I am really Brian Cowen. I told ye all this 18 months ago to soften ye up and ye havn't seen nothing yet.

http://www.irishtimes.com/newspaper/breaking/2009/0130/breaking42.htm

Ireland is now reckoned the riskiest economy in Europe, based on Credit Default Swap trading of Government Bonds.

We have the highest personal debt in the EU and the second fastest decline in GDP (only Latvia, in the hands of the IMF, is worse)

cactus flower wrote:

http://www.irishtimes.com/newspaper/breaking/2009/0130/breaking42.htm

Ireland is now reckoned the riskiest economy in Europe, based on Credit Default Swap trading of Government Bonds.

We have the highest personal debt in the EU and the second fastest decline in GDP (only Latvia, in the hands of the IMF, is worse)

Contracts on Ireland rose 2 basis points to 262.5, CMA Datavision prices show. Credit-default swaps on Greece’s debt fell to 251 basis points, from 255.

Bah - It's only a flesh-wound !! Trichet said this morning that nothing is going to happen the Euro. We're FINE!!!

Or will they just fine us hugely for our deficit so Pat Kenny WILL have to hand over some cash?? Or will they just tax the RTE viewer a bit more on the licence to pay for the new debt we'll need to get to keep Pat in Killiney as opposed to Killarney??

Cliff Taylor explains what Credit Default Swaps means in terms of moolah on the markets.

Quote :

Before the crisis started, the interest rate on Irish government bonds was just slightly higher than that of Germany, the eurozone benchmark. By last November, the rates on Irish bonds were 1 per cent above German levels - in other words, investors demanded a 1 per cent higher return to hold our debt. By mid January, the spread had risen to just under 2 per cent.

Last week, it again rose sharply to around 2.75 per cent on ten-year bonds, a higher premium than other eurozone countries were seeing. Another sign of increased nervousness are so-called credit default swaps. These are financial instruments used to insure against debt default.

While this market can be illiquid and rates can jump around a lot, they nonetheless give an indication of how the market is thinking. Last September, it would have taken an investor €30,000 to insure against default on a €10 million purchase of Irish bonds.

Ten days ago, it would have cost about €230,000. By last Friday, the cost had gone up to around €285,000 (read as 285 basis points on the accompanying graph) just below Poland and higher than any other AAA-rated eurozone country.
http://www.sbpost.ie/post/pages/p/story.aspx-qqqt=NEWS+FEATURES-qqqs=news-qqqid=39026-qqqx=1.asp

Moody's may downgrade our debt rating according to Irish Times this morning

http://www.irishtimes.com/newspaper/finance/2009/0131/1232923378733.html

We got that deal with the Social Partners didn't we or did I dream it?

Quote :

RATINGS AGENCY Moody’s has threatened to downgrade the State’s debt rating if the Government’s finances deteriorate further. The news came as Eurostat said that annual inflation in the euro zone had fallen to 1.1 per cent, strengthening the case for further rate cuts.

The Republic of Ireland has become the first western European country, in the current downturn, to have its rating placed on a negative outlook by Moody’s.

The agency outlined three factors that would result in a downgrade of Ireland’s “AAA” rating – the highest available – over the coming year.

These include an erosion of the Irish “economic model” and a further significant weakening of the Government’s financial strength, possibly due to rising liabilities from the banking system.

I'm sure I also saw the rudiments of an Obama-esque economic plan coming together on some news item or other - was it THE news? Anyway the Dáil are working on something today ahead of Cowen's State of the Nation speech on Tuesday ...

Quote :

Talks aimed at agreeing a new economic plan for the country are intensifying at Government Buildings today ahead of Tuesday's deadline.

The Government wants to cut €2bn from the public spending bill this year.

Unions and employers said progress is being made. Both sides will be taking part in further negotiations this afternoon.

http://www.breakingnews.ie/ireland/mhsnqlauidid/

Talks broke down or broke up at 4am this morning according to the wireless... Be interesting to see if this affects our credit rating tomorrow.

