Portugal seek bailout.

strobe

Spain next I guess. How will this effect Ireland's situation I wonder?

Link: http://www.reuters.com/article/2011/04/06/us-portugal-debt-idUSTRE7351EQ20110406

(Reuters) - Portugal's caretaker government said on Wednesday it had decided to seek financing from the European Union in an abrupt turnaround after resisting a bailout for months despite sharply deteriorating financial conditions.
The nation of 10.5 million became the third member of the euro zone to seek a rescue after Greece and Ireland after months of fending off market pressure to request assistance, as borrowing costs soared amid deepening political instability.

Prime Minister Jose Socrates said in a televised statement that parliament's rejection of additional austerity measures last month had aggravated the financial situation, ultimately making the request for aid "inevitable."

"I tried everything, but in conscience we have reached a moment when not taking this decision would imply risks that the country should not take," he said.

Portugal's position worsened last month when his minority Socialist government resigned after the parliamentary defeat, casting the country into political limbo. An early general election is set for June 5.

Bond yields spiked, ratings agencies downgraded sovereign and bank debt, and local banks warned this week they may no longer be able to buy government paper.

"In this difficult situation, which could have been avoided, I understand that it is necessary to resort to the financing mechanisms available within the European framework," Finance Minister Fernando Teixeira dos Santos said.

Euro zone officials say Lisbon is likely to need between 60 and 80 billion euros in European and International Monetary Fund loans over three years, but any assistance will be subject to strict conditionality.

The European Commission's top economic official, Olli Rehn, welcomed the Portuguese decision, saying it was in the interest of the 17-nation single currency area as a whole.

"This is a responsible move by the Portuguese government for the sake of economic stability in the country and in Europe," Rehn told Reuters.

DEFICIT TARGET MISSED

EU officials have been striving to prevent financial market contagion spreading beyond Portugal to affect larger economies such as Spain, which has undertaken major economic reforms and a banking clean-up to stay out of danger.

In a moment of farce, Socrates began to make a televised statement at 1900 GMT but his appearance was aborted after a few seconds because of a technical hitch, resuming 40 minutes later.

His government has implemented a series of spending cuts, tax rises and wage curbs and proposed further measures aimed at reducing the public deficit to 4.6 percent of gross domestic product this year after missing last year's 7.3 percent target.

Following a restatement of public accounts, the 2010 deficit came in at 8.6 percent.

steddyeddy

strobe wrote: »

Spain next I guess. How will this effect Ireland's situation I wonder?

Any links mate?

EDIT: heres one http://www.theaustralian.com.au/business/news/portugal-asks-eu-for-financial-bailout/story-e6frg90x-1226035045336

Basq

Portugal's caretaker prime minister has confirmed the country has called for a bailout from the European Union.

In a television statement, Jose Socrates said the administration had requested financial aid from the European Commission.
For months the debt-laden country has resisted increasing pressure to apply for help from the European Union (EU) and the International Monetary Fund (IMF).
Until now Lisbon has said it could manage on its own, but its borrowing costs reached unsustainable levels after the collapse of the government in March.
The move makes Portugal the third country in the eurozone to ask for help, following Greece and Ireland.

The European Commission's top economic official, Olli Rehn, welcomed the decision, saying it was in the interest of the 17-nation single currency zone.
Eurozone officials have said Lisbon is likely to need between €60bn (£52.6bn) and€80bn (£70.2bn) in EU and IMF loans over the next three years.
On Wednesday Portugal raised more than €1bn ($877m) on the bond markets, but had to pay an interest rate of 5.9% on its 12 month bonds, compared to 4.3% previously.
Speaking ahead of the announcement on Jeff Randall Live, Larry Kantor, global head of research at Barclays Capital welcomed the developments.
"The sooner they get the assistance and we establish this, the sooner we'll get more stable markets there."

Sky News

cherryghost

http://www.bbc.co.uk/news/business-12993318

Earlier today: Don't worry brah's, we haz monies.

Later today: lol jk, we need some. Give us plz k thx

karlog

They can go to hell.

strobe

steddyeddy wrote: »

Any links mate?

Sorry, edited. It's confirmed so there are lots out there.

