Varadker's "financial bomb"

wendell borton

http://www.rte.ie/news/2012/0122/politics.html
Varadker has been warned by the troika that not repaying the €1.2bn due this wednesday to unsecured bondholders would be like an economic bomb going off, which would lead to higher bills and mortgages.

I say it it go off, we are all ready paying higher stealth taxes and cuts to services to pay the interest on the money borowed to pay for the bondholders.

Chucky the tree

wendell borton wrote: »

http://www.rte.ie/news/2012/0122/politics.html
Varadker has been warned by the troika that not repaying the €1.2bn due this wednesday to unsecured bondholders would be like an economic bomb going off, which would lead to higher bills and mortgages.

I say it it go off, we are all ready paying higher stealth taxes and cuts to services to pay the interest on the money borowed to pay for the bondholders.

Don't forget to pay our public service and unemployed. That's where most of the money is going.

edanto

Indeed, it's true that's where most of the money is going. But obviously if we decided not to pay back these Anglo investors, then our financial position would be healthier and we would be a better loan prospect.

It's explained far better in this article:

Stephen Donnelly TD wrote:

The ECB's representative stressed the need for stable financial markets, requiring the payment of bondholders. The obvious flaw in position was expertly exposed by Vincent Browne during Thursday's press conference. The reason for paying unguaranteed bondholders? Vincent asked. To maintain the financial stability of the Irish banking system, explained Klaus. But then why pay Anglo bondholders, when Anglo is no longer a part of our banking system, and when the paying of them makes it harder for Ireland to recover and in fact makes it more difficult to honour our legitimate, sovereign debts? No explanation was forthcoming.

http://www.independent.ie/opinion/analysis/stephen-donnelly-small-eurozone-states-must-work-together-to-scare-away-bogeymen-2996301.html

HellFireClub

"Not deferred, not discussed, not reduced, just NOT PAID", to quote Varadker when he previously ran into a similar situation.

hallelujajordan

edanto wrote: »

Indeed, it's true that's where most of the money is going. But obviously if we decided not to pay back these Anglo investors, then our financial position would be healthier and we would be a better loan prospect.

It's explained far better in this article:



http://www.independent.ie/opinion/analysis/stephen-donnelly-small-eurozone-states-must-work-together-to-scare-away-bogeymen-2996301.html

Interested in understanding why you think we would be a better loan prospect post defaulting on our bonds ? Intuitively, the market should consider us a greater risk if we have already had a default event and that should weaken our ability to borrow in the bond market, No ??

I can't see where Stephen Donnelly's article explains your position.

meglome

wendell borton wrote: »

I say it it go off, we are all ready paying higher stealth taxes and cuts to services to pay the interest on the money borowed to pay for the bondholders.

Really we need to stop this mantra. We are paying most of the money back for our overspending, nothing to do with the banks. We can cut our spending now by 15 billion and face the consequences. Of course given the crying about the relatively easy budget we just had I can't see any public support for that. Easier to keep shouting about the banks and ignoring the elephant in the room.

HellFireClub

hallelujajordan wrote: »

Interested in understanding why you think we would be a better loan prospect post defaulting on our bonds ? Intuitively, the market should consider us a greater risk if we have already had a default event and that should weaken our ability to borrow in the bond market, No ??

I can't see where Stephen Donnelly's article explains your position.

We should be spending a lot more time making the argument that a "default event" to my mind is a state being unable to meet, as opposed to not being prepared to pay a debt as it falls due.

This is not the same thing, I think, or at least we should be making the argument that it is not the same thing, as repudiating debt that there should never have been any liability placed upon us to pay.

It's not like we can't write a cheque for this amount in the morning, but it doesn't necessarily follow that us writing the cheque is the right thing to do, how telling someone who is an private UNSECURED creditor, that they are not being repaid, can considered to be a default event, is completely beyond me.

Godge

HellFireClub wrote: »

We should be spending a lot more time making the argument that a "default event" to my mind is a state being unable to meet, as opposed to not being prepared to pay a debt as it falls due.

