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Europe Goes From Worse To Horrible: Ireland Broker Than Expected, Greece Mulls Splitting Up Into "Good" And "Bad" Greece
Greece hasn't even filed for bankruptcy yet and the "unexpected" consequences are already coming. In comments to The Sunday Times newspaper, Irish Transport Minister Leo Varadkar said the country will likely need another "unexpected" loan from the troica, after he became the first cabinet member to cast doubt in public on Ireland's ability to raise cash. In other words once on the temporary bailout wagon, always on the temporary bailout gain. Reuters reports: "I think it's very unlikely we'll be able to go back next year. I think it might take a bit longer ... 2013 might be possible but who knows?" Varadkar was quoted as saying. "It would mean a second program (of loans from the EU/IMF)," he said. "Either an extension of the existing program or a second program. I think that would generally be most people's view." We wonder how German taxpayers will fell now that they realize they have not one, not two, but three (and soon 5 or more) heroin addicts they need to clean, wash, scrub, and feed on a monthly basis (with their, and US money, but Americans continue to not care that the biggest source of capital for the IMF is them). And speaking of ground zero, Greece is now scrambling after the Independent said that even Sarkozy is now prepared to let the Greek chips falls where they may. Following earlier news that the troika believes that the privatization plan it itself set up is not ambitious enough, Greece which now realizes that Germany, the EU, IMF, and Franch all are prepared to let it go, the country is now coming up with last ditch ideas faster than a speeding bullet: according to Reuters: "A Greek paper reported on Sunday that the government was considering setting up a Spanish-style "bad bank" to clean up its lenders' accounts from "toxic" Greek bonds and make them more attractive to potential buyers." Of course since it is toxic Greek sovereign bonds we are talking about, this implies that the country will somehow be split into a "good" and "bad" version of itself. And who thought financial innovation only comes out of the US.
From Reuters:
A 'bad bank', formed to hold risky assets owned by a state guaranteed bank, could be set up to absorb the risky Greek bonds held by state-controlled lenders slated for privatization, such as the Savings Post Bank, To Vima said.
"With problematic, Spanish savings banks (cajas) as a model, the finance ministry is examining proposals to implement the idea in the country," it said, without citing any sources.
Spain's Bankia, created from the merger of seven cajas, said last month it would create such a unit in a bid to attract investors ahead of a stock market listing.
Probability of success: 0.0%
As for Ireland being broker than expected:
Deputy Prime Minister Eamon Gilmore told broadcaster RTE that fears of a domino effect from Greece's problems were overblown. The possibility of a Greek default has sent bond yields rocketing for indebted Ireland, Portugal and Spain.
"It's not a situation that if Greece defaults then there are immediately implications for Ireland," Gilmore said.
"If Greece defaults there are implications for the wider euro zone and obviously we are part of that."
Ireland, meanwhile, wants to tap investors for funding in 2012 before its 85 billion euros EU-IMF bailout runs out the following year.
But investors believe Ireland will be unable to return to the market and instead will have to tap the European Union's permanent rescue fund in 2013, which might require some restructuring of privately held sovereign debt.
Reflecting this medium-term risk, Ireland's two-year and five-year paper are yielding close to 12 percent, more than its 10-year bonds on the secondary market.
Some 50 billion euros of the existing EU-IMF bailout has been earmarked for sovereign funding requirements with the remainder set aside to prop up the country's ailing banks.
Earlier this month, the IMF said whatever was left over after recapitalizing the banks could be channeled to the sovereign if there was a delay in returning to markets.
At the end of March, the Irish government said the banks needed 24 billion euros to bulletproof their balance sheets but Dublin hopes some five billion euros can be raised from imposing losses on junior bondholders and asset sales, meaning that 19 billion euros of the 35 billion would be tapped.
Gilmor's best defense: "It is wrong to put Ireland in the same basket as Greece."And coming soon to a theater next to, the story of the deputy PM who cried not bankrupt wolf.
