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  1. #91
    Mad as Fish Mad as Fish is offline

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    Quote Originally Posted by Davidoff View Post
    There's a little too much negativity here.

    The government has converted the PNs to bonds, dramatically extended the duration (which is good) and cut the interest rate (also good).

    We might leave the exact numbers to the economic gurus, but there is undoubtedly a clear financial benefit to Ireland in this deal. The country is better off today than it was a week ago. Anyone who can't bring themselves to admit that is not being fair about this, in my view.

    However, what has been missing from much of the media coverage is consideration of the broader context.

    The PNs represented only about 15% of our total national debt. And while restructuring that small component represents a genuine step forward, the overall picture remains bleak.

    Our government bonds are still officially rated as junk. The IMF are still helping to pay our day to day bills. And realisitically our overall burden of debt remains unpayable.

    For all the euphoria in the media, we still have a mountain to climb.
    Why leave it to the gurus as an after thought? Surely if the government didn't have some fairly firm figures then all they have done is gambled.

    How much better off?
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  2. #92
    greengoose2 greengoose2 is offline
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    One might feel entitled to be sceptical of the utterances of a totally dysfunctional government, populated by a bunch of tatally inept politicians. There is ample proof of the uselessness of all governments in the history of the state.

    Nothing works properly in this kip. We are told that on average, 50% of the treated water leaks from the water system, kindly brought to us by Queen Victoria's merry men! Cop shops are closing. Hospital trolleys are at a premium. We owe money that we never borrowed and the government is shored up with the greatest brigade of useless advisers, at great expense to the long suffering taxpayer.

    No sir, I do not believe anything these morons come out with. That is purely pragmatic; neither negative nor pessimistic, just realistic.
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  3. #93
    moralhazard77 moralhazard77 is offline
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    Quote Originally Posted by 44percent View Post
    The deal seems to revolve around the cash flow benefit and the gamble that by the time the principle falls due it will be relatively miniscule. Whether that proves to be the case will only be known in 40 years time. The question for us right now is whether we continued with the PN and its cost or try to change things. There is no doubt that the short term benefits of the deal give the state and its finances a breathing space. Short of default or write off (write down is an idiotic accounting term) what was the alternative?
    The alternative was to allow the PN legal case to be heard and have the debt repudiated as illegally created or if that failed as obvious odious debt at some future date.

    The alternative was to take the pain of the PN's now until we could get some form of economic justice rather than the total capitulation of passing this unjust burden of odious debt onto future generations.

    The alternative was to make the E.U. do what they said they would do in June and seperate banking debt from sovereign debt instead of copper fastening it to the state as this "deal" does.

    The alternative was to do what the government said they would do before being elected and get burden sharing on banking debt and stand up for the interests of the Irish people.

    Obviously we now know that they actually meant burden sharing between the generations and only standing up for their own narrow interests.
    Last edited by moralhazard77; 8th February 2013 at 08:07 PM.
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  4. #94
    44percent 44percent is offline

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    Quote Originally Posted by moralhazard77 View Post
    The alternative was to allow the PN legal case to be heard and have the debt repudiated as illegally created or if that failed as obvious odious debt at some future date.

    The alternative was to take the pain of the PN's now until we could get some form of economic justice rather than the total capitulation of passing this unjust burden of odious debt onto future generations.

    The alternative was to make the E.U. do what they said they would do in June and seperate banking debt from sovereign debt instead of copper fastening it to the state as this deal does.

    The alternative was to do what the government said they would do before being elected and get burden sharing on banking debt and stand up for the interests of the Irish people.
    Obviously we didin't realise that they meant burden sharing between the generations and only standing up for their own narrow interests.
    If the case failed then we repudiate the debt as "odious" I.e. default.
    How would taking the pain for 10 years (the PN life scale) bring economic justice?
    I agree with you on the EU: the separation of the two debts was conceded but not retrospectively. That point needs to be fought.
    I agree with you that burden sharing needs to be revisited and the nationalizing the losses of private enterprise has had it's day.
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  5. #95
    moralhazard77 moralhazard77 is offline
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    Quote Originally Posted by 44percent View Post
    If the case failed then we repudiate the debt as "odious" I.e. default.
    If the Hall case didn't succeed than some other case against the PN'S eventually would have. They were dodgy on so many levels.


    Quote Originally Posted by 44percent View Post
    How would taking the pain for 10 years (the PN life scale) bring economic justice?
    Well actually they should have just not paid it in March as not paying the PN's wouldn't technically be a sovereign default but knowing our politicians they just don't have the guts to do that. So imo if we had to take the pain until we got a proper government it would have been better than this pathetic deal.
    Last edited by moralhazard77; 8th February 2013 at 08:43 PM.
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  6. #96
    tonic tonic is offline

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    Quote Originally Posted by Davidoff View Post
    There's a little too much negativity here.

    The government has converted the PNs to bonds, dramatically extended the duration (which is good) and cut the interest rate (also good).
    Extending the duration isn't of any benefit at all, except if it was at very low or no interest, which it isn't and therefore no different from borrowing to pay it all back, you still have a loan to service, no difference at all and they didn't cut the interest, as it is we get 90% of the interest we pay returned to us, with the new deal that ends after an average of 8 years, again no saving at all.

    We got next to nothing and for that we agreed to turn the PN's into sovereign debt, to suit the ECB and in so doing have given up on getting them to pay their fair share of the Anglo costs.

