an ignorant question

geordief

I confess but I wonder , as the Greek situation seems to be coming to a conclusion (?) whether the consequences being mooted for countries such as Portugal, Spain ,Italy and Ireland ( the list could be longer ...) are consequences , in the case of Ireland in particular that may (have ) been due even if the economy here had been managed in a perfect way (or at least in a half decent way)
I appreciate that this is an academic (?) and hypothetical question but was this a bullet that Ireland was never going to dodge?

aftermn

Access to credit is wonderful, even necessary. Debt is dangerous, as we are now finding out.

If we had no debt we need have no fear of the bullit, but if we had no debt would we still be mainly an agricultural economy.

Dannyboy83

Don't really understand the question.
I think you're asking if we would have needed a bailout, if our economy had been properly managed?

The answer is probably not, imo.
The reason we needed a bailout, is because we could no longer borrow on the bond markets.

Why could we no longer borrow on the bond markets?
At the moment, we are having the equivalent of a mini-banking crisis, every single year, due to the ongoing obscene borrowing/spending. The budget hole over the last 3 years has been in excess of €70 billion I believe. So another 3 years of this, and it will have been like a second banking crisis all over again.

Investors are not scared of Ireland because of one large bank bailout mistake, realistically the opposite is true -> that would prove that we are a safe country to invest in, because we privatise profits and socialise debts.

The reason they are scared is because the government continues to grossly mismanage the economy, 3 years after the banking crisis and even after a change of government.
i.e. Not only have we not shown investors that we are capable of repaying them, we've made it crystal clear that we can't even sustain ourselves.

This is not going to change.

Our government are not going to close the defecit through reduction in expenditure, they are going to do it through taxation.
Investors know that in a country like Ireland, high taxation=minimal growth, especially with so much wasteful government spending.

This waffle about going back to the bond markets in 2013 is just PR.
We will be looking for another bailout.

geordief

Dannyboy83 wrote: »

Don't really understand the question.
.

maybe that is what I meant about it being an ignorant (ie a bit vague and more of a feeling than an opinion) question.I think I was saying that all the states in Europe seem to be at some sort of a risk and Ireland ,being so small ( and with the altruism/solidarity ) of some of the European countries appearing lacking could be vulnerable even if the economy had been managed within accepted norms of correctness (including the banks of course)

Beau

No we would be completely fine then! No deficit equals no borrowing.