Gerry Adams: “We would negotiate with the bond market…”

Politics.ie characterised it as a “ding dong” between Fine Gael spokesman Leo Varadkar and the still MP for west Belfast, Gerry Adams, on RTÉ’s Morning Ireland.  But it’s probably not as bad as that 2007 debate…

It’s towards the end of the 13 minute clip [RealPlayer audio file] that Adams displays what Leo Varadkar refers to as “his ignorance of economics”.

 “We would negotiate with the bond market after we have straightened out the crisis in our own economy,” [Adams] said.

That would be after acting “unilaterally” and “burning the bondholders…”

, , , , , , , , , , , , , ,

  • stewart1

    Jees, hardly worth starting a thread about it. He obviously got it wrong.

    No one ever thought Adams was an ecomomist. look at the disaster that is Joan Burton, and she’s Labour’s finance spokesperson!

    Perhaps the shinners should be doing the same as Labour and Fine Gael, and hide their leaders away as much as possible.

  • Greenflag

    Where was Varadkar’s self presumed economic awareness in the Dail over the past three or four years ? Where was Biffo’s , Bertie’s or Enda’s or for that matter Blair’s or Brown’s or Bush’s or any of the world’s top economists and central bankers . Would that Gerry Adams was alone in his ‘understanding’ of how the world outside NI works 🙁

    The ‘bondholders ‘ will be burnt but it won’t be by SF or by any Irish Coalition government . They the bondholder’s will eventually have to take some pain for their ‘irresponsible’ investments . That will happen within the next two or three years following negotiations within the ECB and affected governments .

    It has to happen for the Eurozone to go forward in it’s present format and that course would as of now still be in the interest of the major eurozone economies and even the UK ..

  • Marcus McSpartacus

    Good for you Baker! Whoop-woop-woop!
    You found a wrong use of tense in a spoken debate between two politicians! Good man yourself!

    While you’re at, can you tell us how Varadkar, Fine Gael, Labour et al are not committing an act of gross financial treachery against their population 1) by retroactively supporting the hostaging of the Irish State, for French, German banks/institutions, via a really, really dumb bank guarantee 2) by being utter hypocrites in condemning FF, while supporting their IMF/ECB national mortgage, “necessitated” by that very guarantee 3) by being the unthinking cheerleaders for the Euro/ECB, etc. etc. and all the while, Iceland is now pulling out because it is not straightjacketed by those things…

    I’m a businessman, don’t live in a housing estate, am watching people go under left and right, and just love this fine analysis by people like you who focus on twigs and miss the forests.

    But at least you got cheap shot at Adams/SF, and that’s what’s really important, right?

    Do pull me up on my misuse of grammar, spelling etc. Because THAT’s important.

  • Mack

    @Greenflag

    Varadkar has been better than most. Gerry Adams got caught on a piece of inspirational rhetoric that happened to contradict his core position. The core position that banking debt should be defaulted on is a valid one (as is the FG / Lab position that this should be negotiated with our European partners). He didn’t quite figure out how to square the two in the interview (the danger being of course that he would wind up exactly where Varadkar stood).

    The more serious internal contradiction was the notion that the deficit can be reduced over 6 years. It’s unlikely that after unilaterally defaulting on banking debt guaranteed by the sovereign we’d be allowed back into the bond markets at a low interest rate that would facilitate such a leisurely return to fiscal prudence or that our European partners would allow us negotiate a 6 year repayment schedule at this stage in the game..

    If the distraction of 4 years vs 6 was removed – it was shaping up to be a good debate on the appropriate stance re senior bank debt and European support / shackles..

  • Ceist

    SF are making a horlicks of this. From RTE’s Election twitter account yesterday evening


    Pearse Doherty tells #todaypk that what happens in the next couple of hours will be crucial for the future for the country.

    Sinn Féin TD Pearse Doherty has said Finance Minister Brian Lenihan asked his delegation to leave the meeting discussing the Finance Bill.

    Mr Doherty said his delegation refused to leave the meeting at that point, but would not be returning to the resumed meeting later.