    We just cost ourselves 15 billion and got f**k all in return for it.
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  7. #97
    Davidoff Davidoff is offline

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    Quote Originally Posted by tonic View Post
    Extending the duration isn't of any benefit at all, except if it was at very low or no interest, which it isn't and therefore no different from borrowing to pay it all back, you still have a loan to service, no difference at all and they didn't cut the interest, as it is we get 90% of the interest we pay returned to us, with the new deal that ends after an average of 8 years, again no saving at all.

    We got next to nothing and for that we agreed to turn the PN's into sovereign debt, to suit the ECB and in so doing have given up on getting them to pay their fair share of the Anglo costs.

    We just cost ourselves 15 billion and got f**k all in return for it.
    If you won the lottery, would you rather collect the money tomorrow or in thirty years time?

    This deal isn't the metaphorical 'game-changer' that the country needs. But it is a step forward.

    Let's allow a little credit where its due.
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  8. #98
    WTTR WTTR is offline
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    Quote Originally Posted by moralhazard77 View Post
    The alternative was to allow the PN legal case to be heard and have the debt repudiated as illegally created or if that failed as obvious odious debt at some future date.

    The alternative was to take the pain of the PN's now until we could get some form of economic justice rather than the total capitulation of passing this unjust burden of odious debt onto future generations.

    The alternative was to make the E.U. do what they said they would do in June and seperate banking debt from sovereign debt instead of copper fastening it to the state as this "deal" does.

    The alternative was to do what the government said they would do before being elected and get burden sharing on banking debt and stand up for the interests of the Irish people.

    Obviously we now know that they actually meant burden sharing between the generations and only standing up for their own narrow interests.
    This is what the alternaive would have resulted in

    The latest on Iceland from Fitch Ratings, positive this time:

    -17 February 2012: Fitch Ratings has upgraded Iceland’s Long-term foreign currency Issuer Default Rating (IDR) to ‘BBB-’ from ‘BB+’ and affirmed its Long-term local currency IDR at ‘BBB+’. Its Short-term foreign currency IDR has also been upgraded to ‘F3′ from ‘B’ and its Country Ceiling to ‘BBB-’ from ‘BB+’. The Outlooks on the Long-term ratings are Stable.

    ‘The restoration of Iceland’s Long-term foreign currency rating to investment grade reflects the progress that has been made in restoring macroeconomic stability, pushing ahead with structural reform and rebuilding sovereign creditworthiness since the 2008 banking and currency crisis,” says Paul Rawkins, Senior Director in Fitch’s Sovereign Rating Group.

    “Iceland has successfully exited its IMF programme and gained renewed access to international capital markets. A promising economic recovery is underway, financial sector restructuring is well-advanced, while public debt/GDP appears to be close to peaking on the back of a robust fiscal consolidation programme” added Rawkins.
    The difference was that the Iceland people had a politician, their President who listened to them. Then when they had a plebscite (In fact two) on a proposed agreement with the financiers; both were rejected by the people. All the politicians listened to them; did not ask them to vote again.

    This was again followed by new negotiations about the adjustment of the terms for the repayment agreement, which was the root cause behind why the Icelandic people had rejected it in 2010.

    The negotiations resulted in December 2010 in a new adjusted version of the repayment agreement named Icesave bill 3, with better terms for Iceland. The improved terms included the removal of a previous creditor priority issue, and the introdution of a lower 3% interest rate in combination with extension of the repayment window to 30 years. When the Icesave bill 3 subsequently was put to a referendum in March 2011, it was however again rejected by 59% of the Icelandic votes.

    After analysing the results, it was decided by all stakeholders not to attempt the negotiation of a further improved Icesave bill 4, but instead to refer the case as a legal infringement dispute for the EFTA court to judge.
    The court came down on the side of the Icelandic people. Courts do not generally go against decisions of the people. Iceland politicians are clever.

    We have to bear a severe austerity programme. Were we given a decision on converting promissory notes or on bailing out the banks? Were we hell?

    The Icelandic Economy is now one of the fastest growing economies in the world. Why? The politicians, by returning to their people for advice, kept them on their side.

    Our government do not think the Irish people are capable of making a decision. While we are up to our eyeballs in debt; we are giving the Child’s Rights referendum!

    The Icelanders can now raise money with no problem on the open markets; while our politicians have learned nothing and are yet getting involved in complicated borrowing arrangements with which they themselves don't seem to have all the details, never mind their people.

    Fianna Fail is back as the leading party in the poles

    This nightmare continues................
    Last edited by WTTR; 9th February 2013 at 11:17 AM.
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  9. #99
    odlum odlum is offline
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    Iceland can raise money no problems? Incorrect. 10 year Icelandic bonds currently trade 6.6%. Ireland could borrow now for 3.9%.

    Iceland is in a very precarious position. Make no mistake about it. They are struggling to refinance - why? Because no one trusts them. They will need new a new assistance program sooner or later. It's completely unsustainable.
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  10. #100
    stopdoingstuff stopdoingstuff is offline
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    Quote Originally Posted by odlum View Post
    Iceland can raise money no problems? Incorrect. 10 year Icelandic bonds currently trade 6.6%. Ireland could borrow now for 3.9%.

    Iceland is in a very precarious position. Make no mistake about it. They are struggling to refinance - why? Because no one trusts them. They will need new a new assistance program sooner or later. It's completely unsustainable.
    Everything should be viewed in context. Iceland does not have an ECB that has removed all risk of default by declaring that it will monetizeid necessary. There is in effect no true market price for Irish debt because there is no possible way to lose on an Irish bond, because even if there was printing for us, it would not necessarily be inflationary because of the samll size of the numbers involved. Iceland does not have that luxury- any printing by them would massively destroy the underlying value of the paper-but is still being rewarded for doing the right thing.
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