Author: Philip Lane

Free until 31 December to celebrate 30 years of Economic Policy:

Tomorrow is the anniversary of the “Black Monday” crash:  summary of that event here.

Kevin’s recent Keynes Lecture at the British Academy can be viewed here.

It seems that not everyone enjoys the massive media coverage allocated to the rugby and football events.  Lifted from the comments, Sarah Carey writes:

I think sports should be on at the end of the news for a minute, and Saturday or Sunday afternoons for all-Irelands and perhaps the semi’s. Instead it has (through marketing – its an economics thing) come to dominate the media to the point where it’s not something men take an interest in after work, but a constant mainstream time and space occupying event. It used to be sufficient to shout for your county during Championship season and your country on the rare occasion we won anything (Ole!) but now it’s CONSTANT and even women are expected to be able to converse about a wide variety of sports AS IF IT MATTERED. And as if the nobility attached to PLAYING sports is earned simply by watching it, on a telly, on Tuesday nights and Wednesday nights, and all weekend, and all the golf opens, and horse racing (I mean, if you’re not betting on a horse at Cheltenham WHAT’S WRONG WITH YOU) and as for F1 PLEASE/ cars going around and around? and I’m sorry. Rugby is a good sport, but you know it’s not a widespread country sport. It’s a posh boy sport. And it’s getting very dangerous with them all going around built like tanks and no son of mine will play it.
Hockey, there’s a grand sport. Gentlemanly and understated and no fuss and grandiosity. And only the odd injury if you put your head in the wrong place.
As for cycling, with ye going around in packs on Sunday blocking up the roads in that ridiculous gear instead of lazing in bed. Or out golfing. What happened to golf? The men could do their bonding and blabbing in awful clothes out of sight of the rest of us.
And all of it, even GAA, which really is noble, all about the money money money.
I’m going to set up a radio station which guarantees NEVER to have sport on it.

Right, got that off my chest!

As for compelling viewing on Sunday afternoons, you really can’t beat Pride and Prejudice. Or a good Agatha Christie. Something soothing to the nerves.

Sarah will be recording the Talking Point show at the DEW on Friday: 1pm in the library room at the Hodson Bay and everyone welcome to pile in and watch. Colm McC, Karl and Lorcan Sirr on panel.

The DEW programme is available here.

The Washington Post carries an extensive profile of Olivier Blanchard, now of PIIE after his period as IMF economic counsellor – here.

The section on the Irish bailout is interesting:

The one place European leaders were anxious for a bank rescue, however, was in Ireland, where by fall 2008 banks were already reeling from losses after the bursting of a giant real estate bubble. The Irish government had nationalized one big bank and bailed out several others, but the cost proved so high that two years later the government itself was on the verge of defaulting on its own debts and turned to the international community for help.

The IMF had convinced Irish officials that, as part of any rescue package, those who had lent money to the banks should be forced to share in the pain. But Jean-Claude Trichet, head of the European Central Bank and a key player in any rescue plan, was adamant that there be no “haircuts” for bank creditors.

Trichet’s motivation was not surprising. The biggest creditors of the bankrupt Irish banks were French and German banks that themselves could go under if forced to recognize such losses, requiring costly and unpopular bailouts from their own governments. He also feared that any debt restructuring, as it is politely called, might make it difficult and more expensive for other European banks to borrow. Trichet went so far as to threaten to cut all central-bank lending to Irish banks if their debts were restructured, the equivalent of a death sentence for the Irish banking system.

With no other options, Ireland agreed to guarantee all of its banks’ debts, paying for it with a $67 billion international loan package whose harsh terms would drive the Irish economy into a deep recession and saddle a generation of Irish taxpayers with the full cost of repayment.

Strauss-Kahn, desperate for the Fund to play a visible role in the crisis, agreed to go along with the terms of the bailout. In rationalizing its participation, the Fund was forced to issue what Blanchard and his colleagues knew were unrealistically optimistic predictions about the quick recovery of the Irish economy. It would not be the only time the Fund would buckle to political pressure from European governments that are among its largest shareholders.

“We were in a difficult position calling attention to the fact that the European banking system may have been insolvent,” Strauss-Kahn said in an interview from Morocco. “It was not our job to cause bank runs. Olivier’s intellectual authority on that matter was particularly helpful, if not totally successful.”