This is not the same thing, I think, or at least we should be making the argument that it is not the same thing, as repudiating debt that there should never have been any liability placed upon us to pay.

It's not like we can't write a cheque for this amount in the morning, but it doesn't necessarily follow that us writing the cheque is the right thing to do, how telling someone who is an private UNSECURED creditor, that they are not being repaid, can considered to be a default event, is completely beyond me.

but it doesn't matter what a default event means in your mind, it only matters what it means on the market.

You can argue all you like that it is "repudiating debt that there should never have been any liability placed upon us to pay" but the fact is the FF government decided on the 30th September 2008 that indeed it was a liability they wished to put upon us. Just because they were too stupid to realise what a monumentally stupid decision it was and that we would pay for that decision for twenty years or more doesn't mean that we should be let off the hook for it. Our FF government decided of its own free will, against European advice, to guarantee our banks in what they thought would be the cheapest bailout ever, and when that gamble falls flat, we have to pay the price, like it or not. From the day the guarantee was put in place we have been on a track to where we are today.

john reilly

meglome wrote: »

Really we need to stop this mantra. We are paying most of the money back for our overspending, nothing to do with the banks. We can cut our spending now by 15 billion and face the consequences. Of course given the crying about the relatively easy budget we just had I can't see any public support for that. Easier to keep shouting about the banks and ignoring the elephant in the room.

how does this change the fact that we are just "kicking the can down the road" and will inevitably have to renigh on are debts, so why pay half them before we cant pay any more, why not stop now and hold onto what we have and get the pain over with now instead of prolonging it

john reilly

if the germans have threatened us with a bomb, we must be at war and yet are goverments answer is to just take it. why did people vote for these muppets

Godge

john reilly wrote: »

how does this change the fact that we are just "kicking the can down the road" and will inevitably have to renigh on are debts, so why pay half them before we cant pay any more, why not stop now and hold onto what we have and get the pain over with now instead of prolonging it

It is not a fact that we will have to renege on our debts. It is an opinion held by certain popular economists who like the sound of their own voices. Other more sensible economists such as Seamus Coffey (http://economic-incentives.blogspot.com/ see his website) believe that we will be able to pay our way.

later12

meglome wrote: »

Really we need to stop this mantra. We are paying most of the money back for our overspending, nothing to do with the banks.

Sorry, I'm really opposed to default of sovereign debt and a unilateral default on banking debt but this is not true.

The Irish crisis is a product of overspending, but it is also very much a product of the Irish banking industry.

Banks and bank employees certainly get too much bad press in some of the media invective, but the term "nothing to do with the banks"in the above post goes way too far,and is very wide of the mark. This was a banking crisis that became a sovereign crisis. If you add up the bank liabilities (which go far beyond the recapitalisation and contingency provisions of the EU-IMF programme) they are indeed vast and they are form a significant explanation for Ireland's sovereign debt crisis.

There are two extremes in this argument sometimes; representing an extreme that this is "nothing to do with the banks" is really no more true than the alternative extreme ("this was everything to do with the banks").

Scofflaw

john reilly wrote: »

if the germans have threatened us with a bomb, we must be at war and yet are goverments answer is to just take it. why did people vote for these muppets

The Germans have not threatened us with a bomb. Indeed, nobody has threatened us with a bomb except Varadkar, because it's purely his phrasing:

He said the troika of EC, ECB and IMF, which is supplying Ireland’s bailout loans, had issued a stark warning to the Government about the consequences of IBRC not repaying the money.

"What they’ve said really is that: ‘It’s on your head. We don’t want you to default on these payments. It is your decision ultimately. But a bomb will go off, and the bomb will go off in Dublin, not in Frankfurt.’"

Mr Varadkar made the comments on RTÉ’s The Week in Politics. He told the Irish Examiner last night that the comments were his characterisation of the ECB’s warning rather than a direct quote, as he did not deal directly with the troika.

Read more: http://www.irishexaminer.com/ireland/troika-warns-of-financial-bomb-in-dublin-181098.html#ixzz1kNKRIHO9

cordially,
Scofflaw

meglome

later10 wrote: »

Sorry, I'm really opposed to default of sovereign debt and a unilateral default on banking debt but this is not true.