The US may be on vacation, but the EUR, at a third of its regular volume and with substantially more volatility, sure won't be come 5 pm EDT.
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The money that had been lent to Greece at low interest in the boom years during Euro membership is on the private bank accounts of rich Greeks who didn't pay their taxes !
It is also stored in the worthless megalomaniac half-finished mansions that they plastered the Greek coast with.
Now these Greek private thieves transfer that stolen money to London or Switzerland,
while the not so rich Greeks are expected to lower their standards of living and pay higher taxes in order to reduce the public deficit and pay back the public debt.
The Greek millionaires and billionaires are the main beneficiaries of this tax evasion scheme and THEY should have their assets seized.
They ond only they are the main culprits here !
Meanwhile the fat-bellied Greek millionaire motherfuckers are buying high-end properties in London with the stolen money that's lacking in their home country !!!
They're eating caviar and sipping champaigne in Notting Hill and Chelsea while Athens is burning.
London is the place where all the unproductive milionaire human garbage is crammed together.
Another such worthless place is Manhattan.
FUCK THEM ALL !
I find myself AGREEING to 100% of your very "to the point" post's Franken'. Enjoy your insight, mainly because it's EXACTLY LIKE MINE!
The establishment of the EU had laudable goals, but it's a fair assessment to blame the ECB for lending the money in order to trap the Greeks into a lifestyle they could never afford. It is also fair to blame the Greeks for trapping themselves into a lifestyle they could never afford too. It's not as if they didn't know the rules (Which all the Southern European countries seem to ignore) about the strict budgetary requirements of joining the Eurozone. The Greeks, like Spain, Ireland, Portugal, France, and other "Agriculturally poor" countries have been given billions in subsidies for their farmers and for their infrastructure for a couple of decades now, which of course are now in the hands of a few expatriots living in London after they defrauded the EU in a couple of grand projects. The fact that these troubled countries managed to piss it all away, over-spend, over-print, and over-employ their civil services, without making any effort to be fiscally responsible or even make an export drive, is probably not what people (who prefer to blame the evil bankers) want to hear, but it is true. They brought all this on themselves.
These billionaires' teenage kids can be seen scoffing champers and stuffing foie gras into their gobs through the huge windows at the Caviar House between Picadilly and St.James's St. in London. It's hilarious during weekdays to see how the beggars of London walk by these kids inches away from them through the plate glass windows and not a single one notices. Last time I went there, plenty of Russian, ME, and American kids were there too. Very loud crowd, all elbows at the bar queues, and as appetite inducing as pubes in soup. I bought a jar of Prunier Paris and decided to eat it at home instead.
Once a greek shipping magnate. Taking advantage of global wage arbitrage Now living in a world where billions are spent on roads when people soon won't be able to afford cars and hundreds of new huge super tankers and super cargo ships are built which will forver have no cargo.
The world the corporations built is a cargo cult. And the cargo is gone.
the only way this will work is for the IMF to be the bad bank, like the FED.
then, maybe DSK, after he finishes with justice, could have his old job back, running the baaaad bank!
"then, maybe DSK, after he finishes with justice, could have his old job back, running the baaaad bank!"
Failing that, how about a position as bank dick?
Bailouts don't work. Family is a prime example, if you give out $ to "get by" you will forever be giving out $.
The world economy is a currency devaluation bailout economy, there is no stopping it. Get off the grid if you can to survive the coming crash.
Umm, well, why not set up bad Greece and good Greece .... we already have a good Europe, bad Europe within the EU.
Personally, I think the PIIGS need to form a PIIGS coalition and threaten to default together. Then do it. Together. Leap into the fire. The PIIGS may be the ones with the upper hand since the Eurostrash elitists will apparently do anything to save their EU socialist dream.
It is beyond me why the PIIGS allow themselves to get picked off, one by one, on a rotating basis instead of negotiating as a group. If they merely called for a "private" PIIGS summit amongst themselves it would work miracles.
