govt default and Farmers

awaywithyou

well lads,

was wondering with all this talk of a default on the huge debts the govt have....

how will farmers be affected by it????

pakalasa

http://www.independent.ie/business/personal-finance/what-would-happen-to-your-money-if-ireland-defaulted-2647568.html

Tora Bora

Grass will still grow, cows will still come bulling, calves, lambs, will still be born, etc., etc..
People will still need to eat at home and abroad.

Maybe we will fare better than some other sectors.

Rather have any spare bit of cash invested in something agricultural at the moment, than in any of the Irish banks. At least I can look out in the morning and see if its still where it was the night before.

Come to think of it, if Greece defaults, the pressure in the euro financial system will rise several notches. Spain will shake. God knows what would come after that.
Maybe the arrogance if the French and Germans will come back to haunt them, with their big banks up to their eyes, in PIG, country debt.

Billions of Irish savings, stashed away in German and French banks, might well be wiped out.

Another reason to keep a few more cows.:cool:

johngalway

"Millions of Argentinians were also forced to barter for food and petrol that year because they were not allowed to spend the money in their bank accounts."

Yes, wonderful picture. People calling for default don't know what they're wishing for. I'm firmly against it, regardless of the other road to be traveled.

Our exports would be worth a lot less, our imports would become a lot more expensive.

Who here has a machinery/shed loan or mortgage? What would the price of fuel do? The price of fert? The price of feed?

Nightmare if you ask me.

pakalasa

We wouldn't have to default if the government had the bottle to cut the deficit. Sadly, but that aint going to happen with Labour in power. Don't want to upset the unions.
We would more than likely be forced back to the punt. Farmers would be king of the road again. Exports would be worth a fortune but our (Irish people in general) standard of living would hit the floor. You could kiss goodbye to cheap foreign holidays and petrol would hit the roof. Multi-nationals would look favourly at us again and we'd have to work for a living, rather than speculating on property.
Do we seriously think we can keep borrowing €50 million a day without hitting a wall. Either way, there are tough times ahead.

theaceofspies

If & when this country defaults direct farm payments from Europe will start to look very shaky methinks. Time to tug the forelocks once again to Lizzie Windsor.

nilhg

johngalway wrote: »

"Millions of Argentinians were also forced to barter for food and petrol that year because they were not allowed to spend the money in their bank accounts."

Yes, wonderful picture. People calling for default don't know what they're wishing for. I'm firmly against it, regardless of the other road to be traveled.

Our exports would be worth a lot less, our imports would become a lot more expensive.

Who here has a machinery/shed loan or mortgage? What would the price of fuel do? The price of fert? The price of feed?

Nightmare if you ask me.

I'm no economist but not sure that we would definitely have to leave the euro if we did default, I think a lot of what you are referring to would arise if we left the euro and immediately devalued.

In that case I'd hope we (farmers) would be able to elect to keep receiving our SFP in euro.

pakalasa wrote: »

We wouldn't have to default if the government had the bottle to cut the deficit. Sadly, but that aint going to happen with Labour in power. Don't want to upset the unions.
We would more than likely be forced back to the punt. Farmers would be king of the road again. Exports would be worth a fortune but our (Irish people in general) standard of living would hit the floor. You could kiss goodbye to cheap foreign holidays and petrol would hit the roof. Multi-nationals would look favourly at us again and we'd have to work for a living, rather than speculating on property.
Do we seriously think we can keep borrowing €50 million a day without hitting a wall. Either way, there are tough times ahead.

I suppose it will come down to whether something happens in a planned way with the support of our European "partners" or we are forced to do something off our own bat.

Not going to be pleasant one way or the other.

theaceofspies wrote: »

If & when this country defaults direct farm payments from Europe will start to look very shaky methinks. Time to tug the forelocks once again to Lizzie Windsor.

I think it would be hard to discriminate against Irish farmers WRT their SFP, it's a completely separate scheme from anything to do with our bank troubles, the Dept handle the processing and distribution but the money comes from the CAP for the benefit of the farmers.

johngalway

nilhg wrote: »

I'm no economist but not sure that we would definitely have to leave the euro if we did default, I think a lot of what you are referring to would arise if we left the euro and immediately devalued.

In that case I'd hope we (farmers) would be able to elect to keep receiving our SFP in euro.

I think the choice would be taken out of our hands at that stage. Look at the generosity the French and Germans are displaying towards us at the moment. Plus, we'll soon have a rather nationalistic Government in place in Finland, if that hasn't already happened.

Right now, we actually have protection being in the Euro. Outside of it we'd be the lone duck at the bottom of a very dark barrel.

haybob

That’s one of the most sensible posts I have seen anywhere, some of the people who are roaring for default could be roaring for food

johngalway wrote: »

"Millions of Argentinians were also forced to barter for food and petrol that year because they were not allowed to spend the money in their bank accounts."

