In simple terms...what happened? How bad is it?

Hermy

K-9 wrote: »

I suppose the point is, the money has to come frome somewhere. I think Latvia had a similar idea and the IMF said grand, as long as the country can finance it by saving elsewhere and it doesn't get too big.

I'm more concerned with where the money is going rather than where it's coming from. The whole focus is on fixing the corporate sector and to hell with society. Maybe this makes me a socialist but I think this policy is nuts.

K-9

Hermy wrote: »

I'm more concerned with where the money is going rather than where it's coming from. The whole focus is on fixing the corporate sector and to hell with society. Maybe this makes me a socialist but I think this policy is nuts.

I'd be of the view, socialist and I'd be quite the left winger, that really there isn't that much between left and right wingers! They just have different methods of ending up in the same place!

Anyway, to get back to your point, we could give more money to cut debt but banks and lenders will see through it.

The banks here seem to have reached their pit. They aren't going to lend in abig way to an economy that has to cut SW and PS Pay and raise taxes. Even if the state subsidises mortgages, the banks, same as most people cop that money needs to be drained out of the economy elsewhere to pay for it.

There's a notion that banks aren't lending. I'd say it's 50/50. Why would banks lend to say retail, with less money around and more to come?

Hermy

K-9 wrote: »

I'd be of the view, socialist and I'd be quite the left winger, that really there isn't that much between left and right wingers! They just have different methods of ending up in the same place!

Anyway, to get back to your point, we could give more money to cut debt but banks and lenders will see through it.

The banks here seem to have reached their pit. They aren't going to lend in abig way to an economy that has to cut SW and PS Pay and raise taxes. Even if the state subsidises mortgages, the banks, same as most people cop that money needs to be drained out of the economy elsewhere to pay for it.

There's a notion that banks aren't lending. I'd say it's 50/50. Why would banks lend to say retail, with less money around and more to come?

But how is all this supposed to end? On the face of it the government is bending over backwards to facilitate the banks while making cuts left, right and centre to public services to pay for the banks private debt. With unemployment at close to 450,000 and the massive drain that is on resources how does the current approach to the Irish financial crisis achieve it's goal? Or more to the point what exactly is the goal of said approach?

K-9

How's it going to end? I don't think anybody knows and anybody that tells you they do, stay clear ! LOL

While the banks create a whole lot of attention, the deficit without them is about €10/11 Billion. Social Welfare costs over €20 Billion and Public Service pay about €16/17 Billion.

So, forgetting banks, we need to save 27% of the PS/SW bill.*

*We actually need to save more as SW/PS pay taxes!

What's the goal or aim? I don't know!

Leaving the Euro or defaulting? Seems far fecking worse to me!

easychair

K-9 wrote: »

How's it going to end? I don't think anybody knows and anybody that tells you they do, stay clear ! LOL

While the banks create a whole lot of attention, the deficit without them is about €10/11 Billion. Social Welfare costs over €20 Billion and Public Service pay about €16/17 Billion.

So, forgetting banks, we need to save 27% of the PS/SW bill.*

*We actually need to save more as SW/PS pay taxes!

What's the goal or aim? I don't know!

Leaving the Euro or defaulting? Seems far fecking worse to me!

It's unlikely to ever "end" as such, and even if we go back to a system of barter it will never end.

We are all, now, economists, it seems, and the topic even is being discussed seriously at water coolers around Europe even as we type here!

sparkling sea

WE are in a depression, we can't cut our way out - this has never sucessfully happened since the Industrial Revoloution, but, we can't borrow our way out, no one will lend us the money because we can't even pay back what we owe.

44% of income taxes comes from 5% of the population - we can't tax our way out, dont know why they didn't get rid of the PRSI ceiling though - old boys network still looking out for each other perhaps, a bit like the Croke Park agreement - another thing we can't afford

We really aren't making any progress in digging our way out of this though, nothing is changing. For example we won't ever be a knowledge economy until we make subjects like Irish and Religion (civic responsibility instead) elective and business languages and science subjects mandatory or as near to this as possible, but the government ignore thess fact, there not implementing change at all.

Scofflaw

Hermy wrote: »

But how is all this supposed to end? On the face of it the government is bending over backwards to facilitate the banks while making cuts left, right and centre to public services to pay for the banks private debt. With unemployment at close to 450,000 and the massive drain that is on resources how does the current approach to the Irish financial crisis achieve it's goal? Or more to the point what exactly is the goal of said approach?

