Ireland must default

zero_hope

Ireland will never be able to repay it's debt and therefore at some point it must default.

If you put together all debts of government, private citizens and corporation Ireland probably is the most indebted country in the world.
http://www.davidmcwilliams.ie/2012/01/25/private-debt-so-enormous-that-default-is-only-option?utm_source=dlvr.it&utm_medium=twitter&utm_campaign=private-debt-so-enormous-that-default-is-only-option

Ireland's total debt is a staggering 660% of GDP, servicing this debt will at some point make up over a third to half of Ireland's tax revenue and this is not sustainable.

Some sort of default is inevitable.

Sykk

No.

zero_hope

Sykk wrote: »

No.

How do you think Ireland will be able service this debt?

Solair

Is that figure not astronomical for several countries, including the UK, if you calculate it including the banks total liabilities (which include deposits) and various other aspects of non-public debt?

I'm not saying our debts are realistically serviceable, but I don't think public debt is anywhere near 600%+ much of it is also IFSC operations which we do not guarantee (unless FF did something even more stupid than the bank guarantee !!)

Morrisseeee

Here's another link, and it paints a sad picture !!
Basically (as regards Foreign dept) Ireland owes €390k per person, compared to Greece @ €38k and Spain @ €41k, in fact we are 10 times greater than any of the other countries !!
Our Foreign dept is @ €1.7tn compared to GDP @ €0.2tn !!

Godge

Now, let me see, David McWilliams, the man who dreamt up the bank guarantee (but later said it wasn't that kind of bank guarantee I meant) that bankrupted the country takes one table in a report and concludes we have to default.

Meanwhile, another economist, in the Irish Independent today, deconstructs that table, examines the figures, checks them for validity and reaches an opposite conclusion.

http://www.independent.ie/opinion/analysis/seamus-coffey-david-mcwilliams-analysis-of-private-debt-is-stark-but-it-also-100pc-wrong-3000117.html


Read both pieces and think for yourself.

stackerman

For what it's worth here's my take on it.

Irish debt is NOWHERE near that of the UK and the US. It is also just a pimple on the European picture. The US is screwed, and the Euro is only "up first" because of it's difficulty in printing money. Thanks to the US world QE it's happening anyway. So what is to be done about the MASSIVE incomprehensible debt that the western world faces ?

Two options

-A 1930's style crash, wright off of all debts, bank holidays etc.

OR

-Create hyperinflation and let that take care of the debt !!

The US has allowed its country to grow beyond it means for years by simply printing money out of fresh air and devaluing their $ in the process. This however will not sort the problem now, its gone FAR beyond it.

So my prediction, the US, UK and possibly some EU countries will war monger in the straights (Hormus) and slowly escalate the situation. Thus driving up fuel prices and then knock on to most other commodities. Panic will set in slowly once people realise that prices are rising fast, and their savings are being quickly eroded.
High inflation, if not hyper inflation to follow.
And the beauty of doing it this way (and intentionally so) is that the various governments can blame someone/something else. Instead of admitting that their economic policies, or lack of, are at fault.

Maybe I'm wrong, but thats where the figures point me.

You asked

RichardAnd

It seems to me that a sizable number of western states are "screwed" under the rules of a game that was invented by . . . western states!

I truly wish Johnathan Swift was still alive to work this joke into Gulliver's Travels 21st century. God be merciful on us, wrenched Yahoos that we are

Slydice

zero_hope wrote: »

How do you think Ireland will be able service this debt?

As it stands, we won't.

Politicians (as they do) will wait and kick the can down the road in the hope that they don't have to deal with the problem.

We'll either default or something will change in our situation which will result in us not having to.

Either way, we've taken money out from the loan shark (bondholders), we've taking more money out from the local banks (central bank of ireland) and now we're moving on to taking money from the credit union (european central bank).

So, we're out of cash, we're in debt and we're borrowing more money to pile onto the debt.

but...

Our mates are giving us work (foreign direct investment and food prices going up around the work) which is helping a little but it's not enough right now.

So, eventually we'll have borrowed so much that we just plain can't find anyone else to give us money or maybe we'll default or leave the euro. Maybe the ECB will start printing euros, maybe they'll do "quantative easing" (giving the printed euros only to banks). Who knows? Maybe Germany and England will write down some of the money we owe.

Scofflaw

zero_hope wrote: »

Ireland will never be able to repay it's debt and therefore at some point it must default.

If you put together all debts of government, private citizens and corporation Ireland probably is the most indebted country in the world.
http://www.davidmcwilliams.ie/2012/01/25/private-debt-so-enormous-that-default-is-only-option?utm_source=dlvr.it&utm_medium=twitter&utm_campaign=private-debt-so-enormous-that-default-is-only-option

Ireland's total debt is a staggering 660% of GDP, servicing this debt will at some point make up over a third to half of Ireland's tax revenue and this is not sustainable.