    So the negotiations are crucial for the country, lets go and get kicked out. Once kicked out refuse to leave. Having left the meeting refuse to return.

  • Tochais Síoraí

    He was desperately poor. Why did SF put Adams up for this interview or did he do a solo run? He had a poor grasp of the basics and seemed very uncomfortable.

    I suspect after this morning SF will try to do an Enda on him because he’ll lose them votes anytime he opens his gob on the economy but he does seem to like being interviewed.

  • pippakin

    SF appear pretty thin on any real talent or experience. Gerry Adams can talk conflict or resolution he is not good at anything approaching common sense. As for economics he is not alone in his ignorance, thankfully elected or not he will be no where near finance.

    Leaving or being evicted from a meeting is a typical example of SF antics. A pity, I thought Pearse Doherty was better than that.

  • joeCanuck

    Can’t be bothered to watch the clip. But negotiating with the bond market happens all the time; it’s called holding a bond auction.

  • 241934 john brennan

    “We would negotiate with the Bond Market”: Gerry Adams.

    You need a lotta lolly, a lotta credit, and a lotta backers to get into that particular game.

    So how does Gerry propose raising the wherewithall to buy the chips, before being allowed to sit down at that table?

  • Fionn

    John, if you owe the bank 200 quid its your problem, if you owe the bank 200,000,000 quid its their problem. Suggest you read P.ie for some excellent threads on the subject.

    Actually read the thread to get a feel of how Ireland is thinking

    SF, if I recall were asked to leave the meeting because when asked their position on the FB they said they were against it, it won them a lot of support on the Kenny show.

    Most damaging thing about that clip is Leo giggling at the suggestion of negotiating, something both FG and Lab fell down on the Kenny show.

    Point is Pete, for the sane world Adams is no longer an MP or MLA but a candidate in Louth for the Dail, is this part of your forthcoming coverage of every candidate in the Irish elections or are you and Mick still on your ‘he can’t resign until he hops backwards three times holding his nose and whistling GstQ’ trip about him being an MP.

    Think I mentioned earlier his MI5 handler said it was ham and mustard today, possibly cheese tomorrow (in brown) surely thats worth several blogs

  • Cynic2

    I am delighted to see the Republic have to put up with the specious nonsense we have had to cope with for the last 15 years.

    You are welcome to him?

  • Greenflag

    @ mack ,

    I recall former USA Presidential candidate McCain admitting to some interviewer that Economics and Finance were not his strong points and that was just a week or so before the Lehman collapse . He may have admitted to crashing a fighter jet into the Vietnamese jungle and elsewhere on three occasions 😉 Presumably that’s the qualification needed to run a modern economy ?

    Mr Adams would do well to stick to the UI mantra as his best card in the upcoming election but he should be advised to play it a few decibels lower this time around 🙁

    ‘Varadkar has been better than most.’

    I’m sure – must have been tough for him eh ;)?

  • Cynic2

    “The UI Mantra”???? Who is interested?

  • Nunoftheabove

    I don’t think we should personalize this to Adams per se in as much as I literally can’t remember the last time I heard a SF candidate or already elected representative of any description convince me that they knew what they were taking about with respect to economics, crisis or none. And I’d be referring to north as well as south here.

    I would be very surpised if they actually shaped their own manifesto material on this and therefore believe them to have no significant grasp of what they think they’re saying – no authority on what they say they believe in and/or mastery of the party line in terms of what they would/could do if elected.

    Given the current southern political instability and the possible potential for inroads which this election represents to them (or appears to represent for or to them), this is surely party political incompetence of the highest order.

    It’s the ease with which even not-terribly-bright or insightful journos put them on the back foot which is noteworthy here; I can’t think of a single one of them that could last 3 rounds with Shane Ross before throwing their black gloves and beret in if there weren’t any towels handy. The self-pitying reliance on ‘the unfair media’ guff is also instructive here.

    ‘Tis the economy, stupids.

  • Comrade Stalin

    Why did SF put Adams up for this interview or did he do a solo run?

    Because he’s an international statesman and peacemaker and anyone who says otherwise is an evil British imperialist/crypto-unionist.

