Rescued?

“We may have been rescued from the wolves. However, it is open for debate whether our rescuers are planning to feed us to the lions.”

Thats good sh1t Karl. For the record, i’m robbing that line…. 😀

@Karl
Thanks for providing the doc.

Its a good summary, but I wonder where do you stand on what options are available to the next government.

By stating (and repeating here today) that senior bondholders are not explicitedly protected in the memo, are you hinting that there is scope for unilateral action by the incoming government? Or that the lack of explicit protection could give the new govt some opportunity for renegotiation.

“Rescued from the wolves” is good enough endorsement for me. As to whether it is part of a wicked plan to ultimately “feed us to the lions” is pure speculation.

What part of ‘loss of sovereignty’ do people not understand? I admit it took me some time for the penny to drop, but, with the help of the knowledgeable commenters on this board (many thanks to them – you know who you are) it finally did. The Government played a good game for more than 2 years trying to convince all and sundry that they were in charge – and this encouraged acres of commentary outlining varying options (but all predicated on the implicit assumption that the Government had some scope to act unilaterally). The EU was prepared to play along with this because it lacked the mechanisms to deal effectively with the mess Ireland was presenting – and still doesn’t (even if it is slowly getting there).

The EU has just about enough in place to protect Ireland from the bond markets, but it is far short of what is required. The idea that the EU/IMF is prepared to ‘feed Ireland to the lions’ is ludicrous. It is not in the EU’s interest to have Ireland, Greece, Portugal or any other member drowning in a sea of debt. But there are millions of voters in the core EZ countries who have been excluded from giving their direct consent to major institutional developments in the EU over the last decade who have to brought on board.

This will take some time, but it is in the EU’s interests to do so and it will happen. In the meantime Ireland will have to demonstrate a willingness to employ the sovereignty it retains to remove the deadweight costs that are hindering economic recovery.

IMF deal decision postponed due to the vote next week…

*IMF SAYS IT POSTPONES ACTION ON LOAN FOR IRELAND
*IMF POSTPONEMENT `IN DEFERENCE’ TO IRISH PARLIAMENT MOVE
*IMF: IRISH APPROVAL RECOMMENDATION COULD BE AS EARLY AS 12/16
*IMF SAYS LOAN APPROVAL ASSUMES IRISH PARLIAMENTARY SUPPORT

http://www.imf.org/external/np/sec/pr/2010/pr10482.htm

fyi

Statement by IMF on Ireland
Press Release No. 10/482
December 10, 2010

An International Monetary Fund (IMF) spokesperson issued the following statement today on Ireland:

“The Government of Ireland decided yesterday to table a motion on the EU-IMF Financial Assistance Program for Ireland in the Irish Parliament (Dáil). The vote on this motion is scheduled for Wednesday, December 15, 2010.

“The authorities have informed us that while parliamentary approval of the EU-IMF support package is not legally required, the Irish Government has put the motion before parliament to strengthen political support for the agreement. In deference to Ireland’s parliamentary process, the IMF has decided to postpone consideration by its Board of the proposed loan under the Extended Fund Facility until after the debate. Assuming parliamentary support for the package, the Managing Director could recommend approval by the IMF Executive Board of the proposed €22.5 billion IMF loan as early as December 16.

“We welcome the first implementation measures of the 2011 budget – stipulating the fiscal consolidation path and important reform measures involved in the program – have recently been passed by the Irish Parliament, confirming Ireland’s strong commitment to the program and the policies involved.”

“*IMF SAYS LOAN APPROVAL ASSUMES IRISH PARLIAMENTARY SUPPORT”
and here was me thinking that constitutionally we didn’t actually require a vote… If we now require a vote in order to actually get this money one can only hope that there will actually be full information given to the Parliament. Meanwhile, the debate about pre-funding continues… See here http://blog.cornerturned.com/?p=39

Is it time that we moved on and figured out how we might realistically restructure our sovereign debt (which includes the bank stuff). The figure Karl uses for debt/GDP of 110% by 2014 looks low. I have seen much higher projected figures.