Yes, wonderful picture. People calling for default don't know what they're wishing for. I'm firmly against it, regardless of the other road to be traveled.

Our exports would be worth a lot less, our imports would become a lot more expensive.

Who here has a machinery/shed loan or mortgage? What would the price of fuel do? The price of fert? The price of feed?

Nightmare if you ask me.

irishh_bob

pakalasa wrote: »

We wouldn't have to default if the government had the bottle to cut the deficit. Sadly, but that aint going to happen with Labour in power. Don't want to upset the unions.
We would more than likely be forced back to the punt. Farmers would be king of the road again. Exports would be worth a fortune but our (Irish people in general) standard of living would hit the floor. You could kiss goodbye to cheap foreign holidays and petrol would hit the roof. Multi-nationals would look favourly at us again and we'd have to work for a living, rather than speculating on property.
Do we seriously think we can keep borrowing €50 million a day without hitting a wall. Either way, there are tough times ahead.

intransigent unions , high public sector pay , high wellfare , all small fry compared to the massive debt we have been saddled with by way of the bank guarentee put in place by the last goverment , the worst part of it all is how the bailout :rolleyes: is being potrayed abroad as some sort of charity , the reality is that we the irish tax payer are picking up the tab for reckless lending by german , french and british banks , germany was in rescession for 15 yrs after reunification , they had no one to lend to domestically so instead lent to the likes of fingers at anglo irish bank , anyone who thinks what the french and germans are doing at the monent is generous , well all i can say is , i hate to see what you call draconian , were not just called pigs , were being bled like a stuck pig

5live

irishh_bob wrote: »

intransigent unions , high public sector pay , high wellfare , all small fry compared to the massive debt we have been saddled with by way of the bank guarentee put in place by the last goverment , the worst part of it all is how the bailout :rolleyes: is being potrayed abroad as some sort of charity , the reality is that we the irish tax payer are picking up the tab for reckless lending by german , french and british banks , germany was in rescession for 15 yrs after reunification , they had no one to lend to domestically so instead lent to the likes of fingers at anglo irish bank , anyone who thinks what the french and germans are doing at the monent is generous , well all i can say is , i hate to see what you call draconian , were not just called pigs , were being bled like a stuck pig

Yup that just about sums it up for me too. 10/10. As pakalasa said borrowing close to 50 million a day just isnt sustainable. Would anyones business survive if you were borrowing 500 euro a week every week for the next 2 years with little or no hope of ever actually stopping borrowing not to mind actually paying off the accumulated debt? There is NO soft landing coming. The only hope appears to be 'burden sharing' but in 2 years time??? I only know what a guy in the bank told me last year. Cut down borrowing and pay off as much as you can as fast as you can and start putting some cash under your bed, preferably x and n denominated notes (germany and austria)

JohnBoy

It'll be a serious test of the new government to see what they'll do if/when we get a reduction in the eu bailout interest rate.

If that reduction is worth let's say half a billion per annum will they simply reduce the deficit by half a billion, or stick with their current (too slow imho) deficit reduction schedule and simply spend that half billion?


However, as to the original question of the impact on farmers?

they should be one of the better placed sectors to ride out the storm, between direct payments, and an export driven sector they'll be the ones bringing in the money.



whether that money will make it to the farmers or stay with the processors or not is another question entirely.




I too am wholly against a unilateral default.

irishh_bob

5live wrote: »

Yup that just about sums it up for me too. 10/10. As pakalasa said borrowing close to 50 million a day just isnt sustainable. Would anyones business survive if you were borrowing 500 euro a week every week for the next 2 years with little or no hope of ever actually stopping borrowing not to mind actually paying off the accumulated debt? There is NO soft landing coming. The only hope appears to be 'burden sharing' but in 2 years time??? I only know what a guy in the bank told me last year. Cut down borrowing and pay off as much as you can as fast as you can and start putting some cash under your bed, preferably x and n denominated notes (germany and austria)

the 50 billion we are borrowing is only to run the country , that 50 billion doesnt include the money we have been lent to bail out the banks , the point is , even we cut public spending by half down to 25 billion and had 5 billion to spare , we would still be faced with the gargantuan bank debt , the bank debt dwarves all other considerations , im no fan of our present unions or of having some of the highest paid public servants in the world but the harsh reality is that all those things pale into insignificance when it comes to the nightmare that is the bank bailout , morgan kelly is correct , we should reject the bailout and knuckle down for the **** storm that would follow but at least we could re-emerge a number of years afterwards , free , im not being dramatic when i say it could be our second rising , europe is becoming insignificant anyhow , just because we left the euro or perhaps even the EU , doesnt mean china , india and other emerging powers wouldnt want to trade with us , id rather be poor than be little more than a small cog in a european super state