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Ray Kinsella - Leave the Euro

Duke Leonal Felmet

Or so he said in the news recently. I would be inclined to agree except for two crucial points.

If we leave:

1) How do we replace the liquidity that the ECB has been providing to our crippled banks?

2) How do we pay our Euro-denominated debt, even if we apply a restructuring of, say, 30%?

and more loosely:

3) Should we peg to/join the sterling?

Answers on a SAE.

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meglome

damino wrote: »

Well the current governement are lying to people deying the fact that currently the Irish Mint is printing Irish Punts and minting Irish pence coins. Where have this information come from, well from everybody who works in the Irish Mint. They have been telling all their family and friends they have been working flat out printing Irish Punts and minting Irish pence. The reason being, PLAN B; ITS A CONTINGENCY BACKUP PLAN; IF THE THE EURO WERE TO FALL APART.

It's a fact is it? The minister has said publicly they haven't produced the Punt since 2001. Of course my guess is the usual anti-EU/Euro crowd will also assume he's lying.

http://www.independent.ie/national-news/state-denies-rumour-it-is-printing-the-punt-again-2886886.html

meglome

Kaiser2000 wrote: »

Whether or not you're tired of hearing it is irrelevant to be frank, it doesn't change the fact that the decision that was made by the people was ignored and they were forced to do it again (I certainly don't remember being asked if I wanted a second referendum, do you?) by a somewhat more scared/alert government who were perhaps terrified that the sheep didn't just do what they were told first time round - albeit this time with slogans like "yes for Jobs" (by our own Enda Kenny no less) to scare people into giving them the answer they wanted.

Ironic really that only a few years later that same Enda Kenny is getting to preside over the potential economic demise of the country, jobs and all!

Really can we cut out this nonsense. No one was forced to do anything and everyone could go and vote No if they pleased. But they voted Yes by a large majority. Get the **** over it.

And and BTW the Lisbon treaty came into force in December 2009, the recession started over a year earlier. So you're complaining that your plane was late when the engines had been damaged by a bird strike and demanding to know why the faster wingtips put on afterwards didn't sort it. They are two different things, it's very simple.

irishh_bob

Idbatterim wrote: »

so you are implying our own politicians do? any they dont only care about staying in power?

i think they care more about us than franz from frankfurt would , fear by way of close proximity would ensure it

Good loser

irishh_bob wrote: »

why is it irresponsible , nothing will ever be the same again when it comes to the euro and what is to come will not in anyway shape or form help ireland , the germans will not agree to QE and the price they will extract for bailing out italy , spain , greece and ireland is complete economic ( and in many ways political ) union , this will inevitabley lead to ireland loosing our export advantage through our corporation tax , with effectivley one european finance minister setting spending and taxation policy , it will see wellfare and public sector pay slashed in this country and most likely , a loss of multinational investment and jobs , kinsella can see this and is brave and honest enough to point it out , were we to leave the euro , our new currency would devalue , our deficit would need to be cut almost overnight and this would require massive cuts in expenditure , however , we would not only retain our corporation tax rate , our wage competitivness would be increased dramatically which would bolster multinational investment due to our low wage enviroment by way of a weakended currency , as for our bailout debts , we simply default on them and say very politley , thanks but no thanks to the EU , serious hardship would be endured for a few years but ultimatley , our future would be in our own hands as a fully indepdendant soverign nation

You say staying in euro will see 'welfare and public sector pay slashed'.

And if we leave euro as you suggest 'our deficit would need to be cut overnight'.

So there's no difference?

The latter position could devastate living standards for years.

I cannot see international investors flocking to Ireland if we leave euro.

Their existing investment here would be devalued and they would be into currency risks.

The country's debts/mortgages would remain in euro.

Anyway how could we effect the move out of the euro? Overnight? And fix the budget deficit overnight?

If the euro collapses in the next 6 to 12 or 24 months an earlier (Irish) exit would have been pointless.

Kinsella's proposal is mischievous.

damino

From reading Business Post and Sunday Times Business Section, the Ecomonic commentators reckon it would cost between 40% to 50% of GDP in the first year, if a country were to leave the Euro.