The Irish crisis is a product of overspending, but it is also very much a product of the Irish banking industry.

Banks and bank employees certainly get too much bad press in some of the media invective, but the term "nothing to do with the banks"in the above post goes way too far,and is very wide of the mark. This was a banking crisis that became a sovereign crisis. If you add up the bank liabilities (which go far beyond the recapitalisation and contingency provisions of the EU-IMF programme) they are indeed vast and they are form a significant explanation for Ireland's sovereign debt crisis.

There are two extremes in this argument sometimes; representing an extreme that this is "nothing to do with the banks" is really no more true than the alternative extreme ("this was everything to do with the banks").

I don't disagree and I actually said "We are paying most of the money back for our overspending, nothing to do with the banks". Most, the majority, certainly not all. My main point is many people are fixated on the banks and are missing where the biggest long term problem lies. They are also using the banks/ECB/IMF as a convenient scapegoat for their own actions and previous long term voting habits.

donegal_road

they are good at getting poor old Varadkar to break bad news. And he words it in such a way so as to cause controversy, it was very similar to when he hit the headlines re people taking 1 holiday less etc. They are using him as a smoke screen of some sort... maybe to take the heat off Noonan who has fallen out of favour with the public with his remarks on emigration.

antoobrien

edanto wrote: »

Indeed, it's true that's where most of the money is going. But obviously if we decided not to pay back these Anglo investors, then our financial position would be healthier and we would be a better loan prospect.

It's interesting to note that we pay for the PS & sw in about 18 months than we will ever pay out to the anglo bondholders (which of course isn't going to be paid out over such a short time frame).

john reilly

antoobrien wrote: »

It's interesting to note that we pay for the PS & sw in about 18 months than we will ever pay out to the anglo bondholders (which of course isn't going to be paid out over such a short time frame).

A f.g t.d said on the radio today that if we didnt pay the bondholders we would have to immediately cut p.s pay and social welfare by 30%. Brilliant win-win

Scofflaw

I find I'm increasingly irritated by RTE's coverage of this issue. They seem to have adopted a particular narrative, which is that the ECB are forcing Ireland to do pay the bondholders, and are quite willing to quote in "support" of that claim Government Ministers saying something completely different.

Today's coverage of the unsecured repayment is a good example of the style:

Ireland has 'no choice' on €1.25bn Anglo bond

Tánaiste Eamon Gilmore and Minister for Finance Michael Noonan have both said Ireland has no choice but to pay €1.25bn to Anglo Irish bank bondholders as not doing so would cost the country more.

Arriving at Government Buildings for the weekly Economic Management Council meeting Mr Noonan said that all along we have been told by the ECB the consequences would be serious if we did not pay.

Mr Gilmore said he understood that taxpayers are annoyed at having to pay the unsecured bondholders and that it riled him as well.

He said the Goverment is continuing to discuss Ireland's debt situation with the Trokia and he would be hopeful of a result.

He said their whole approach is already paying dividends as seen by the yield on Irish bonds now dropping to 6% for the first time since the bailout began.

The European Central Bank has warned that defaulting on payments could have negative consequences.

Now it's certainly true that the ECB has said there are risks associated with non-payment, and that's clearly what they believe, but it's also clear that the risks and spillovers they're referring to aren't a threat from the ECB, because the ECB has no credible threats they can make against Ireland - they are simply a statement of the ECB's view of likely market consequences.

The implication of the article, though, is clearly that the government is under duress, and were it not for the ECB, would happily give these bondholders a haircut. I don't think that's true at all - I think repayment in full is something that the government has decided on, which is what the ECB said at the troika press conference.

Is this a government line from RTE, or is it their own particular spin? It seems to be the latter.

cordially,
Scofflaw

FreudianSlippers

Scofflaw wrote: »

I find I'm increasingly irritated by RTE's coverage of this issue. They seem to have adopted a particular narrative, which is that the ECB are forcing Ireland to do pay the bondholders, and are quite willing to quote in "support" of that claim Government Ministers saying something completely different.

