So what if we had let the banks collapse......

Hitman3000 wrote: »

FG and Lab converted the promissory note into sovereign debt at a late night sitting in the Dail as a court case against it's legality was launched.

Yes. The court case was lost, the loss appealed and the appeal rejected.

We made out own poor decisions and we got to deal with their consequences.

kaymin wrote: »

Iceland bounced back from recession within 2 years. The reason we had a lost decade was because the banks were hamstrung from legacy high debts. If we allowed banks to fail, the new banks to emerge would not have had that problem.

Iceland has the same population as Cork. They didn't have the same economy or level of debt. They had their own currency....
There is so many difference between the two situations that it is completely ridiculous to even put them in the same sentence for comparison when talking about letting banks fail.

Hitman3000 wrote: »

Anyone ever identify the Maple 10?

https://www.google.com.au/amp/s/amp.independent.ie/irish-news/courts/who-were-the-maple-10-30196885.html

What has that got to do with anything? Maybe have a look at the reason for the Maple 10...i.e. Sean Quinn.

Wanderer78 wrote: »

was there are any coercion from financial institutions in such a decision?

Everything stems from the decision on the bank guarantee,and I'm not aware of any 'coercion' in that decision.
We made our own mistakes and we need to grow up and accept responsibility and stop trying to put it on other people.

We aren't children.

Hitman3000 wrote: »

Contradicts a few of the earlier posts on this thread.

Maybe they were deleted..............

Wanderer78 wrote: »

Come on now, there's loads of writings now to confirm coercion from well established financial institutions, even the IMF is starting to say, imposing these bailouts, and as political scientist mark Blyth would say, the death nail policy of austerity on such nations is truly dreadful economic theory. It's time we put the financial sector back into its box, or god knows what will happen. We re effectively encouraged to make our own mistakes during the era of cheap credit

There may or not be 'loads of writings' saying all sorts of things.
Evidence on the other hand ...

We need to be responsible for our own poor decisions.

Wanderer78 wrote:

Come on now, there's loads of writings now to confirm coercion from well established financial institutions, even the IMF is starting to say, imposing these bailouts, and as political scientist mark Blyth would say, the death nail policy of austerity on such nations is truly dreadful economic theory. It's time we put the financial sector back into its box, or god knows what will happen. We re effectively encouraged to make our own mistakes during the era of cheap credit

If the banks hadn't been bailed out unemployment would have been way way way higher. Any business that relied on Irish banks for working capital facilitates such as an overdraft would have gone bust overnight. Anyone with a deposit in an Irish bank would have lost their money overnight. The result of that would have been large amounts of people would have been unemployed suddenly overnight. The debt relating to the the money people borrowed would also would not have gone away. When you factor in the impact of that on government finances there would have been far far deeper cuts to the budget. That would caused massive social damage. No sane government would let that happen. You didn't need any external pressure to make the decision.

You can argue over the exact method and that's where there is an argument about external pressure. However the bank guarantee was an Irish decision. At one point it was called the cheapest bailout in history. The problem was it took too long for the Irish government to grasp the fact that the banks were insolvent. The only way the bank guarantee makes sense if you think the banks only had a temporary liquidity problem.

Wanderer78 wrote:

What part does critical sectors such as our financial sector play in creating such situations, and do we have the relevant regulations and regulatory bodies in place to control such sectors, and are such sectors truly democratic, and operate with the overall needs of society within their ethos?

Because there was no incentive. You cannot look at the bank bailout and its causes in isolation. You have to factor everything else that was going on at the time. The large increase in spending and reduction in tax rates in the 2000's were only possible a property bubble financed by reckless bank lending. If FF had tackled the bank lending and property bubble they would probably not have won the 07 election. Every other party was saying spend, spend. Remember the bank bailout makes up only a minority of the money borrowed since the crash.

Even now there has been some criticism directed at the Central Bank for its Bank lending restrictions. Which is crazy.

Hitman3000 wrote: »

Once I asked a question you answered thank you. Why you still going on about it is a mystery.

The biggest mystery is why you asked the question in the first place.

Hitman3000 wrote: »

Actually you taking such a defensive attitude is what AMUSES me.

What defensive attitude? You asked a question irrelevant to the thread topic and I answered it wondering why you asked it.

Phoebas wrote: »

We guaranteed the bondholders in a decision made by FF in government. We became the debtholders at that point.

It wasn't the EU or the US or anyone else that made that decision for us and the bailout was a direct consequence of our own decision, freely made. We even had the gall to tout for business based on the bank guarantee.

No point in trying to shift the blame when the whole thing went tits up.

FF made the decision to guarantee bondholders for a year. FG extended that guarantee. Both the EU and the US applied pressure on Irish politicians to do so. They should have been told where to go.