Now if Ireland were to leave, the government would have to cut the deficit and they reckon 20% -25% public/civil servants wage cuts and social welfare cuts including pensions would be in order. Plus with a depreciating currency the cost of living rises rapidly. Take for example Iceland, their currency plunged initially 80%, INFLATION ROSE TO OVER 25%. Also their Central Bank had to increase INTEREST RATES TO 18% to discourage capital flight. That would leave social welfare recipients, public/civil servants broke, mortgage holders including landlords would have to hand in the keys on mass as they could afford interest rates that high. Then remember Irish companies who owe money to international lenders would find the cost of their loans become unbearable, thus they would close and unemployment would increase significantly. No competitive advantage their.

Also everybody forgets companies who owe money to European counterparts has to pay in that country's currency, in order to avoid this the country would have to leave the European Union to avoid international treaties.

irishh_bob

damino wrote: »

From reading Business Post and Sunday Times Business Section, the Ecomonic commentators reckon it would cost between 40% to 50% of GDP in the first year, if a country were to leave the Euro.

Now if Ireland were to leave, the government would have to cut the deficit and they reckon 20% -25% public/civil servants wage cuts and social welfare cuts including pensions would be in order. Plus with a depreciating currency the cost of living rises rapidly. Take for example Iceland, their currency plunged initially 80%, INFLATION ROSE TO OVER 25%. Also their Central Bank had to increase INTEREST RATES TO 18% to discourage capital flight. That would leave social welfare recipients, public/civil servants broke, mortgage holders including landlords would have to hand in the keys on mass as they could afford interest rates that high. Then remember Irish companies who owe money to international lenders would find the cost of their loans become unbearable, thus they would close and unemployment would increase significantly. No competitive advantage their.

Also everybody forgets companies who owe money to European counterparts has to pay in that country's currency, in order to avoid this the country would have to leave the European Union to avoid international treaties.

having gained independance from britain , we became poorer overnight aswell , we are much better prepared for independance this time , we can still deal direct with the imf so the deficit need not be closed overnight , plus our bank and what remains of our bondholder liability can be let go

View

Kaiser2000 wrote: »

Whether or not you're tired of hearing it is irrelevant to be frank, it doesn't change the fact that the decision that was made by the people was ignored

Really? So, the Oireachtas went ahead and ratified the Lisbon Treaty after the 2008 Lisbon referendum, did it? What did the Supreme Court say to that?

Kaiser2000 wrote: »

and they were forced to do it again (I certainly don't remember being asked if I wanted a second referendum, do you?)

I certainly don't remember being asked if I wanted a first referendum. Were you?

View

irishh_bob wrote: »

having gained independance from britain , we became poorer overnight aswell , we are much better prepared for independance this time , we can still deal direct with the imf so the deficit need not be closed overnight , plus our bank and what remains of our bondholder liability can be let go

The IMF is under no obligation to deal with us and, if we convince them we a bunch of loons by completely violating the basis of the existing agreement we reached with them, they probably won't.

syklops

Im on business in America at the moment, but I work out of an office on the continent for an American Software company. Despite this, my corporate visa card is a Bank Of Ireland card. As a result of our finance department being in Ireland, everyone in EMEA, carries and uses a Bank of Ireland Credit card. Thats about a thousand people. Maybe two. Suggest to anyone in our Irish office, that Ireland is leaving the Euro, and they themselves will be recommending moving the base to somewhere else, ASAP. Zurich maybe. Talk about the turkeys voting for Christmas.

You dont read about it or see it online, but the amount of money that runs through the country is unreal. Even suggest that we are leaving the Euro and Google, Microsoft, maybe even Intel will drop us like hot potatoes. As another poster said, it really does seem like a case of:

1. Leave Euro
2. ????????
3. Profit!

Some people seem to think we can create a new currency, and make 1 Punt Nua = 1 Billion Euros, and we can give 16 of them back to the EU, and we will be grand.

It doesnt work like that folks.

Boskowski

damino wrote: »

Now if Ireland were to leave, the government would have to cut the deficit and they reckon 20% -25% public/civil servants wage cuts and social welfare cuts including pensions would be in order. .