They could just party for two days behind closed doors and come with hangovers and just say they created a roadmap forward and "made progress" -- no details needed. Juncker and Trichet would shit their pants and the planet would heal itself.
Is anyone else amazed by how the elites are coordinating the financial problems between the Europe and the US? It seems like every 6-8 weeks the focus switches from how bad the US is financially to how bad Europe is financially and back again. I really don't think this is just an accident or coincidence. It's all planned. It's a game of musical chairs designed to keep the West's morbidly ill world financial system from collapsing.
Eventually there's only going to be one chair left.
It's the Chuck Prince school of Finance.
“As long as the music is playing, you’ve got to get up and dance,” he told The Financial Times on Monday, adding, “We’re still dancing.”
http://dealbook.nytimes.com/2007/07/10/citi-chief-on-buyout-loans-were-still-dancing/
"Eventually there's only going to be one chair left."
Gold.
"We wonder how German taxpayers will fell now that they realize they have not one, not two, but three (and soon 5 or more) heroin addicts they need to clean, wash, scrub, and feed on a monthly basis"
Give me a break - Zero Hedge is becoming grossly autistic in its analysis.
If we walk the British ,German and French savings go south for the financial winter.... what do you think happens to their tax raising ability when they have little savings to tax ?
They needed us Euro Sheep to deindustrialize via the core farming credit on the way up and farming goverment debt on the journey down which the periphery has done - following our masters instructions to the tee so that they can go on extracting the smaller and smaller surplus.
Isn't life wonderful ?
And of course the farming credit will all but disappear on the renegotiation of CAP in I think 2014.
How are PIIGS getting picked off? They seem like the smartest players here. The welfare mothers of the EU always needing more cash. It's the "middle class" EU states that are getting screwed with currency devalution to "inflate" extra cash to bail out the PIIGS.
a veritble "touche" in their "snafu" all right.
Olli Rehn now getting in on the act.
Sound like they all just woke up to the fact that Greece cannot repay it's debt.
Idiots the lot.
http://www.google.com/hostednews/afp/article/ALeqM5gE7u-mCv7OnuxNWEs3EHohp9JJrg?docId=CNG.0523b3d2cc2f33b4bd9269bded6f6be6.a81
"If you don't clean up your act, I will fart in your general direction!" What are they going to do? Nothing they can do, except print more Euros and ask them to please fix their economy. But politically they cannot, and the EU cannot politically let the PIIGS go down, so it's print and kick the can and squawk about it so they can say they are trying to fix it.
Agreed.
I've been of the opinion that they should have printed €1.5Tn once the extent of the problem became apparent.
However the ECB does not have the power.
The ECB is not really a Central Bank at all.
They can't print. They can't buy Sovereign debt.
I'm beginning to think the ECB and the EU are stuck between a rock and a hard place.
The Germans never really wanted the Euro but went along for the ride as long as the EU/ECB let Germany get on with re-unification.
"Safeguards" were put in place. NO BAILOUTS.
Now they need to print and bailout.
And they can't.
I think IMF and ECB print via the Federal Reserve's currency swap programs. It's the same way the Federal Reserve comes up with cash to buy crap assets from wall street. Both sides make a ledger entry and *poof* there is cash in the accounts.
"The Germans never really wanted the Euro ..."
Here's a black swan scenario: The German Constitutional Court rules NO on further bailouts.
Maybe all these officials realize that that's what's coming, and they're just engaging in sound and fury posturing until it happens and the curtain comes down on this farce.
Not knowing much of Germany you could be right.
Certain Irish Judges are getting a little peeved with the actions of Government lately.
Anything could happen.
that's what DSK said..."and then he unleashed his Fleur de Guy." (pronounced "ghee" for all you unsopthisticates out there.)
They can kick them out of EU/eurozone and it will happen, sooner or later.
I thought "debt" was "good" ?