Quote :

Talks aimed at agreeing an economic recovery plan have collapsed at Government Buildings in the early hours of this morning.

Employers and trade unions have been holding talks with government official for several days with the aim of agreeing measures to overcome the economic downturn.

One of the main planks of the discussions was ways to cut €2bn in public spending this year.

The talks broke up just before 4am this morning.

Speaking as he left the negotiations, ICTU general secretary David Begg said the unions were not prepared to accept the measures that the Government wanted to impose on low and middle-income public servants.

The Government is now expected to impose its own cuts in public spending without the agreement of the unions.
http://www.breakingnews.ie/ireland/mhsnqlmhsnid/

Quote :

Economic Recovery Talks Collapse - RTE

Talks on a national economic recovery plan collapsed at Government Buildings shortly before 4am.

Tánaiste Mary Coughlan said that in the absence of agreement, the Government will now move to make its own decision at this morning's cabinet meeting on how to secure savings of €2bn from exchequer spending this year.

She said it was unfortunate that the parties had been unable to bring the matter to finality but it did not represent the end of social partnership.
Advertisement

Taoiseach Brian Cowen left Government Buildings shortly after 4am.

In a statement, he says he regrets that it was not possible for the unions to agree the proposals for the reduction in the public service pay roll presented at the talks.

However, Mr Cowen says he was grateful for the quality and the sincerity of the engagement that took place.

He says this includes agreement on a framework published last week, which acknowledged the urgency of the situation and the need for an adjustment in the order of €2bn.

Mr Cowen says the Government will consider the position at its meeting later this morning and will take the necessary decisions in respect of the fiscal adjustments as was indicated by him over the weekend.
http://www.rte.ie/news/2009/0203/economy.html

They are saying on the News that the Cabinet are going ahead and making decisions today anyway - Turlough was saying that after Cathal MacCoille asked him what his view was now that there was a possiblity that our credit rating would be damaged ...

Turlough O'Sullivan just said the Taoiseach would have to make the decisions in the Cabinet today - what decisions ??? So much was hinging on the outcome of these talks and discounting the national bill.

Now everybody is copping on to the "Irish problem" and questioning the credibility of our governments actions. Sorry it's in German but you get the idea.

http://www.nzz.ch/finanzen/nachrichten/zweifel_an_irlands_kreditwuerdigkeit_1.1840407.html

I would go along with expatgirl with one thing: it is not only Ireland that is lost in this and doesn't know what it is doing. At Davos the feeling was clearly similar, with none of the "World Leaders" other than depressed and confused. Obama of course not there.

The Government is horribly exposed with this last minute scramble with the Partnership - Cowen "dropped in" to the talks on Sunday night I hear. Surprised he could find the time.The Government, for all the talk of partnership is really talking to itself - public sector unions and IBEC funded hugely by the semi states like FAS. All of them have their salaries and pensions in place.

Ireland is at the back of the herd now with the lions running behind. Our crash is faster and deeper and our fiscal situation the worst in Europe. I doubt the 2 billion of cuts was going to make much difference to the bond markets one way or the other as it is a tiny fraction of the shortfall. Hold onto the hats: bumpy ride coming.

Trade war opening up between the US and the rest might take some attention off us.

Slim Buddha wrote:

Now everybody is copping on to the "Irish problem" and questioning the credibility of our governments actions. Sorry it's in German but you get the idea.

http://www.nzz.ch/finanzen/nachrichten/zweifel_an_irlands_kreditwuerdigkeit_1.1840407.html

Translation: (excuse the peculiar bits, I just threw it into Babelfish)

The credit loss insurance for Irish state obligations became on Friday the most expensive in the entire euro area. The course for Credit default Swaps (CD) climbed on 262,5 base points and exceeded thereby that one for Greek government loans. The rising credit protection costs illustrate the increasing doubts about of Ireland credit-worthiness. The Rating agency Moody's back-gradated likewise on Friday the view for the soil quality of Ireland of “stably” on “negatively”, maintained the maximum note “Aaa” however for the time being.