Unfortunately that's what we should be doing anyways. 3 years down the' austerity' and were still spending 20b over budget. How anyone can claim were turning corners I dint know. Unfortunately were not able to turn corners unless being forced to do so

irishh_bob

View wrote: »

The IMF is under no obligation to deal with us and, if we convince them we a bunch of loons by completely violating the basis of the existing agreement we reached with them, they probably won't.

the IMF didnt care whether we guarenteed all creditors investments in 2008 , the EU did , the IMF only want whats owed to them direct

irishh_bob

syklops wrote: »

Im on business in America at the moment, but I work out of an office on the continent for an American Software company. Despite this, my corporate visa card is a Bank Of Ireland card. As a result of our finance department being in Ireland, everyone in EMEA, carries and uses a Bank of Ireland Credit card. Thats about a thousand people. Maybe two. Suggest to anyone in our Irish office, that Ireland is leaving the Euro, and they themselves will be recommending moving the base to somewhere else, ASAP. Zurich maybe. Talk about the turkeys voting for Christmas.

You dont read about it or see it online, but the amount of money that runs through the country is unreal. Even suggest that we are leaving the Euro and Google, Microsoft, maybe even Intel will drop us like hot potatoes. As another poster said, it really does seem like a case of:

1. Leave Euro
2. ????????
3. Profit!

Some people seem to think we can create a new currency, and make 1 Punt Nua = 1 Billion Euros, and we can give 16 of them back to the EU, and we will be grand.

It doesnt work like that folks.

this country should be about more than best facilitating professional money laundering through the ifsc , the likes of dell left for poland because wages were too high here , had we had the punt , we would have been much more competitive when it comes to wages , we should focus on multinational who make stuff , not try and be a mini city of london on the docks

ei.sdraob

Why leave the euro? Embrace socialism and go dual currency instead, we already have a "dual" economy anyways

Pay welfare and PS in new pesos, as added bonus CP wont be broken :P

Who says there has to be "ONE currency to rule them all"TM anyways?

syklops

irishh_bob wrote: »

this country should be about more than best facilitating professional money laundering through the ifsc , the likes of dell left for poland because wages were too high here ,

Yes, it is true that Dell and more recently left because we are not competitive.

irishh_bob wrote: »

had we had the punt , we would have been much more competitive when it comes to wages ,

Whether we were inside the Euro or not, Irish ambulance drivers would still be earning what they earn, and minimum wage would still be as it is. The price of a pint 15 years ago when we had the punt was a hell of a lot more that the price of one in Poland today.

irishh_bob wrote: »

we should focus on multinational who make stuff , not try and be a mini city of london on the docks

Concentrating on 'making stuff' is not a good idea because we would always be susceptible to companies moving elsewhere for even cheaper manufacture. Ideally the much talked about knowledge economy is where our salvation lies, but to be honest, the likes of Poland is beating us there too.

While I dont agree that having a degree is a good indicator of knowledge(I dont have one myself), it is a piece of paper that states that a person can stick with something for 4 years, and complete it. Of all the polish people I know(and I know a lot), every single one has at least a Bachelors Degree and many have Masters. The culture we have here of people going to college for 6 months, and then dropping out does not exist over there. There, people go to college and they drink heavily, and they miss classes, but they keep going, and around exam time, they do the necessary and they get through. Here, they go, drink heavily, then decide the party is over, that First Arts is not for them, drop out and go sit on the dole for a few years, until they grow up and realise they need some kind of a career to function.

The result: companies want graduates who they can mould. Per head of population Poland as an awful lot more graduates than we do in Ireland.

The education system is broken. Partly, i think from a bit of creative accounting when it came to results there too. It needs fixing but it wont happen over night.

Currently Pharma and IT are the two things keeping us afloat. If we didn't have them, we would be in serious hot water. We need to keep them, we need to make this island a more hospitable country to do business by lowering costs, and we need to heavily upskill our work force. Dell was a disaster waiting to happen because the job was so easy. I have a friend where 4 members of the family were working there. One of them, preferred the night shift. He got a little more money, so he would go and have a few pints before work, and the shift would then fly along. It was only a matter of time before they moved to cheaper land.