…an Irish solution to an Irish (sic) problem…

Sporting the cuddly-ish name of the ‘Troika’, the IMF, ECB and European Commission were in Dublin  making sure that taxpayers in Ireland pay for the socialised debts of, amongst others, German and French banks who made poorly judged loans to Irish banks.

Troika frontman, of sorts, Ajai Chopra, gave his approval of the current arrangements.

It represents an Irish solution to an Irish problem and it enjoys our support.

If Mr Chopra isn’t taking the proverbial, his Troika colleague Istvan Szekely (EC director of Economic and Financial Affairs) must be when he made this claim about last weeks stress test on the banks at the centre of that same bailout:

The credibility of the exercise has been reflected in positive market reaction, with Irish bond yields declining following the announcement…

I’m not an economist, but today Moodys actually cut Irish bonds down to just about junk level today while bond yields were around 9.83% (and rising). Now, in March the Irish bond yields were hovering around 10%, having been just below 9% in November when the state formerly known as the Republic of Ireland was made a ward of the European financial services industry. It had been a mere 6% in September 2010. Meanwhile, 210,000 people are unable to pay utility bills and the FG/Labour government announced that it has now plans to reverse the reduction in the minimum wage, although, if you read the small print, that has been balanced by changes in joint labour agreements over wage rates (that, surprise, surprise, actually impact on more lowpaid workers, probably what they meant by ‘burden sharing’).

Now, my two maths A-level certificates may be nearly 20 years old, but 9% is still lower than both 9.83% and 10%, isn’t it?

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  • Pete Baker


    “I’m not an economist, but…”


    And yet you claim that the troika are “making sure that taxpayers in Ireland pay for the socialised debts of, amongst others, German and French banks who made poorly judged loans to Irish banks.”

    “I’m not an economist, but…”


  • Greenflag

    The German and French Banks need to be told to p*** off. Ireland should follow Iceland’s example and get Portugal and Spain and Greece to follow suit . The ‘mad ‘ bankers have to be put down and whether they are French , German , British , American or Irish is immaterial . Shylock is alive and well and squeezing the lifeblood of nations from behind the ECB/IMF cordon and reckless German , French , British , Irish and American bankers are getting away with financial murder !

    As for the rating agencies ? What credibility have they got ? Are these not the same institutions that gave AAA + ratings to the worthless pieces of paper the CDO’s and sub prime mortgages flooded onto world financial markets by Wall Street gangsters ?

    You don’t have to be an economist or have A level math certificates to recognise financial scamming by the ‘banks ‘ that were too big to fail -but which are now bigger than ever 🙁

  • pippakin

    Curtailing of the power of the banks cannot be done unilaterally. It will need full international agreement between the banking countries. Obama got into power saying he was going to tame the banks, what happened to that?

    It needs to be done but the financial institutions appear to be quietly, and not so quietly, threatening to take their huge profits to more amenable countries.

    Ireland has a huge debt it cannot possibly pay so default appears inevitable anyway.

  • Alias

    It became an Irish problem when the government transferred eurosystem losses from private businesses to taxpayers on the instructions of the EU. Prior to that is was a eurosystem problem. Brian Cowen is a notorious europhile so the taxpayers overlooked that systemic flaw at their own expense. He would always put the EU interest shead of the national interest. FG are even more rabidly europhiliac, so again taxpayers overlooked that conflict of interest at their own expense. These debts are now sovereign debts, and the state has a legal obligation to honour them. The trick was to get them on the hook by understating the level of debts, and by misrepresenting the problem as liquidity rather than solvency.

    In regard to why the CDS rate is increasing: that is because the government simply lied to the taxpayers when it told them that it would decrease. The CDS rate incorporates an assessment of the probability of the sovereign defaulting; and, rather obviously, the more debt the state takes on, the greater the probability of the sovereign defaulting. Therefore, the rate will increase, and not decrease.