The cuts aren't primarily the result of the bank debt, or even due to it any very large degree - were that the case we'd only have needed to cut a couple of billion from the budget over the whole 4-5 year programme. Of this year's deficit of €16bn or so, less than a billion is interest on the bank debts, and none of it is bank repayments.

Most of the deficit is government spending - social welfare, public sector pay are the two big ones - and reduced tax receipts, because a lot of the tax take in the property boom came from property (something over a quarter of the price of a new house went to the government one way or another).

cordially,
Scofflaw

Hermy

Scofflaw wrote: »

Most of the deficit is government spending...

What about the tens of billions that are being put into the banks to keep them afloat - where does that appear on the balance sheet or indeed where does that money come from?

Kellyboy77

locomo wrote: »

Basically what has happened is that the IMF + EU are here because nobody else will lend us money any more, and our government is spending 50 billion + taking in 30 billion. We have proved that despite the tens of billions of grants / handouts received in EC structural funds, + from Europe already, we are incapable of governing ourselves. The reason we are the laughing stock of the world is that our government and public servants give themselves - and have done so for many years - probably the highest pay and pensions in the world. Even the social welfare ( dole , old age pension etc ) in Dundalk is over double that in Newry, which is part of a G7 economy which has economy of scale and part of a major industrialised country and which is helping to bale us out. Cowen, the present leader who was minister for finance during the artificial boom , is just regarded as a white version of Mugabe throughout the world.( maybe not at 3.30 am in a hotel in Galway though before addressing the nation at 8.30 ! ).

I don't think we are the laughing stock of the world, not at all. We are in fact an example of a country who got itself in a hole and is working hard to climb out of it - more and better than other nations such as Greece, Spain and italy.

Worztron

Kellyboy77 wrote: »

I don't think we are the laughing stock of the world, not at all. We are in fact an example of a country who got itself in a hole and is working hard to climb out of it - more and better than other nations such as Greece, Spain and italy.

But at what cost to our society? It seems we are a perfect example of a country wanting to appease the markets whilst having little regard for our own people. The economy should serve us, not the other way around.

Hermy

Worztron wrote: »

But at what cost to our society?

Ultimately this is my concern. Everything in the Budget is about savings but what will be the cost of the current financial mess and the way it is being dealt with.

Worztron

This was the main picture today (10-Dec-2011) @ http://www.irishtimes.com/

http://www.irishtimes.com/newspaper/breaking/2011/1211/breaking4.html What a big surprise, Seán FitzPatrick walks scot-free yet again. :rolleyes:

Just look at that smirk! :mad:

R0ot

If someone could point me to the place (search didn't find it for me) or answer directly, what would happen if we didn't continue to pay bond holders / banks ? I am honestly so confused on this point.

usamaoreilly

In simple terms "we are up a certain creek without a certain paddle"...

later12

R0ot wrote: »

If someone could point me to the place (search didn't find it for me) or answer directly, what would happen if we didn't continue to pay bond holders / banks ? I am honestly so confused on this point.

There's a recent thread on this in the main politics section
http://www.boards.ie/vbulletin/showthread.php?t=2056488208

A synopsis (for Irish government bond holders) might be

-exclusion for borrowing on international markets for an unknown period
-increase in the cost of borrowing to an unknown degree
-possible spread of default contagion to the rest of Europe, damaging the single currency even more

This is a very vague synopsis, there is more in the thread as well as some difference of opinion.

Voodoo_rasher

13 months on and Irish people unaware, not informed of this??

http://info-wars.org/2010/10/03/hedge-funds-hold-ireland-to-ransom-over-anglo-irish-bank-bail-out/

Does the Govt. / controlled Media think Irish population are too thick to understand all of this, therefore say nothing

So the ######g b#nd-holders turn out to be hedge-funds. Someone

pls explain how bad that is. Just think, the Govt can be taken to court

over not paying back the bond losses - well a population cannot be

taken to.....\

Eireann go Bás.

Cork boy 55

Scofflaw wrote: »

The cuts aren't primarily the result of the bank debt, or even due to it any very large degree - were that the case we'd only have needed to cut a couple of billion from the budget over the whole 4-5 year programme. Of this year's deficit of €16bn or so, less than a billion is interest on the bank debts, and none of it is bank repayments.

