6.7 % rate for the bailout.

Bob_Latchford wrote: »

If we walk like mugs, talk like mugs, vote like mugs. You cant blame europe for thinking they can mug us off

donegalfella wrote: »

This post has been deleted.

EastTexas wrote: »

So please excuse, if some of question may be ignorant
My concern as an outsider would be Irish sovereignty and self determination.
Would this “ bailout” undermine it in the long run?
Is it really a bailout or rather a trip from the fire into the frying pan?
Thanks and Greetz
ET

jmayo wrote: »

Care to reappriase you opinion of lenihan ??

Iceland Is No Ireland as State Free of Bank Debt, Grimsson Says

Iceland’s President Olafur R. Grimsson said his country is better off than Ireland thanks to the government’s decision to allow the banks to fail two years ago and because the krona could be devalued.

“The difference is that in Iceland we allowed the banks to fail,” Grimsson said in an interview with Bloomberg Television’s Mark Barton today. “These were private banks and we didn’t pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks.”

Ireland’s Prime Minister Brian Cowen said this week his government has discussed an 85 billion-euro ($112 billion) bailout with the European Union and International Monetary Fund after the country’s banks threatened to bring the euro member to the brink of bankruptcy. Iceland’s banks, which still owe creditors about $85 billion, were split to create domestic units needed to keep the financial system running, while foreign liabilities remained within the failed lenders.

As a consequence, “Iceland is faring much better than anybody expected,” Grimsson said. The Icelandic state’s liability on foreign depositor claims stemming from Icesave accounts at failed Landsbanki Islands hf should be put to a national referendum, he said.

“How far can we ask ordinary people -- farmers and fishermen and teachers and doctors and nurses -- to shoulder the responsibility of failed private banks,” said Grimsson. “That question, which has been at the core of the Icesave issue, will now be the burning issue in many European countries.”

Accept Losses

Iceland is relying on a $4.6 billion IMF-led loan to rebuild its economy. Grimsson said today the government may not need the entire amount.

Bondholders of European banks should be prepared to accept losses because voters are becoming increasingly unwilling and unable to fund bailouts, FXPro Financial Services Ltd. said in a Nov. 24 note.

“The taxpayer has no realistic prospect of being able to save their banks, such is the magnitude of their bad loans and their extraordinary dependence on central bank support,” wrote Michael Derks, chief strategist in London at foreign-exchange firm FXPro. “Both junior and senior bondholders in these insolvent banks need to suffer huge haircuts,” he said.

Forcing bond holders to “share the burden,” may help the euro region remain intact, Derks wrote.

Junk

Grimsson, who said Iceland’s talks to join the European Union are ongoing, in January this year blocked a $5.2 billion deal to cover British and Dutch depositor claims stemming from Icesave accounts. The move prompted Fitch Ratings to downgrade the island’s debt to “junk” as a normalization of international relations grew more remote. Iceland’s Finance Ministry on Nov. 16 said the country may now be weeks away from a “final resolution” to the Icesave dispute as it secures broad lawmaker backing for a new accord.

Kaupthing Bank hf, Landsbanki and Glitnir Bank hf failed within weeks of each other in October 2008 after they were unable to secure short-term funding. The banking crisis led to an 80 percent slump in the krona against the euro offshore, until the slump was stemmed by the introduction of capital controls at the end of 2008.