“a crash doesn’t destroy wealth, it merely reflects the extent to which wealth has already been destroyed”

David McWilliams’ column yesterday showed the value of someone sticking with the long arc of a story, in this case the financial collapse which he tried to warn people in advance. Let us not forget that every bank in Ireland went bust. It didn’t matter whether the banks were locally or foreign run and owned. They all indulged in reckless lending and they were all bailed out. To date there hasn’t really been a satisfactory answer as to how exactly … Read more

After the #AngloTapes revelations, “you cannot put people in jail for stupidity…”

This a great conversation from last night’s Prime Time Special (apologies for cutting out Paul Williams of the Irish Indo who’s scoop is driving most of this renewed and energetic discussion)… Worth highlighting is Colm McCarthy’s point that whilst any Irish citizen can download a 2000 page report of the collapse of Lehmann Brothers, there is virtually no bank by bank explanation as to how every single bank in the country had to be bailed out by either the Irish … Read more

Four years on in Ireland’s crisis: No blame, no pain, no shame…

Colm McCarthy in the Sindo points out , via Stephen: In Ireland, almost four years after the balloon went up, not so much as a parking ticket has been issued. Inquiries are under way by the Director of Public Prosecutions, An Garda Siochana, the Criminal Assets Bureau and the Office of the Director for Corporate Enforcement but none has yielded fruit. The Irish banking bust has been described by Central Bank governor Patrick Honohan as one of the largest, relative … Read more

Not everything you hear about Greece is true…

Richard Parker from Harvard’s Kennedy School shoots a few urban myths on Greek profligacy… Mick FealtyMick is founding editor of Slugger. He has written papers on the impacts of the Internet on politics and the wider media and is a regular guest and speaking events across Ireland, the UK and Europe. Twitter: @MickFealty

ECB self censoring its own comms with an (overly?) sensitive Irish marketplace?

In the digital age, edits get noticed. Clearly there are some details about the ECB’s bail out for banks that it didn’t want too widely publicised in Ireland… Jörg Asmussen, a German member of the executive board of the European Central Bank, where he has responsibility for international and European relations… Perhaps Mr Asmussen has inherited the Danish penchant for speaking plainly from his Flensburg home but on Friday in a speech to the IEA in Dublin, he said: “…the … Read more

Queen’s visit: Affirmation of Irish independence (and Constitution)…

I’ve a piece in today’s Guardian on the visit of the Queen to Dublin, which began yesterday. At the heart of the matter, I argue that yes, it is historic, and yes it may be cathartic. But I also that by and large, despite some deft handling and framing of the event by Belfast born President, Mary McAleese, this visit is very much for the benefit of the Irish people of the 26 counties, rather than those of us living in … Read more

Euro crisis: “The Government is due to consider a potential programme of asset disposals…”

Greece were the first of the PIGS to request a EU-IMF bail-out – with the threat of contagion, as Mack’s timeline records, leading to the construction of a wider mechanism which Ireland, eventually, availed of.  The result, according to ECB executive Lorenzo Bini Smaghi, of the “choice of economic model” by “successive governments, and their voters”. As Tim Garton Ash commented at the time, “The crisis of the eurozone has only just begun.” A year on and, as BBC Europe editor Gavin Hewitt noted … Read more

Coalition needs to keep its collective eye on the Brussels game…

All politics is local, except when it comes to an Irish banking crisis. As Paul Gillespie notes in today’s Irish Times: Ireland is more deeply entangled with its partners in the European Union as a result of the banking crisis and the measures taken by the new Government to resolve it. That is part of a more general process called Europeanisation by writers on the subject. It makes European issues part of domestic politics. Politicisation of the issues makes them … Read more

“What will be the end of this sorry saga?”

With tensions rising across Europe, Irish Life and Permanent suspended trading earlier today amid speculation that it would have to sell its profitable pensions and investments business, Irish Life, and its fund management business, Irish Life Investment Managers, after the publication of the bank stress test results tomorrow. That publication is also expected to result in further nationalisation of the Irish banking sector with the banks expected to need “as much as 30bn euros ($42bn; £26bn) in additional capital”. The BBC’s Robert Peston, … Read more

Euro crisis: “If Portugal asks, we will be ready to intervene…”

To the apparent outrage of some, last night Taoiseach Enda Kenny agreed to defer seeking a conclusion to talks on reducing Ireland’s bail-out interest rate at the two-day EU summit in Brussels.  At the IIEA blog, Karl Whelan argued After a lot of fighting talk about renegotiation during the recent election campaign, the new Irish leader Enda Kenny probably feels a certain amount of pressure to come home from this summit with a deal on the interest rate. My advice, for what … Read more

