6.7 % rate for the bailout.

Inquitus · 27-11-2010 12:00AM

donegalfella wrote: »

This post has been deleted.

I 100% wholeheartedly agree with you on this. How can we, as sensible wealth generating individuals, influence our Government not to sign us up at 6.7%? In that regard I despair.

RonMexico · 27-11-2010 12:01AM

EastTexas wrote: »

Thanks, I also think it is to save the Euro, at the expense of the people living there.
When Germany bailed out Greece, didn’t they actually bail out their own banks?
Rather an act of self interest?

Is there any good old Texas saying that sums up what is going on here?

carrolls · 27-11-2010 12:02AM

Freiheit wrote: »

Michael Noonan said that 'the smart economy was being spoken of by some of the biggest fools the country has ever produced......'.....fools does not do them justice...I'm simply lost for words.....Think Donegalfella was right...this deal must be rejected as it will lead us to slavery and ruin.

Totally agree. When Charlie McCreevy first uttered the words "Smart Economy", I knew we were doomed. This should be the Oxford definition of Oxymoron.
When you put a gerbil in charge of the Irish economy we end up in this situation ten years down the line.:eek:

EastTexas · 27-11-2010 12:06AM

keving wrote: »

As an aside, do you think the US can just print money to get out of their problems

Well at least they CAN if they so choose, smart probably not.
But perhaps the better of two evils for the moment. being stuck between a rock and a hard place.
I don’t care for massive spending at all.

But also wouldn't support austerity.
A little more balance and less partisanship, yes.

Question, if Ireland still used it’s own currency would printing more money for the time being be a better option, then using the bailout?
I mean in the long run.

Scofflaw · 27-11-2010 12:06AM

ArtSmart wrote: »

That of course is going on Lenihan's 'fire-power' assumption / speech.

but i'm inclined to ask would the EU/IMF really be gathering to put in place a 'contingency' lifeboat - and also believe it will be little used?

I'm not sure - except that I can understand: (a) that the money is being borrowed partly from other lenders in the first place, and it's uncertain what rate they're charging; (b) that this is supposed to be a backstop solution that the government claims they don't need (unless they've retracted that claim); and (c) that given Ireland's track record, making the rate on the facility too attractive would tempt the government in the next four years to avail of it to prop up current spending.

Still, it could be a kite, it could simply be inaccurate, it could be a piece of political chicanery - I know Fianna Fáil will fly a kite to see the reaction, and pull its horns back in if it sees too negative a reaction. In this case, though, it makes more sense for them to leak any higher rates in order to put public pressure on their side - they can say "look, people won't accept this".

cordially,
Scofflaw

sollar · 27-11-2010 12:06AM

Might the eu be setting us up for a default with interest rates like that, merkel is a measured person and she said a few weeks ago that investors should have to suffer losses for bad investments.

We could be leading the way now in a macabre experiment to bring this world financial crisis to a head

blue_steel · 27-11-2010 12:08AM

Given the result of the Donegal bye-election surely an immeadiate no-confidence motion will bring the government down and stop this madness in its tracks? Provided Lowrey and Healy-Rae doesn't change their self-serving little minds yet again?

puppetmaster · 27-11-2010 12:09AM

If They Fail to Realise at this point in time Ireland is possibly the most powerfull country in the EMU. Then Voting them out at election time is the least of their worries.

Aswell as listening to the FF Idiots and their underhand tactics, why havent we heard any constructive response from the other Dips**ts. Do they now think that they should be a shoe in Cause FF has destroyed us. If thats the thinking, God help us all.

EastTexas · 27-11-2010 12:14AM

RonMexico wrote: »

Is there any good old Texas saying that sums up what is going on here?

By golly, I’ll have to think on that one and figure out what going on first.
Frankly if I may say so, I think it smells of rat.
The beginning of an EU/German superstate.

