run on the banks and for them to collapse, making it even worse.

thebman

Never heard of them but they are a pan-African bank from google so why should I care what they think about Europe or the Euro?

The guy in charge is head of Group of 10 foreign-exchange strategy for the bank apparently.

From googling he appears to be talking down Sterling and the Euro and talking up the dollar.

Does he have his own agenda?

hinault

We're not going to get booted out of the EU.

Yesterdays FT had a very interesting piece about Greece and it's travails.
Greek debt to GDP ratio is heading for 123%.
And to the price of ensuring Greek bonds has surpassed those of Hungary and Vietnam (both of whom, have sought advise/help from the IMF in recent months).

In respect of national govt debt, all EU members have seen an appreciable increase in national govt debt - which is concern and the bond markets have reacted more dramatically to Greece's situation than other highly leveraged EU members.

However the value of the Euro has no waivered - despite the Greek situation.

aurelius79

There's no way Ireland would be kicked. We own too much money. If we do decide to leave, as Britain is threatening to do, you can bet the EU Army will be knocking on our door looking for the billions we owe the ECB.

thebman

hinault wrote: »

We're not going to get booted out of the EU.

Yesterdays FT had a very interesting piece about Greece and it's travails.
Greek debt to GDP ratio is heading for 123%.
And to the price of ensuring Greek bonds has surpassed those of Hungary and Vietnam (both of whom, have sought advise/help from the IMF in recent months).

In respect of national govt debt, all EU members have seen an appreciable increase in national govt debt - which is concern and the bond markets have reacted more dramatically to Greece's situation than other highly leveraged EU members.

However the value of the Euro has no waivered - despite the Greek situation.

Aye I think this is opportunistic and I'd love to see what Standard Bank are actually upto.

Many companies/banks will try to take advantage of our fragile situation putting bad news stories out there in the hope to effect market rates on things I imagine.

hatrickpatrick

Even if it was possible for a member to be "evicted" (which it isn't, unless they agree to it), there's no way in hell they would actually do it. It wouldn't work out in anyone's favour, confidence in the group as a whole would plummet if they sent a signal that things were that desperate. That's why the other members of the EU are trying so hard to show solidarity with eachother at the moment no matter what their opinions might be. I would imagine that a lot of other countries think our government is utterly incompetent to be in this position but you won't hear them saying that, you'll hear them expressing sympathy and offering support. The EU has to more or less stick together at the moment financially or we're all screwed. Not just Ireland.

murphaph

strathspey wrote: »

You'de better believe there is. Each country's Euro bank notes have a designated serial number, specifically so that in the eventuality that a country did leave the Euro, that country's bank notes could be quickly taken out of circulation. Ireland's bank notes are designated with a 'T' and Germany's are designated with a 'X'. It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

Lol, sitting here in Berlin I just opened my wallet. In it I have a 50, 20, 10 and a 5 Euro note. Only the fiver is German (X). The others come from U and V, wherever they are! This sounds like a classic urban myth. The Germans aren't an irrational bunch of twits and know well that each note will behonoured regardless of what serial number prefix is on it.

TheCandystripes

i think any country who comes out with crap like 'closer to boston than berlin' should be kicked out. poland is another piece of **** country who thinks they can just leave european union and become a state of usa. kick all the non europeans out. the eu is meant to be about being european, an identity, an entity to challenge the usa, not some socialist crap that benefits poor countries.

hinault

TheCandystripes wrote: »

i think any country who comes out with crap like 'closer to boston than berlin' should be kicked out. poland is another piece of **** country who thinks they can just leave european union and become a state of usa. kick all the non europeans out. the eu is meant to be about being european, an identity, an entity to challenge the usa, not some organisation that benefits poor countries.

We are European.

When I heard Harney make that preposterous comment, it made my blood boil.

TheCandystripes

Yes but the elites for some reason want to isolate Ireland from Europe. I'd love to get to bottom of that.

hinault

TheCandystripes wrote: »

Yes but the elites for some reason want to isolate Ireland from Europe. I'd love to get to bottom of that.

What elites, ?

TheCandystripes

Irish elites

thebman

TheCandystripes wrote: »

Irish elites

Not really they only point to the US because they think its the Irish persons dream as it was when everyone was emigrating there.

They don't give a fook and will lick anyones arse to stay in power.

onedoubleo

If we were to be kicked out of the eurozone its fairly obvious what would happen.

1. Crisis - Everyone "running" the country will spend 6 months arguing with each other over whose fault it is in the first place. X did this but Y didnt do that etc.
2. New Currency - Punt would come back probably tied to the euro(maybe pound) within some ridiculous ratio that would mean its basically the euro in disguise.
3. Our debt would rise because even though it would be tied to the euro the risk associated with them would increase 10 fold.
4. 5 Years or so and we will have artificially inflated some sector making our economy seem good and be allowed back in the euro.

