A couple of days ago I was giving out that the proposed deal lacked nuance given the time spent trying to reduce the payment by the government to IBRC for the promissory notes which would, in turn, pay down the ELA issued by the Central Bank of Ireland. Now that news of the deal has come, with much scratching of heads and flowing of flow charts, for some reason, we can all agree that not very much has happened at all.
Really what’s just happened is the government has been given a loan by the Bank of Ireland for a year, after which the previous status quo reasserts itself. The ECB hasn’t budged in its position that Ireland must get the ELA written off quick smart. Bank of Ireland’s shareholders must be feeling ambivalent about the deal which sees their holdings of Irish debt increase, albeit for a short time. The taxpayer is still on the hook, of course. But the people I feel sorry for most are the journalists who have to explain what just happened[1]. My sense is that in the complex negotiations that went on, the ECB won, hands down.
To the roundup then. Karl Whelan is underwhelmed. FT’s Alphaville gets the story mostly straight, Constantin does a good job of spelling things out clearly, and the IrishTimes gets the story a bit muddled but mostly right.
[1] This is a lie.