Could we learn a valuable lesson from Iceland and seek to push out the debt really long term as they did with the Icesave repayment out to 2046. The interest rates charged of 3.3% and 3% showwhat a really hard nosed negotiator can achieve. Do we have any in the MoF?

@Brian Lucey

If we now require a vote in order to actually get this money one can only hope that there will actually be full information given to the Parliament.

Oh indeed. Is FG preparing to allow through a deal which contains a secret side-letter they haven’t seen? Or if the FG leadership has seen it, what are they going to do to reassure the rest of us about it? And are the lobby-fodder going to loyally vote for it either way? Time for someone to start asking them those questions.

The ‘wolves and lions analogy’ will probably be passed off as a rhetorical flourish, but it appears symptomatic of a desire to huddle together around the ‘nuclear button’ that we could press to twart the designs of all those evil people out there seeking to do us in. What nonsense! Rate investors in the bond market want assurance that the coupon will be paid and that the face value will be repaid on redemption. The EU has its own dysfuntion, but it is getting to grips with it. For example, the ECB is unable to use its firepower to convince bond shorters that will get hosed if they persist. The EU Grand Panjandrums know that dodgy banks in the core EZ are benefitting costlessly from the currently enforced protection of senior bondholders in Irish banks. These and other issues will be resolved. If the EU fails to relieve the burden Ireland is carrying in the near future, the EU fails. It’s as simple as that.

But we have to realise that any relief, restructuring, call it what you will will only occur when millions of voters in core EZ economies and their political representatives are convinced that Ireland is deserving of such relief and that it is in their interest to step up to the plate to finance it. In the context of the EU Constitution and the EMU they have been lied to, manipulated and ignored by their politicians and they will take some persuading. And they must be persuaded that we are doing everything we can to do our share of resolving the problems plus ensuring that reforms have been implemented to ensure there is no repetition before they will be minded to assist.

This is the audience we must seek to convince and we seem to be doing a brilliant job. I expect the political acceptance of the first stage of fiscal adjustment has been noted, but can they see any evidence of reform of the bankrupt and dysfunctional system of political governance that was a major cause of this mess? This proposed Dail vote is a perfect example that it is alive and well. (The objective here is to highlight the differences between FG and Labour and has nothing to do with establishing political support for the Troika deal.) Or can they see any serious effort to remove the deadweight costs being imposed by the public, semi-state and private sheltered sectors? Can they hell. I wonder how ‘cheque-cashing half hour’ translates into German?

@Paul Hunt

: “Check-Einlösung halbe Stunde”

As Karl points out there is a dearth of information on what is intended with the banks. The Irish Examiner has an article on Maarten Van Eden (Anglo’s CFO) and an articlehe wrote for the Dutch financial newspaper in which he is reported as saying

“The banks operating in Ireland have a long-term capital need of €75 billion and require €70bn in the medium term to cover bad assets,” he wrote in the newspaper.”

€70bn in the medium term?

http://www.irishexaminer.com/business/anglo-chief-says-eu-support-does-not-solve-irish-banks-problems-138955.html#ixzz17jIJ2njh

@anonym, Brian Lucey

wrt side deals and full disclosure, Kevin OR had a post earlier which referenced the Indo report about the private briefing of certain investors / bond market participants.

If the Indo is accurane, then as this was private and contained clearly price sensitive information which was specific in nature, it may have been unlawful – not just morally / democratically objectionable.

@Bills Hobbs

RE ” Just who has told Dublin it must have a vote on the package and why?”

We are being told to bind ourselves with our own constitutional chains.

@Joseph Ryan
FF has nothing to lose by having a Dail vote.
They hope this will tie all other parties up in knots.

CB/ECB lending figures to Irish banks.

igsy01 said “Under such circumstances, a country with a BBB+ credit rating able to get fixed rate funding at 5.8% would normally attract considerable envy.”

But has our rating not been cut BECAUSE of the 5.8% rate ? To me this is a classic example of sub-prime lending where a party with credit access problems (Ireland) gets a high penalty rate to access loans.

Does anyone really believe that we can afford 5.8% ??? And whatever happened to that sub-prime market in the US. Nice to know we havent learnt anything from the last few years.

