Morgan Kelly - Scorching attack on Honohan, the ECB and Irish politicians

Sir Oxman

http://www.irishtimes.com/newspaper/opinion/2011/0507/1224296372123.html

In this piece, Morgan Kelly firmly lays the blame for the entrenchment of Ireland's predicament and ultimate bankruptcy at the door of Honohan & the ECB
He lashes into Honohan for his incompetence and acquiescence to the ECB - his "manageable" mantra guaranteed the payout of billions to the bondholders which is all but done now.

Kelly paints a picture of inevitable bankruptcy which will be catastrophic for what's left of Ireland's reputation.
He also points the finger at Paul Geithner for torpedoing the IMF's plan of two-thirds of a haircut for 30bn unguaranteed bonds


"Honohan’s miscalculation of the bank losses has turned out to be the costliest mistake ever made by an Irish person. Armed with Honohan’s assurances that the bank losses were manageable, the Irish government confidently rode into the Little Bighorn and repaid the bank bondholders, even those who had not been guaranteed under the original scheme. This suicidal policy culminated in the repayment of most of the outstanding bonds last September."

However, i don't understand completely his solution to it all - it looks like he is saying cut the banks loose, the ECB can't punish that as it would trigger catastrophy around Europe and cut borrowing to zero immediately - tough and misearble for a few years but according to Kelly, the only way.

He maintains we are being used as a cork on the Spanish bottle to stop them exploding and engulfing the Euro project.

Have to say, it's a very interesting read.

beeftotheheels

gambiaman wrote: »

He lashes into Honohan for his incompetence and acquiescence to the ECB - his "manageable" mantra guaranteed the payout of billions to the bondholders which is all but done now.

Kelly paints a picture of inevitable bankruptcy which will be catastrophic for what's left of Ireland's reputation. He also points the finger at Paul Geithner for torpedoing the IMF's plan of two-thirds of a haircut for 30bn unguaranteed bonds
.

Paul Geithner - who is this man and what right has he to any say in the running of our economy???:rolleyes:

Is this per chance an argument that if Irish people paid a little more attention to detail at the right time we might not be in this predicament?

Sir Oxman

beeftotheheels wrote: »

Paul Geithner - who is this man and what right has he to any say in the running of our economy???:rolleyes:

Is this per chance an argument that if Irish people paid a little more attention to detail at the right time we might not be in this predicament?

Indeed.
I'd like your opinion on his IT piece beef, when you get the chance to digest it.;)

beeftotheheels

gambiaman wrote: »

Indeed.
I'd like your opinion on his IT piece beef, when you get the chance to digest it.;)

Oh, well if we're to stay on topic, the man needs to consider the legal ramifications of what he has suggested. His position doesn't undermine our membership of the euro, it potentially undermines our membership of the EU. Not sure that that is something I would be prepared to gamble with, but at least I realize that that is what is on the table if we start suggesting the ECB should shoulder out debts.

Quite frankly I am sick to death of commentators suggesting that we "should follow the Icelandic model of national interests first" without acknowledging that the courts outside Iceland may yet make the Icelandic people stand over the debts they believe that they have avoided.

It is not simple, and it is not simply a matter for economists. The problems pre-date Patrick Honohan getting the top job at the Irish central bank, the problems were not caused by the ECB. I'm all for reducing the terms of our bailout, the ECB seems to have my (our) back on this.

http://www.irishtimes.com/newspaper/breaking/2011/0506/breaking3.html

So threatening them with our debts when they are already possibly breaking the rules to support us, seems a little harsh, and strikes me as possibly being in breach of EU law.

Dob74

The golden phase that these debts are MANAGEABLE.
This line of thinking has bankrupted this country.
The banking debt is clearly not manageable.

JonathanAnon

Patrick Honohan is responding right now on (1.05pm) RADIO ONE on their news program...

RubyRoss

What was the gist of his response?

beeftotheheels

RubyRoss wrote: »

What was the gist of his response?

IT summary

http://www.irishtimes.com/newspaper/breaking/2011/0508/breaking31.html

meditraitor

beeftotheheels wrote: »

IT summary

http://www.irishtimes.com/newspaper/breaking/2011/0508/breaking31.html

Wasn't really a response? did he actually say anything that shows Kelly was wrong....I couldn't see it.

The more I look at it the more I can see Honahan for what he is,

Scofflaw

There's another, more active, thread in Irish Economy: http://www.boards.ie/vbulletin/showthread.php?t=2056260991

moderately,
Scofflaw