If folk do ‘invest’, I doubt that the majority will stay the distance. If they introduce a ‘Series II’ that has a more attractive rate of return, they may run the risk of cannibalising ‘Series 1′.

The one noticable exclusion from this product V’s other State Savings Schemes is the word ‘Guaranteed’. A sop to the banks, perhaps.

http://thestory.ie/2010/05/02/sufficient-room-to-manoeuvre-to-weather-the-present-turbulence/

http://www.thestory.ie

Good work from Gavin (Sheridan)

http://www.youtube.com/watch?v=vc8ykHoBXmQ

Classic from 2008, enjoy if you can !!!

I guess any answer would be speculative. They start selling today? I wonder where we can find out about the take-up in the first few days?

My guess is that it will be slow. I’m not sure enough people have enough faith in this government to actually want to buy anything from them. The marketing of it has not exactly been ‘ram it down their throats’ either.

Maybe it’s just symbolic. Why would you want to put so much money into saving the banks then put up a competitor product? Seems a bit odd to me (to take deposits/savings away from them in those circumstances).

Does the solidarity bond lash private savers to the boughs of the international bonds? Or is there no material difference? Let’s hope this is not another example of the gambler’s mentality that “we are so kiboshed if this goes wrong that we don’t need to worry about making things worse”.

I would be interested to know whether people think there is any chance that this bond could raise a significant amount through this bond. One hears flippant remarks from people that there is loads of money out there but that investors don’t want to risk it. Personally I think there is very little money left in Ireland. I think we have seen Krugman style wealth destruction on a grand scale.

So the cynic in me wonders why was this done?

After working for large organisations I am a bit cynical & my initial thought is that this was done to show that something is being done. The perception of doing something grand is seen as better than just doing something basic & useful. And of course someone seen as doing something grand can also justify a high salary while the peon doing the basic & actually useful will struggle along on a low salary.

It is a dream grand project for a career minded person: Seemingly addressing a current concern but its success can’t be measured. (is it cannibalising or is it creating something new?)

… and yours too

Sorry to be off-topic but the Indie today reports “Meanwhile, the head of financial regulation, Matthew Elderfield, has demanded that banks use the initial haircuts right across their NAMA-bound portfolios, for the purposes of calculating how much capital they must raise by the end of the year to meet regulatory targets.”

Doesn’t this mean that Anglo’s loansof €35.6bn will have a discount reported at 55% which means a loss of €19.58bn and means a further recap this year of what €8bn? And for INBS it means another €2bn.

Full story here:

http://www.independent.ie/business/irish/anglo-to-transfer-first-836410bn-of-loans-to-bad-bank-2161000.html

http://www.zerohedge.com/article/treasury-redeems-gargantuan-643-billion-treasuries-april

http://baselinescenario.com/2010/04/29/to-save-the-eurozone-1-trillion-european-central-bank-reform-and-a-new-head-for-the-imf/

Those figures for Italy look pretty frightening. I’m surprised the Italians haven’t come under more scrutiny. Would you know how much the government there receives in tax take every year?

“As a final choice morcel of paranoia, here is a quote from Jean-Paul Fitoussi, a French economist interviewed in the left-wing paper Libération today. M. Fitoussi has some sensible things to say about how the EU’s political cacophony bears a lot of the blame for Greece’s current agonies. But then he asks aloud why Ireland is not suffering the same “market attacks” as Greece, when its debt and deficit numbers are actually worse. Even taking account of the fact that Greece lied about its public accounts, he says, there is another reason:

“Because [Ireland] is a tax haven for capital. Greece does not have that card to play.”

Hmm. Indeed

“…..shouldn’t in any way change the processes used to assess which types of public spending should be prioritised.”

was poorly worded.

I didn’t at all mean to suggest that current processes were in any way optimal! Just that having money from something called a Solidarnosc Bond wasn’t a good reason to change the composition of spending in some particular way.

Would that be the process outlined by Dr. Suiter’s research used on Primetime last night? i.e. priority is given to any minister’s home constituency. Oh well, at least it’s not a complicated process!