@BWII
“Plan is to downsize Irish banking to be domestic. 75Bn long term capital implies around 750bn risk weighted assets. So that’s about 6 times GNP. Is it reasonable to assume that domestic agents would owe the banks 6 times their annual income? Maybe it is.”
Eh, no.

Don’t forget the losses…

We’re already at 45 bn in capital (in many and varied forms). The plan is to inject a further 10 bn/use it as guarantees and have 20 bn on standby. This latter amount is to allow the deleveraging. My poor arithmetic says that is 75 bn. What does yours say?

The refusal of angela merkel to back euro zone bonds to backstop the ESFS is ,I believe significant.
Its a point blank refusal by Germany to pool its sovereign credit rating with the rest of the eurozone .This would neccessarily increase the yield on German bonds which would also have to compete for funds with the euro bonds.
As someone else has stated here its possible the EU will now asset strip the ESB etc as payment .At 2013 the liabilities that remain on the ECB balance sheet can be warehoused and the outstanding balance financed by revenue streams flowing from ESB etc.

If Germany is serious about the euro zone then the only long term option left is a Federal Fiscal authority.
The political actions of Merkel suggest there is either no long term vision for the euro or that a strategy is already in motion to exit by Germany which consists of extracting as much as they can from Ireland before they go.

@all

New York Times
End to Ireland’s Financial Crisis Starts With Banks

http://www.nytimes.com/2010/12/11/business/global/11ireland.html?_r=1&hp

Worth a read … as Stiglitz is cited here ““Unless they figure this out better, they are exacerbating their own problems, … and they will compound the weaker economy with a negative dynamic.”
2_of_7 makes a guest appearance … and politics.ie takes the ribbon on the blogs.

@ christy

We ought not allow Germany benefit form state guarantees that they don’t contribute to the cost of.

Chancellor Merkel speaking in the Bundestag, Oct 07, 2008: “Fourthly, we know that we operate in an EU internal market. Of course this raises the question of how to dovetail national and European actions. Here I want to identify the approaches which, in my view, are not appropriate. The Irish approach of backing its own banks without prior consultation and not backing other international institutions which have long paid taxes in Ireland, thereby of course distorting competition in a way that is, in my view, unacceptable in the internal market – this approach is not appropriate.“

@Eoin,

You have consistently highlighted the huge net exposures that core EZ governments have facilitated their stupid banks in salting away, or as you put it ‘warehousing’. It would be interesting to get a handle on the proportion of these net exposures that comprise exposures to Irish banks and dodgy sovereigns and banks in Greece, Portugal and Spain. I suspect this proportion isn’t that large and that the bulk of the net exposures comprises some of the most toxic devices ever conceived by the quants in the bulge backet and global banks.

Of equal relevance is the hypocrisy of these governments, while facilitating this ‘warehousing’, in seeking to force Ireland, Greece, Portugal and Spain to accept the burden of keeping these stupid banks whole in relation to their net exposures to the banks and the sovereign in these countries. And this hypocrisy is driven by pure dread; dread of having to address the implications to the EZ financial system of confronting these net exposures and dread of having to ask their voters to stump up to finance the inevitable shoring up.

Michael Noonan was very good in the Dail last Tuesday (and Garret FitzGerald had another go in the IT today) on the extent to which Ireland is isolated within the EU. Since the lid blew on this debacle at end-Sep. 2008, the Government has been locked in a clammy and damaging embrace by the EC, the ECB and, more recently, the IMF. In the same way as the markets picked off the peripherals one by one, the core EZ governments have been able to isolate them politically.

That is why a general election and a new government are urgent requirements. We need a new government that can honestly admit to the mistakes of the past, express sufficient contrition to our EU partners, speak for and to the people of Ireland and demonstrate a commitment to pursue the reforms required to manage the required fiscal adjustment, to boost economic recovery and to prevent a repetition. And more importantly, to speak on behalf of the Irish people to our EU partners and their voters. And this includes steps to form common cause with the other peripherals to confront the hypocrisy of the core EZ governments. It is in the interests of the EU to forge a political and economic solution that preserves and develops its institutions in the common interests of all. There is a common problem and there has to be a common solution.

