Schauble Proposes Greek Maturity Extension

It’s being discussed in the comments already but it’s worth giving German Finance Minister Wolfgang Schauble’s letter to the ECB, IMF and Ecofin ministers its own thread. The key proposal:

This means that any agreement on 20 June has to include a clear mandate — given to Greece possibly together with the IMF — to initiate the process of involving holders of Greek bonds. this process has to lead to a quantified and substantial contribution of bondholders to the support effort, beyond a pure Vienna initiative approach. Such a result can best be reached through a bond swap leading to a prolongation of the outstanding Greek sovereign bonds by seven years, at the same time giving Greece the necessary time to fully implement the necessary reforms and regain market confidence.

Just to be parochial about this for a minute, this raises an interesting question. If this approach was implemented successfully and did not trigger a financial crisis (I know some disagree — this is a hypothetical question) what are the chances that a similar restructuring would not be part of any potential second EU-IMF deal for Ireland?

Art and the economy

Last nights programme on Irish playwriting during bubble and bust was thought-provoking and enjoyable (I’m not sure if the link works outside Ireland). It also gave us a chance to see frequent commentor on this site, Gavin Kostick, in his natural habitat.

I love Irish theatre, and the last 10-15 years have given us some fabulous plays. But O’Toole wanted something more: art that engaged with the really big themes in Irish society, a lot of which are, nowadays, economic. I found myself wondering how you would have written a bubble play that would have been more than an unfunny and joyless (Michael Colgan’s phrase) social satire. But surely there are cleavages in Irish society today that are ripe for artistic exploration.

Professor Sinn Misses the Target

I’ve written a post at the IIEA blog commenting on Hans Werner Sinn’s recent columns on the operation of the Eurosystem. Sinn has made some seriously incorrect claims and followed them up with dangerous policy recommendations. These columns have been cited approvingly by Martin Wolf, Paul Krugman and Felix Salmon over the past week.

Felix, however, has now read this post by Olaf Storbeck of Handelsblatt and doesn’t seem sure who is correct on these issues: He’s looking for “a central-banking wonk out there who fancies adjudicating this dispute”.

Well, with 11 years experience working in central banks, I suspect I meet the job requirements. I wrote my post before seeing Storbeck’s but hopefully my arguments back his up to help counter Professor Sinn’s somewhat wilder claims.

Leaving cert maths

The news this morning isn’t great.

Review of top-level pay

One of the most disgraceful decisions of the last government was its U-turn on Assistant Secretaries’ pay. Personally, I wouldn’t blame any low-paid public servant from digging in their heels on pay and conditions when people at the top benefit from this kind of special consideration.

Guess what? They’ve gotten away with it again.