TCD Professor demolishes government's defence over IMF report

[cd27]

Brian Lucey tells it as it is,

IMF analysis a damning report on State's snail-like reactions and lack of prescience - The Irish Times - Fri, Jun 26, 2009

"Recall when reading this that the IMF has stated the losses are such as to leave the banks in a position of undercapitalisation at best. This argument from them echoes the almost unanimous consensus of academic finance observers. However, undaunted, the department (who, remember, don’t seem to know the magnitude of the problem they are trying to solve) disagreed. However, their arguments (on page 19 of the report) are straw men – the need for nationalised banks to operate under the same regulatory regimes as non-nationalised ones, the need for a clear exit strategy, the need for lack of politicisation of lending – that have been discussed and to which solutions have been suggested in many forums including this newspaper.

So we are left with a Minister committed to incrementalism in solving a crisis the magnitude of which his department professes ignorance of, an incrementalism the department agrees runs the risk of a lost decade, and a determined if unargued rejection of all advice (internal and external) relating to the efficacy of the sole solution proposed.

And we wonder why the country is in crisis?"

[MortgageBroker]

ZOMG! read the report!
Irish Mortgage Brokers | Mortgage Brokers Dublin

the IMF repeatedly states that they feel authorities have made vital moves in the two most important areas, that of financial stabilization and that of addressing the deficit.

only ONE section of ONE page out of 52 pages talks about the potential need for nationalisation, every second page mentions the need to cut the public wage bill (interestingly that's a topic Lucey is quiet on!).

Read the full report and you'll see that far from being critical of the actions taken thus far the IMF feel we are actually doing the right things, we just need to keep going!

[cd27]

FF spin, you must be insane.

IMF conference call over report:

http://www.imf.org/external/np/tr/2009/tr062409.htm

"Let me consider each of these positions in a brief manner. I look back at the imbalances not to assign any blame, but they are a necessary part of the diagnosis. There were three features that were particularly prominent in the evolution of this crisis: overvalued property prices, the vulnerabilities built up within the banks—many of those related to the overvaluation of property prices—and the gradual loss of competitiveness of the Irish economy over a period of several years.

Put together, when the global crisis manifested itself in the middle of 2007, these domestic vulnerabilities interacted with the global crisis and that has now led to what is likely to be a protracted downturn."