Posted on 11/21/2010 3:06:51 PM PST by bruinbirdman
Ireland has accepted an EU and IMF bail-out thought to be worth up to £77 billion after emergency telephone conference talks.
Ireland has finally been forced to take an economic bail-out from the European Union in a deal designed to save the euro.
After a humiliating week of denying it needed help, the Dublin government succumbed to pressure from other euro zone countries and asked for a “very big” loan.
G7 and euro zone finance ministers including George Osborne, the Chancellor, held emergency telephone conference talks on a combined EU-IMF rescue package of up to £77 billion.
British taxpayers now face paying a bill of at least £7 billion as under a deal signed by the last Labour government, British taxpayers are liable to share in the cost of any EU bail-out.
On Monday Irish and euro zone governments will be watching the markets after Greece, which received a £94 billion bail-out in April, warned that the EU’s debt crisis was not finished yet.
Portugal has already warned that there is a “high risk” it might need economic help. If investors are unconvinced by the Irish rescue package, the euro could come under pressure while the cost of borrowing for the Dublin government could rise.
Wolfgang Schaeuble, the German finance minister, said that the deal was necessary to preserve the euro’s future.
“We are not just defending a member state but our common currency,” he said.
“Ireland has to meet strict conditions, and these will be negotiated in the coming days, so that it is not just providing financing but about ensuring that the problems are solved.”
Last week, Herman Van Rompuy, the EU president, warned that debt contagion was a “survival crisis” threatening the existence of the euro and the wider European Union. . .
(Excerpt) Read more at telegraph.co.uk ...
Why don’t they just print more money like we are doing?
This could get ugly...
This bail-out blackmail must be stopped
Taxpayers cannot be expected to pay for all the banks’ bad debts, says Jeremy Warner
Real IRA says it will target UK bankers
Exclusive: Republican terror group vows to resume mainland attacks with banks and bankers now potential targets
http://www.guardian.co.uk/uk/2010/sep/14/real-ira-targets-banks-bankers
Print money, borrow, raise taxes. No matter how you slice it, you are engaging in policies that will stifle your economy. But that's okay, there is always China....
But Bernanke said it would work! /s
They have to pay the Bankers bills just like we were forced to do with the bailout and again through Bernankes QE2 this this is a bailout for the Banks! The Bankers socialized the losses just like they did here.
snippet..
Ireland is on the brink of insolvency too, which has helped drive down the S&P 500 stock index by nearly 4 percent over the last few days. But unlike Greece, Ireland is a relatively wealthy country, with per capita GDP of nearly $38,000. That’s 21 percent higher than per capita GDP in Greece, and in the top third for European countries. Low corporate tax rates and a skilled workforce have made Ireland a haven for some of the world’s biggest companies. And its public debt, about 65 percent of GDP, is far below Greece’s crushing load, which is 126 percent of GDP. Ireland’s debt levels are even lower than those in France, Germany and the United Kingdom.
But Ireland has one huge problem that may soon make it a supplicant to its European brethren: A failed banking sector that Ireland’s government can no longer rescue on its own. Ireland is in the midst of a real estate bust that could trump even the ruinous downturns that turned parts of southern California and Nevada into suburban ghost towns, with home-grown banks stoking it all. Now, those banks are trying to manage catastrophic losses. The Irish government has effectively nationalized the nation’s biggest banks by guaranteeing their debt, which would be akin to the U.S. government taking over Citigroup, Bank of America, J.P. Morgan Chase and Wells Fargo.
In full http://finance.yahoo.com/news/Why-the-Irish-Crisis-is-Going-usnews-4028366968.html?x=0
What was the per capita GDP of Iceland? Latvia? These countries bit the bullet and are starting over.
yitbos
Because printing more money leads to inflation!
Germany has, as expected, an antipathy towards inflation.
If Germany is forced to choose between inflation and leaving the EU, my guess is they will leave the EU, or at least end the idea of a common currency, the Euro.
When you accept a common currency, you give up control over your money supply.
“Why don’t they just print more money like we are doing?”
I would assume that since they use the EURO it’s not their money to print.
Germany seems to be taking economic control over the entire EU, and may deflate them all into the poorhouse. It may be that Germany, against its own desires, may become the political overlord of all of Europe.
The problem is no amount of money will satisfy the markets so soon you can expect Portugal, Spain and maybe Italy to be in crisis.
Too bad that Ireland did not do what Sweden did about a decade ago when this crisis first hit in 2008. Sweden basically nationalized the banks, told the shareholders and bondholders they were taking a haircut, dumped the crap on the books and then set the banks free to resume lending although in a much smaller and humbled mode.
Ah, time will tell, the tale of the Euro.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.
