I imagine their debt will actually continue to go up!

Of course it’s just a passage to safe haven for the European (and other) banks. You didn’t think the people who actually run the world had come over all sentimental did you?

The Greek “bailout” will not improve the Greek economy. Their GNP will drop when they implement cuts and their debt will remain the same. It is a short term bail out for European banks who are set to lose billions from a Greek default. A neccessary recapitalisation to buy time on how to really sort out the public and private debt problem of Europes’ economy.

As Richard Douthwaite (author of the Ecology of Money) argues in this article, the debt to GNP ratio will not improve until the latter - national income starts to improve. According to him printing more money is the answer.

http://www.irishtimes.com/newspaper/opinion/2010/0507/1224269862656.html

Air force: Ireland 7 Propeller planes, Greece 159 F-16s

Whether or not Germany and others derived some security advantage from the large Greek military, or they just needed a customer for their armaments industry in a post cold war world and didn’t care about being repaid is up for grabs. The amount of corruption involved in weapons sales in general is also something to contemplate, but is probably unknowable.

Greece may be better off than Ireland in the sense that they can probably just stop buying expensive cold war weapons systems. Or perhaps others will just stop selling the stuff to them. Barman make that a double …

Anglo was taken over by the DoF………. this happens when the parties ignore the rules and just get on with it. A gang.

The contagion comes from comparative analysis of the failings - Greece - high deficit, high debt, low growth outlook, government sector too high a proportion of the economy. So, Greece having failed (based largely, one suspects, on the shock admissions of debt gaming) the search is on for others in similar positions.

As to the order, I couldn’t tell you. I suspect it is down to the individual government’s willingness to take action and its population’s willingness to accept it. We had effectively three budgets in a year cutting spending or raising revenue. We may have another one this year, my bet has been on June for a while! In June, I’ll bet on September…

Hotel California currencies are so last year!

What goes around…comes around.

The Irish false sense of superiority and unbelivable greed has finnally caught up wth them!

Congrats!

I didn’t see your reference!!

That song was on my playlist long before I had heard of the iPod!!

‘I suggest that the primacy/importance of statistics in the foundations of the abstract concept that is today’s “money” explains somewhat how influential transparently misleading statistics can be’

As a social construct, the statistics derive a great deal of their power from the very fact that they are trusted. They produce a ‘truth effect’ as Michel Foucault would put it. Having the ‘government’ stamp or the ‘academic’ stamp of ‘objectivity’ is the key.

One can accept that the statistics are, in many respects, ‘true and objective’, while recognising that both their truth and their objectivity are inevitably limited by the institutional process whereby they are constructed. Political considerations are often tacitly at work in the actual construction of the figures, and not just in their subsequent interpretation. Those processes are quite subtle, and I am not accusing any statistician of ‘fiddling the figues’ as such.

Ulrich Beck and Anthony Giddens have written extensively on the way in which trust operates in modern economies. The ordinary citizen, no matter how well educated, cannot hope to grasp more than a fraction the technical basis which underlies the systems we use every day. We put the card in the ATM and have to trust that the cash comes out. (We had to trust fiat currency long ago and, pace Drumroe, there’s no rational way back to gold).

I think it was Weber who defined organised religion as a ‘well founded illusion’. Insofar as it has become the dominant worldview, much of modern economics functions as a secular faith, which precents us from seeing how the world works. No wonder we are up a gum tree.

The capture of the ratings agencies was fundamental to the looting, which is still driving much of the sovereign crises. The blood sports are nicely described by Yves Smith in Econned. The public sector requires major reform, but that must not be permittred to deflect attention from the need to eradicate gross manipulation and undeclared conflicts of interest from capital markets.

Good business governance is good political governance as the medieval trading cities knew well. There are no truly objective views, and all ‘official’ commentators are spokespersons for some institutional opr corporate interest. Nothing wrong with that, as long as it is acknowledged as such.

You really can’t fool all of the people all of the time, so the battle between democracy and plutocracy will be fought, with outcome unknown.
Notwithstanding the IFCSC and FDI, our economy seems increasingly, rather than decreasingly, peripheral.

It is in our interest to grasp as many of the global and European dynamics as possible, if only to avoid being cast in the role of austerity pawns in the looting game.

I said ‘my quipp’, not ‘my lyrics’.

“It probably does not help that debt held in the IFSC appears to be added to the pile held by Irish banks - that makes us look worse and gives rise to ill informed comments (I have come across them myself), which do not help.”

I was listening to David Harvey on the third chapter of Capital the other day.
(http://davidharvey.org/2008/06/marxs-capital-class-03/)

Harvey makes the point that since the gold standard was abandoned the value of money depends on statistics which describe imaginary national economies. It seems that the statistics may be imperfect but they are the senior metric in analysing the health of a national economy. I suggest that the primacy/importance of statistics in the foundations of the abstract concept that is today’s “money” explains someshat how influential transparently misleading statistics can be.

I’m relaxed. I don’t have an axe to grind one way or the other about the Euro. I suspect we/markets are all skating on thin ice though.

One question: where is that 600bn actually coming from? i.e. Is it ‘real’ money? Are they just going to print it? Or is it some kind of ‘guarantee’ from the various EU governments?

Show me the money!

btw I notice that you nicked my Eagles/Hotel Calfornia/’You can check out but you can never leave’ quipp on this blog the other day and put it in your Finfacts article! That’s OK. My ideas that I put in the public domain are free.

Relax.

The ECB is likely to deploy some of the considerable firepower in its arsenal in coming weeks, if necessary.