Today's coverage of the unsecured repayment is a good example of the style:

Ireland has 'no choice' on €1.25bn Anglo bond

Tánaiste Eamon Gilmore and Minister for Finance Michael Noonan have both said Ireland has no choice but to pay €1.25bn to Anglo Irish bank bondholders as not doing so would cost the country more.

Arriving at Government Buildings for the weekly Economic Management Council meeting Mr Noonan said that all along we have been told by the ECB the consequences would be serious if we did not pay.

Mr Gilmore said he understood that taxpayers are annoyed at having to pay the unsecured bondholders and that it riled him as well.

He said the Goverment is continuing to discuss Ireland's debt situation with the Trokia and he would be hopeful of a result.

He said their whole approach is already paying dividends as seen by the yield on Irish bonds now dropping to 6% for the first time since the bailout began.

The European Central Bank has warned that defaulting on payments could have negative consequences.

Now it's certainly true that the ECB has said there are risks associated with non-payment, and that's clearly what they believe, but it's also clear that the risks and spillovers they're referring to aren't a threat from the ECB, because the ECB has no credible threats they can make against Ireland - they are simply a statement of the ECB's view of likely market consequences.

The implication of the article, though, is clearly that the government is under duress, and were it not for the ECB, would happily give these bondholders a haircut. I don't think that's true at all - I think repayment in full is something that the government has decided on, which is what the ECB said at the troika press conference.

Is this a government line from RTE, or is it their own particular spin? It seems to be the latter.

cordially,
Scofflaw

Do you believe the market danger concerns? I'm not sure what to think; it's certainly not outside of the realm of possibility that burning bond holders would hurt our market interest rates, but would this last to when we did go back to the markets (2016?)?

If the answer is no, then we may as well give it a punt; things could only get better (or worse)

Scofflaw

FreudianSlippers wrote: »

Do you believe the market danger concerns? I'm not sure what to think; it's certainly not outside of the realm of possibility that burning bond holders would hurt our market interest rates, but would this last to when we did go back to the markets (2016?)?

If the answer is no, then we may as well give it a punt; things could only get better (or worse)

I'm in two minds on the reality of market concerns. I'd agree the risk is there, and given the relatively trivial savings to be made by burning the last few bonds, I'd be disposed not to do so, were I the government.

There are - to quote Dick Cheney Donald Rumsfeld* - known unknowns and unknown unknowns on the risk side here.

The risk may be confined to a temporary rise in sovereign bond rates and an extension of the market lockout of the Irish banks - known unknowns. The former there I don't regard as necessarily a bad thing, because I'm of the view that the government is seeking to escape from troika tutelage before they're forced to make any really hard decisions, and I suspect, in turn, that that would mean a return to merely optical reform, because the markets don't have access to the real information in the way the troika does. The latter may actually wind up costing us more than the haircut saves.

Unknown unknowns, though...what if the action cause the fragile growth in confidence in Ireland to shatter, rather than just being temporarily reversed?

cordially,
Scofflaw

*thanks, KIERAN1

Kinski

Scofflaw wrote: »

I find I'm increasingly irritated by RTE's coverage of this issue. They seem to have adopted a particular narrative, which is that the ECB are forcing Ireland to do pay the bondholders, and are quite willing to quote in "support" of that claim Government Ministers saying something completely different.

Today's coverage of the unsecured repayment is a good example of the style:



Now it's certainly true that the ECB has said there are risks associated with non-payment, and that's clearly what they believe, but it's also clear that the risks and spillovers they're referring to aren't a threat from the ECB, because the ECB has no credible threats they can make against Ireland - they are simply a statement of the ECB's view of likely market consequences.

The implication of the article, though, is clearly that the government is under duress, and were it not for the ECB, would happily give these bondholders a haircut. I don't think that's true at all - I think repayment in full is something that the government has decided on, which is what the ECB said at the troika press conference.