Fucking moron Banksters.....
If I owe $10M, I've got a problem. If I owe $100 Billion, the ECB/IMF has a problem.
(German lower house bars lobbyists from the Reichstag)
Rund 1500 Lobbyisten konnten bisher ohne Sicherheitskontrollen in das Reichstagsgebäude. Nun sollen ihnen die Hausausweise gesperrt werden.
About 1500 lobbyists until recently were able to enter the Reichstag building without clearance. Now their house access badges are due to be revoked.
http://www.welt.de/politik/deutschland/article13401091/Bundestag-sperrt-...
Wonder if that was ever thinkable in Washington, that lobbyists cesspool, where the men with the coffers full of money are forming lines in front of the doors of senators' offices.
Soo sorry to disappoint my electorate and constituents, but they twisted my arm, what could I doo hoo hoo ... *weeping*.
a irish government official with the name "leo" . oh boy, this story is not getting off on the right foot........
AS USUAL HERE COMES THE EURO ANSWER TO THE ARTICLE: 1.4319 IN NEW ZEALAND. WAIT, WASN`T THE EURO MEANT TO FALL TO PARITY - ACCORDING TO BNP PARIBAS LAST YEAR? AY, AY, AY. BAD LUCK, HUM?
PIIGS defaults are deflationary and therefore EUR- bullish. And 1 trill dollars of oil revenus are being diversified out of, including into EUR. So the parity bugs will continue to get shafted in multiple orifices.
After last night..I was sort of feeling ill. It was OK. I took a few aspirne then went back to the room..But then I was like, I wonder what ZN digged up over the last 24.. Then I opened up my browser, read it and felt like puking again. I am going back to bed.
Why didn't PIIGS governments sell Austerity as a means to save the planet?
The proles would have eaten that up.
Ring, ring.. ring, ring, ring.. ring, ring, ring.. ring, ring, ring.. ring, ring, ring.. ring, ring
<unintelligible speech> Fetch the fucking car.... NOW! He's not answering his bloody phone
Days Gone By
http://youtu.be/cPZxP5l0vAA
Reality to Greece: DEFAULT.
Ditch the euro.
Swear off government debt FOREVER.
Make "grams of gold" your official money.
Fire at least 90% of your public employees.
Your economy will boom, and your money will become the world reserve "currency" within 3 years.
Zimbabwe already has a head start
We need massive defaults of countries, companies and individuals; then all currencies may inflate to pre 1970 levels. There will be penny candy again, average salaries of 20 grand, and houses medans values of 70,000 or less. However, energy will be on a different playing field.
"We need massive defaults of countries, companies and individuals; then all currencies may inflate to pre 1970 levels. There will be penny candy again, average salaries of 20 grand, and houses medans values of 70,000 or less. "
Did I hear "deflation?"
__
"However, energy will be on a different playing field."
Well, in your scenario (which would be nice but not likely) when millions of people no longer "work" making exotic cupcakes, or designer children get-togethers, and don't have money to spend on _____ energy costs might not be the problem you see.
Hello? If anything scary happens to the banks in Greece then the remaining private depositors in the Irish banks can be expected to run for the exits. Then either those deposits will be replaced by a massive further infusion of "emergency" funding, or they won't be replaced. So either Gilmore knows something we don't about the ECB's intentions, or he's whistling past the graveyard.
"...2013 might be possible but who knows?", said the Minster.
Oh great. Most reassuring.
If the ES futures are not down by 40 points or so on Monday on this news, then it is going to be a long, hot summer for the bears.
Unfortunately for the coin-clutchers, if ES drops by 40 points, gold will also fall.
Best thing the coin-clutchers could hope for is a massive rescue plan coming out of China or something that saves the PIIGs and the market stages a huge rally.
Then gold will be dragged up reluctantly, kicking and screaming and will probably make new highs within a couple of weeks.