Threatening to put on the headband and to go on a lone kamikaze mission is entirely self-defeating and will isolate Ireland even more. The sooner this government is gone the better. The judgement of the people has been delayed for far too long. By all means let them push though the full legislation required to enact the budget. But that’s it. JHR, Lowry, Behan and others could do a great public service by pulling the plug at that stage and calling time on the Green fantasies.

@BWII
I think ‘capital’ is being used loosely here. The banks need either to sell assets or to replace lost deposits to the tune of 125 bn (75+50 bn according to Mr. van Eden, but they have a regulatory capital requirement of 70 bn to cover losses and raise their capital ratios.

Should have been

*Isn’t a chunk of the capital needed so that the banks have positive equity rather than negative*

@ Hog & D_E

It is hard to precisely know what he meas. Fopr example, the following quote:

“Van Eden said that a further €50bn is needed to restore the term structure of the banks’ obligations.”

I was interpreting the 75bn requirement as a “positive equity” thing, in which case it is much less worrying as in a stable economy that should be an investment. What I would like to know is how much has to go down the tubes?

Excellent article and the first one I have seen that actually goes through the timeline of the “bailout”. Our being thrown to the wolves or lions is interesting too, because that timeline make it clear to me that we are not being bailed out. Instead we are in the process of legitimizing the transfer of private sector bank losses onto sovereign balance sheets and I have yet to see a good article about this. The “big lie” spin is to refer to this as burning bondholders as if the act of non transference is one that maliciously targets bondholders and once that phrase appears, the conversation turns emotional. The other element of the “big lie” is to point to the consequences of “burning the bondholders” and by doing that, to suggest that failed banks, lost deposits etc will only happen if the state fails to assume these liabilities. In reality, that can all happen even if we try to assume these liabilities and, by assuming the losses onto the state, we make ourselves more vulnerable. We do this because today, the state has cash (the pension fund). Tomorrow, when that cash is gone and the bank losses are now officially the responsibility of the state, we may have no choice but to default in a chaotic manner along the lines of Argentina, without any buffers to protect our citizenry against the fall out.

We can’t blame a wolf for behaving like a wolf, we have to blame ourselves for creating a situation in which, by refusing to consider alternative paths, we put ourselves under the mercy of the wolf.

The reality is simpler, but I may be wrong.

Getting a lot of economists to agree on anything is a nontrivial task. I have some experience of it. Perhaps we can get a load of bw2 and eoin^2 instead?

This article deserves a wider readership than B&F. Would it not be possible to get a load of Irish economists together to sign an article along these lines and have it published in ALL the newspapers before the Dáil votes on the Troika reparations?

Why not a group of small businesspersons struggling to keep the economy afloat rather than economists in protected positions, whether they are right or not?

After all, one of the few economists who had publicly sailed against the winds of conventional wisdom, was part of what you apparently see as a capitulation.

As for the allusion to Versailles, we can of course ask Russia or China for a loan or decide to return to self-sufficiency but try and keep in mind that this dénouement was not caused by outsiders.

@MH

I think a letter from some senior business people would be even better.
As would jail for many of the architects of the Irish crisis.

The problem is much bigger than Ireland’s banks now though. Sovereign default is virtually guaranteed in more countries than Ireland if the bank boldholders don’t take a hit.

The denouement had many home grown elements but it was funded by much foreign money and has now spread way beyond Ireland. There is an urgent need for a pan European solution.

Italy needs to fund E300bn next year and Spain E150bn and the way things are going they’ll only be able to get that at penal rates. There’s a Euro political ineptitude premium build into yields now.

@seafóid

‘… There’s a Euro political ineptitude premium build into yields now.’