  • Comrade Stalin

    Point is Pete, for the sane world Adams is no longer an MP

    Who is the MP for West Belfast then ?

  • Fionn

    test

  • Fionn

    “I am delighted to see the Republic have to put up with the specious nonsense we have had to cope with for the last 15 years.

    You are welcome to him?”

    well, tempted to ask if ‘we’ can also have fermanagh, tyrone, derry and posssibly armagh and belfast as those areas obviously agree with him and his so to speak, but actually we’ll hang on for the rest

    And actually its Ireland not Repubic, read the label

  • Gerry Lvs castro

    ‘well, tempted to ask if ‘we’ can also have fermanagh, tyrone, derry and posssibly armagh and belfast as those areas obviously agree with him and his so to speak, but actually we’ll hang on for the rest’

    Of course you can Fionn, just as soon as a majority in the six counties vote for it, as agreed to by all the main parties including SF.
    In the meantime, I hope you enjoy Gerry as much as we have.

  • Munsterview

    JoeC : “Can’t be bothered to watch the clip. But negotiating with the bond market happens all the time; it’s called holding a bond auction…..”

    We has one today, it lasted all of twelve minutes and in that time the bonds on offer and was oversubscribed by nine to one.

    Yes Joe C, correct! According to the media and all almost all the international financial talking heads, the financial arse has fallen out of Ireland, yet here this morning in Irelands first bond offer of the new year there were nine times more bond purchasers with money available to buy than Ireland had available to sell.

    In the late seventies, I made a few pound from a design project that I was involved in, I bought a workshop contents three weeks before auction, transferred it elsewhere and went to production. At that time there was only one way that a high profile Provo could get money out of a bank !

    My house was paid for, the deeds went across the bank counter for working capital when I failed to get a business loan and I went into production. A few years later we were hit with the recession. I was in second line services, servicing first line people and as their customers lost work and went broke, the first line guys folded. In three months I lost my remaqining customer base, had to lay off my staff and was back self employed.

    I had had a the equivalent of ten years pay invested….and I lost it. That is the system.

    This is how capitalism worked for all the self employed and small business in the Celtic Tiger era, they took a risk and the market determined their fate : a few made it big in good business, many others managed to survive but most went to the wall.

    The bondholders took exactly the same risk : they see an opportunity to increase their capital, Ireland had some of the best international performances at that time so they invested in Ireland.

    They had abosutely no certainities against loss, in fact that is one of the rules of the financial game, the greater the return, the bigger the risk and if returns are consistently over market average there must be valid reasons and where not there is an artificial inflation and a bubble forming.They too rode the Tiger and lost…… except they did not……. the Government underwrote and guaranteed their investment !

    So one set of rules for these meaga rich billionaires and another for small business people in the same situation now, as I was in back then. The markets are not free nor is it capitalism when the Government bail out bondholders worth billions and burn householders to the extent that they cannot pay a mortgage while our goverment bleed them to pay back these financial vampires.

    This ‘budget before the Dail is dissolved’ is nothing other than a massive conspiracy by insider system politicians, with the exception of Sinn Fein against the voting public. If the public get the opportunity the politicians know that the majority of the public would vote to burn the bondholders.

    Where would this leave the the Irish People ?

    There are many opinions on that but one thing is sure, it would be somewhere where 90% of our elected representatives and that includes FF, FG, Labour and Greens do not want to be as it means that the country would have to be run for the people rather than the politicians. That would be the end of life as they know it, they do not want that.

    This is the bottom line here !

  • obeachain

    the adams bashing is tiresome, his position similar to higgins , is i believe the following:

    The reasons that Ireland and other like “poor risk “ nations should be given the same rate as the Germans include but are not limited to :

    They all belong to a common currency, none of the member states of which are able to print there own money, if like the USA they were able to print there own money they would be able to spend there way out of the present financial crisis. Essentially devaluing there currency.

    A common bond would stopped what is essentially speculators screwing the weaker members of the Euro

    It is ludicrous to say you have one currency but different bond rates. One Euro, one bond! If the Irish negotiators had threatened to default based on the above scenario w, what could the Germans have done?