"Best thing the coin-clutchers could hope for is a massive rescue plan coming out of China or something that saves the PIIGs and the market stages a huge rally."
But, but, but..... the "coin-clutchers " are all begging for a collapse!!!
Too short sighted to see the big picture.....once weak hands are shaken this will be the first thing to snap back...similar to fall of 2008.
Precisely. Most GATA gold bugs are constantly cheering on for a collapse in the economy and the financial markets with their "capitulation watch". Little do they know that they have everything backasswards, and if they want gold to go to new highs, they should be cheering for economic growth, more printing, better job market, and even more more manipulation and intervention by the TPTB to jam risk assets higher and punish savers.
My "Formula" remains 100% correct. $1,650 is only acheivable if the Dow starts heading towards the 2007 highs and the economy starts booming. Anything less, stocks will fall out of the sky and take down gold with it.
I think it can go either way. I doubt Obama/Washington will let the stock market fall prior to the election. I'm betting on QE3 in some form to at least hold the market until 2012 elections. However this will make commodities climb along with food/etc. But "other bad guys" can be blamed for that.
Ooops I just realized I replied to the infamous robot trader. You have predicted a peak in gold since I started reading this blog. You haven't been right yet have you?
A collapse will likely cause a large call for physical delivery which will cause a collapse in paper positions sending the commodity to the moon. This will be the delay in golds true price discovery following a collapse
So Gold falls! This must mean that the buying power of the USD must rise? Sounds good to me.
or take "oil and treasuries right with it." valuations matter, so i'm told.
The Good, the Bad and a lot of Ugly
Government should take care of the people and should be the good?
Money makers over the backs of the people are the bad?
The bad protected by governments is going to mean a lot of ugly evolving and/or are the good the people who elect the governments? Then there is still a lot of good but they are still sleeping a bit except for the demonstrators taking a shot for their families, relatives and their country.
Nobody is going on the streets to express their colaboration in the european union. Maybe because there is no concept of the EU that has a sound fundation for people. Let's not forget understanding the goal. It has been forced all the way. EU has failed. Point
the gold
the bad
and the fiat ..
Egypt stocks rally to 2 mo. high on more "bailout" programs announced.
http://noir.bloomberg.com/apps/news?pid=20601087&sid=a0n35fxWQvCo&pos=3
Same thing will be announced tomorrow, China, IMF, or somebody is going to step up and offer some "temporary assistance" for the PIIGS before the markets open back up on Tuesday.
Just watch.
After the huge success at rallying consumer stocks with all the nationalizations/reflations/POMOs, etc. do you thing TPTB is going to stop now?
http://www.zerohedge.com/article/europe-goes-worse-horrible-ireland-brok...
Hey Tyler:
@Tyler
"Then again it hints at the endgame: good world/bad world, with the global central banks taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun. Aka: coordinated global currency devaluation (as these are assets, suddenly worthless, supporting global central bank liabilities - i.e. currencies)."
________
Then again what it really hints at is deflation ("taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun")
Your words, ""taking a multi-trillion write off on all the "non-performing assets" and blasting them off into the sun" not mine.
That's trillions of confetti pieces dissapearing poof and gone.
Can't be collarilized. no CDO for it, nada, it's gone. Sorry no credit is available for it.
"as these are assets, suddenly worthless, supporting global central bank liabilities - i.e. currencies" yeap, your words.Dead money, stuck there, just dead, not moving.
_
And as posted above, your statist view is amusing as usual. The Fed, just sitting there, watching trillions disappear, when all it knows and has to do is print, print, print... restoring "confidence" to the "full faith and credit" of the infinitely dilutable Bernankebuck. FYI - Dead money multiplied by 100,000,000 just makes it deader.
So right you are TD. Watch the fun begin on the airwaves. MSM two bit whores selling pleasure for the new monetary dope fix.
I can hear the desparate words hailing.. this is a national security crisis.. the US will default if we don't pass this bill.
hahahahahaha
@Tyler
Your statist views befuddle me.