I mean the Germans are downright pathological about exports of which 70% are in Europe.
But I digress, and don’t want to steer this thing of topic

ArtSmart · 27-11-2010 12:14AM

Scofflaw wrote: »

I'm not sure - except that I can understand: (a) that the money is being borrowed partly from other lenders in the first place, and it's uncertain what rate they're charging; (b) that this is supposed to be a backstop solution that the government claims they don't need (unless they've retracted that claim); and (c) that given Ireland's track record, making the rate on the facility too attractive would tempt the government in the next four years to avail of it to prop up current spending.

Still, it could be a kite, it could simply be inaccurate, it could be a piece of political chicanery - I know Fianna Fáil will fly a kite to see the reaction, and pull its horns back in if it sees too negative a reaction. In this case, though, it makes more sense for them to leak any higher rates in order to put public pressure on their side - they can say "look, people won't accept this".

cordially,
Scofflaw

I dunno. No VB tonight, missed the radio news twice. time for a bit of South Park and some Irish coffees - in memory of the soon to be extinct race of the same name.

AntiRip · 27-11-2010 12:15AM

According to the Irish Times the IMF side is 4.5% and the EU higher averaging more than 5.2%.

http://www.irishtimes.com/newspaper/breaking/2010/1126/breaking6.html

Greece's rate is 5.2% but is over a 3 yr period.

Capt'n Midnight · 27-11-2010 12:18AM

Look on the bright side, we don't have to pay it in devalued punts

6.7% 9 years = 1.79 Germans got a little over 2% for 10 years, 1.25 or so

so we've to pay back 50% of what we borrowed over and above what the Germans do

It would be cheaper to offer those in the public sector and on public welfare and PPP schemes the future money instead. And let them figure out how to fund themselves in the mean time.

ArtSmart · 27-11-2010 12:19AM

blue_steel wrote: »

Given the result of the Donegal bye-election surely an immeadiate no-confidence motion will bring the government down and stop this madness in its tracks?

actually possible if they join with SWP and inds.

Drumpot · 27-11-2010 12:20AM

Wow . .

Just Wow . .

I have struggled to understand where the figures add up (or dont add up in this case) and I have tried to give the EU and our european "friends" the benefit of the doubt, but as far as I am concerned this should be the beginning of the end of negotiations (if 6.7% is a real possibility). .

There are advantages on all sides to Ireland taking a bailout and all sides have much to lose by not agreeing some sort of deal. The people of Ireland should not be prepared to be used/sacrificed to prop up a flawed economic system.

In terms of defaulting, it has been done before by other countries and they survived. Perhaps we should be willing to go to the extreme and call the bluff of the EU.

I have debated this to no end and can see no logic to what we are signing up for , other then that it makes more people outside of Ireland happier then it does for our people. I have heard no rational debate on why we should accept this bailout, other then "its the norm" or "it makes sense" .

I hope tomorrow the Irish People send a message to their government and the EU and say no more will we sit by and allow people to impose things that we have not been allowed to decide on . . I want to believe in our european "friends", but they have not afforded me the courtesy of explaing the pro's and con's to my country whichever way we decide to go, as such I have no alternative but to be cynical about their intentions.

neilster · 27-11-2010 12:23AM

Mayo Exile wrote: »

Interesting little piece on Bloomberg today. It illustrates what the alternative is rather than accepting a loan at 6.7% or anything near it in order to bail out our banks.

There is a fair amount of rubbish on this issue not withstanding the Iceland solution we cannot forget that we are where we are, we are :

-members of the Euro
-we voted for it
-we voted away some economic sovereignty including issues linked to banking etc
-In Iceland they did save banks they took good loans and created domestic replacements and parked the outstanding debt

Butch Cassidy · 27-11-2010 12:24AM

Fine Gael's Michael Noonan had a press release ready to go for the Irish Times... either he leaked the figure or he knew.

He mentioned something on Prime Time the other night about the IMF "being kinder" than EU.