After Fianna Fail, the new government must stretch time horizons…

A few years back, my old mucker from River Path days, David Steven warned an audience in Tokyo of the dangers of the unrest that would come in the wake of the world credit crisis: …be ready for the backlash – people are angry and rightfully so, but that may well lead us down some populist blind alleys. You can’t help thinking that the Arab world may be in part or in whole wandering down some particularly nasty populist blind … Read more

“We are in some pickle now”

Vincent Browne tracks the history of Ireland’s banking crisis in yesterday’s Sunday Business Post, ending with what must be the biggest understatement of the new millennium (see title). He argues that the EU will not countenance a restructuring / default of debts run up Ireland’s banks. But getting rid of some or all Of the bank debt will not be a runner in the EU, according to a source that knows. And disowning it all would cause massive problems, not … Read more

Bank debt crisis: “….what happens when the Irish taxpayer stiffs the German taxpayer?”

Riffing off John’s nicely subversive theme, there’s another subversive version in Vanity Fair by Michael Lewis, which has a useful perspective on the similarities between Ireland and Iceland: Ireland’s financial disaster shared some things with Iceland’s. It was created by the sort of men who ignore their wives’ suggestions that maybe they should stop and ask for directions, for instance. But while Icelandic males used foreign money to conquer foreign places—trophy companies in Britain, chunks of Scandinavia—the Irish male used … Read more

Moral hazard is about behaviours not structures…

If you can get it, John Kay’s column in today’s FT is worth a peruse. Not least since he’s sounding a warning whistle that beefing up regulation is not the way to smarten the market or protect tax payers interests. In particular he sounds a note that will be familiar to those of us who witnessed the Irish government’s gung ho short cut to shoring up its banking sector: “It is sometimes tempting to think that guarantees that are not … Read more

Credit Institutions (Stabilisation) Bill will not be referred to Supreme Court

Despite the reported concerns Mick noted here, RTÉ are reporting that Irish President Mary McAleese has signed the Credit Institutions (Stabilisation) Bill into law after a three-hour meeting of the Council of State. From the RTÉ report The Council of State has 22 members, including the Taoiseach, the Tánaiste, two senior judges, the Ceann Comhairle of the Dáil, the Cathaoirleach of the Seanad, and the Attorney General. Former President Mary Robinson, five former Taoisigh and two former Chief Justices are also members, as are … Read more

McAleese and ECB worried about legality of hastily assembled Bank Bill

It seems the Credit Institutions (Stabilisation) Bill is in trouble. Not only does the President think it could be constitutionally questionable, the ECB is expressing the same concern. The key clause is in section 53 of the bill: The provisions of this Act, and any order made under this Act, have effect notwithstanding anything in— (a) the Companies Acts, the Building Societies Act 1989, the Credit Union Act 1997 or any other enactment, (b) any other rule of law or … Read more

NAMA was just one part of what should have been a three part process

The FT’s editorial yesterday second leading article was entitled In Praise of NAMA. Their logic being that NAMA was the first element in what it proposes as a necessary three part process, that is to force the banks must come clean on their losses. But that it failed to take the second and third steps, ie make a political decision about who should carry those losses and to develop ‘the legal, technical and political capacity’ to impose those losses: Nama … Read more

Economic crisis blogburst 1: Government in denial of bailout

The sovereign/bank debt story has moved on over the weekend, with the Government denying it was talking about triggering a bailout, and everybody else talking about the likihood that they would. So, with little or no attempt to editorialise, here’s some of the best commentary of the day: – Dan O’Brien suggests this is no longer a domestic only issue. The question of a bail out for Ireland may be secondary to a larger crisis in the Eurozone… – As … Read more

Guido casts a cold eye on Anglo

Political blogger extraordinaire, Guido Fawkes has set the cat among the Dáil pigeons this evening with fascinating results. Guido has obtained and published a list of foreign Anglo-Irish bondholders as of the close of business tonight. The blogger states: Every child in Ireland is being bequeathed a huge debt at birth to protect the interests of foreign, mainly German, bondholders – why? Guido was once a bond trader, it was always understood that sometimes the bond issuer defaults. That is the … Read more

Misheard rumours on Allied Irish causes peak prices on Irish debt..

Scary stuff, but I guess it demonstrates just what a risk Brian Lenihan’s been running. It’s not great that the basket case bank, Anglo Irish Bank has the same acronym as more solid bank… Alphaville have the detail and the scary charts… H/T Niall… Mick FealtyMick is founding editor of Slugger. He has written papers on the impacts of the Internet on politics and the wider media and is a regular guest and speaking events across Ireland, the UK and … Read more