Vinny B - 23/11 Should we tell Europe we cant afford it?

oppenheimer1 · 24-11-2010 01:51AM

hinault wrote: »

S&P are only following the same conclusion which Moodys announced last week concerning Irelands credit rating.

We're being emulsified in debt.

And remember, many citizens carry huge levels of personal debt too.
(sorry to be totally pessimistic).

The bank debt is personal debt. Loan repayments pay off that bit.

th3 s1aught3r · 24-11-2010 01:52AM

oppenheimer1 wrote: »

Its also full of social arsonists who wouldn't be happier to see the whole country fall to pieces. .

It has that in common with the government

jmayo · 24-11-2010 01:54AM

Bob_Latchford wrote: »

We have a gun to our own head and europes head. Its a hostage situation

Yes but knowing ff, they will shoot us in the head and EU/IMF in the feet.

oppenheimer1 wrote: »

Their figures are fundamentally flawed and only serve to frighten people. We are currently carrying the banks debt at this very moment, but believe it or not the banks also have assets. The difference between the liabilities and the assets is whats important. Clowns like Lucy only serve to frighten people. We will not be on the hook for a quarter of a trillion euro.

To make it worse, Guirgev wants a scheme that lets those in NE (Like himself who very wisely bought at the top of the boom, Guirgev is by his own admission 40% in NE) to get relief. You couldn't make it up. Why do people listen to these talking heads?????

Jeeze you are sounding more like lenny again and after your good post about not accepting 7% on another thread I had such hope.

fatalll wrote: »

Vinny is the most pessemestic man ever..
and he brings on guests who are like him alot of the time.
He may be right in some of it, but the scare mongering is unreal!
Just be a bit more positive..all of us, out our shoulder to the wheel and lets shove!!:)

Problem with putting our shoulder to the wheel is that gobsh**es from ff are still in control of the stering wheel.

Cavehill Red wrote: »

You'll be out buying AIB and BoI shares in the morning, no doubt, since by your analysis they are currently massively undervalued?

But aren't they good value now

RealityCheck wrote: »

People, things are bad and we all know that but really the world is'nt going to end. Look we may default at some stage, but it is'nt going to change things a whole lot.

Are you sure that is your username ?
A default could have massive reprecussions for all of us.
Then again siging upto 6% or 7% bailout will have equally massive reprecussions. :rolleyes:

ArtSmart wrote: »

interestingly it was only at the end vinny asked - and what happens to countries that do default?

only one half ans mumbling something about 'a good default'

as for the nuclear button 'option'

the press-ee in this case gets blown up first - hardly a strong hand.

MAD worked during the coldwar.
We have a damm big nuclear option.
Yes we destroy ourselves but we take Europe and even Britain and Sweden with us.
Has anyone ever wondered why a country not in the Euro and not our next door neighbour is offering us a bailout ?

th3 s1aught3r wrote: »

Why has it taken TWO YEARS for us to go bankrupt? I mean the banking crisis was in 2008 !

Because we had a soft or softish type of banking crisis that involved lot of corners.
But now we have turned the final corner and we are where we are.

flynnlives · 24-11-2010 01:56AM

ArtSmart wrote: »

em, well I wouldn't use the word idiots

ps, chill dude.

My apologies!

But seriously when are people going to wake up and call a spade a spade.

Seriously like.

You have 5 independent economists

Brian Lucy
Constantin Gurdgiev
Paul Sommerville
David McWilliam
Morgan Kelly

all generally saying the same thing.

How many more times do you need to be told your house is burning to the ground!!

wylo · 24-11-2010 01:57AM

gambiaman wrote: »

Too late buddy, it's already here.

no wonder im broke!

th3 s1aught3r · 24-11-2010 01:58AM

All this is great for my Gold investment..:D

sorry

/gets coat

ArtSmart · 24-11-2010 01:59AM

flynnlives wrote: »

Some seriously deluded people on this thread!!

These are the average figures.
1.Existing National Debt of circa €90billion;
2.Bailout debt to be incurred over the next 3 years €85billion
3.Bonds falling due to be paid by Ireland in next 3 years €23billion
4.ECB funding put into our banks circa €100billion
5.Irish Central Bank money put into our banks in the last 2 weeks after the ECB said no more circa €30billion.

Circa €340billion all told.

what Lucey said.

90 current ecb debt
20 Cb money printing
23 bonds due
35 banks something mumbled ?
45 sovereign debt

213

100 upcoming facility

313

i think you're mixing up 2 with 4.

Cavehill Red · 24-11-2010 02:00AM

th3 s1aught3r wrote: »

All this is great for my Gold investment..:D

sorry

/gets coat

Up 1.5% today V euro. Silver up too.
Let me see...