+1

@Bond Eoin Bond

Neat work. Round it all up – that’s a Trillion … From an ECB perspective, of course, this is ‘manageable’ (-;

It sounds from Garret Fitzgerald’s article in the IT that our relationship with the EU is at an all time low. Short of a massive crisis or an EU change of heart I wonder how likely a rescue is. Unless of course this current government has a rock solid commitment from them. If they claim to their backbenchers that they do, the backbenchers would be utterly gullible to believe them without written evidence. After the next election I can see lots of government TDs claiming they were completely deceived by the two Brians. By then our next government may be lobbying for it’s life.

@SeanO’
Don’t get caught up in this “lost sovereignty” side track. A sovereign government can renege on any deal or treaty it likes. It has to face the consequences – but that is what diplomacy is all about.
We have choices. We just don’t have as good a range of choices as we might of had if we had had a less craven spineless governement as we have now. And that is why our choices at the next election are so very important.
We can still negotiate, because sooner or later default or “restructuring ” are coming our way. We need to be using our guile and cunning and some badass hard neck, to build an alternative consensus to that of Sarko and Merkel. Don’t you think there might be some others in Europe who are a bit uncomfortable with a Franco-german diktat?

Echoing Bismarck’s reputed comparison between law-making and sausage-making, EU decision-making is seldom a pretty sight. But what should we expect from history’s most successful example of multilateralism which has expanded from 6 to 27 countries since Dec 31, 1972?

There has always been an idealism element in the EU project – – why else was a poor country like Ireland admitted in 1973 — and a flawed EMU governance system now collides with a reality that every country has seen public debt levels spike during the severe recession.

The approx €50bn in senior debt at BoI and AIB is about 40% of the current borrowings of Irish domestic banks from the ECB and Central Bank. Haircuts would mean exclusive reliance on public funders for some years.

The 2 banks had a combined market cap of €2.5bn on Friday; restructuring, selling and downsizing must be a priority.

Anglo had 1,250 employed last month — which is still a huge number for an Irish company; the new government will be faced with the unpleasant decision on big layoffs also at BoI and AIB.

The current issue of the Economist says: “A 20% loss on euro-zone and British banks’ combined exposure to Greece, Ireland, Portugal and Spain would mean a hit of about €300 billion.

That is a fraction, albeit a hefty one, of the €1.1 trillion aggregate Tier 1 capital of the 91 European banks that were stress-tested earlier this year. Some think the BIS data overstate the danger. For instance, German regulators reportedly believe their banks’ exposure to Ireland is only €25 billion-30 billion, against a BIS number of €150 billion. This echoes the complaints of Austrian bankers in 2008, who said the BIS figures on their exposure to eastern Europe exaggerated the true risk and panicked the markets unnecessarily.”

Restructuring may come in a few years when the global recovery is sustained and as IMF programs wind down. However it will not be simple nor will it be a free lunch.

For example, how could Italy with a debt ratio of 119% be excluded?; how could it be included?

As we obsess about default with its identifiable villains, we ignore the issues of not only reform but the challenge of creating 200,000 net new jobs.

Our cargo-cultists put their faith in a ‘flexible’ economy, university research and American FDI.

Facebook and Citi announced 350 jobs this week, which is welcome but despite the spin from the IDA, FDI has peaked as a jobs engine; we are heavily reliant on the pharmaceutical sector which employs less than 30,000 and is responsible for more than 50% of merchandise exports; just last Sunday, the CEO of Pfizer abruptly resigned because of the challenges.

The FDA approved as many new drugs in 1950 as it did in 2008.

Anti-euro flat-earthers should note that apart from the tax rate, our membership of the EU is an important factor for US firms; most significant Japanese and Korean operations have shut and beyond the IFSC, Ireland isn’t an attractive location for the big German firms.

A Michael H

+1 as usual.

‘As we obsess about default with its identifiable villains, we ignore the issues of not only reform but the challenge of creating 200,000 net new jobs’

Plus another 100k+ (?) to replace those which will be shed in the restructuring/reform/privatisation processes. It’s hard to see anything other than another big emigration wave on the way.

@seafoid,

I have consistently argued that the markets will continue to press to close the gap between the political fantasy being purveyed by the Troika/S-MCo and the economic reality the markets perceive. This gap will be closed. You seem to be in favour of Ireland putting on the headband, climbing into the Zero and going on a kamikaze run.