Is this a government line from RTE, or is it their own particular spin? It seems to be the latter.

cordially,
Scofflaw

I don't see anything in that article that supports your claims about RTÉ "spin".

Scofflaw

Kinski wrote: »

I don't see anything in that article that supports your claims about RTÉ "spin".

The juxtaposition of points which, while true in themselves, create an impression that's not backed up by the facts mentioned. The article goes like this:

1. Tánaiste Eamon Gilmore and Minister for Finance Michael Noonan have both said Ireland has no choice but to pay...

2. ...we have been told by the ECB the consequences would be serious if we did not pay.

3. Mr Gilmore said...it riled him as well.

4. ...the Goverment is continuing to discuss Ireland's debt situation with the Trokia...

5. The European Central Bank has warned that defaulting on payments could have negative consequences.

So, the "government must do this" is followed by "the ECB says that", repeated a couple of times. The narrative is very plain - the government must do this because the ECB says that, which is not the case. There's a reference to our troika debt negotiations, which is a not too subtle way of saying "and remember, folks, these guys hold the whip hand".

At this point both the government and the troika have said at various points that it's a government decision and the government's preference that the bonds be repaid.

cordially,
Scofflaw

sarkozy

I was at an Anglo: Not Out Debt campaign event last night. I found the main speaker convincing in his argument that there is no bomb were we to renage on this debt.

Anyway, useful resources are here.

Kinski

Scofflaw wrote: »

The juxtaposition of points which, while true in themselves, create an impression that's not backed up by the facts mentioned. The article goes like this:

1. Tánaiste Eamon Gilmore and Minister for Finance Michael Noonan have both said Ireland has no choice but to pay...

"...as not doing so would cost the country more."

Nowhere in that article does it suggest, or imply, that the larger costs Gilmore mentioned would come as some form of sanction imposed by the ECB.

And how does any of this prove your assertion that RTÉ "are quite willing to quote in "support" of that claim Government Ministers saying something completely different"? Have you seen the unedited content of the interviews? Or direct quotes from them which can be held up as evidence that the broadcaster is twisting their words?

If they were somehow compelling every reporter on their staff to follow an editorial line that ("implicitly") shifts responsibility for the decision to make the repayments onto the ECB, then why would they go for a banal headline like: "Ireland has 'no choice' on €1.25bn Anglo bond"? Why not "Gilmore 'riled' by unsecured bondholder repayments"? It's not everyday that a deputy prime minister states that some govt policy "riles" him...if I was aiming to follow that line, then that's the story I would have written.

Also, it was Varadker who used the unfortunate metaphor of a "financial bomb." The thing about bombs is that they're usually planted by someone...

Scofflaw

Kinski wrote: »

"...as not doing so would cost the country more."

Nowhere in that article does it suggest, or imply, that the larger costs Gilmore mentioned would come as some form of sanction imposed by the ECB.

I would say it does imply exactly that - which is of course only my opinion. I've laid out why I formed that opinion about it, and you're obviously free to disagree, but a mere repudiation by you doesn't change anything I've said.

Kinski wrote: »

And how does any of this prove your assertion that RTÉ "are quite willing to quote in "support" of that claim Government Ministers saying something completely different"? Have you seen the unedited content of the interviews? Or direct quotes from them which can be held up as evidence that the broadcaster is twisting their words?

Actually, that was from the Lyric FM news earlier today, who rather baldly stated that the ECB were making us pay the bonds, then went to a clip of a government Minister explaining why the government thought it was a good idea to pay them. Alas, I failed to transcribe it.

Kinski wrote: »

Also, it was Varadker who used the unfortunate metaphor of a "financial bomb." The thing about bombs it that they're usually planted by someone...

That's kind of meaningless, though, since everything that happens in finance is the result of human action - there are no unbendable physical laws in operation. It would apply perfectly well to market actors - rather better, in fact.

The ECB have no real threats they can make against Ireland that don't involve creating an even worse mess than the threat is supposed to prevent. So the idea of ECB 'duress' isn't very credible.

cordially,
Scofflaw

Kinski

Scofflaw wrote: »

I would say it does imply exactly that - which is of course only my opinion. I've laid out why I formed that opinion about it, and you're obviously free to disagree, but a mere repudiation by you doesn't change anything I've said.