Some sort of default is inevitable.

You have two different types of debt mixed up there. Tax revenue only services public debt, which is expected to top out at 118% of GDP in 2013 according to the fourth troika review, and expected to decline to 111% of GDP by 2016. Those aren't great numbers, but they aren't anywhere near what you're quoting, which is the figure for private debt.

And not only is it a figure for private debt, but it's a figure for gross debt, not net. Without seeing the corresponding assets figure, it's a figure that means relatively little.

cordially,
Scofflaw

stackerman

SO glad austerity is working, and we should be thankful for it. Sure isn't it our own fault :rolleyes:

Fitch downgrades credit ratings of 5 eurozone nations including Italy, Spain, Belgium
Friday, January 27, 10:30 AM

LONDON — U.S. ratings agency Fitch says it is downgrading the credit ratings for five European nations including leading economic heavyweights Italy and Spain.

The agency on Friday lowered credit ratings for the five nations by one notch and placed a negative outlook on all of them, as well as on Ireland. Those nations downgraded included Belgium, Cyprus, Italy, Slovenia and Spain.

Italy went down to A- credit rating while Spain was downgraded to A. Ireland’s BBB+ rating was affirmed but it also received a negative outlook.

Fitch Ratings blamed the revisions on “the marked deterioration in the economic outlook” in Europe and “the absence of a credible financial firewall against contagion and self-fulfilling liquidity crises.”

jased10s

i'd rarther be asked than forced to pay USC... me and my partner paid over 7k in USC last year , thats money we could have spent in the local economey.

ArmaniJeanss

jased10s wrote: »

i'd rarther be asked than forced to pay USC... me and my partner paid over 7k in USC last year , thats money we could have spent in the local economey.

And income tax as well.... If they didn't take income tax from my pay packet every single month I'd have an extra 35%+ to spend in the local enonomy.

GSF

The general populist view in Ireland seems to be that we must default on our current debt. we must then start borrowing again to fund our lifestyles as we have concluded that it is too painful to close the budget gap. So inevitably in some date in the future as yet unknown we must default again. And on and on we must go. Borrowing and defaulting. Because we dont seem to be willing to balance the budget.

Morrisseeee

jased10s wrote: »

i'd rarther be asked than forced to pay USC... me and my partner paid over 7k in USC last year , thats money we could have spent in the local economey.

More than likley tho you'd save a quarter, spend a quarter in Ireland, and spend the other half (abroad) on a holiday !!! So..............it makes sense for Enda to reach into your pocket & take €7k, afterall he has to give it to some poor unfortunate unsecured bond holder

Bullseye1

With everyone owing everyone else huge amounts of money surely there will be a write down of debt at some stage in the future.

Icepick

The author calls himself an economist. This piece is lazy, inaccurate, alarmist and offers no practical solutions to the problem.

Ireland will not be able to pay off the debt as currently projected. That does not mean that it should default like Argentina.

The author feeds the extremist opinion that the only way out is to either pay off everything or default.

thebman

jased10s wrote: »

i'd rarther be asked than forced to pay USC... me and my partner paid over 7k in USC last year , thats money we could have spent in the local economey.

And if the state didn't tax me and gave me free money each month, I'd be able to contribute more to the local economy.

Why isn't the government giving me free money and when will they stop taxing me?

Dannyboy83

Godge wrote: »

Now, let me see, David McWilliams, the man who dreamt up the bank guarantee (but later said it wasn't that kind of bank guarantee I meant) that bankrupted the country takes one table in a report and concludes we have to default.

Meanwhile, another economist, in the Irish Independent today, deconstructs that table, examines the figures, checks them for validity and reaches an opposite conclusion.

http://www.independent.ie/opinion/analysis/seamus-coffey-david-mcwilliams-analysis-of-private-debt-is-stark-but-it-also-100pc-wrong-3000117.html


Read both pieces and think for yourself.

What is his agenda?

He posted this on his Facebook on Friday (after that rebuttal by Seamus Coffey):
http://www.bbc.co.uk/news/business-15748696

I've seen this particularly misleading piece of nonsense debunked on everything from car to bodybuilding forums but David McWilliams is great at stirring up a panic, isn't he?

He knows full well what he is doing; it's reprehensible in my opinion and it's ironic because he genuinely is talking down the economy here, which would be laughable, only that he is scaring the sh1te out of ordinary people who don't understand... He is a panic merchant.


The Journal got the chop from my RSS Feeds after their blatant misrepresentation of Noonan's comments last week.

David Mcwilliams got the chop on Friday after this tripe:



Good riddance.

thebman

The Journal got the chop from my RSS feed for their FF youth movement push when the college year started with no balance toward other parties.

That and a few other questionable articles IMO.

As for the whole external debt measurement mentioned by David McWilliams and other places, it has been dealt with many times here before.