Gold? Check.
Silver? Check.
Guns? Check.
Ammo? Check.
Canned food? Check.
Bottled water? Check.

What am I forgetting?

Permabear · 24-11-2010 02:00AM

This post has been deleted.

hinault · 24-11-2010 02:01AM

oppenheimer1 wrote: »

The bank debt is personal debt. Loan repayments pay off that bit.

It's not actually.

The bank guarantee in 2008 indemnified the banks with regard to their liabilities (ordinary deposits, corporate deposits, deposits by other instititutions and ECB etc).

What about loans which were deemed to be performing (assets on the banks balance sheets) which have subsequently begun to default and are now liabilities?
I'm thinking of personal loans, car loans and other unsecured loans, for example.

With the deterioration in the wider economy, assets (loans) which may have been good 24 months ago or even 12 months ago, have started to deteriorate.

Sea Sharp · 24-11-2010 02:04AM

This whole European banking crises can be largely traced back to burst property bubbles.

What is happening in Ireland now IS going to happen in Spain and Portugal. This is a European problem and the solution for this country needs to be part of a solution for Europe.

The EU needs to start printing a series of stimulus packages to buy up the toxic property in Ireland Spain, Portugal and Italy.

The French and Germans are reluctant for stimulus packages because of the inevitable inflation and currency devaluation that comes with printing money.

I say, screw 'em. The European property bubbles that caused this mess were fuelled by interest rates that were designed to help the French and German economies to grow.

It's absurd that the economies of one half of Europe should be crippled for decades to come because of narrow minded policies that were designed to stimulate growth in the other half of Europe.

oppenheimer1 · 24-11-2010 02:06AM

jmayo wrote: »

Jeeze you are sounding more like lenny again and after your good post about not accepting 7% on another thread I had such hope.

You should have known us agreeing on something couldn't last.

In all seriousness though the talk of the national dbt rising to €350bn is scaremongering. For one bank debt isn't part of the national debt. The debts we take on from the nationalised banks will have assets to back them. Yes some of them are distressed, some are non performing, but Lucey presents that the assets the banks have are completely worthless. If the IMF accepts we need 85bn in a bail out, that is close to the figure the Government came up with of 50bn for the banks + money to run the country over the next three years.

The banks needed such large amounts of loans from the ECB because they needed to roll over debt and required liquidity to release deposits. The banks however are too big and the burden they place on the nation is too great. Thats why the IMF propose a loss sharing arrangement between the investors and the government. Yes we will be on the hook for some, but not all. I am heartened that Anglo announced that it was burning some bondholders to the tune of 20c in the euro. We can expect similar arrangements for the other Irish banks.

Scarab80 · 24-11-2010 02:08AM

Here is how i think the 85bn will be broken down....

24 bn to fund deficit to 2014
23 bn to rollover existing debt
38bn to overcapitalise banks (seems high)

The idea being that if you overcapitalise the banks it makes it more attractive to debt investors as their money is safer, they are betting that the banks will be able to attract bank deposits and further debt issues to be able to rollover their central bank lending.

Overall debt position would then be....

Current - 89bn
Current Banks - 50bn
Future Deficit - 24bn
Future Banks - 38bn

Total - 201bn (110% of forcasted GDP in 2014)

Less 18bn in non bank pension reserve funds if you want gives 183bn

th3 s1aught3r · 24-11-2010 02:09AM

The Sparrow wrote: »

Fúck me this is some scary shít.

The really scary thing is that even if the pannelists on Vincent Browne are partially right, we are completely screwed.

I'm off to bed. Hopefully when I wake up it will be Sept 27th 2008 and this will all have been a nightmare.

Its a bit like that film Inception. Dont know whats real anymore !

ArtSmart · 24-11-2010 02:10AM

I will say this then hit the hay

we either take the extra burden to pay for our partying whilst holding down a job of sorts and keep our connection with our rich cousins.

or

we stiff em, scramble around the slag heap for a few years, then finally catch that elusive leprechaun, take his gold , become supermen, and tell Europe to "kiss my shinny golden ass"

personally i dont believe leprechauns exist - (though a million Americans cant be wrong...)

truckinheaven · 24-11-2010 02:11AM

flynnlives wrote: »

My apologies!

But seriously when are people going to wake up and call a spade a spade.

Seriously like.

You have 5 independent economists

Brian Lucy
Constantin Gurdgiev
Paul Sommerville
David McWilliam
Morgan Kelly

all generally saying the same thing.

How many more times do you need to be told your house is burning to the ground!!

HEAR HEAR HEAR HEAR!!!!!!!!!!!!
Will everyone WAKE UP...... Paul Sommerville is a Financial Analyst with contacts in all financial markets...... the proposed 6bn budget cut means nothing..... the markets know we`re in over our heads to the tune of 300bn, they also know 2m taxpayers can never service this debt.
Default is absolutely inevitable.
Default NOW!!!

hinault · 24-11-2010 02:12AM

Scarab80 wrote: »

Here is how i think the 85bn will be broken down....