But surely you can do better than your stale German hyperinflation straw man argument, can't you?
"The Fed, just sitting there, watching trillions disappear, when all it knows and has to do is print, print, print... "
It did, just sit there and watch trillions disappear!!
There was nothing they could do.
What you, uniformly, miss is that in a fiat economy credit is money and trillions of confetti papers did evaporate in 08.
___
edit:
"Dead money multiplied by 100,000 just makes it deader."
Right. The velocity of money (of whatever amount) by zero, is strangely enough, zero.
Which by definition is deflation. Remember, velocity of money * ... etc.
Come on, bring out the good Tyler.
This is too easy.
Which is more deflationary: a Fed balance sheet with $1.6 trillion in Treasurys on the asset side it, or one with $1.6 quadrillion? This is hopefully not a trick question.
"Which is more deflationary: a Fed balance sheet with $1.6 trillion in Treasurys on the asset side it, or one with $1.6 quadrillion?"
1.6 trillion.
By which I hope the question refers to the crap they bought under their "emergency" powers when there was no one left to buy.
Of course the real answer to your question is this:
Crap bought - Crap destroyed =
+ or - ?
Is the answer 1.6 trillion(+) positive? Because absolutely, and, positively , no money was destroyed i.e. 1.6 Trillion - 0 = 1.6 trillion.
OR, a negative number?
And hopefully, that was not a trick question for you either either.
By the way, can't help noticing, and I am sure others will also, not one of my questions was ever answered.
And you can not, because every point you made was deflationary.
The velocity of money.
The utter destruction of money.
Some people here get it.
Some do not.
__
You have one sound argument, but only one.
But you did not make it today, you only hinted at it.
But every time you go off script you must sound silly even to yourself.
So yes, in the end, we may still have hyperinflation.
-
Deflation will reign. We now sound very sophisticated to ourselves. And you can still have the final word. Buy dollars.
Thanks, I'll have the final word: You are not the real Tyler (he would have put up a lot better arguments)
There was no real fight.
Get early to Fightclub meetings Fridays will you!
Sound`s interesting to me, would you?
Money velocity can never be zero. NEVER. If you look at a countries average percentage of expenditure towards food, energy, clothing you will find it's lower limit on money velocity. IE in america once the dollar is depreciated 3x the majority of it's citizens have sounded the inflationary limits. They will be sufficiently threatened in survival to cause rapid uncontrolled responses to government. There's more specific pain points in there though. At 1x inflation which we are approaching you cause extreme pain and suffering to the utility, phone and consumer level information technology and entertainment industry. At which point you are forced to throw the housing sector entirely under the bus for a massive deflationary collapse of 25 to 30 percent. If you look at rapid overnight currency devaluations such as korea and the one in russia these zero hedge guys wrote about you can get an idea of what their countries average discretionary spending is. Most currency devaluations come in at 50 percent which indicates most of those countries spend about 40 percent on food, clothing, shelter.
Initial collapse across the board deflation.
Inflation in food, clothing, energy and even perhaps further deflation in housing.
Rapid deflation in housing and consumer descretionary, massive inflation in food, clothing, energy.
Uncontrolled hyperinflation as wealthy who just bought a bunch of stuff, remember how many corporate takeovers we've had those are almost ending, try to inflate their way out of the debt burdens they just aquired. IE try to make bought on credit turn into owned for real.
But none of these events will occur as more pressing matters will rule the day.
(Super rich Greeks transfer their money to London)
Immobilienmakler in den Londoner Vororten reiben sich die Hände.
Reiche Griechen, Spanier und Italiener bringen dort ihr Geld in Sicherheit.
Realtors in London's suburbs are rejoicing.
Rich Greeks, Spaniards and Italians are investing their money there in a flight to safety.
http://www.welt.de/wirtschaft/article13393346/Superreiche-Griechen-bring...
gesundheit to you, too!