Magnificent, yes, but stupid and self-defeating in the extreme. The immediate requirement is to build political cohesion among the peripherals to confront the naked self-interest of S-M&Co. This is how the EU has traditionally – and excruciatingly slowly – moved through successive crises to something better.

Your recommended approach, if pursued, would render Ireland no longer fit to be a member of the EU.

@ Paul Hunt

This Eurozone crisis is moving faster than the political cycle. We have no idea how things will stand by Christmas. A union of the peripherals would be great but all of the houses of the peripherals are under similtaneous attack. Spain has to fund 150bn next year and it is desperate to get its yields down and will do almost anything in terms of austerity to placate the markets and still it is not enough. What can a union of peripherals do between now and Christmas ?

The whole EU philosophy of the last 50 years is under threat IMO.
Under severe pressure there is a reversion to beggar my neighbour politics by individual states which damage everyone.

Ireland is going to have a sovereign default anyway if the Troika deal goes ahead. And so will Portugal ad Greece and Spain and possibly Italy.
And if they happen so will everyone else because everything is fite fuaite ina cheile.

The EU can’t afford a bailout fund bigger than the EFSF because it has to borrow in the markets for the money and the market is demanding a higher premium for this money and each country that chips in must
borrow its share and that increases their debt… It is a savagely vicious cycle.

The markets want someone else to pay for the losses of the banks and the sovereigns can’t pay.

It’s a battle between the markets and the people and it demands a coherent response from our politicians. As well as coherence between countries.

The markets have enough money to absorb the losses of the bank bondholders. The sovereigns don’t. Merkel and co. are trying to hold the line because they don’t want the cost of funding their banks to rise next year but that is a forlorn hope IMO.

Interest rates will go up regardless as risk has been very badly mispriced and bond rates are too low.

A wave of sovereign debt will wipe out many mainland EZ insurance companies who are heavily exposed to savings funds linked to sovereign bonds. In whose interest is this ?

@ BJG

The capital markets at the moment are in risk off mode and are not taking the long term view.

If the guarantee stays, Ireland will default. That is what the markets are saying at the current level of yield. The markets are telling Ireland that it can’t afford the guarantee.

As to your previous point about the ESB and foreign ownership- Connex is a French company that owns railways in the UK. It price gouges as well as the local firms. That is the way of the market.

@seafoid,

You are perfectly entitled to express a pessimistic view about the future of the EU. My view is that the project is worth sustaining, as I fear the alternative. S-M&Co are compromised on two counts. First, too many of their financial institutions are vulnerable and it is in their interests to seek to protect them – even at the expense of the peripherals. Secondly, the institutions and mechanisms they and their predecessors have developed – and which have now being found to be unfit for purpose – were established without the full consent of their voters. They will now have to confront their voters with these two unpleasant realities. And their instinct is to duck and dive, but the markets, as you rightly point out, won’t allow this to continue indefinitely.

Very few in the markets will profit from mayhem. Most want resolution and some measure of certainty. But none will volunteer for haircuts. The EU is ruled by law which is made by politicians and any resolution will only come from revised institutions and mechanisms.

If the EU is to survive it will have to happen, but Ireland pulling the plug won’t make it happen any faster; it will put Ireland outside the pale. That’s why we need a new government to speak calmly and persuasively, with our fellow-peripherals, both publicly and privately, to S-M&Co about Ireland’s inability to endure the medium term measure of economic pain that is being prescribed. But it will also need to demonstrate a commitment to reform political governance and to make structural economic reforms to unburden the economy.

@ Paul hunt

I agree on the need for reform. It must happen. But the situation now is not about what to do in 2012 and beyond. It is how to get through next week. The EU is ueberfordert. It boils down to a row between Trichet and Sarko at Deauville. Sarko said that ultimately there is a limit to what the people can pay. And Trichet said the markets should decide .
Now the markets are saying that if Ireland doesn’t sort out bank debt it will be forced into a sovereign default. And the cancer has spread to other countries. The financial system is inherently unstable and also desperately fragile.
Too many banks grew on the back of leverage at cheap rates. There is probably too much money in the system too. And there is no magic growth rabbit to pull out of the hat before Christmas. I don’t think anyone in the Government has a proper handle on this. Neither does Olli Rehn.