I can't imagine FG would stoop low enough to leak this fig however, the 9PM had a vox pop with Varadkar&Noonan seemingly had a press release raring to go right away as well....

This story's got a lotta leg

EastTexas · 27-11-2010 12:25AM

sollar wrote: »

Might the eu be setting us up for a default with interest rates like that, merkel is a measured person and she said a few weeks ago that investors should have to suffer losses for bad investments.

We could be leading the way now in a macabre experiment to bring this world financial crisis to a head

I listen to her in German and she has the unfortunate habit of talking out of both sides of her mouth.
And a bit too general to give any real indication as where her head is at.

bryaner · 27-11-2010 12:26AM

Time to go back to barter me thinks..

ArtSmart · 27-11-2010 12:26AM

Capt'n Midnight wrote: »

Look on the bright side, we don't have to pay it in devalued punts

6.7% 9 years = 1.79 Germans got a little over 2% for 10 years, 1.25 or so

so we've to pay back 50% of what we borrowed over and above what the Germans do

.

Point is the proportion required of our yearly revenue intake to service a loan at this rate.

8.5 billion on interest a year for our economy = impoverishment.

ArtSmart · 27-11-2010 12:28AM

AntiRip wrote: »

According to the Irish Times the IMF side is 4.5% and the EU higher averaging more than 5.2%.

http://www.irishtimes.com/newspaper/breaking/2010/1126/breaking6.html

Greece's rate is 5.2% but is over a 3 yr period.

a second reading might be in order.

bleg · 27-11-2010 12:29AM

Imagine paying 1/5 of your gross income on interest for your mortgage.

neilster · 27-11-2010 12:29AM

Drumpot wrote: »

Wow . .

Just Wow . .

I have struggled to understand where the figures add up (or dont add up in this case) and I have tried to give the EU and our european "friends" the benefit of the doubt, but as far as I am concerned this should be the beginning of the end of negotiations (if 6.7% is a real possibility). .

There are advantages on all sides to Ireland taking a bailout and all sides have much to lose by not agreeing some sort of deal. The people of Ireland should not be prepared to be used/sacrificed to prop up a flawed economic system.

In terms of defaulting, it has been done before by other countries and they survived. Perhaps we should be willing to go to the extreme and call the bluff of the EU.

I have debated this to no end and can see no logic to what we are signing up for , other then that it makes more people outside of Ireland happier then it does for our people. I have heard no rational debate on why we should accept this bailout, other then "its the norm" or "it makes sense" .

I hope tomorrow the Irish People send a message to their government and the EU and say no more will we sit by and allow people to impose things that we have not been allowed to decide on . . I want to believe in our european "friends", but they have no afforded me the courtesy of explaing the pro's and con's to my country whichever way we decide to go, as such I have no alternative but to be cynical about their intentions.

has anyone thought that mayb the 6.7% rate is due to percieved risk

Greece is a basket case but it is a basket case that never collects tax (this can be stamped out just l
They as a result have a huge black economy , again that can be stamped out
They have pension and public sector differences again that are cuckoo

Maybe our EU/IMF friends see our banks as a trickier proposition

Scofflaw · 27-11-2010 12:31AM

AntiRip wrote: »

According to the Irish Times the IMF side is 4.5% and the EU higher averaging more than 5.2%.

http://www.irishtimes.com/newspaper/breaking/2010/1126/breaking6.html

Greece's rate is 5.2% but is over a 3 yr period.

That makes more sense, since the EU member states are drumming the money up from other investors and their own sovereign funds. Still, unless the EU rate is much much higher than 5.2%, you're still not going to get within touching distance of 6.7% for the combination. Assuming two-thirds of the bailout is provided by the EU and by the member states, you'd need them to charge 7.83% on their portion to hit 6.7% overall, which is a figure you wouldn't bother describing as "averaging more than 5.2%".

