Morgan Kelly on the impending bankruptcy of Ireland;
… the sole purpose of the Irish bailout was to frighten the Spanish into line with a vivid demonstration that EU rescues are not for the faint-hearted. And the ECB plan, so far anyway, has worked. Given a choice between being strung up like Ireland – an object of international ridicule, paying exorbitant rates on bailout funds, its government ministers answerable to a Hungarian university lecturer – or mending their ways, the Spanish have understandably chosen the latter […]
Cutting Government borrowing to zero immediately is not painless but it is the only way of disentangling ourselves from the loan sharks who are intent on making an example of us. In contrast, the new Government’s current policy of lying on the ground with a begging bowl and hoping that someone takes pity on us does not make for a particularly strong negotiating position. By bringing our budget immediately into balance, we focus attention on the fact that Ireland’s problems stem almost entirely from the activities of six privately owned banks, while freeing ourselves to walk away from these poisonous institutions. Just as importantly, it sends a signal to the rest of the world that Ireland – which 20 years ago showed how a small country could drag itself out of poverty through the energy and hard work of its inhabitants, but has since fallen among thieves and their political fixers – is back and means business.
“we focus attention on the fact that Ireland’s problems stem almost entirely from the activities of six privately owned banks”
These banks have a lot to answer for, putting a gun to the head of the Irish government and forcing them to borrow money and blow it like drunken sailors they way they did./sarc
When Noami Klein wrote her book ‘Disaster Capitalism’, it was not a warning; it was projection and thinly veiled strategy for lefty radicals. This is basically the plan for all the economies in the world. Put them in bankruptcy, blame unfettered capitalism, implement even more socialism.
I have to stress this part; watch out for the term “unfettered capitalism”, that is the first clue.
In a letter, my 83 year old aunt in Ireland summed up this situation like this: “Times are bad. The young people are leaving again.”
You know its interesting that the Romans first started down the road to oblivion by devaluing its currancy. What started out as pure silver coins ended up with mixed bronze with a patina of silver covering.
This caused inflation & a run out of its cities to rural areas where barganing became the rule.
JMO
In a letter, my 83 year old aunt in Ireland summed up the situation like this: “Times are bad. The young people are leaving again.”
Our man Harper needs to use all his background in Conservative economics more than ever in the coming days ahead. With Obummer destroying the American economy under the tutelage of slimy George Sorass, caution is now an very important word.
Andy your Aunt is correct . . . go into the Bay in Vancouver and half the staff are Irish kids.
Lots in restaurants, grocery stores . . . the diaspora is happening.
The Irish banking crisis is no different than the banking crisis in the rest of Europe or the U.S.: if you look closely, it’s the result of central banks trying to create capital out of thin air by lowering interest rates to unsustainable levels. In a market economy without a central bank, capital investment can be financed only by savings; i.e. with value stored up through delayed consumption.
If investments are not backed up by real savings, then those investments will inevitably fail when investors discover that the resources necessary to complete such projects don’t actually exist.
As much as I appreciate the article mentioned, the author clearly doesn’t understand the critical role played by central banking in creating real estate bubbles and subsequent bank failures.
In a market economy, banks would not partake in absurd ponzi schemes in such numbers because of the risks involved. But when a central bank explicitly or implicitly guarantees such investments, banks have no incentive to be prudent. In fact, they have every incentive to be anything but prudent.
Its funny. when things in Ireland get bad, the Irish come to Canada and the USA.
When things get bad here, just where in Hell are we all going to go? Ireland?
I am going to flee to the Mid East
Where I don’t have to tolerate anyone that doesn’t
Think like me.
Besides —– I find the thought of unwrapping a shroud and discovering a 9 year old Virgin.
Just a tad bit alluring.
I know -I know–
It is a perversion.
I must be sick in the head.
Public hangings could make a real comeback if we used them to pass judgment on all these crooked banksters!
I have a question: why are democracies slaves to the governments that they democratically elect? Governments spending countries into oblivion … why do the citizens allow it?
“why are democracies slaves to the governments that they democratically elect?
Governments spending countries into oblivion … why do the citizens allow it?”
~Strathy
a) Because if a prospective government’s policy is to rob Peter to pay Paul, Paul can always be counted on for a vote.
B) Because most people rally to the protection of the government in times of crisis and a rogue government will exploit this knowledge to rally people by manufactured crisis.
c) Because in a democracy every fool’s vote is equal to every wise man’s and the fools outnumber the wise men by a majority.
d) Because the biggest number of people get the biggest government that they ask for and deserve.
e) all of the above.
JMO
That’s only half of it, Dennis. The other half is that large parts of the banks’ investments were worthless, invested in property mortgages that were or will default.
Yeah, sure. Lets just blame everyone but ourselves. We are a bunch of slovenly, decadent, self-absorbed idiots. Most of us can’t handle basic credit. We borrow $ to buy 40″ plasma TV’s and other assorted crap from China and complain that the “big banks” are holding us hostage. What a bunch of pathetic, incompetent whiners. Countries don’t fall apart because of governments. Countries fall apart because of stupid, selfish, immoral, lazy citizens.