Most of the deficit is government spending - social welfare, public sector pay are the two big ones - and reduced tax receipts, because a lot of the tax take in the property boom came from property (something over a quarter of the price of a new house went to the government one way or another).

cordially,
Scofflaw

When you say this year is that 2012?

In otherwords
What is the deficit this year 2012 planned for?
How much is current account government spending?
How much of it is interest on the bank debts and none bank repayments?

Worztron

Of every €1 paid in tax. What % is going to bail out the bankstards and bond holders? :mad:

later12

Worztron wrote: »

Of every €1 paid in tax. What % is going to bail out the bankstards and bond holders? :mad:

€2.72.

But that's assuming that things like all of the €28.7 billion guaranteed in NAMA is needed.

Zander1983

We're in a bad oul way, ha?

Lantus

What happened: The entire premise of world economies and society as we know it has been based in the completely incorrect assumption of infinite growth. There is no such thing. (We live in a finite universe and very much so on one finite planet with finite resources.)

Why: The key driving facor that has collided with this growth faslehood is oil production. Oil production has now plateaued and will continue to decrease over the next 20-50 years before its eventual total decline. As everything in our society is dependent in oil from food to cars to pesticides to everything made out of plastic which fuels our materialistic nature the rising cost of this fuel and its continued depletion will forever change us a species.

debt: The massive growth we thought we were creating was really just created by getting into more and more debt. The world economy is probably the biggest pyramid scheme running today. (Although the game isn't fully up yet as not everyone has realised this fact.)

Future predictions: World societys stand on the brink of huge upheavel and change. What we have wittnessed so far is just the titanic hitting the iceberg. We've only just started to take on water. The world is for the most part in total denial about it's predicament.

1/ The worlds massive 7 billion population has been created and is being supported by cheap oil. Now that is at an end that population is no longer viable and must decline sharply. In any natural or artificial system periods of extreme growth are always followed by a sharp decline. economies and stock markets are no different to nature where a food surplus drives a massive population boom which is unsustainable.

2/ We will need to totally restructure our society if we are to survive. Food and water are the priorities and we should start to encourage everyone to grow there own food and for all available land to be given to people for nothing to grow food.

3/ Ireland needs to build 2 nuclear power plants NOW. this should help provide the majority of it's power needs for the next 50 years assuming a supply of uraniam ore can be obtained reliably.

4/ All housing and habitation needs to be fossil fuel neutral (i.e. cannot use coal or gas or oil to heat.) We will need to retrofit or demolish and replace housing over the next 20-40 years to the highest standards. local electric production through PV and wind. Local heat through solar on all buildings.

5/ We are all going to need to become more self sufficient for food and water. people living in deserts or in hospital regions where food and power is shipped in huge distances are knackered unless they move to where they can grow food and get water.

We can survive this but its going to take a lot of time and humans are only geared to think a very short time ahead (we live in the moment and react to immediate threats.) we will not see oil dissapear overnight. It's eventual dedcline will take time. Already countries like america that have the military might are moving to secure countries that can guarantee fossil fuels like iraq and afghanistan. It wont end there as they need more.

Ireland is in a better position to survive than most. we have green climate with water and land to build on a population that could probably be fed domestically long term.

Our goverment needs to get rid of it's debt. To do that it needs to make some really unpleasant decisions that we have not even gotten our heads around yet. Today we are arguing about a few % here and there. But the fundementals that make up this system is flawed (its based on infinite growth.)

firstly we need to change our political msystem and government. We need to radically reduce TD's one per county is enough and abolish the senate. to make a new society you need a new tool. lighter, more nimble and able to make better decisions faster. TD's on fixed contracts that work 9 till 5 with 4 weeks annual leave on industrial average wages and working on central govenment issues not local issues. local cocos can deal with local issues.

for efficiencys we need to focus on population centres. hospitals in these areas can be kept. rural areas need to be closed. There is a huge scale of waste in supporting smaller rural areas and ireland will be hurt by trying to protect it all. same for all other services. we may well need to move people to other areas. electric cars will need to become mainstream in 10-20 years.