In the focus of the doubts of investors the Irish household stands. The national incomes broke in the second half year 2008, since the tax revenues from real estate transactions collapsed in view of the crisis in this sector. For 2009 the situation looks desolate. With expenditures of 60 billion € observers expect a deficit from 17 to 18 billion €. The Irish government is therefore in urgent negotiations with the social partners, in order to agree upon additional savings of 2 billion €. The Irish central bank prognosticated a decrease of the gross national product on Thursday for the current year around 4,7% (2008: - 2.6%). One cumulated that the sharpest contraction of Irish history to mean. Ireland with a relatively low debt level is geschlittert nevertheless into the deep crisis. At the end of of 2007 amounted to the national debt net only 14% of the gross domestic product (Gross Domestic Product). But the current deficits are not durable, particularly the treasury since the nationalization that Anglo Irish bank additional, uncalculable risks for their doubtful active ones carry in the long run.

See? Even the Germans know that :

"Ireland with a relatively low debt level is geschlittert nevertheless into the deep crisis"

I heard Trichet on radio last week but he wasn't Doomy that the peripheral issues would affect the Euro - will the ECB bail us out now ?? More likely they'll fine us.

God knows what will happen - does anyone know ??? Are we three letters and 15% interest rates away from Iceland now ???

Alan Aherne on Newstalk just said these cuts would have to be made or they will be made for us by the IMF or our European partners ...

Another man (John Drennan?) is saying this is worse than the eighties and more like the post civil-war period ...

I saw on the Pin an article which says our level of personal debt is in the order of trillions .. The article was hidden away in the irish times somewhere - I think it could be panic-attack inducing

http://www.irishtimes.com/newspaper/opinion/2009/0203/1232923383096.html

Quote :

According to the IMF total gross indebtedness of Irish residents - the State, the banks and the non-financial personal and corporate sector - stood at €1,671 billion at the end of 2008.

In any normal country, Sean Fitzpatrick would be helping police with their enquiries. In any normal country, a prime minister would have something official to say he is tax compliant. In any normal country perjury is a criminal offence. In any normal country, a dependence on construction is not allowed to run to 25% of the economy as a whole.

The model we have had for governing this country, which has served us with varying degrees of efficiency over the years, is patently outdated and is serving us very badly now. In a way, it is not the fault of our political parties that out politics are so bad and our representatives in the Dail are so totally wanting. It is us.
We tolerated this failing model since 1977, when the rot really set in, for 32 years. It has been getting steadily worse and accelariting in pace since the new millenium started. Dire government, dire choices, dire results have been programmed into a dire system to bring us to the point we are at. A Taoiseach who inherited a Dail seat, a Tanaiste and Finance Minister who did the same, all bequeathed rotten boroughs by relatives, all with no clue how to do anything really, are steering the country through its worst economic crisis since independence, none of whom have the vaguest idea how an economy works. A small town solicitor, more equipped to conveyance agricultural smallholdings, a quotation exchanger from the Law Library and a barely tested social worker from a far-flung corner of a far-flung county are the people who are to guide us through this economic crash.

It is a devastating confirmation of our political poverty. There is no hope of improvement as long as we tolerate this nonsense and it seems, after FF get 28% of the opinion poll in the latest Red C testing of the political temperature, that over a quarter of the public see nothing wrong, that we will get no change.

I see no hope for Ireland and, though it pains me to say it, the next 20 years looks catastrophically bad for the country. A fundamental change is badly needed but I wouldn't hold my breath in a country where someone like Mary Coughlan can become Deputy Prime Minister.

So has Social Partnership let us down today?
Will there be strikes and marches as a result?

eoinmn wrote:

So has Social Partnership let us down today?
Will there be strikes and marches as a result?

That will probably await announcement of where the axe is to fall.... anyone know when??