24 bn to fund deficit to 2014
23 bn to rollover existing debt
38bn to overcapitalise banks (seems high)

The idea being that if you overcapitalise the banks it makes it more attractive to debt investors as their money is safer, they are betting that the banks will be able to attract bank deposits and further debt issues to be able to rollover their central bank lending.

Overall debt position would then be....

Current - 89bn
Current Banks - 50bn
Future Deficit - 24bn
Future Banks - 38bn

Total - 201bn (110% of forcasted GDP in 2014)

Less 18bn in non bank pension reserve funds if you want gives 183bn

http://namawinelake.wordpress.com/2010/11/22/how-much-of-a-bailout-will-we-need-%e2%80%93-%e2%80%9cyou-can-work-it-out-yourselves%e2%80%9d-says-minister-for-finance-brian-lenihan-here-are-my-workings/

a148pro · 24-11-2010 02:18AM

lads, without knowing exactly what is going on...

- what is the upshot of default for govt guarantee on small deposits?
- on the EU guarantee on same?
- if we default and the other EU banks begin to tumble, how reliable are Rabo and Northern Rock (being the two institutions I have accounts with and could conceivably transfer money to quickly)?

flynnlives · 24-11-2010 02:20AM

ArtSmart wrote: »

what Lucey said.

90 current ecb debt
20 Cb money printing
23 bonds due
35 banks something mumbled ?
45 sovereign debt

213

100 upcoming facility

313

i think you're mixing up 2 with 4.

i might be but it makes no real difference. cant remember exactly what he said cause there is slightly different opinions.

Either way annual debt servicing of more then 10billion is completely unsustainable.

Cavehill Red · 24-11-2010 02:21AM

Let's remember who's really getting the bailout here:

(Reuters table of European bank exposure to Irish sovereign debt)

And of course:

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186447686.jpg?AWSAccessKeyId=0ZRYP5X5F6FSMBCCSE82&Expires=1290562492&Signature=r5vdNgWtfpC51Aq7SMx8W1okqx0%3D

(AIB's UK bondholders)

And then there's:

186427642.jpg?AWSAccessKeyId=0ZRYP5X5F6FSMBCCSE82&Expires=1290562549&Signature=Wq6qIn8o0A4CAsuI8LVXziBR8pg%3D

186427642.jpg?AWSAccessKeyId=0ZRYP5X5F6FSMBCCSE82&Expires=1290562549&Signature=Wq6qIn8o0A4CAsuI8LVXziBR8pg%3D

(AIB's German bondholders)

Not to forget:

ai-bondholders.gif?w=480&h=623

(Anglo Irish Bank's bondholders.)

who_ru · 24-11-2010 02:25AM

Portugal & Spain will inevitably follow - then we will have 4 nations essentially outside the euro currency as none of us could ever repay the debt.

either the euro collapses or we leave it. one will have to happen. maybe re-align ourselves with sterling? who knows anymore.

Scofflaw · 24-11-2010 02:26AM

CiaranC wrote: »

Its seems that if Scofflaw and oppenheimer are on here scoffing and snorting at people and telling us that something is unfounded scaremongering one week, it will have come to pass the next.

I say that rumours are rumours, and speculation is speculation, but very rarely deny the things themselves are possible. When some of it turns out to be true, people remember that, rather than all the bits that weren't. Confirmation bias works against me, sadly.

How many people believed an IMF deal had already been done when that rumour was doing the rounds? That the bailout had already been agreed at €250bn when that rumour was doing the rounds? Much the same people who now believe themselves vindicated by a confirmation of some of what they believed - conveniently forgetting the rest of the stuff they touted as true.

Now we have some speculative figures from professional speculators, and people are in a rush to declare game over again on the basis of them. It's all wind, and it all just passes over - all of this will take the next couple of years to work itself into something other than the abstract, and that's plenty of time to make decisions, rather than climbing under the desk and kissing your backside goodbye because someone on Vincent Brow's TV show said something scary. And, yes, I'm afraid optimism is still the best position, because the facts will happen either way.

cordially,
Scofflaw

Scofflaw · 24-11-2010 02:29AM

a148pro wrote: »

lads, without knowing exactly what is going on...

- what is the upshot of default for govt guarantee on small deposits?
- on the EU guarantee on same?
- if we default and the other EU banks begin to tumble, how reliable are Rabo and Northern Rock (being the two institutions I have accounts with and could conceivably transfer money to quickly)?