    The state had a AAA+ credit rating from Moodys before it guaranteed these private eurosystem debts. So the state didn’t have a liquidity problem or a solvency problem. Now, as a result of the actions of the rabid europhiles, the state has a junk status credit rating from Moodys and it also has a liquidity problem and a solvency problem.

    There is no way out of it since the government has locked the taxpayers into the arrangement. The idea of telling people that they could default was simply a device to trick them accepting the terms of their servitude by giving them the false hope that they could always object at some future stage if they didn’t object at the critical states.

    It’s too late now, kids, so you’ll just have to work hard for however long it takes you to generate the few hundred billion in wealth that you have pledged to your new colonial owners.

  • John Ó Néill

    Pete Baker @ Indeed.

    And how is this being understood in the alternate universe?

  • Greenflag


    ‘ It will need full international agreement between the banking countries’

    And theres the rub .The ‘banking’ countries are out to protect and defend their own banking institutions .The G-8 and G-20 are as far away from a reformed international currency order as they were in 2007 before the Lehman collapse . In the USA the ‘banks ‘virtually tell Obama when he can get of bed in the morning and what he can and cannot say . The threat is palpable and importantly theres an election on the way and the so called recovery is faltering and there’s talk of another Wall St ‘adjustment ‘ downwards in the DJI.

    We still don’t know why the Irish Government ‘guaranteed’ the deposits of reckless bondholders at the behest of the ECB/IMF . What is clear is that the banks (BOI, AIB, and Anglo Irish ) have been lying to successive governments for years about the extent of their losses and what they were on the hook for due to their reckless greed.

    ‘Curtailing of the power of the banks cannot be done unilaterally.’

    If the G8 and G-20 won’t do it because it does not serve the interests of the IMF (USA) or ECB (EU) then eventually one or more countries will default and Iceland willl be the role model to follow .

    Iceland was the world’s first ‘real ‘ democracy and somehow it seems fitting that in a western world where ‘democracy’ has been downgraded to corporate and financial services oligarchy that little Iceland has so far been the only country that stood up for itself against the ‘mad banksters’

    For anybody who is interested Charles Ferguson’s award DVD ‘The Inside Job’ does an excellent job on how Icelandic banks were allowed to ‘bankrupt’ their own country . Has no investigative journalist or film maker in Ireland or the UK got the guts or know how to do similar?

  • joeCanuck

    Yes, there’s an oldish maxim that when you owe the bank 1,000 pounds, you have a problem but when you owe them 1,000,000 they have a problem. That no longer seems to apply. Gamblers get their debts paid by the taxpayer.

  • aquifer

    At those interest rates the ratings agencies must hope to force a sell-off of Irish state assets and rights to natural resources, destroying the welfare state on the way.

    The Irish and other small countries should rate the bankrupt US, where these chancers are based, against other nations.

    All is fair in war and currency exchange.

  • aquifer

    US 10 year Bond Yields 3.5%, 1.5% above inflation.
    UK 10 year Bond Yields 3.75%

    When irish rates are nearly 10% maybe they should take a leaf out of Gordon Brown’s book and subcontract both monetary and fiscal policy to an expert committee.

    If the ratings agencies are pretending not to trust Irish politicians the time has come to call their bluff.

  • Mac

    ““I’m not an economist, but…”

    The terse schoolmaster persona tends to be ineffective once your target audience emerges from the other side of puberty.

  • DC


  • pippakin

    Since our banks, government and some sections of the media appear to have been lead by a bunch of juvenile delinquents perhaps a big stick would be in order

  • Reader

    aquifer: If the ratings agencies are pretending not to trust Irish politicians the time has come to call their bluff.
    By proving them right?