I thought I just heard a snippet on Newstalk saying they are going to have a last ditch negotiation. May well have misheard it though because he jumped to an ad break.

Same old pantomime.

Slim Buddha wrote:

In any normal country, Sean Fitzpatrick would be helping police with their enquiries. In any normal country, a prime minister would have something official to say he is tax compliant. In any normal country perjury is a criminal offence. In any normal country, a dependence on construction is not allowed to run to 25% of the economy as a whole.

The model we have had for governing this country, which has served us with varying degrees of efficiency over the years, is patently outdated and is serving us very badly now. In a way, it is not the fault of our political parties that out politics are so bad and our representatives in the Dail are so totally wanting. It is us.
We tolerated this failing model since 1977, when the rot really set in, for 32 years. It has been getting steadily worse and accelariting in pace since the new millenium started. Dire government, dire choices, dire results have been programmed into a dire system to bring us to the point we are at. A Taoiseach who inherited a Dail seat, a Tanaiste and Finance Minister who did the same, all bequeathed rotten boroughs by relatives, all with no clue how to do anything really, are steering the country through its worst economic crisis since independence, none of whom have the vaguest idea how an economy works. A small town solicitor, more equipped to conveyance agricultural smallholdings, a quotation exchanger from the Law Library and a barely tested social worker from a far-flung corner of a far-flung county are the people who are to guide us through this economic crash.

It is a devastating confirmation of our political poverty. There is no hope of improvement as long as we tolerate this nonsense and it seems, after FF get 28% of the opinion poll in the latest Red C testing of the political temperature, that over a quarter of the public see nothing wrong, that we will get no change.

I see no hope for Ireland and, though it pains me to say it, the next 20 years looks catastrophically bad for the country. A fundamental change is badly needed but I wouldn't hold my breath in a country where someone like Mary Coughlan can become Deputy Prime Minister.

I've been trying to work it out how exactly forked we might be, how it could be addressed. You've made a great point above - it's not as simple as breaking the balls of politicsl parties anymore - at least not for the stuff we're breaking their balls for. The image below came to mind this morning ... which concurs with someone saying this morning that our problems are post-civil war more than 21st century. Open mouths were one thing back then in an incipient State but gradually we should be seeing much more maturity and independence.

I can't help feeling that the likes of the ESB have us by the balls too and we've done nothing to shake this off. Basic stuff and services could be at risk in this country now and there's sweet f all we or complaining at the government can do about it. We should not be in such a precarious situation. How did we allow it to happen and is there a solution, Slim ????

I suspect Mr Obama and his buy american stimulus package will keep the rest of Europe (and Canada) entertained for some time, taking the heat off us. Fortunately, steel is not one of our bigger exports (although this will hurt the UK)

Our personal debt, as a proportion of GDP is substantively very similar to the UK. This may not be any consolation to us, but we are, nevertheless, not alone (according to the FT, the Dutch and the Danes were SUBSTANTIALLY worse than both. Link posted on another thread here). I can't imagine US personal debt is pretty either. That is not to excuse any of it. We are all too indebted. Full stop.

Gordon Brown also inherited his premiership; and as for the US, Hilary Clinton is now Sec of State (husband having been prez) and Dubya served 2 terms (his father having been president). Do you really all think we are worse than everyone else?

Just to cheer yiz up, http://www.finfacts.ie/irishfinancenews/article_1015847.shtml

A devastating critique of Obama's stimulus package.... Like, he knows what he's doing?? Judging by the furore over the buy american aspect, the EU and Canadians seem to be accusing him of laying the footwork for a future Hitler somewhere.

Honeymoon periods are short.

The worst thing is, both the Bush and Obama admins seem to be bailing out banks without grabbing a return for the taxpayer

For our banks, the Guarantee comes with a charge, and the recaps here and the UK are in the form of preference shares, which should pay a dividend

I don't wish to lavish praise on Brown and Cowen, but at least they're not totally giving money away and have nationalised where necessary.