The article is probably just drawing on whatever interview material a reporter got from the two Ministers as they made their way to this meeting - probably just a few snatched words. If Gilmore and Noonan both said things like "The ECB has told us yadda yadda yadda," and didn't appear to take any responsibility for the analysis of the potential outcomes of a default, speaking, as they do, on behalf of the Govt of which they are members, I just don't see how that can be interpreted as evidence that the journalist is twisting things (every line in the article, bar the last one, states that "So-and-so said"). It would actually be misleading to not include in the report that every mention of possible consequences was prefaced by "The ECB warns" or some such. And as I said above, there is IMO a much more useful angle available in Gilmore's use of the word "riles," if that were the route one wanted to go down.

Actually, that was from the Lyric FM news earlier today, who rather baldly stated that the ECB were making us pay the bonds, then went to a clip of a government Minister explaining why the government thought it was a good idea to pay them. Alas, I failed to transcribe it.

Well, that would be interesting to hear, but you'd need much more than just a Lyric FM news report to prove that this was an editorial line throughout the organisation.

That's kind of meaningless, though, since everything that happens in finance is the result of human action - there are no unbendable physical laws in operation. It would apply perfectly well to market actors - rather better, in fact.

I'm not sure what you're getting at, but I will say that the "bomb" metaphor (with all its terrorist connotations) suggests an act which aims to destroy, one which is self-righteous and vindictive. I don't really think you could characterise being locked out of bond markets by prohibitive interest rates, for example, as being something like being the victim of terrorism.

Scofflaw

Kinski wrote: »

The article is probably just drawing on whatever interview material a reporter got from the two Ministers as they made their way to this meeting - probably just a few snatched words. If Gilmore and Noonan both said things like "The ECB has told us yadda yadda yadda," and didn't appear to take any responsibility for the analysis of the potential outcomes of a default, speaking, as they do, on behalf of the Govt of which they are members, I just don't see how that can be interpreted as evidence that the journalist is twisting things (every line in the article, bar the last one, states that "So-and-so said"). It would actually be misleading to not include in the report that every mention of possible consequences was prefaced by "The ECB warns" or some such. And as I said above, there is IMO a much more useful angle available in Gilmore's use of the word "riles," if that were the route one wanted to go down.

No mention is made, however, of the many statements that have now been made by the government explaining why they think the bonds need to be repaid.

Kinski wrote: »

Well, that would be interesting to hear, but you'd need much more than just a Lyric FM news report to prove that this was an editorial line throughout the organisation.

I would accept that, of course!

Kinski wrote: »

I'm not sure what you're getting at, but I will say that the "bomb" metaphor (with all its terrorist connotations) suggests an act which aims to destroy, one which is self-righteous and vindictive. I don't really think you could characterise being locked out of bond markets by prohibitive interest rates, for example, as being something like being the victim of terrorism.

I'm having to presume here that you're claiming that the ECB would somehow be the ones planting such a bomb. If so, you now need to put forward a credible threat from the ECB that they could carry out without producing exactly the same effect as burning these bonds, but several magnitudes more explosively.

Because if the ECB has no credible threat, there can't realistically be any question of duress from them.

cordially,
Scofflaw

Kinski

Scofflaw wrote: »

No mention is made, however, of the many statements that have now been made by the government explaining why they think the bonds need to be repaid.

Which I'm sure RTÉ covered at the times they were made; like I said, this article is just a report of what these two said to some reporter this morning, which may not have been much more than what is contained in the article. And it does report Gilmore's assertion that their policy is "already paying dividends."

I'm having to presume here that you're claiming that the ECB would somehow be the ones planting such a bomb. If so, you now need to put forward a credible threat from the ECB that they could carry out without producing exactly the same effect as burning these bonds, but several magnitudes more explosively.

I was just unpacking Varadker's metaphor.

