First Iceland, now Ireland?

[Fittster]

So Björk and co had the go to the IMF for a bail out but are the Irish about to go down the same route?

"During a speech in Tokyo, Ireland's Taoiseach Brian Cowen commented that the IMF may be called in to help the country's recession-hit economy, warning that people had to "get real" about the severity of the situation."
http://www.axiafx.com/newsarticle.asp?article=2093

"Ireland is to demand pay cuts for civil servants and public employees to prevent the budget deficit soaring to 12pc of gross domestic product by next year – becoming the first country in the eurozone to resort to 1930s-style wage deflation to claw back competitiveness."

http://www.telegraph.co.uk/finance/4241720/Ireland...

[Skipppy]

Fittster said:

"Ireland is to demand pay cuts for civil servants and public employees to prevent the budget deficit soaring to 12pc of gross domestic product by next year – becoming the first country in the eurozone to resort to 1930s-style wage deflation to claw back competitiveness."

http://www.telegraph.co.uk/finance/4241720/Ireland...

Could you EVER see that happening here?

This country will be bankrupted because the government don't have a pair of bks between them. They know that they need to do the same thing, but they won't because of the consequences at the next election. Frankly, i don't see Labour getting back in anyway.

[JRM]

Wouldn't surprise me, they grew very fast very quickly, never a good sign.

Love the quote "Standard & Poor's has issued a "negative outlook" alert on Ireland's AAA rating, noting that the bank bail-out has increased state liabilities by 228pc of GDP."

Why the fk are they AAA in the first place - negative outlook on AAA, typical, what a classic of the rating process. Bet they are still issuing new bonds on AAA

[Fittster]

At least Bono will give up saving the rest of us.

[aspender]

Living in Dublin, yes things are slippery and property is tanking big time (good for me, not owning any...) and the fx rate is hurting exports (again, good for me paying off a loan in the UK!) However, I daresay that it is simply that things are happening here a little bit quicker than elsewhere. It is going to hurt just as much in the UK

[NoelWatson]

I was slightly surprised that the UK wasn't placed on watch and Spain was

[Dogwatch]

aspender said:

Living in Dublin, yes things are slippery and property is tanking big time (good for me, not owning any...) and the fx rate is hurting exports (again, good for me paying off a loan in the UK!) However, I daresay that it is simply that things are happening here a little bit quicker than elsewhere. It is going to hurt just as much in the UK

Except that UK interest rates are controlled by Gordon, not Brussels which looks to Berlin.

However I expect he'll be at the IMF with his begging bowl soon. It'll be The Right Thing To Do of course.

[Badgerboy]

Dogwatch said:

aspender said:

Living in Dublin, yes things are slippery and property is tanking big time (good for me, not owning any...) and the fx rate is hurting exports (again, good for me paying off a loan in the UK!) However, I daresay that it is simply that things are happening here a little bit quicker than elsewhere. It is going to hurt just as much in the UK

Except that UK interest rates are controlled by Gordon, not Brussels which looks to Berlin.

However I expect he'll be at the IMF with his begging bowl soon. It'll be The Right Thing To Do of course.

If that happens he'll be shafted. The IMF are only going to stump up the cash if the Government slashes public services/workers to bring down expenditure. The unions will love that.

[aspender]

Dogwatch said:

Except that UK interest rates are controlled by Gordon, not Brussels which looks to Berlin.

But surely that financial lever is going to run out of steam quite soon?

[s2art]

aspender said:

Dogwatch said:

Except that UK interest rates are controlled by Gordon, not Brussels which looks to Berlin.

But surely that financial lever is going to run out of steam quite soon?

Thats only one. Another real benefit will be the dip in Sterling, making the UK more competitive. Ireland should apply to rejoin Sterling.

[Welshbeef]

JRM said:

Wouldn't surprise me, they grew very fast very quickly, never a good sign.

Love the quote "Standard & Poor's has issued a "negative outlook" alert on Ireland's AAA rating, noting that the bank bail-out has increased state liabilities by 228pc of GDP."

Why the fk are they AAA in the first place - negative outlook on AAA, typical, what a classic of the rating process. Bet they are still issuing new bonds on AAA

This is kind of interesting - IF Ireland still had its own currency that would be tanking but as its in the Euro it will have little impact on its value.

Imagine IF in Europe every state had signed up to its tax centrally and any social benefits were again delt with centrally - Ireland would be ball deep in something very tight and not very nice.

[Welshbeef]

s2art said:

aspender said:

Dogwatch said:

Except that UK interest rates are controlled by Gordon, not Brussels which looks to Berlin.

But surely that financial lever is going to run out of steam quite soon?

Thats only one. Another real benefit will be the dip in Sterling, making the UK more competitive. Ireland should apply to rejoin Sterling.

They never had sterling it was the Irish pound IIRC.

Does anyone know what Irelands core resources are i.e. UK being Coal, Slate

[JRM]

Potatos? Oh no that's wrong...

[s2art]

Welshbeef said:

s2art said:

aspender said:

Dogwatch said:

Except that UK interest rates are controlled by Gordon, not Brussels which looks to Berlin.

But surely that financial lever is going to run out of steam quite soon?

Thats only one. Another real benefit will be the dip in Sterling, making the UK more competitive. Ireland should apply to rejoin Sterling.

They never had sterling it was the Irish pound IIRC.

Does anyone know what Irelands core resources are i.e. UK being Coal, Slate

Yes but until 1979 the Irish pound was pegged to Sterling. Effectively Ireland was in the Sterling group.

[FarleyRusk]

Fittster said:

At least Bono will give up saving the rest of us.

I hate that righteous fecker.

[john_p]

But those banks had 100% guarantees right? Right???

[Welshbeef]

john_p said:

But those banks had 100% guarantees right? Right???

Thing is now yes the Irish Govt have given that 100% cash BUT what if everyone took their cash out due to this downgrading ala Iceland....


Might be a good thing let them all go bust then start again.

[Uncle Fester]

I don’t wish to worry anyone, but...

The IMF has to get its money from somewhere. It has some, and then it has legally binding agreements with governments that they will come up with some money if the IMF asks them for it. This is known as ‘Special Drawing Rights’ (SDR).

The UK government is obligated to come up with 2,549 Million SDR. The value of the SDR is based upon a basket of currencies and is set against the $US.

Today the exchange rate is 1.46050 as the rate is fixed for a period.

So, one country, perhaps Ireland goes down. If it’s not Ireland then it will be someone else. The IMF calls up the UK government and requires for the 2,549 Million SDR.

Oh dear.

So, to come up with that we do what, print more money?

Now, Gordon’s cunning plan is to print just enough ‘Quantitative easing’ money to stabilise the economy. Print too much and the £ goes haywire, rampant inflation, worthless £ and all that.

So, before long the IMF is quite likely to give Gordon the perfect opportunity to stick the final nail in the coffin lid of the UK economy.

[Puggit]

I was in Ireland in December - the tales of public sector waste and corruption put Gordon Clown and his pals in to the shade.

[s2art]

Puggit said:

I was in Ireland in December - the tales of public sector waste and corruption put Gordon Clown and his pals in to the shade.

Now that is a big claim. I find it very hard to believe, Brown is just better at hiding it.