The FT says there is speculation that the central bank could be preparing a €600bn loan facility for one-year loans at 1 per cent to help more than 1,000 banks in their funding.

Greece and Portugal account for less than 5% of the Eurozone’s GDP. Even when Ireland and Spain are added in, the so-called peripheral countries or PIGS account for less than one-fifth of the region’s GDP. 

Niall Ferguson writes in Newsweek: Europe now faces a much bigger decision than whether to bail out Greece. The real choice is between becoming a fully fledged United States of Europe, or remaining little more than a modern-day Holy Roman Empire, a gimcrack hodgepodge of “variable geometry” that will sooner or later fall apart.

The doomsayers will be proved wrong.

Ferguson’s article is titled The End of the Euro; mine is The Euro is a success; Free lunch yet to be invented:

http://www.finfacts.ie/irishfinancenews/article_1019628.shtml
(article includes link to Ferguson’s article — 2 links trigger moderation!)

Sorry. I was being ironic. Must find out how to put those funny little faces.
It would be interesting to hear someone unpick Constantin’s figures, as he sure puts in the effort.

@ Oliver Vandt

Re ’social silence’. It’s not even that certain points of view are rejected or dismissed, it’s that they are defined as illegitimate and entirely unworthy of response. That’s censorship, which we Irish know a thing or two about.

The science of economics is, sadly, mostly ideology at this point in history, as it rules out of consideration the things which matter most to people, principlally social status. Pierre Bourdieu’s sociological work is essential reading for anyone who is interested in how the economy actually works. Fair play to Gillian Tett for seeing that.

The power of suggestion is an economic fact as well as a psychological one. In very broad terms, the best way to control people is to control the boundaries of the debate or discourse. That way people don’t need to be ordered about. They simply do what they perceive is expected of them, as Milgram’s experiments demonstrated so well.

Lifestyle and aspirations drive business, so the struggle for control of the MSM is accordingly fierce.. Celebs, game shows and other manufactured role models are not some kind of epiphenomenon. They are central to the consumer credit-basded globalised economic model developed by Greenspan and the Washington consensus. Like ancient Rome, our civilisation is in a decadent phase.

The distance between Hello magazine and scientific journals is not as great as one might imagine. Much private and corporate capital goes in ’supporting’ departments and institutes. Like the philosophers of old, the technical display often seves to obscure some points of view which would be shockingly crude if expressed in plain language.

Colm McCarthy who is right about the need for serious reform in Ireland, but it seems ironic that, having just been sold the consumer society, we should now be asked to buy into austerity.

http://www.irishtimes.com/newspaper/breaking/2010/0508/breaking5.html

+G7 conference call last night.

I’ve no doubt that others smell blood.

It’s going to be a long weekend for our European ‘leaders’ and their finance ministers.

It is a fact I have touched upon before, but is obvious to all. We have had an intermittent fight, currently dormant, over hundreds of years, with much bloodshed on both sides to regain our sovereignty. We have since agreed to surrender a large part of it by treaty. And an even greater amount, unwisely, by allowing pump and dump on our land. We always had the land, but due to a touch of black magic it was made to appear far more valuable.

The debts remain and that loss of sovereignty was sneakily done by unknown persons. By “inaction” and by systemically important parts of the banking sector. As banks all need licences, and we have regulators, do we really want to pretend to ourselves that it just happened to be the reverse of what was known to be necessary? We are in danger of whatever

I am hopeful that we are all part of a devaluation stroke, but it is unlikely that the destruction of Irish capital by way of land bubble was a part of it. That seems to be a permanent loss. Anyone want to quantify it?

We still do not know what has been going on in Anglo.

The bailed out Investment Banks are now turning on the tax payers that saved them.”

“Europe’s Web of Debt
Banks and governments in these five shaky economies owe each other many billions of euros — converted here to dollars — and have even larger debts to Britain, France and Germany. Arrow widths are proportional to debt amounts.”
http://www.nytimes.com/interactive/2010/05/02/weekinreview/02marsh.html

Courtesy of poster Disgruntledcitizen on another forum.

Poster Bob3367 disputes the above:

“No we are not on the hook for $1.32trn, but I couldnt be to tell you why.

This stuff really is tabloid finance, I’ll give a hint intercompany balances.

If a break down was given ie categories would help, but of course that would require work, so that.

I have been involved with companies registered here, who debt could be as high as $15bn per balance sheet.”

@Sam, Robert, Paul
I don’t like to jump to conclusions (no, really!). Also, much of this debt is secured on foreign assets, hopefully. It doesn’t look good though and it would be interesting to see expert views. I wonder how our bank debt compares to Japan’s after their bubble…One of the comments suggests that the very high debt of real sectors might be multi national related, maybe? I’ve only seen Debt Wish 6 and already I’m frightened.
http://trueeconomics.blogspot.com/2010/05/economics-03052010-world-debt-wish-6.html

Anyone see investors running to buy Irish bank shares? Anyone see investors running to buy government bonds? We cannot even get these auctions away. And it is going to get a lot worse. Merkel’s idea of setting up and ECB ratings agency to “compete” with Moody’s, Standard & Poor and Fitches shows how desperate they are becoming.

If Canadian banks are admitting that under Basle iii they will have to raise their regulatory capital requirements by 20% where does this leave Irish banks? Constantin does more than just bang away. “True Economics” cuts through the relentless, dishonest spin designed to obfuscate rather than shed light. BTW less than 12 hours after the British election UK property falls is that just a coincidence.