If anyone is trying to shift responsibility onto the ECB, it's more likely members of the Govt. I find it hard to buy the idea that a reporter, probably sent out this morning to grab a few quotes from govt members and then file copy as quickly as possible, carefully contructed an article which, while factually accurate, subtly places all responsibility for this policy onto the ECB's shoulders.

On the other hand, you have Gilmore claiming this approach is proving successful, while at the same time saying that repaying unsecured bondholders "annoys" him, and Varadker talking about "financial bombs" going off in Dublin if the Govt don't follow the ECB's recommendations. That sounds like politicians talking out of both sides of their mouths to me.

wendell borton

Paying back the bond holders is is all part of FG subservience to the ECB and EU, trying to be good little europeans.

Scofflaw

Kinski wrote: »

Which I'm sure RTÉ covered at the times they were made; like I said, this article is just a report of what these two said to some reporter this morning, which may not have been much more than what is contained in the article. And it does report Gilmore's assertion that their policy is "already paying dividends."

Fair point.

Kinski wrote: »

I was just unpacking Varadker's metaphor.

If anyone is trying to shift responsibility onto the ECB, it's more likely members of the Govt. I find it hard to buy the idea that a reporter, probably sent out this morning to grab a few quotes from govt members and then file copy as quickly as possible, carefully contructed an article which, while factually accurate, subtly places all responsibility for this policy onto the ECB's shoulders.

Ah - no, I don't think that's how it happens. I think it just gets written according to a pre-existing "mental framework", or, knowing journalists, gets tweaked by an editor according to one.

Kinski wrote: »

On the other hand, you have Gilmore claiming this approach is proving successful, while at the same time saying that repaying unsecured bondholders "annoys" him, and Varadker talking about "financial bombs" going off in Dublin if the Govt don't follow the ECB's recommendations. That sounds like politicians talking out of both sides of their mouths to me.

It sounds like a fairly standard attempt to shift any possible blame during the process, while doing the groundwork for being able to claim credit if it works.

cordially,
Scofflaw

Liam Byrne

Does anyone know how much they are being paid ?

Let's say for a second that a guaranteed investment returns 2%
Let's say that an unguaranteed investment returns 5%

Now, assuming these people have been getting 3% extra for the last 10 years or whatever, doesn't that mean that they've already gotten 30% more than their investment would warrant, now that it's guaranteed ?

So couldn't a perfectly valid argument be made to - at most - pay them back 70% ? They've already gotten the other 30% that wouldn't have been paid to lower-risk bondholders.

* Personally they're not owed anything, but let's try to discuss a sensible, factual middle-ground here.

KIERAN1

Scofflaw wrote: »

There are - to quote Dick Cheney - known unknowns and unknown unknowns on the risk side here.

Not been an ass here. But that quote came from the mouth of Donald Rumsfield not Dick Cheney.

http://www.youtube.com/watch?v=GiPe1OiKQuk&feature=related

Crazy Horse 6

Bit thick is that Varadker tbh. Using the word bomb is not okay given the past in this nation.

KIERAN1

john reilly wrote: »

A f.g t.d said on the radio today that if we didnt pay the bondholders we would have to immediately cut p.s pay and social welfare by 30%. Brilliant win-win

I hope that is said with tongue in cheek? I think you should realise the fact, the majority of people who are unemployed and would be claiming benefits are doing so because they've no other choice, but to do so. When there was jobs to go to people worked, its the Irish way. Were not a lazy race history proves that statement to be true.

Obviously we have small "Minority" of people living within this country who've been claiming the dole all their working lives and have never desired a job. This should be a immediate priority for the Social Welfare. People who've been unemployed since the 90's should be questioned and be asked why they have been unemployed for so long and give their reasons? We need to get some of very long term unemployed people back into education and motivate them to do something with their lives, other people we probably we need to cut their benefits as their just useless and lazy and will never change! We should not discriminate between single or married men either. Some married men i have know doubts have been claiming benefits since the early 90's and they have never desired or had any willingness to ever apply for a job that was advertised. Long term unemployed men and married should not be not left alone by the social welfare.