    Ireland real mistake was guaranteeing the banks in the first place, they should have let them go bust .it would have affected the shareholders (of which I am one!!} not the taxpayer.
    The Germans argue that they should not have to pay for Ireland/ Greece / etc being poor financial managers , yet they were instrumental in causing the crisis by funding Irish banks and companies during the mad years ( check German bank exposure to Irish debt} they made a lot of money at the time by funding the boom times.

    The reason for the Irish bail out was a pan Euro effort to stabilize the markets. Ireland was the fall guy for Europe.
    Merkel can’t have her euro and eat it

  • Reader

    obechain: It is ludicrous to say you have one currency but different bond rates.
    Bond rates, like almost all interest rates, are related to risk, not currency. The bond market is not comfortable lending to Ireland, but they are comfortable lending to Germany – hence different lending rates.
    It’s exactly the same in the retail lending market – a lender looks at your credit rating and any security you offer, which may be better or worse than the guy behind you in the queue, who wants to borrow the same amount in the same currency.
    Given some the the “burn the bondholders” rhetoric coming from Ireland these days, do you think it is unfair for lenders to regard Ireland as a poor risk? Do you think it would be fair for the German government to stand surety for a dodgy borrower? (which is what a common bond rate effectively means)

  • Munsterview

    Reader : “Given some the the “burn the bondholders” rhetoric coming from Ireland these days, do you think it is unfair for lenders to regard Ireland as a poor risk?…..”

    Then Reader another question for you : Two days ago the Irish Government auctioned off some Government Bonds, the auction lasted for something like twelve minutes and the Bond Issue on offer was gone, over subscribed by a factor of nine to one.

    In short for every satisfied bond buyer that snapped up the bonds at the offered price, there were nine others willing to purchase more of the same bonds but it was a limited offer. As you seem to have your finger on the international market sentiment, it would also seem that you are the very man to answer my query !

    As to these bond purchasers and given the International doom and gloom headlines on Ireland generated world wide, whatever were these saavy experienced International investors thinking of ?

    PS This was before Michael Martin was elected, it cannot have been that !

  • Reader

    Munsterview: As to these bond purchasers and given the International doom and gloom headlines on Ireland generated world wide, whatever were these saavy experienced International investors thinking of ?
    They were thinking “These AAA bonds are backed by the bailout fund”
    http://www.irishtimes.com/newspaper/breaking/2011/0125/breaking24.html
    Key sentence: “The fund can borrow money on the market using the €440 billion, which euro zone government have guaranteed.” (The Irish Times ought to invest in a proof reader for that article)
    Did you *really* think you would get away with that smokescreen?

  • Mack

    @Munsterview –

    You’re mistaken in this case.

    It was the European Financial Stability Facility and not Ireland that auctioned bonds that were 9 times over subscribed. The EFSF is backed (guaranteed) by (the taxpayers) all EU countries. They are lending to Ireland. In effect they are our new bond holders..

  • 241934 john brennan

    To default, or not default, that is the question.
    Whether it is nobler to repay our debts,
    Or renege and burn the bloody bondholders.
    I have come to bury Cowen, not to praise him.
    The debts that men incur live after them.
    Their savings oft times pissed against the wall.
    So let it be. The noble Enda
    Hath told you Cowen was a spendthrift.
    If it were so, it was a grievous fault.
    And grievously hath Cowen answered it.
    But Enda says he was a spendthrift
    And Enda is an honourable man.
    Yet Cowen brought many Euros into Ireland,
    With largesse did he the people’s pockets fill.
    And all got credit cards and spent the limit.
    Then left unpaid another card took out.
    Yet Enda says Cowen was a spendthrift.
    And sure, Enda is an honourable man.
    I speak not to disprove what Enda spoke,
    But here I am to speak what I do know.
    You all did love Cowen once, not without cause.
    What cause withholds you then, to mourn for him?
    O judgement! Thou art fled to brutish beasts,
    And men have lost their reason. Bear with me.
    My heart is in the coffin, there with Cowen
    And I must pause ‘til it comes back to me.