Think about it.

We are perhaps not worse than anyone else but we are entirely dependent on two economies here, expat. Something like 70%+ of our trade is with Britain and America. In alot of ways, it doesn't matter what we do here and what happens in the Eurozone is in many ways less relevant to us than what happens in Britain and the USA. It was an idiotic idea to join the eurozone and then not seek to engage as much business in it as possible.

Forgive me for saying this (for the hundredth time, it seems) but we ALWAYS compare ourselve to the UK and to a lesser extent, the US. The aping of the dire choices made by both these countries, given a special little "Hibernian" twist by our God-awful inept politicians, has the country suffering more than it should in this economic mess.

We need better, more intelligent, examples, more suited to our own size and capacities. The UK is an example of failure, and failure in a different context to ours, and should never be used as an example for us.

This is still only the beginning. The majority of the public still have their heads in the sand because they've yet to experience the full brunt of what's coming. Or even the force of what's happened already. Credit delays the pain. That's all it's good for.

Things will change over the next few months. Wait until people start dying, for lack of basic medicines and healthcare. Wait for the food and fuel shortages.

We're well up shit creek and all we have are gobshites, all rowing against each other. It's not just FF, it's the whole bloody lot of them.

Post civil war Ireland will look like a picnic compared to this.

Capitalism and this mockery of a democracy are going down the plug hole, and the bastards will not go gentle into that good night.

They'll rage. But they do not understand rage. They will come to understand it nonetheless.

Auditor #9 wrote:

... The image below came to mind this morning ...

[nice pic of bird feeding young]
You do realize, Audi, that that is an American robin?

Perhaps you were thinking of how poor little County Clare is so dependent on the airport fees and refuelling tax paid by the U.S. military.

Quote :

I can't help feeling that the likes of the ESB have us by the balls too...

Why single out the ESB? Hasn't it proved itself time and time again as the best-managed of the semi-states?

Auditor #9 wrote:

Slim Buddha wrote:

In any normal country, Sean Fitzpatrick would be helping police with their enquiries. In any normal country, a prime minister would have something official to say he is tax compliant. In any normal country perjury is a criminal offence. In any normal country, a dependence on construction is not allowed to run to 25% of the economy as a whole.

The model we have had for governing this country, which has served us with varying degrees of efficiency over the years, is patently outdated and is serving us very badly now. In a way, it is not the fault of our political parties that out politics are so bad and our representatives in the Dail are so totally wanting. It is us.
We tolerated this failing model since 1977, when the rot really set in, for 32 years. It has been getting steadily worse and accelariting in pace since the new millenium started. Dire government, dire choices, dire results have been programmed into a dire system to bring us to the point we are at. A Taoiseach who inherited a Dail seat, a Tanaiste and Finance Minister who did the same, all bequeathed rotten boroughs by relatives, all with no clue how to do anything really, are steering the country through its worst economic crisis since independence, none of whom have the vaguest idea how an economy works. A small town solicitor, more equipped to conveyance agricultural smallholdings, a quotation exchanger from the Law Library and a barely tested social worker from a far-flung corner of a far-flung county are the people who are to guide us through this economic crash.

It is a devastating confirmation of our political poverty. There is no hope of improvement as long as we tolerate this nonsense and it seems, after FF get 28% of the opinion poll in the latest Red C testing of the political temperature, that over a quarter of the public see nothing wrong, that we will get no change.

I see no hope for Ireland and, though it pains me to say it, the next 20 years looks catastrophically bad for the country. A fundamental change is badly needed but I wouldn't hold my breath in a country where someone like Mary Coughlan can become Deputy Prime Minister.

I've been trying to work it out how exactly forked we might be, how it could be addressed. You've made a great point above - it's not as simple as breaking the balls of politicsl parties anymore - at least not for the stuff we're breaking their balls for. The image below came to mind this morning ... which concurs with someone saying this morning that our problems are post-civil war more than 21st century. Open mouths were one thing back then in an incipient State but gradually we should be seeing much more maturity and independence.

