Another Lie Exposed: Ireland…Asking EU for a loan… | via @rockingjude Project World Awareness

Another Lie Exposed: Ireland…Asking EU for a loan…

Posted on November 21, 2010 by rockingjude
Brian Cowen on Morning Ireland.
Image via Wikipedia

By Joe Brennan and Stephanie Bodoni

Gee, you think someone would eventually tell the truth…..

Ireland applied for a bailout to help fund itself and save its banks, becoming the second euro member to seek a rescue from the European Union and the International Monetary Fund.
Irish Prime Minister Brian Cowen said he expects talks on the package to be completed in the “next few weeks.” Finance Minister Brian Lenihan said the loan will be less than 100 billion euros ($137 billion), though he refused to give any further details at a press conference in Dublin today.
“A small sovereign like Ireland faced with an outsized problem that we have in our banking sector, cannot on its own address all those problems,” Lenihan said. Ireland may not draw down on the entire loan, he said.
The bailout follows two years of budget cuts that failed to restore market confidence as the cost of shoring up the financial industry climbed. After Irish bond yields soared in the past month, European authorities pushed Ireland to seek aid to prevent the crisis that began in Greece this year from spreading to other euro-area countries such as Portugal.
“It was inevitable. Ireland had no choice but to get financial help,” said Nicholas Stamenkovic, a fixed-income strategist in Edinburgh at RIA Capital Markets Ltd., a broker for money managers. “The market will still be waiting for the details of the assistance and the conditionality, but there should be a relief rally tomorrow.”
Bank Crisis
The cost of saving Ireland’s banks threatens a rerun of the Greek debt crisis that destabilized the euro region earlier this year. Lenihan said Ireland’s banks need a “contingent capital” fund and he indicated that the state will not be able to borrow in bond markets next year at current interest rates.
While the banks have been directed by the country’s financial regulator to have core Tier 1 capital ratios of at least 8 percent, Cowen said that “clearly, the markets are looking for perhaps a higher capital ratio.”
“Stress testing will obviously have to be undertaken in relation to the banking system” to determine how much capital may be needed, Cowen said.
Ireland’s lenders are reeling from the collapse of the property market in 2008, while the government’s finances have been eroded by the recession. An unprecedented budget deficit — equaling one-third of economic output this year — sent bond yields to all-time highs. Allied Irish Banks Plc, Ireland’s second-biggest bank, emphasized the fragility of the financial system on Nov. 19, reporting a 17 percent decline in deposits this year.
While Ireland may not fully use any cash it gets from the EU and IMF, Lenihan said the size of the package “is important to demonstrate” the “firepower that stands behind the banking system.”
The Irish turmoil has also reopened tensions about the governance of the euro region after German Chancellor Angela Merkel last month called for bondholders to foot more of the bill of European bailouts. Her stance, criticized European Central Bank President Jean-Claude Trichet, sparked a bond market selloff.
The risk premium on Ireland’s 10-year debt over German bunds, Europe’s benchmark, widened to 652 basis points on Nov. 11, with the yield reaching a record 9.1 percent. The spread was at 541 on Nov. 19. In 2007, it cost Ireland less than Germany to borrow, with the yield on Irish 10-year bonds 77 basis points below the rate on bunds.
‘Celtic Tiger’
Ireland was one of the poorest countries in Europe when it joined the EU in 1973 along with Britain. Even with European subsidies, unemployment in the mid-1980s averaged 16 percent.
In the 1990s, lured by a 12.5 percent corporate tax, companies such as Pfizer Inc. and Microsoft Corp. helped Ireland export its way into becoming the “Celtic Tiger.” The jobless rate sank to 3.9 percent by 2001. In the decade through 2006, Ireland grew at an average annual rate of about 7 percent, the fastest among euro-area countries.
That expansion, together with easy credit, fanned a real- estate bubble. Home prices almost quadrupled in the decade through 2007. It went disastrously wrong for Ireland following the 2008 demise of Lehman Brothers Holdings Inc ., which turned the slowdown in the property market into an implosion that engulfed the economy. The ISEQ stock index has plunged 70 percent from its record in 2007.
Irish Central Bank Governor Patrick Honohan said total loan losses at the country’s lenders, including foreign-owned banks, total at least 85 billion euros, about half of GDP. Residential property prices have dropped 36 percent since 2006, based on an index compiled by Irish Life & Permanent Plc and the Economic & Social Research Institute in Dublin, requiring the bank rescue that is emptying government coffers.
“Whatever about the government, we need an immediate announcement on the banks,” Dermot O’Leary, chief economist at Goodbody Stockbrokers in Dublin, said in an interview. “The banks are the most pressing issue now.”


“I will be proposing to my colleagues that they should formally apply for a program,” Lenihan said in an interview with state broadcaster RTE in Dublin. “The banks were too big a problem for the country. The key issue all the time for the government is to ensure that we do not have a collapse of the banking sector.”

Why not just blow ‘em up?  Tell the banks to stuff it and let them collapse.

Then set up new banks with sovereign credit.  New banks with clean balance sheets.

Oh yeah, and while you’re at it, arrest the heads of said banks and put them on trial for corruption and looting, and upon conviction, give them this:

That’s what should happen.  And it’s what the Irish People should demand happen – by whatever means are necessary.

The cost of saving Ireland’s banks threatens a rerun of the Greek debt crisis that destabilized the euro region earlier this year. Lenders are reeling from the collapse of the property market in 2008, which resulted in the biggest contraction of any EU nation. An unprecedented budget deficit — equaling one-third of economic output this year — sent bond yields to all-time highs.

Looting becomes impossible to sustain eventually.  Now the Irish Government thinks that the Irish people should pay for being robbed!

It’s not enough to get ripped off – now the government wants to tax the people to pay for the stealing that they allowed to happen in the first place.

This is no different than what happened in Greece or the United States for that matter, and it will continue to happen until the people stand up and refuse to accept it.

Further, and far more importantly, shifting the bad debt around doesn’t get rid of it.  It simply tries to impose the cost on the nation as a tax – a tax that cannot be paid, and won’t be paid.

To the Irish people: You must choose between putting a stop to this – no matter what it takes to enforce that demand – and literal debt peonage and servitude imposed upon you for the sins of a handful of rich bastards that robbed all of you.

The Greeks failed to rise and stop it.

Now it’s your turn.

The problem with refusing to rise is that doing so will not in fact provide a fix.  You will simply sink further into the mud and ultimately will detonate the European Union.

Down the road of ”accepting” these acts by your government lies an inevitable armed conflict of some sort.


Author: Chilleh Penguin

A frisky penguin.

Leave a Reply

Please log in using one of these methods to post your comment: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s