What would you do..?
What a great time to be alive and be so privileged as to have access to this information with expert analysis from ZH and then be able to equally inexpertly comment on it as history is literally being made. A slow motion economic asteroid collision we are powerless to stop with no regrets for having tried in motion by almost everyone with the power to try.
The concept itself of a good bank/bad bank where the assets are treasury notes is clearly borrowed from mark-to-market cmbs - an experiment itself who's ultimate success is still unproven and untested!
What a ride! What a mind fuck, if only I was smart enough to flip to the final page and see what pair of butterfly wings will finally set the whole house of cards on the path of the Dark Ages redux.
"Let the Greeks eat Corfu, the Portuguese eat Cork, The Icelanders eat raw Codfish Roe, the Spaniards eat Shoe Leather.....who else is in trouble ? Diogenes, here's a dark little dream I have for Uncle Sam to pull one over on the stupid Socialist world order once again ! 1. Our national hoard is intact 8,000 tons ? 2. We use the CIA, World Bank etc. to quietly triple the national hoard to 24,000 tons using the worthless paper the Chicoms and others have sucked up ! 3. We worry our own responsible citizens into converting their fiat into a private hoard of let us say 15,000 tons ! 4. Our worried citizens buy major positions in all the world's mine output ! 5. We have one last national fling as we shove our worthless fiat up the world's collective ass ! 6. We kick back and laugh as the world goes to Hell ! 7. We issue a new gold backed dollar ! 8. Our democratic allies around the globe have followed our lead in close, quiet cooperation ! 9. All the Socialist pig states declare bankruptcy !............If only Barney "Blow Job", Hillary "Cliton" and Barack "Yomama" were that smart ! Sigh ! Monedas 2011 Comedy Jihad World Tour
That is exactly what will happen.Of course in national interest.
silver
38.02 $...
Looks like Goldman has given all the sovereigns better prices to get out of there risk assets. Goldman is always doing Gods, no matter how stupid they are!!!
Reply to : Lord Wellington POST #1320674 The system stuck my reply on the end of the posts
Funny, you used the term "whistling past the graveyard" and that same thought had occurred to me before I got that far in your post.
I also had the thought "what the fuck is that Gilmore dude smoking?" when I read his comments in the Irish Times. So far three countries have been "bailed out" though in the case of Ireland I think it was at gunpoint. Each time there were denials and procrastination until the last possible minute of something the markets KNEW had to happen as much as a year in advance. So denials of more countries catching the contagion, and second rounds for the ones already bailed, as well as "restructuring" or outright defaults, well they just do not have credibility do they?
I would like to remind everybody here that Ireland (the Irish state) prior to the Cowen-FitzPatric disaster had little to no net debt.
"As chairman of Anglo-Irish Bank, the now bankrupt FitzPatrick steered the doomed institution through the minefield of insanely reckless lending to speculators and property developers, helping to fuel the Irish property price bubble which has been termed the largest in the history of the world. In September 2008, the Irish Government made the unprecedented decision to issue a full banking guarantee to all the Irish banks, effectively joining the Irish State to the Irish banks at the hip. This decision has had monumental consequences for the Irish people, leading to the IMF/ECB bailout of December 2010 and the harshest austerity measures in living memory."
So, the people who had been saddled with private debt in a RE bubble now also had to be on the hook for the bank debt since the government gifted the banks with a promise to cover all bank deposits. At least that is how I remember it being sold at the time. A guarantee of all Irish bank deposits, and I thought it was simply meant to keep panic from spreading into full scale bank runs. Turns out they meant all bank debt, not just all deposits. So what they really meant was that they would repay all foreign investors (mostly French and German institutions). So the Irishman was now deeply in debt for private debt from the bubble, deeply in debt on a state level for the bailout of foreign institutional investors that created the bubble, and then a gun was put to their head and they were forced into bailouts they did not want and are in hock to the ECB/EU for those as well (and the IMF).
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