  • HeinzGuderian


    You didn’t complain too much when the aul Keltic Tigger was roaring ?? Begorra,now it’s all went tits up,it’s everybody’s fault but dear aul Oirland ??

    excuse me whilst I pour another Hine,and smile 🙂

  • Greenflag

    These credit agencies have been proven to have been lying through their teeth during the 2008 meltdown of the world’s economy. They were issuing AAA+ ratings to Lehman Bros hours before that institution was closed down -Ditto for many other financial institutions . The ‘credit rating agencies ‘ made a fortune from the banks as they were paid directly by the banks for rating them higher . The more the banks paid the rating agencies the more they were paid . Implausible though it may seem trusting an Irish or indeed any politician is preferable to trusting any of these credit agencies .

    Next to the criminal banksters and gangster derivatives and collateralized debt obligations (CDO’s) merchants -the rating agencies are in a close tie for third place with Bernie Madoff in the financial services institutional ‘Liar of the Decade ‘ table 🙁

  • Pete Baker


    Far from “Sporting the cuddly-ish name of the ‘Troika’”, references to the “Troika” appear to come from the media – not the actual EC/ECB/IMF.

    And I doubt it’s intended to be “cuddly-ish” given its Soviet ancestry.

    Your claim that they were “making sure that taxpayers in Ireland pay for the socialised debts of, amongst others, German and French banks who made poorly judged loans to Irish banks” is an almost entirely political position to take.

    I know, you’re not an economist…

    Nothing wrong in taking that position, by the way.

    But to ignore the wider economic and political ramifications in play – beyond a narrow nationalistic interpretation – could be seen to be disingenuous.

  • John Ó Néill

    @ Pete Baker

    I’d suggest you need to re-calibrate your understanding of what the term ‘nationalism’ actually means. If you are, e.g., a German chancellor and you act to protect the interests of, say, German finance houses, that is still nationalism (and, yes, if you understood that, it was disingenuous to pretend that somehow that isn’t nationalism).

    Isn’t ideology funny.

  • Greenflag

    ‘Isn’t ideology funny.’

    It’s hilarious -It enables god fearing neo conservative christian capitalists from the USA to increase the income gap between the top 1% and the remaining 99% in their society by doing business with anti democratic and authoritarian one party Chinese Communists and degenerate feudal Islamic monarchies such as Saudi Arabia who disbar the neo con Christians from even reading their own bible if they ever have to visit or stay in Saudi Arabia .

    On a lighter note the BBC reports

    While the hard-pressed Irish taxpayer dons a metaphorical hairshirt, members of the country’s parliament are arguing over more literal sartorial matters.

    The Irish Times has reported that despite some of a new influx of independents favouring a more relaxed style of dress, it is not going down well with some from the more established parties.

    The newspaper said that Paul Kehoe, chief whip with the ruling Fine Gael party, told his members of parliament (TDs) at a meeting last week that the dress code had “gone to pot”.

    The admonishment has provoked the ire of some of the independents, several of whom adapt a parliamentary style rarely seen before.

    Wexford member Mick Wallace usually prefers a pink shirt while Dun Laoghaire independent Richard Boyd Barrett is rarely seen without his shirt hanging outside his trousers.

    Any edict to make them do otherwise is likely to be resisted, according to another member of their group, Catherine Murphy.

    She told the BBC that she believed in “substance and not style”.

    “It wasn’t the casually dressed who left this country in the state it’s in now – it was the ones wearing the pinstripe suits and carrying the briefcases.

    “This is really a small ticket item and I think those who are complaining about dress codes would be better putting their energy into sorting out the mess our country is in.”

    Catherine Murphy’s quote must surely rate as the quote of the year (to date anyway)

    “It wasn’t the casually dressed who left this country in the state it’s in now – it was the ones wearing the pinstripe suits and carrying the briefcases.

    Not forgetting of course the clerical collar brigade of con artists and heaven magicians 😉

  • Zig70

    I’m a bit confused. The banks go bust, you nationalise them, take on their debts. Find you can’t afford to, borrow from another bank to pay your new debts. But when the 4 remaining banks start to make a profit then that will all go in to covering the losses? right?