What should happen is that we get a new currency and tie it to some form of gold like standard i.e Energy exporting. Focus on generating whatever we tie it to then hope than in 5-10 years after doing whatever needs to be done hope that we have a strong currency that wouldnt need the support of the euro(dreaming is nice )

Boskowski

bobbiw wrote: »

The issue is that Ireland is in the most catastropic state of all the European countries even behind greece and it going to need massive bailouts to keep it afloat in the coming years.

That's a very strange assumption I don't agree with at all.

What would you describe as a 'bailout'? A charity package in the form of a present? Or massive loans?

The former is not going to happen ever. We just have to get our act together and assume responsibility for our reckless finances and our inability to actually steer the country with some sort of competence and vision.

The latter is already happening on a large scale otherwise we wouldn't be able to still pay our public servants and our welfare receivers. The ECB already provides the means for a relatively soft landing allowing us to stretch the coming back to reality over several years. But it won't be for free and it still means we will have to get our act together.

Nobody will bail us out. If we don't sort ourselves out the ECB will do it for us and it won't be pleasant. But there'll be no more presents.

View

strathspey wrote: »

You'de better believe there is. Each country's Euro bank notes have a designated serial number, specifically so that in the eventuality that a country did leave the Euro, that country's bank notes could be quickly taken out of circulation. Ireland's bank notes are designated with a 'T' and Germany's are designated with a 'X'. It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

To clarify my comment - the member states have signed up to use the Euro. There is no legal mechanism in the EU Treaties that allow a member state to voluntarily cease using the Euro much less to have a member state kicked out of the Eurozone. That's right, none. And nobody is going to rush to re-write them over this.

thebman

strathspey wrote: »

You'de better believe there is. Each country's Euro bank notes have a designated serial number, specifically so that in the eventuality that a country did leave the Euro, that country's bank notes could be quickly taken out of circulation. Ireland's bank notes are designated with a 'T' and Germany's are designated with a 'X'. It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

I don't think thats the reason thats there.

Probably to make it so they can detect fraud easier and because (if what another poster said was correct) each central bank in each country makes the euros for that country and so they would have to have designated serial numbers or we'd end up with duplication at some point of the serial numbers.

Dannyboy83

strathspey wrote: »

You'de better believe there is. Each country's Euro bank notes have a designated serial number, specifically so that in the eventuality that a country did leave the Euro, that country's bank notes could be quickly taken out of circulation. Ireland's bank notes are designated with a 'T' and Germany's are designated with a 'X'. It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

I never knew that before, thanks.

Here is the table (burn the greek ones!:D):
http://en.wikipedia.org/wiki/Euro_banknotes#Serial_number
http://en.wikipedia.org/wiki/Euro_banknotes#Printing_works


Code|In English|In Official Languages|Checksum
Z|Belgium |België/Belgique/Belgien| 9
Y|Greece |Ελλάδα [Ellada] |1
X| Germany |Deutschland |2
(W)| (Denmark)| Danmark |(3)
V |Spain |España |4
U| France |France |5
T| Ireland |Éire/Ireland |6
S| Italy |Italia |7
(R)| (Luxembourg) |Luxembourg/Luxemburg/Lëtzebuerg |(8)
(Q)| Not used
P| Netherlands |Nederland |1
(O)| Not used
N| Austria |Österreich |3
M| Portugal |Portugal 4
L| Finland |Suomi/Finland |5
(K)| (Sweden) |Sverige |(6)
(J)| (United Kingdom) |United Kingdom |(7)
(I)| Not used
H| Slovenia |Slovenija| 9
G| Cyprus |Κύπρος [Kypros]/Kıbrıs| 1
F| Malta |Malta| 2
E| Slovakia |Slovensko| 3

Count Dooku

seclachi wrote: »

They`ll never do it, all it will cause is a run on the banks and for them to collapse, making it even worse.

Banks will collapse without nationalization anyway

SkepticOne

realcam wrote: »

What would you describe as a 'bailout'? A charity package in the form of a present? Or massive loans?

Most likely a number of countries in the Euro-zone would come together and tailor a rescue package in the form of a loan with austerity conditions attached. This is something the ECB can't do. It would happen with Greece first. There would have to be some sort of treaty to enable it.

Scofflaw

thebman wrote: »

I don't think thats the reason thats there.

Probably to make it so they can detect fraud easier and because (if what another poster said was correct) each central bank in each country makes the euros for that country and so they would have to have designated serial numbers or we'd end up with duplication at some point of the serial numbers.

It's probably the easiest way of ensuring non-duplication.

Here is the table (burn the greek ones!):

A Greek euro is a euro - even if Greece left, the note is still a euro note.

cordially,
Scofflaw

billy the squid

bobbiw wrote: »

It was noted today in the independent that there has been calls for Ireland and Greece to be removed from the euro zone because of the worse economic situation they find themselves in.