Saila

at bit like the way the bank guarantee did

"ha our money is guaranteed now so fuk the rest of em!"

super_furry

So how will this effect the price of a pint?

ctrl-alt-delete

Classic bit of footage shown on ITV news,

Enda with the Greek and Portuguese PM with commentary saying they all swapped notes a few weeks ago

steddyeddy

Well this will have a massive effect on the stability of the euro!

fontanalis

karlog wrote: »

They can go to hell.

Exactly; Ireland got to the bottom first.

Daroxtar

And the ECB is raising its interest rates....are they having a laugh?

galwayrush

I suppose we could give them advice...:pac::pac:

strobe

Surely what the PIGS should do now is team up and go to the EU and say, "k here's the deal, 1% interest on all our loans over a massively long time period or we call a press conference and publicly default simultaneously. Kill this whole show, financially suicide bomb the EU"

(not an actual suggestion)

policarp

Another one to join the losers club.

KINGVictor

Getting very interesting, wonder what Barosso would make of this as its very close to home.

fontanalis

strobe wrote: »

Surely what the PIGS should do now is team up and go to the EU and say, "k here's the deal, 1% interest on all our loans over a massively long time period or we call a press conference and publicly default simultaneously. Kill this whole show, financially suicide bomb the EU"

(not an actual suggestion)

But when you don't really have much to negotiate with (ie in need of cash) the big boys who didn't over borrow can tell you where to go.

ascanbe

karlog wrote: »

They can go to hell.

If it's anything like our 'bailout' i.e. dumping the entire burden of an enormous international private debt on people who are not responsible for it, they'll be well on the way there.

fontanalis

galwayrush wrote: »

I suppose we could give them advice...:pac::pac:

On a cheapest bailout!

fontanalis

ascanbe wrote: »

If it's anything like our 'bailout' i.e. dumping the entire burden of an enormous private debt on people who are not responsible for it, they'll be well on the way there.

Was it not the guarantee that done that and the bail out that paid for it (along with running the country)?

Colmo52

Will Ireland be contributing to the bailout package??

steddyeddy

strobe wrote: »

Surely what the PIGS should do now is team up and go to the EU and say, "k here's the deal, 1% interest on all our loans over a massively long time period or we call a press conference and publicly default simultaneously. Kill this whole show, financially suicide bomb the EU"

(not an actual suggestion)

I know you were joking but seriously eire, greece and porto should consider forming a sort of technical group!

Mister men

It's coming apart slowly but surely. Spain next and then it's game over.

Ruu_Old

So long Euro.

strobe

fontanalis wrote: »

But when you don't really have much to negotiate with (ie in need of cash) the big boys who didn't over borrow can tell you where to go.

But their currency is our currency. Wouldn't a move like that destroy the Euro's value and therefore knock billions and billions off the price of Germany et els exports? It's not exactly nothing to negotiate with. Isn't it basically the only thing we have to negotiate with. We're like the guys in the bank, strapped with gelignite and holding the detonator, surrounded by cops. We have to make them believe we are willing to kill ourselves and take as many of them with us as we can.

(I'm sure there a very good reasons why it would be a very bad idea. I just don't know any of them. Just speculating like.)

Slydice

Things about to get interesting once this happens from what I gather.

From what I've read, we're likely to see Spain get stung next and that'll be the real test of the EU. Ireland, Portugal and Greece are just small fry next to spain from what I gather.

mike65

Club Med rides again. The Huns must be wishing they could bring back the Coal and Steel
Union

orourkeda

https://www.youtube.com/watch?v=rX7wtNOkuHo

RichieC

cherryghost wrote: »

http://www.bbc.co.uk/news/business-12993318

Earlier today: Don't worry brah's, we haz monies.

Later today: lol jk, we need some. Give us plz k thx

When did we see that before!

KINGVictor

Ruu wrote: »

So long Euro.

Do you think so? I would wager that it is a well thought out and perharps deliberate attempt at economic union.

Methinks the ECB essentially controlled by the Germans with the French as assistants knew this was going to happen.

In the long run, I suspect the Euro might benefit from this by enforcing a structural mechanism that the stability and growth pact failed to implement.

_Cato_

A sad day for Europe.


Nice.

ctrl-alt-delete

_Cato_ wrote: »

A sad day for Europe.


Nice.

Or Lisbon as it became known :pac:

fontanalis

ctrl-alt-delete wrote: »

Or Lisbon as it became known :pac:

Well it is the capital of Europe!

