Irish Economy Conference Liveblog

Hashtag is #ieconf, this liveblog will host tweets and comments from the Croke Park conference.

[iframe src=”″ width=”100%” height=”480″].

New IFAC Report: Strengthening Ireland’s Fiscal Institutions

The report is available here.   See also the background paper by Robert Hagemann here.

Garret Fitzgerald Spring School: 10-11 February

Readers may be interested in the Garret FitzGerald Spring Seminar to be held at UCD on 10 and 11 of February. This is the first of an annual series of “Spring Schools” to be named in Garret FitzGerald’s honour focused on topics that were particularly close to his heart.

This year’s theme will ‘Democracy in the 21st. Century’ and the event will include an opening keynote from Mary Robinson on the evening of February 10th.

Further details can be found here. Those wishing to attend are requested to pre-book a space. Contact

Getting Back in the Bond Market

Official funding runs out at the end of 2013. Today’s manouvre by the NTMA has converted some two-year debt into three-year debt, at a cost. This is not ‘getting back in the market’ in any sense which confirms debt sustanability. No new debt has been issued. The ability to sell new three- or six-month T-bills is not relevant either.

Think about Belgium. The ten-year bond yields 4%, having been briefly higher during the panic. Belgium has a debt ratio about 100%, GGB deficit about 4% and primary deficit about 1%. Belgium is likely (not certain) to be OK and could probably sell 10-year paper in some size. The 4% interest rate is just about consistent with debt sustainability given 2% inflation and a little bit of economic growth.

Ireland’s exit debt ratio will be higher, there are contingent liabilities we all know about and a deficit down to 4% in 2014 would be doing rather well. Can Ireland expect to sell 10-year bonds, in size, in 2014, at 4% yields?

There is a 2025 bond in issue with a 5.4% coupon. It will be an 11-year bond in 2014. The curve should be flat in this zone. So if you think yields on mediums will be 4% in two years time, you can work out the target price for the 2025 bond in 2014. It is about 111.

The bond has recently been trading about 85. So if you think we will be back in the market in a meaningful sense in 2014, on terms as good as Belgium, you can pick up a nice 5.4% coupon twice, and a 30% capital gain, by taking a flutter.

Alternatively you can insist that Ireland can (sustainably) ‘get back in the market’, and stay there, in size, at higher yields. This is entirely conditional on economic growth resuming quickly and at decent rates. The debt sustainability analysis in the IMF staff report to the executive board should issue in a few weeks and will be a must-read.

Draft Insolvency Bill

The draft of the new personal insolvency bill is available here.