Ireland In Talks For Bailout With EU, IMF And ECB

From Reuters:


Also noted that negotiations are continuing and no decision has been reached yet, according to sources. European finance ministers are meeting in Brussels today at 5pm local time. EURUSD jumps 25 pips on the headline but nothing firm yet. After all, could merely be wishful thinking on behalf of the bankers-kleptocrat politician complex, but it appears Ireland may crack soon.

Ireland Rescue Imminent As Bund Spreads Pass 720bps

At last check Irish-Bund spreads were north of 725 bps, meaning Ireland is now effectively insolvent, and joins Greece in the group of bankrupt European countries. If this blow out is not stopped immediately, the contagion will again spread to the periphery first and then to the core shortly thereafter. The only question is when, just like in the case of oh so coy Greece, will Lenihan admit defeat and ask the IMF and the ECB for help (oh, and do it so during a Citigroup-mediated conference call). However, as Market News reports, citing Handesblatt, the Irish rescue may be imminent, and may come as soon as today.

As ECB, IMF Leave Ireland To Hang, Spreads Surge Again, Pass 630bps, 64 Wider

The endgame for Ireland is at most a week away: outcome is simple - bailout or failure. One wonders which the central bankers will pick...

  • Honohan: IMF Package Would Look Same As Current Policies
  • Honohan: Irish Bank Borrowing From ECB Exceptionally Large
  • Honohan: ECB Would Like Irish Banks To Get Back To Self Reliance.
  • Honohan: ECB Won't Curtail Irish Banks' Access To Financing.

The Irish Bunds spread has now surged to 631, +64 bps on the day!

Goldman Calls For Bail Out Of Portugal And Ireland So Everyone Can Go Back To Buying Amazon And Ebay

The more things are bankrupt, the more things stay the same. Evidence #1: Goldman's FUG (Francesco U. Garzarelli) sends a letter to clients in which he implies that Europe should promptly add Portugal and Ireland to its list of wards of the state, so that the Dow can go back to targeting 36,000 on short notice. Apparently this latest European nuisance (punctuated by the Irish Bund spread passing 600 bps) is too much for Goldman strategists, who are perplexed by this stunning inability of the ECB and EMU to grasp that in this market where the only buyer of everything are Central Banks and no market risk is supposed to exist, that Europe still has refused to step up to the plate and debase their currency by a few hundred bips. And after all, the only reason the EURUSD is trading where it is, is so that it has a whole lot of buffer room to fall.

Video Footage Of Protests In Ireland, Ministry Of Finance Besieged

Contrary to convention wisdom, while Irish bond yields were surging to all time highs, the local population was not merrily drinking itself into oblivion, but was taking matters into its own hands. So far every bankrupt European government has at least managed to get its population on the streets, to protest something, and in the case of Greece, caused Waddell and Reed to sell a few SPOOS leading to the biggest crash in capital markets history. Only the most bankrupt nation of all, the United States, continues to see its 300+ million cowering at home, watching sitcom reruns.

An Angry Ireland Calls Out Europe On Its Bullshit Stress Test

Remember when the pathetic farce that was the stress test presumably prevented Europe's collapse, and served as the inflection point preventing the EUR from hitting parity with the USD? Well, one of the banks that the "stress test" uncovered to be solvent was the recently insolvent Allied Irish Bank, which earlier this month needed a taxpayer injection of billions to presumably make sure that European creditors (and likely Goldman Sachs, very much like the case in Anglo Irish) never see even one dime lost. And today, an Irish Member of the European Parliament Alan Kelly said he intends to write to the EU Competition Commissioner to discover just how it is that one of Ireland's top banks slipped through the stress test cracks only to require a bail out mere months later. It appears that slowly everyone in Europe is starting to turn against the trillions in German bank liabilities that stand to be impaired, and lead to a systemic collapse, unless local taxpayers dutifully reach into their back pocket and make sure fat bankers continue their worry-free existence.

Is Ireland About To Impair Bank Senior Debtholders (And Boldly Go Where America Was So Terrified To Venture)?

The biggest piece of news this evening is, surprisingly, not the latest monsoon season suddenly to hit Manhattan, but comes from a few thousand miles to the East, out of Ireland to be specific, where we learn via the FT that the country "has opened the door to a renegotiation with senior bondholders of its two nationalised banks despite previously opposing any such move for fear of drawing the wrath of creditors around the world." This would be a huge change in strategy, and if effectuated, would mean that Ireland (for lack of an alternative) would be forced to do what the US was terrified of doing when Citi, Fannie and all the other still-bankrupt companies were on the brink. While the US never impaired the senior debt, for fear of enraging creditors (mostly China) who would have experienced their first capital loss on US-debt, it seems the dominoes are about to topple for Ireland as Irish eyes are about to stop smiling and take their bitter medicine, which our own Uncle Sam will avoid until well past the bitter end. Alternatively, this would also mean the end of the strong EUR regime once again, as the ping-ponging burden of proof of solvency shifts once again to Europe.

Fitch Downgrades Ireland From AA- To A+, Outlook Negative

After much posturing, Fitch has finally downgraded Ireland from AA- to A+, with a negative outlook. Net result: bund spread blows out to 415, up 5bps on the day, and will likely continue blowing out. We expect the FinMin to hold another conference call with Citi to reassure everyone how nothing is fucked here, which this time will be recorded by everyone in anticipation of another "mute button malfunction." Elsewhere Irish consumer confidence has plunged from 61.4 to 52.4. The two are speculated to be related.

ECB Purchases Of Sovereign Bonds Surge Tenfold Compared To Prior Week, Hit €1.4 Billion, On Continuing Ireland, Portugal Fears

After dropping to a modest €134 million last week, ECB purchases of sovereign debt exploded tenfold in the last ended week to €1.384 billion, confirming that the ECB continues to bid up all Portuguese and Irish bonds available for sale, so the market does not crash. As Reuters notes, this is the highest weekly amount purchase since early July. Once again it is up to the European Fed-equivalent to be the buyer of only resort. And Europe's continued central bank facilitated life support comes on the heels of the latest joke in recession timing: per Dow Jones, the Center for Economic Policy Research Monday said its Euro Area Business Cycle Dating Committee had determined that the currency area's recession began in January 2008 and ended in April 2009, lasting a total of 15 months and reducing gross domestic product by 5.5%. Some recovery there, when half the PIIGS have no access to capital markets, have their Prime Ministers mocked during conference calls, and are fighting with an exchange rate last seen long before Greece, Portugal, Spain and Ireland had to be rescued. We wonder what the CEPR's timing on the end of the European depression will end up being?

Ireland Cancels All Remaining 2010 Bond Auctions Due To Market "Turbulence"

Apparently in Ireland, a global stock market that surges up 10% in a month to celebrate the latest obliteration of the purchasing power of the American middle class is considered "turbulence." This is precisely the excuse given by Irish PM Brian Cowen when asked why he has cancelled all bond auctions for the rest of the year. Surely, the market is buying it. Cowen also added that he doesn't need funds at rates of 6.8 to 6.9%. What is hilarious is that he will need the funds much more in 3 months when the rates are double that, now that the country is openly nationalizing each and every bank, and will fund these "acquisitions" with tens of billions it doesn't have.