People who've recently only become unemployed (last four years or five) need to be treated with more respect and dignity. These people are not lazy they just need opportunities to enable them to get back to work.

That FG TD might not have been wrong. We are locked out of the bond markets until they decide were suitable again. We're currently today borrowing to reduce our budget deficit and keep our day to day public services running. I'd guess the question is if we can't get the money we need from Europe, were do we get it from? Theirs not lot of options available to us. I guess we could enquire and ask China or the FED in the United States as last resort for cash. But what would we have to give away to China or the States for them to agree to lend us?

I personally believe the banks have got away with murder and have scammed everyone in this country. They've used fear to quell our anger. That we need to do this our else this will happen to us if we don't!!!!

This economic crisis has shown me more then ever Governments are not really in control, and are not accountable to the people, their real masters are the greedy elite living all across the world. The bondholders are causing the turbulence with the financial markets why would they do this? Well governments they know will come in and bail them out with the taxes that were gathered from their citizens. Banks across Europe are also making interest on the money we borrowed from them (it be funny if it wasn't so serious). Its a rigged game honestly, but most of the population of Ireland and people who are subjected to same thing are too blind or ignorant to know any better.

wingsof daun

These people are fools (Kenny, Varadkar etc). They are being scaremongered by foreigners that things will deteriorate in Ireland if we don't pay or bow to their demands. The rape of our wealth fund is being continued by this government. It is our soverign wealth fund. Where are the votes or the referenda on the 1.2 billion that was paid to the unsecured? Where is the moral justice in this country? Who is going to stand up for Irish soveirgn rights? The looneys in the Dail aren't. Unless they get their act together and they better do it soon. We are not better off having our economic soverignty out of our own hands, don't be fooled by that notion. Some people seem to think they have halos over their heads or something . Brussels is somewhere 1000miles away. Can the planet Pluto be governed by Saturn? They are committing the acts of traitors raiding our money patching up banks and bondholders. Where is the resistance from this government? Where is the defiant spirit which is a characteristic of a proud people? The solution never lied with bailing out banks etc, we will be better off long term if we end this nonsense of bailouts and giving money to Anglo. We are better than this. One of the first steps has to be to get out of the clutches of the IMF, an unelected bunch of rascals! Who are you? Any representative from a bank or IMF official that comes to my house looking for money will be met with fire.

FreudianSlippers

wingsof daun wrote: »

These people are fools (Kenny, Varadkar etc). They are being scaremongered by foreigners that things will deteriorate in Ireland if we don't pay or bow to their demands. The rape of our wealth fund is being continued by this government. It is our soverign wealth fund. Where are the votes or the referenda on the 1.2 billion that was paid to the unsecured? Where is the moral justice in this country? Who is going to stand up for Irish soveirgn rights? The looneys in the Dail aren't. Unless they get their act together and they better do it soon. We are not better off having our economic soverignty out of our own hands, don't be fooled by that notion. Some people seem to think they have halos over their heads or something . Brussels is somewhere 1000miles away. Can the planet Pluto be governed by Saturn? They are committing the acts of traitors raiding our money patching up banks and bondholders. Where is the resistance from this government? Where is the defiant spirit which is a characteristic of a proud people? The solution never lied with bailing out banks etc, we will be better off long term if we end this nonsense of bailouts and giving money to Anglo. We are better than this. One of the first steps has to be to get out of the clutches of the IMF, an unelected bunch of rascals! Who are you? Any representative from a bank or IMF official that comes to my house looking for money will be met with fire.

wow. Just... wow...

meglome

FreudianSlippers wrote: »

wow. Just... wow...

hehe I was going to say something pretty similar earlier but hadn't had a chance.

Scofflaw

We might have jumped the shark here.

amused,
Scofflaw

Permabear

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antoobrien

Permabear wrote: »

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Why stop at RTE? Any media reporting I've seen has been driven at catching the sales pitch without regard for accuracy (par for the course then).

JustinDee

Permabear wrote: »

This post had been deleted.

I think David Murphy's coverage has been excellent as always. He's a very good business editor.