The only certainty is that as the stakes get higher, national governments are more likely to look after their own citizens first.

cordially,
Scofflaw

MonkieSocks · 24-11-2010 02:29AM

If the ECB & IMF really why don't they give us the loan at ZERO%

marglin · 24-11-2010 02:29AM

wait what are people serious?

i didnt see vb tonight, does anyone have a link?

5% of say 100bn = 5bn EVERY YEAR, that is, currently 1/6 of every euro we take in in tax. This is before we reduce our 19bn budget deficit( does not include the banks debt). Seriously this is unpayable.

If we can only manage to pay even half of the interest every year on just the IMF/EU loan, within ten years we would owe 141 bn. compound interest is a bitch, we will literally never pay back this money but will be expected to pay ever larger amounts of interest.

My calculation assumed 5% p.a. compounded annually and assuming we paid pack half of the interest owed every year, this amount would also rise yearly.

Remeber none of this includes the current banking debt, national debt or the fast approaching household debt crisis(in the form of mortgage arrears and eventually defaults).

The country is not just broke it is most definitely bankrupt. There is a subtle difference but either way we are well and truly F*****KED!!!!!!

flynnlives · 24-11-2010 02:31AM

Scofflaw wrote: »

Now we have some speculative figures from professional speculators, and people are in a rush to declare game over again on the basis of them. It's all wind, and it all just passes over - all of this will take the next couple of years to work itself into something other than the abstract, and that's plenty of time to make decisions, rather than climbing under the desk and kissing your backside goodbye because someone on Vincent Brow's TV show said something scary. And, yes, I'm afraid optimism is still the best position, because the facts will happen either way.

My heart wants to believe you but the brain thinks other wise.
I think you are seriously underestimating this crisis.
Either way the markets arent buying this and after some of the remarks on telly today, tomorrow could be a very dangerous day.

marglin · 24-11-2010 02:33AM

Scofflaw wrote: »

The only certainty is that as the stakes get higher, national governments are more likely to look after their own citizens first.

Yes you're right. I feel I must correct you on one thing, most other national governments. Germans, French, British et al will most certainly look after their own citizens first. It seems ours is the only one who would rather be more popular internationally than at home

Cavehill Red · 24-11-2010 02:33AM

flynnlives wrote: »

My heart wants to believe you but the brain thinks other wise.
I think you are seriously underestimating this crisis.
Tomorrow could be a very dangerous day.

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

This.
Tomorrow is going to be very ugly indeed.

Scarab80 · 24-11-2010 02:35AM

hinault wrote: »

http://namawinelake.wordpress.com/2010/11/22/how-much-of-a-bailout-will-we-need-%e2%80%93-%e2%80%9cyou-can-work-it-out-yourselves%e2%80%9d-says-minister-for-finance-brian-lenihan-here-are-my-workings/

NWL includes promissory notes payments up front, but the drawdowns are included in the budget deficit figures. Also the assumption that the soverign will have to act as debt investor for the banks in rolling over ECB lending - if the bailout is 85bn then clearly they are not going to do this and instead are going to gamble on being able to attract private sector funds by overcapitalising the banks. Made some mistakes in the original figures, changed below...

48 bn to fund deficit to 2014 (added percentages rather than nominal figures, doh!)
28 bn to rollover existing debt (23bn taken from Lucey figures, looking at NTMA its 28. Assumes we can rollover treasury bills otherwise it's 10bn higher)
9 bn to overcapitalise banks (seems low)

Scofflaw · 24-11-2010 02:43AM

flynnlives wrote: »

My heart wants to believe you but the brain thinks other wise.
I think you are seriously underestimating this crisis.
Either way the markets arent buying this and after some of the remarks on telly today, tomorrow could be a very dangerous day.

Maybe I feel this way about it because of personal factors - when I was growing up, going to college etc, national debts were enormous. It's sucky, and it's a drain on the economy, but it doesn't reduce you to living on leaves and killing your neighbours. Also, I think a lot of people were in denial that this was all happening - I appreciate that's what I get accused of, but to be honest I was more worried when people were still trying not to face up to the reality of our problems, and conjuring up various reasons why it wasn't actually going to be so bad, because we had magic money trees or the moral high ground. We are badly screwed, the last two years have been a sort of 'phoney war', but we were never going to get through this without paying a lot more taxes and getting a lot less services. In a sense, I'm glad people are finally realising that's how it is, and that it's not going to change, whether we take the bailout or default. There are no painless options - there haven't been since the bubble burst.

Also, having worked at sea, I can safely say I'd still rather be here right now than standing in the lifeboat queue on a burning oil rig in a hurricane. That was a Tuesday night as well, but with a lot less certainty of Wednesday morning happening for me.

cordially,
Scofflaw

Vinny B - 23/11 Should we tell Europe we cant afford it?

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