I can't help feeling that the likes of the ESB have us by the balls too and we've done nothing to shake this off. Basic stuff and services could be at risk in this country now and there's sweet f all we or complaining at the government can do about it. We should not be in such a precarious situation. How did we allow it to happen and is there a solution, Slim ????

I said the rot set in in 1977, when FF bought the election of that year by promising to abolish rates which they promptly did. This was a catastrophic mistake in my opinion, because it served to centralise power in the Department of the Environment where County Councils once had the power of decision, and crucially, their own budgets, previously.

I believe that devolved power works much better than centralised power. When I compare the country where I am living to Ireland, Ireland is wanting on every level. Education, Health, Public transport, environment, housing, in fact everything benefits by having the cantonal system in place. The central government is for defence, foreign policy and the co-ordination of nationwide projects like motorway and rail infrastructure but what is most important here is that the power of the cantons to limit the power of the central government is enshrined in the constitution. Cantons raise taxes, not central government, and the constitution requires the cantons to pass on to central government the taxes cantons collect on its behalf. But for almost everything I need from the authorities, I get it from the canton. Driving licence? Issued by the canton on behalf of the central government. Residence Permit? Issued by the canton. Tax return? Made to the canton. Social Insurance? Run by the canton. My bank? ZKB (Zurcher Kantonalbank). The strength of the system is to be found in the localisation of not just the politics but in every aspect of life here. a third of the public holidays in Canton Zurich are public holidays unique to the canton. Other cantons have their own holidays unique to them .

Switzerland has 26 cantons. We have 26 counties. It's a start. I am not advocating we import such a system lock, stock and barrel. But in a time of economic crisis and political paralysis, we could do worse than examine it and see if there are benefits for Ireland in drawing the best from it. God knows, we cannot go on as we are.

My apologies - that's much clearer.

I agree with you broadly I suppose - I'd love to see a thrust towards this but I see no parties offering this besides the Greens, perhaps Sinn Fein. It could be one way of shaking us out of the dependence we're in and in reference to Soubresauts post, Clare is dependent on certain things - I doubt if Shannon militarism can be seen as a massive factor.

Clare has plenty of other stuff bar decent swathes of growing land but I'm sure we'd survive well enough.

Auditor #9 wrote:

See? Even the Germans know that :

"Ireland with a relatively low debt level is geschlittert nevertheless into the deep crisis"

I heard Trichet on radio last week but he wasn't Doomy that the peripheral issues would affect the Euro - will the ECB bail us out now ?? More likely they'll fine us.

God knows what will happen - does anyone know ??? Are we three letters and 15% interest rates away from Iceland now ???

Actually, Audi, it's Swiss. NZZ is the main daily here in Zürich (Neue Zurcher Zeitung) .

Hermes wrote:

This is still only the beginning. The majority of the public still have their heads in the sand because they've yet to experience the full brunt of what's coming. Or even the force of what's happened already. Credit delays the pain. That's all it's good for.

Things will change over the next few months. Wait until people start dying, for lack of basic medicines and healthcare. Wait for the food and fuel shortages.

We're well up shit creek and all we have are gobshites, all rowing against each other. It's not just FF, it's the whole bloody lot of them.

Post civil war Ireland will look like a picnic compared to this.

Capitalism and this mockery of a democracy are going down the plug hole, and the bastards will not go gentle into that good night.

They'll rage. But they do not understand rage. They will come to understand it nonetheless.

Not going to happen.
There will be no food or fuel shortages nor lack of basic medicines and healthcare and no one is going to die where we can help it because of this situation. We are spending far too much, particularly on the public service, but the room is there to pull that back, people, partcularly the public service unions & their members just need to be made to understand what needs to be done, we're nearly there as it stands. There will be kicking & screaming yet, but in the end they'll come along, they'll have no choice.