Month: November 2009

The O in IOU Stands for Owe

Just heard on RTE’s The Frontline from Minister Mary Hanafin (seconds before a very angry man got up to shout at Pat Kenny):

First of all, we’re not borrowing to pay NAMA, em to pay the banks. What we’re doing basically is giving a bond or an IOU and we’ll be getting €77 billion worth of assets in return.

By the same logic, we’re not borrowing to fund the budget deficit either. We’re just issuing bonds, or IOUs if you like, to people in international financial markets and we’re getting cash in return. Sort of makes you wonder what all the fuss is about. Still, it’s good to know that the NAMA bonds are buying us €77 billion worth of assets.

The Visual Display of Data

OK, this is a digression but it is occasionally good to escape from the Irish economy.

One of the lessons we try to instill in our students is the importance of the visual display of data, rather than relying too much on text.  Via Turbulence Ahead,  I came across this really striking example.

The Public-Private Pay Differential

Last week’s SSISI meeting featured a paper by Patrick Foley and Fiona O’Callaghan of the CSO and a ‘vote of thanks‘ by Seamus McGuinness of the ESRI.

Martin Wolf on the Irish Economy

The Sunday Tribune carried an interview with Martin Wolf yesterday.  Among the main points:

  • the importance of nominal wage reductions in order to promote export-led growth
  • funding risk in the sovereign debt market

Tax Strategy Group Papers

Some insights into the official thinking concerning tax policies can be obtained by reading the papers produced by the Tax Strategy Group:  a new batch has just been released.