I wonder if Fine Gael would "leak" scary numbers to damage the government...

cordially,
Scofflaw

th3 s1aught3r · 27-11-2010 12:32AM

Its hard to imagine working for the next few decades paying high taxes, most of which are going to pay off this debt that was used to bail out private banks :eek:

Drumpot · 27-11-2010 12:33AM

neilster wrote: »

There is a fair amount of rubbish on this issue not withstanding the Iceland solution we cannot forget that we are where we are, we are :

-members of the Euro
-we voted for it
-we voted away some economic sovereignty including issues linked to banking etc
-In Iceland they did save banks they took good loans and created domestic replacements and parked the outstanding debt

We voted for Europe, but what has that got to do with choosing to saddle ourselves with private debt thats mainly about bailing out dead banks and foreign bondholders?

Because its an acceptable contradiction of "doing business" in "free" capitalist markets, does not mean we should bend over and take it.

stackerman · 27-11-2010 12:36AM

Scofflaw wrote: »

I wonder if Fine Gael would "leak" scary numbers to damage the government . . /QUOTE]

Or it could be FF, to make it look like they got us a great deal :rolleyes:

Inquitus · 27-11-2010 12:36AM

Scofflaw wrote: »

That makes more sense, since the EU member states are drumming the money up from other investors and their own sovereign funds. Still, unless the EU rate is much much higher than 5.2%, you're still not going to get within touching distance of 6.7% for the combination. Assuming two-thirds of the bailout is provided by the EU and by the member states, you'd need them to charge 7.83% on their portion to hit 6.7% overall, which is a figure you wouldn't bother describing as "averaging more than 5.2%".

I wonder if Fine Gael would "leak" scary numbers to damage the government...

cordially,
Scofflaw

I hope you are right, but for our own national broadcaster to run it as fact as the second item on the news would be incredibly irresponsible were it not at least close to the truth.

Scofflaw · 27-11-2010 12:37AM

Butch Cassidy wrote: »

Fine Gael's Michael Noonan had a press release ready to go for the Irish Times... either he leaked the figure or he knew.

He mentioned something on Prime Time the other night about the IMF "being kinder" than EU.

I can't imagine FG would stoop low enough to leak this fig however, the 9PM had a vox pop with Varadkar&Noonan seemingly had a press release raring to go right away as well....

This story's got a lotta leg

Did he now...that's interesting. Would make a classic Fine Gael tactic, since the chance of it backfiring badly is quite high. There's a lot of short-term political capital in issuing large numbers to make the government look bad, but if the government shows up with a lower number, that can be painted as a win for the government. However, that depends on how long the negotiations take - if there's more than a week or two to go, the anger will settle another fraction of a percent against voting Fianna Fáil, and the relief will take too long to arrive for the release to backfire.

intrigued,
Scofflaw

sollar · 27-11-2010 12:37AM

th3 s1aught3r wrote: »

Its hard to imagine working for the next few decades paying high taxes, most of which are going to pay off this debt that was used to bail out private banks :eek:

and to think that 2 of the main culprits are still living it up. One playing golf in marbella and the other playing games by transfering his assets to his wife and back again after declaring bankruptcy.

Drumpot · 27-11-2010 12:39AM

neilster wrote: »

has anyone thought that mayb the 6.7% rate is due to percieved risk

Greece is a basket case but it is a basket case that never collects tax (this can be stamped out just l
They as a result have a huge black economy , again that can be stamped out
They have pension and public sector differences again that are cuckoo

Maybe our EU/IMF friends see our banks as a trickier proposition

We are not a "basket case" and if we have shown a desire to pay off our liabilities and deserve a preferential rate for this very reason.

If we takeup this debt , the idea is that everybody else will benefit from our token sacrifice. In many regards we deserve better treatment because our problems were not so much caused by our own decisions, they were that of companies and bondholders. .

6.7 % rate for the bailout.

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