We have not even begune to grasp the hard decisions we need to make in relation to the big picture. We are all so busy looking at the interest rates and housing prices we are being blind sided by nonsense while the ship is still filling with water.

There is no miracle cure to this problem. there is no replacement for oil and no sign of fusion coming on line in the next 20 or even 40 years. there will never be infinite growth or growth like we have experience again. we all need to get serious about the big problem that is coming down the line after the wake up call of the financial meltdown.

fat__tony

mm_surf wrote: »

I didn't really want to use the nasty figures of who'll actually be paying for it.

Of those 4 million, 2 million are employed.

Of those 2 million, maybe half are net contributors? (i.e. pay more in tax than they receive through other breaks)

So if my figures are used for just the 1 million who'll actually be paying off that captial:

€20k a year over the 5 year period?
€4k a year over a 25 year period?

Kinda makes a joke of the various parties' claims that they are going to put up tax by less tham €1500 a year?

Or am I wrong? Is there any other way out?

Total employment in the country is now under 1.8 million and falling.

Belfast

what happened?
we went bankrupt by borrowing and spending too much like most of the western world.

Better question is why did this happen?

It is all explained by the Austrian Business Cycle Theory.

all booms and bust are explained by this.

Austrian Business Cycle Theory

https://www.youtube.com/watch?v=69ogV3mGwv4

How bad is it? very bad
but nothing that cannot be fixed if we stop doing the stupid stuff that got us in to the problem in the first place.

Worztron

George Santayana: "Those who cannot remember the past are condemned to repeat it."

Why bother trying to get out of this economic mess - it is all going to happen again anyway. Capitalism is clearly a failed system.
What caused the mess? = Spend, spend spend.
The governments solution to 'recovery' = Spend, spend spend. (with cutbacks to the poorest) :eek:

Ironmaiden11

You have some good ideas.Do you think there will be a sort of world war for resources? At least that might tackle population growth...it remains to be seen whether we can change mentality.
People with poor impulse control and antisocial traits seem to be most likely to come out on top as they already are in many of the positions of power and control many assets although perhaps intelligence will be victorious. It could be a case of humans needing to exterminate other humans who can't live in a socially minded way for the sake of survival of the race?
I'm a bit scared about what's coming

_AVALANCHE_

Ironmaiden11 wrote: »

People with poor impulse control and antisocial traits seem to be most likely to come out on top as they already are in many of the positions of power and control many assets although perhaps intelligence will be victorious.

BornToKill

Voodoo_rasher wrote: »

13 months on and Irish people unaware, not informed of this??

http://info-wars.org/2010/10/03/hedge-funds-hold-ireland-to-ransom-over-anglo-irish-bank-bail-out/

Does the Govt. / controlled Media think Irish population are too thick to understand all of this, therefore say nothing

So the ######g b#nd-holders turn out to be hedge-funds. Someone

pls explain how bad that is. Just think, the Govt can be taken to court

over not paying back the bond losses - well a population cannot be

taken to.....\

Eireann go Bás.

That's a 15 month old story on junior bondholders, not a nugget. The subordinated bondholders have been aggressively discounted. Some of them mounted challenges and those were contested in court. It's all been in the newspapers.

Worztron

I don't recall the radio station or show I heard this on today - may have been newstalk. It claimed 168 (160 odd anyway) people owed €60 billion -- that puts a big damper on douche Kenny lites claim that the Irish public are to blame.

Those 160 or so greedy scum should never see the light of day again. :mad:

Belfast

Worztron wrote: »

I don't recall the radio station or show I heard this on today - may have been newstalk. It claimed 168 (160 odd anyway) people owed €60 billion -- that puts a big damper on douche Kenny lites claim that the Irish public are to blame.

Those 160 or so greedy scum should never see the light of day again. :mad:

Of course the Irish Public are to blame.
We elected the people who caused the problem.

A lot of people like David McWilliams warmed us but we still kept electing people who were bankrupting the country.

No one in the Dáil listened to the warnings or did anything about them and we kept voting for them.

Worztron

Belfast wrote: »

Of course the Irish Public are to blame.
We elected the people who caused the problem.

A lot of people like David McWilliams warmed us but we still kept electing people who were bankrupting the country.

No one in the Dáil listened to the warnings or did anything about them.

I never took out loans, never got into debt, never went spending mad and never voted for FF nor FG. I am not to blame.