Ireland Given 24 Hour Ultimatum To Take Bailout Or Be Responsible For Pan-European Contagion

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Domino 2 is done. Europe's banks are about to be rescued again as Europe's taxpayers foot the bill. In other news, former SAC star money manager Ron Insana says Ireland does not seem to be that much of an issue.

From the Guardian:

An increasingly isolated Irish government was coming under mounting pressure tonight to seek a European or International Monetary Fund bailout within 24 hours amid fears that contagion from its crippled banking sector might spread through the weaker eurozone countries.

Portugal, Spain, the European Central Bank and opposition parties all urged Brian Cowen's coalition government to remove the threat of a second crisis in six months by putting a firewall between Ireland and its partners in the 16-nation single currency.

With finance ministers from the eurozone due to hold emergency talks tomorrow night, financial markets were expecting Dublin to finalise negotiations with the EU over the terms of a deal to allow Ireland to rescue banks laid low by the collapse of the country's construction boom.

"The Irish problem is spreading, but it could get more volatile," said Ashok Shah, chief investment officer at London Capital, a fund management firm. "They have to get this bailout, they have a period of time before it gets impossible, before nasty things happen. The longer they leave it, the more difficult it will get."

Portugal has seen its borrowing costs rocket along with Ireland's as speculation has grown that it too may have to consider a bailout. Its finance minister, Fernando Teixeira dos Santos, told the Wall Street Journal his country had been hit by a contagion effect caused by fears about Ireland's ability to pay its debts.

"I would not want to lecture the Irish government on that," he said. "I want to believe they will decide to do what is most appropriate for Ireland and the euro. I want to believe they have the vision to take the right decision.

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h/t @Lizzie363