What will happen if Ireland is kicked out, bear in mind that I would say there would be about a 99% chance that would have happened if Lisbon wasnt agreed to.

So does Ireland go back to the stone age with no european support and would it go back to punts?

Before lisbon there were no rules on countries leaving the EU, so your belief that we would have been kicked out had we voted no is misguided.

murphaph

If anyone wants to trade their Greek and Irish notes 2:1 for my German ones I'll happily oblige

recedite

billy the squid wrote: »

Before lisbon there were no rules on countries leaving the EU, so your belief that we would have been kicked out had we voted no is misguided.

The other countries could have gone ahead with some kind of two speed EU arrangement.
Like in the movies when all the soldiers are lined up on parade and the sergeant major calls out for a "volunteer" to step forward. Everyone else steps back one pace

Call it the New Schengen EU or whatever.
We are left in the old EU with maybe the UK for company.

seclachi

Dannyboy83 wrote: »

I never knew that before, thanks.

Here is the table (burn the greek ones!:D):
http://en.wikipedia.org/wiki/Euro_banknotes#Serial_number
http://en.wikipedia.org/wiki/Euro_banknotes#Printing_works


Code|In English|In Official Languages|Checksum
Z|Belgium |België/Belgique/Belgien| 9
Y|Greece |Ελλάδα [Ellada] |1
X| Germany |Deutschland |2
(W)| (Denmark)| Danmark |(3)
V |Spain |España |4
U| France |France |5
T| Ireland |Éire/Ireland |6
S| Italy |Italia |7
(R)| (Luxembourg) |Luxembourg/Luxemburg/Lëtzebuerg |(8)
(Q)| Not used
P| Netherlands |Nederland |1
(O)| Not used
N| Austria |Österreich |3
M| Portugal |Portugal 4
L| Finland |Suomi/Finland |5
(K)| (Sweden) |Sverige |(6)
(J)| (United Kingdom) |United Kingdom |(7)
(I)| Not used
H| Slovenia |Slovenija| 9
G| Cyprus |Κύπρος [Kypros]/Kıbrıs| 1
F| Malta |Malta| 2
E| Slovakia |Slovensko| 3

Interesting, thanks !

I dont think it can be used as a mechanism for annulling a country's euros though, how many people will check the serial number on a note the accept in a shop ?

Dannyboy83

Of course not, I was just joking.
As Scofflaw said, a Euro is a Euro.

AFAIK, in the UK, they have to accept Scottish Notes in England, same difference.

T-Square

brianthebard wrote: »

#


There would be a 100% chance that such a thing would have been impossible if Lisbon hadn't been passed.

Quite possibly the most poorly formed sentence posted today.

Lemming

Dannyboy83 wrote: »

Of course not, I was just joking.
As Scofflaw said, a Euro is a Euro.

AFAIK, in the UK, they have to accept Scottish Notes in England, same difference.

I have actually encountered people looking twice at a sterling note when it doesn't say "Bank of England" in England; this would include Bank of Scotland and Bank of Ireland sterling notes. You then have to explain to them that yes it's still sterling and could read "Bank of Tatooine" and still be sterling.

Relatives (Scottish) have had similar experiences on occasion when in England, so it's not a one-off that I experienced.

slimjimmc

Lemming wrote: »

I have actually encountered people looking twice at a sterling note when it doesn't say "Bank of England" in England; this would include Bank of Scotland and Bank of Ireland sterling notes. You then have to explain to them that yes it's still sterling and could read "Bank of Tatooine" and still be sterling.

Relatives (Scottish) have had similar experiences on occasion when in England, so it's not a one-off that I experienced.

I don't think the Bank of Tatooine is included, but yeah, there are a lot of banks allowed to print Sterling, it's no wonder people get suspicious when they see an unfamiliar note.
http://en.wikipedia.org/wiki/Banknotes_of_the_pound_sterling

SeanW

With a sig like mine, I was always going to respond to this!

strathspey wrote: »

It is even rumoured that some German citizens are refusing to accept bank notes from any of the PIIGS countries, as they are affectionatly called.

Somehow I doubt that very strongly, but whilst on the topic, who are the "PIIGS" Countries?

murphaph wrote: »

Lol, sitting here in Berlin I just opened my wallet. In it I have a 50, 20, 10 and a 5 Euro note. Only the fiver is German (X). The others come from U and V, wherever they are! This sounds like a classic urban myth. The Germans aren't an irrational bunch of twits and know well that each note will behonoured regardless of what serial number prefix is on it.

Well, that's strange, because out here, I get X (German) notes with almost the same frequency as I get T (Irish) notes. And that includes notes that are newly printed, out of ATMs and whatnot.