The EU/IMF deals for Greece and Ireland assume some level of market funding for these countries: today’s WSJ carries an article on the problems with this assumption; you can read it here.
Month: April 2011
The slides from the talk by Klaus Regling at the IIEA yesterday are available here.
Save the Date – Conference Reminder
On Friday May 20th from 4 pm – 7 pm there will be a conference on:
Bank Credit Flows and Eurozone Stability: Theory, Evidence and Policy Implications
at the Institute of Bankers, 1 North Wall Quay, Dublin. The conference is jointly hosted by the Financial Mathematics and Computation Cluster (FMCC) at UCD, the Institute of Bankers, and the Department of Economics, Finance & Accounting at NUI Maynooth. Admission is free. We encourage early enrolment to register a place. We are grateful to the Science Foundation of Ireland for their generous sponsorship via a grant to the FMCC.
What next for Ireland? This column by CEPR President Richard Portes makes the case that the country should restructure its debt.
This article by Martin Walsh in the Irish Times has some convincing analysis (unfortunately the graphics are not shown in the on-line version), and some thought-provoking comments on the Irish government policy conundrum regarding residential house prices. As Martin Walsh notes, to minimize expected future (state-owned) bank losses and Nama losses, policymakers must hope that prices have now fallen to their steady-state equilibrium level. But for the purposes of restoring competitiveness, continued house price decreases would be better.
“… it seems that there is a real dilemma at the heart of national policy. Do we prioritise competitiveness by bringing house prices back into line with incomes or keep them inflated in the hope of reducing further losses to the banks and Nama (National Asset Management Agency), as well as containing the extent of negative equity?”
Most importantly, by most long-term metrics, current house prices in Ireland still seem to be above sustainable levels.
What actions (if any) should Irish policymakers pursue regarding stabilizing the residential housing market, and to what ends?