Looks like FF Lite (main opposition party FG) are waiting to see if FF and presumably FG’s Creighton are sufficient to pass the IMF deal. If they aren’t then further FG “in the national interest” defectors will be necessary.
From Labour poster on politics.ie:
Regarding FG voting for the IMF deal:

“”former deputy leader Richard Bruton said it was ‘not a foregone conclusion’ ”

“communications spokesman Leo Varadkar said Fine Gael support for the deal was ‘unlikely’”

One hinting that they will support it and another hinting that they wont. So like the budget, they’re at sixes and sevens over the bailout. Perhaps they’ll do the same as they did on the budget and speak against but provide pairs to the government to facilitate getting it through.

We’ll have to keep an eye on Al Jazeera in case the Taoiseach in Hiding (AWOL opposition leader Enda Kenny) releases another video.””

Cowen was concentrating his fire on Labour in recent interviews. May be tactical but journalist John Drennan says FF TDs hoping to link up with FG after the election, presumably if decimated.

Rafa hijo Says:

”We can still negotiate, because sooner or later default or “restructuring ” are coming our way.”

Agreed.But my point is there is no point in voting unless political parties express in manifesto form prior to the election if they will default or support the deal.
If they support the deal or state they will renegotiate without default the final option they WILL use then voting in the next election is pointless.

You vote for people who make the critical decisions that affect your life and who govern your life.These decisions are now made by Ollie Rehn,the ECB and Angela Merkel.

I suspect FG and labour will say they ‘ll renegotiate but that should be trashed as a ruse by them to fool the electorate straight away..

Remember FG and Labour colluded with FF to overthrow the result of the NICE referendum until we voted yes.That resulted in mass immigration from 2004 onwards which combined with unrestrained hosing of our financial system with limitless credit from German banks etc has in large measure lead to our current demise.
Lisbon should have taught them a lesson but they still went ahead and campaigned for a second referendum.

In my view the scenario most people fear a far right anti EU political movement will a step in the right direction.
Rescue as the title of this thread alludes to,is best if it comes from ourselves.
The EU are not our friends or our partners,they are in fact hostile to our best interests.

@ Rafo

I mean a lot of money was created over the last 30 years and it went into assets that were sub standard and not worth what was paid for them and so deleveraging needs to happen and the issue of who pays for it is crucial. Taxpayers can’t do it all. Total global financial assets were c USD 40 trn in 1980 and over cUSD 200 trn in 2007 and a lot of that growth is *possibly ;)* bogus.

@seafóid:
“It price gouges as well as the local firms. That is the way of the market.”

Surely that’s the way of the non-market? Free enterprise as opposed to free markets?

bjg

@ Rafa hijo says

”There was a very good reason for building a european union.”

Yes for Germany and France.But I dont see what the benefit for Ireland was other than for farmers to sit in front of the EU with a begging bowl for the past 35 years.
Certainly its difficult to see what a great union it is.

….”The threat of anti-european ideas around the continent is quite scary.”…

Not sure what you mean by this but if its a rejection of the undemocratic and unwanted intrusion of the EU in our country and all the harmful effects brought to these shores post the Nice and Lisbon treaties then anti european ideas are a legitimate political response.

The only reason that seems to be put forward in defence of the Euro and EU is that we would be a lot worse outside of them.Thats not much of a positive reference.
A year ago the pro europeans were propogandising that if we left the euro or if we did nt bail out the banks we would end up like Iceland.
Objectively Iceland’s course was the correct one and we are the fools.
I cant think of a single public person ,organisation or political party that can make the case for Europe that is convincing any more.

@ Oliver Vandt Says:

..”Ourselves and the UK allowed access to our labour markets from Eastern Europe – not the EU.”

Not a true statement.
The EU mandates access to our labour markets in the Nice treaty.

The Irish government had the option ,contained in that treaty of deferring access up to 2012 .