Ireland and the 2nd Bailout / Enda Kenny

Stiffler2

Why is Ireland returning to the borrowing markets even though economists are saying Ireland needs a second bailout ?

First of all we're no where near paying back what we owe and won't be for decades.

Secondly why the F**K does Enda even want Ireland to return to the borrowing markets ??

We can either borrow from the markets and pay back a 7% interest rate or we can continue to borrow from the IMF / ECB and pay back the interest rate on those loans at 2%.

Am I missing something here ???
Does Enda need to return to school to go back to Maths class ??

Or the new way of how Irish people should be thinking which is :

What's in it for Enda and his cronies for returning to the normal markets ?
Possibly some sort of backhanders from the EU or special pay out they get ??

charlietheminxx

Not ANOTHER one of these threads..... FFS! What's wrong with commenting on one of the existing ones?

the groutch

Borrowing from IF/EU = they call the shots
Borrowing from markets = we call the shots

admiralofthefleet

enough of these threads. enda story

stevenmu

In short we're spending far more than we're earning, so we need to borrow from someone.

If we borrow from the IMF/ECB bailout fund we get a better rate but in order to actually get the money we need to agree to their terms and conditions. These conditions will sooner or later dictate that we drastically cut basic social welfare rates, and probably huge cuts in health care spending as well.

If we borrow from the open market the money is more expensive but gives the government a free hand to set economic policy as they see fit.

IMO the first option (including drastic cuts), would be better for the country as a whole, but would be catastrophic for FG/Labour in the next election. Therefore I expect them to go with the second option.

bleg

Nah it was only one guy that said it and what he says doesn't have much weight even in his home country.

Sykk

Stiffler2 wrote: »

Why is Ireland returning to the borrowing markets even though economists are saying Ireland needs a second bailout ?

First of all we're no where near paying back what we owe and won't be for decades.

Secondly why the F**K does Enda even want Ireland to return to the borrowing markets ??

We can either borrow from the markets and pay back a 7% interest rate or we can continue to borrow from the IMF / ECB and pay back the interest rate on those loans at 2%.

Am I missing something here ???
Does Enda need to return to school to go back to Maths class ??

Or the new way of how Irish people should be thinking which is :

What's in it for Enda and his cronies for returning to the normal markets ?
Possibly some sort of backhanders from the EU or special pay out they get ??

You're missing a lot. Especially about the basics of how a country needs money to operate.

WoollyRedHat

There be gold in those mountains

MrStuffins

Stiffler2 wrote: »

Am I missing something here ???

Yeah, its called the search function

Stiffler2

the groutch wrote: »

Borrowing from IF/EU = they call the shots
Borrowing from markets = we call the shots

Well that's obvious, but even if we did return to the markets the EU will still call the shots since we're using the same currency anyway ?

We'll still have to tighten our belts and cut spending regardless of where we are borowing the money from.

Enda - Borrow it from the IMF / ECB

it's cheaper for all of us !

Frank Black

the groutch wrote: »

Borrowing from IF/EU = they call the shots
Borrowing from markets = we call the shots

Yeah, we need to regain our economic freedom as soon as possible so we can completely **** things up again.

later12

Stiffler2 wrote: »

Secondly why the F**K does Enda even want Ireland to return to the borrowing markets ??

Because the crisis mechanism won't always be there.

It's a crisis mechanism; an emergency. If the value of our debt stock increases, thereby lowering yields, we can be assured that investor confidence in the sovereign is recovering, and the crisis is tapering out.

So when this program comes to its scheduled end, if our market rates are anywhere near sustainable, German and French and other core European tax payers should feel no obligation to guarantee our debts (which is what they are doing at the moment)

When a sovereign's debt stock rises in value, there may be positive feedback loop effect where the market satisfies itself that that debt stock is now safe, a sort of self-fulfilling prophecy of the opposite kind that we have been accustomed these latter days.

A similar effect applies to our internal economy, which enjoys greater investor confidence provided we can control our new found popularity and maintain our debt at sustainable levels.

By the way, the programme's interest rate is closer to 3%, not 2%.

Son Of A Vidic

Stiffler2 wrote: »

Does Enda need to return to school to go back to Maths class ??

Oh it's more than just Maths that muppet needs to brush up on.

44leto

I would say don't borrow, to spite the huge difficulties I would say cuts and higher taxes is the prudent way to go.

Picture it like your household, when you are strapped for cash if you are wise you cut back, you don't borrow more and you never go to a loan shark, at least you shouldn't.

Freddie59

Sykk wrote: »

You're missing a lot. Especially about the basics of how a country needs money to operate.

Not spending more than you're taking in would seem the appropriate starting point. O course, to do this you need to reduce PS wages, Social Welfare, etc. And no-one has the balls to do it.

One day - and that day will be soon - this will blow up in ALL our faces. There won't BE any money for SW, PS wages, or lavish PS pension "entitlements". Cuts in these will be the least of the worries.

Any normal household could not function the way this country does. Imagine earning €320 a week and spending €500? And borrowing a further €40 EVERY week to fund the difference?

Just to pay the kids their pocket money?:rolleyes:

Super-Rush

charlietheminxx wrote: »

Not ANOTHER one of these threads..... FFS! What's wrong with commenting on one of the existing ones?

Exactly.