RichieC

KINGVictor wrote: »

In the long run, I suspect the Euro might benefit from this by enforcing a structural mechanism that the stability and growth pact failed to implement.

When you say Euro you mean us and the currency right?

ctrl-alt-delete

fontanalis wrote: »

Well it is the capital of Europe!

Needs the capital of Europe

ascanbe

fontanalis wrote: »

Was it not the guarantee that done that and the bail out that paid for it (along with running the country)?

The bank guarantee was introduced while the EU/ECB were in consultation with our government and were well aware of the problems Irish financial institutions were having.
We/the general public are not deemed worthy of knowing exactly why this decision was taken and who, exactly, was involved in advising our govt in making the decision.
It was not put to a referendum and was passed with the help of an opposition that was also not privy to this information and subsuquently found that what information they had been given by the government was wildly inaccurate.
Its legal standing is dubious, it should have been disowned by the succeeding government and there should be a full public enquiry into exactly why/how it was implemented; with a criminal investigation to follow if necessary.

_Cato_

I don't subscribe to the European Union.

It is a totalitarian entity; the result of vanity. Far from being a Utopia, it's inevitable failure - just how much damage it will cause is yet to be understood. I support entrance to the free commerce - Europe is nothing more than a warden directing traffic of beef and wine carts. It's very make up suites France and Germany on an economical level - but what about us? A country with less of a population than Berlin and Paris? Where do we come into their plans?

It is, essentially, an economic prison.

KINGVictor

RichieC wrote: »

When you say Euro you mean us and the currency right?

Both Richie, the Euro is basically an economic experiment by Europe supposedly for the benefit of Europeans.

fontanalis

ascanbe wrote: »

The bank guarantee was introduced while the EU/ECB were in consultation with our government and were well aware of the problems Irish financial institutions were having.
We/the general public are not deemed worthy of knowing exactly why this decision was taken and who, exactly, was involved in advising our govt in making the decision.
It was not put to a referendum and was passed with the help of an opposition that was also not privy to this information and subsuquently found that what information they had been given by the government was wildly inaccurate.
Its legal standing is dubious, it should have been disowned by the succeeding government and there should be a full public enquiry into exactly why/how it was implemented; with a criminal investigation to follow if necessary.

Here's hoping.

Jesus Wept

strobe wrote: »

Surely what the PIGS should do now is team up and go to the EU and say, "k here's the deal, 1% interest on all our loans over a massively long time period or we call a press conference and publicly default simultaneously. Kill this whole show, financially suicide bomb the EU"

(not an actual suggestion)

Shouldn't be paying it all in the first place.

RichieC

KINGVictor wrote: »

Both Richie, the Euro is basically an economic experiment by Europe supposedly for the benefit of Europeans.

Agreed.

_Cato_

Is anyone else having trouble signing in.

It says "Thanks for signing in" and all that...but then it goes back to the page and asks me to sign in...wtf?

Mr Cawley

It'll be fine, the dollar is a lot more F'ed than the Euro.

We can always print more euro:p

Or launch a second tier euro 'the gimpy euro'

I'll lend ireland money, 40% return per annum!

Also 'the road' for kicking the can down(Debt) can be a long long road if needs be!

all decisions that can be taken after each other, endlessly

PeterIanStaker

So, looks like the end of the European single currency project, within a year or two then.

*looks under mattress to see if there are any Punts stashed there*

bryaner

PeterIanStaker wrote: »

So, looks like the end of the European single currency project, within a year or two then.

*looks under mattress to see if there are any Punts stashed there*

I found a tenner yeaaaa..

prinz

We're a great bunch of lads altogether.

UglyBolloxFace

strobe wrote: »

Surely what the PIGS should do now is team up and go to the EU and say, "k here's the deal, 1% interest on all our loans over a massively long time period or we call a press conference and publicly default simultaneously. Kill this whole show, financially suicide bomb the EU"

(not an actual suggestion)

Interesting. Now, don't get me wrong I don't profess to be a financial whizzkid - but what's stopping the PIIG countries from carrying out what strobe has suggested above? What would be the downsides?

In my opinion, it would be in the greater interests of the EU system as a whole to accept this PIIG ultimatum, as the EU would collapse without them.

Hande hoche!

karlog wrote: »

They can go to hell.

Thanks, that made me laugh.

Penfailed

fontanalis wrote: »

Exactly; Ireland got to the bottom first.

Ah, no, that was Greece