Wanderer78 wrote: » the poster is absolutely spot on, growing public debt is absolutely fine, provided your economy can indeed continue to service these debts.
Geuze wrote: » First, are you sure banks are the main buyers? Read this:https://www.ntma.ie/uploads/general/Investor-Presentation-November.pdf see slide 30.
Arthur Daley wrote: » You know what gets me about all these discussions about debt is that it's a conversation without the creditors ever really playing a part in it. It is like a conversation in the front seats of a car, with the creditors sitting in the back, arms folded while it's decided what to do about the problem child. According to a post several posts up, the creditors are largely the Irish citizens, and then various European citizens via the ECB. In particular the creditors are future pensioners, who keep seeing the state default, yes default, on their pensions by pushing the pension age out. Continually pushing the pension age out because you cannot honour your commitments because you've taken on too much debt and too many commitments is a fairly major negative effect to us pensioners.
Seth Brundle wrote: » You make it sound like you want the citizens to have a voice in all of this. The citizens are ignorant in terms of national financial management and shouldn't be let anywhere near this. It would become politicised just like water charges.
Arthur Daley wrote: » In particular the creditors are future pensioners, who keep seeing the state default, yes default, on their pensions by pushing the pension age out. Continually pushing the pension age out because you cannot honour your commitments because you've taken on too much debt and too many commitments is a fairly major negative effect to us pensioners.
Brussels Sprout wrote: » The reason the pension age gets pushed out is twofold:People are living much longer There are proportionately fewer younger people to support the pensioners now due to a falling birth-rate That demographic shift is happening all over the western world and as a result pension ages are being pushed out.
Arthur Daley wrote: » Thanks, I don't know what IGB stands for but I'd suspect Eurozone pensions and Insurance companies are big holders of these debts.
Arthur Daley wrote: » But we have increases in population almost every year, due to migration in. I know the next line will be that some of the population increase is due to people getting older, but there is a limit to that, yes people are living longer on average but that is not the main driver of the population increase. Also, zero coupon bonds are not going to help here, and there is a limit to how much pensioners can fund zero coupon debt issued by government.
Harry Palmr wrote: » The Kaiser Bismarck chose 70 for the introduction of the state pension as it was about when most people dropped dead in the 1880s, it was lowered to 65 in 1917. That the retirement age has hardly shifted in generations as EVERYTHING else has changed is one of the great missteps of the last century.
Podge_irl wrote: » You have the causality completely backwards. Borrowing is not causing us to limit pensions, massive increases in pension payments are necessitating borrowing (among other things obviously). The demographic maps is changing rapidly and the ratio of workers to pensioners is constantly decreasing. The pension age will need to increase (and should have already) because of demographics and nothing more. In essence, you are borrowing to pay for pensioners now under the assumption that increased GDP and inflation will pay for it in the future.
moon2 wrote: » I feel like the second half of your sentence is being casually ignored throughout this entire thread. The truism being repeated is "everything is fine as long as it's fine". Yes, taking a loan is fine as long as you can pay it back. At what point will the debt we take on *no longer* be serviceable? At what interest rate would the current irish national debt become unsustainable? When will it begin to negatively impact our economy, our pensions, our ability to improve national infrastructure, or our day to day lives.
Edit: I assume the calculation being performed by our government is that $1 borrowed today will result in the county being $1.2 better off - i.e. borrowing will result in economic growth large enough to compensate for the loan and interest. What rate of growth do we need to sustain for that to hold true?
FreudianSlippers wrote: » Why? IMF already has multi-currency reserve. The USD has historically been one of the most stable currencies and nothing has changed there. US debt is largely short-term, so we'd need to see a massive depression in the US which didn't materially impact other countries to see a realistic reason to move away from the USD as the main currency reserve; but as I said, there are already other reserve currencies. If we're talking hypothetical in the longer term, maybe crypto could potentially be a new reserve... that's about as realistic as a massive move away from USD in the foreseeable future.
ice.cube wrote: » Agreed it isn’t going anywhere anytime soon but do you think it will remain in place long term? The big question mark is on a suitable alternative as I stated earlier. The Fed attempted to take their foot off the printing press pedal in 2019 however were unable to successfully do so. This year has obviously been unprecedented but for every $1 the government spends .50c is basically money created out of nothing. I would have doubts on how they can bring these massive deficits into line in the short to medium term. Throw in the trade deficits and they are basically creating dollars, selling the debt across the world and then using that money to buy goods from other countries. This is a very interesting point IMO. Obviously the dollar isn’t the only reserve currency, but you have to wonder what the future will hold for it. Crypto is obviously an interesting one and of course you have some people suggesting going back to gold or even a combination of the two. I realise both are highly unlikely but still very interesting! I am just very curious on how it will all play out!
mcsean2163 wrote: » I think we've already borrowed too much and are living on borrowed time and the potential future generosity of decision makers in the EU like Viktor Orban.
FreudianSlippers wrote: » Current Hungarian Government 10Y bond is 2.835% so best of luck with that to them and Mr Orban going forward. I think we'll be just fine at 0.018% 10Y.
L1011 wrote: » There is no figure if the ECB continues its support programmes.
Bit cynical wrote: » It is like the game of musical chairs with the ECB controlling the music. Who will be nearest the chairs and be able to grab a seat? Who will be left standing after the music stops?
mcsean2163 wrote: » Agree, we've spent the most on covid19 and have had the second strictest lockdown in the EU. Finland seems to have taken a much more balanced response to covid19 (150th strictest restrictions globally) and had a sixth of our deaths. They've had to pay for our banks, our public sector and now our extreme covid19 stance. We've rewarded them for their investment by offering multinationals a way of avoiding paying taxes in the EU. Do people think we'll be allowed to be the most profligate nation in the EU forever? I think the s&&t will hit the fan by 2023 unless a miracle happens.
Deseras wrote: » Europe is printing money due to Covid soon there will be hyper inflation
