Goldman Sachs on Ireland

Kevin Daly’s piece is below:
European Views: Ireland – Old News, New News, and Breaking the ‘Vicious Circle’

September 9, 2010

Irish bond spreads have widened significantly in recent weeks, driven by fears over the cost of bailing out the banking system and the nationalised Anglo Irish Bank in particular. Some of this is old news (the government’s estimate of the cost of bailing out Anglo was first announced six months ago) and the Irish government argues – credibly, in our view – that the costs of bailing out the bank are “infuriating but manageable”. However, the rise in Ireland’s borrowing costs has now created a dangerous dynamic of its own, which needs to be addressed with some urgency. Providing an independent estimate of the bailout costs will be an important first step. In addition, the Irish government should (and, we expect, will) accelerate the speed of its fiscal adjustment.

Background: Rise in Irish Bond Spreads on Costs of Anglo Bailout