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Thread: External Debt drops to 1.64 Trillion Euro

  1. #1

    Default External Debt drops to 1.64 Trillion Euro

    We have by far the highest external debt per capita in the world. It has dropped from 1.7 Trillion Euro back in September 2008. Government foreign debt has soared as we know to 73 Billion Euro at Sept 09. However financial institutions debt has shrunk from over 800 Billion back in June 08 to 691 Billion reflecting the general evaporation of credit in this country.

    http://www.cso.ie/releasespublicatio...ternaldebt.pdf
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Politics.ie Member HarshBuzz's Avatar
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    Cassandra, this is an entirely useless statistic and has been proven so many times

    what happens when you strip out IFSC numbers from that?
    “'retail deposit flight, I don't see that as a great danger. Ireland is an island” - Brian Lenihan - to hundreds of international investors

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    Quote Originally Posted by HarshBuzz View Post
    Cassandra, this is an entirely useless statistic and has been proven so many times

    what happens when you strip out IFSC numbers from that?
    The majority of Monetary Financial institutes on Page 2 as I detailed in the opening post. 400 Billion of this debt is in turn loaned to the Irish private sector.

    As external debt is defined;

    The IMF External Debt Manual defines external debt to be a point in time statistical statement of
    the value and composition of the stock of an economy’s gross foreign financial liabilities to the rest
    of the world.
    The liabilities referred to cover those arising from Irish residents issuing debt
    securities such as bonds, notes and money market instruments to non-residents, as well as any loans
    received from and outstanding to non-residents, and any trade payables due to non-residents. In
    essence, external debt refers to financial obligations to non-residents other than those arising from
    transactions in equity or financial derivative contracts.
    Its 1.2 Million Euro per household. I am aware of the factor of the IFSC and foreign direct investment is involved in this figure, but the fact that this makes it mind boggling on top of our high personal and government debt figures is worthy of highlighting.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Quote Originally Posted by Cassandra Syndrome View Post
    The majority of Monetary Financial institutes on Page 2 as I detailed in the opening post. 400 Billion of this debt is in turn loaned to the Irish private sector.

    As external debt is defined;

    Its 1.2 Million Euro per household. I am aware of the factor of the IFSC and foreign direct investment is involved in this figure, but the fact that this makes it mind boggling on top of our high personal and government debt figures is worthy of highlighting.
    This external debt is mostly owned by corporations. When a corporation goes bust with excessive debt, it is wound up and the debt basically vanishes. The creditor has lost his "asset". No household is liable for the debt of the wound-up corporation.

    So saying "X amount per household" makes as much sense as "X amount per rabbit".
    When you see the words "Mises" or "Hayek" in someone's post, just ask yourself: do I really want to ban paper money and go back to gold?

    You have to pity the kind of people who buy into conspiracy theories. I find the following to be the saddest words on the internet: "Re: connection between Bilderberg puppet lady gaga and viral outbreak in ukraine "

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    Politics.ie Member HarshBuzz's Avatar
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    Quote Originally Posted by feargach View Post
    This external debt is mostly owned by corporations. When a corporation goes bust with excessive debt, it is wound up and the debt basically vanishes. The creditor has lost his "asset". No household is liable for the debt of the wound-up corporation.
    true....unless that corporation is called Anglo Irish, Irish Nationwide, Bank of Ireland, Allied Irish Bank etc etc
    “'retail deposit flight, I don't see that as a great danger. Ireland is an island” - Brian Lenihan - to hundreds of international investors

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    Politics.ie Member HarshBuzz's Avatar
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    Quote Originally Posted by Cassandra Syndrome View Post
    The majority of Monetary Financial institutes on Page 2 as I detailed in the opening post. 400 Billion of this debt is in turn loaned to the Irish private sector.

    Its 1.2 Million Euro per household. I am aware of the factor of the IFSC and foreign direct investment is involved in this figure, but the fact that this makes it mind boggling on top of our high personal and government debt figures is worthy of highlighting.
    oh yeah, I'm not trying to understate our crushing debt burden - both private and corporate (and, increasingly, sovereign) - just trying to point out that most of that 1.64trn has nothing to with Irish citizens or corporations

    they really should release a 'net of IFSC operations' figure at the same time
    “'retail deposit flight, I don't see that as a great danger. Ireland is an island” - Brian Lenihan - to hundreds of international investors

  7. #7

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    Quote Originally Posted by feargach View Post
    This external debt is mostly owned by corporations. When a corporation goes bust with excessive debt, it is wound up and the debt basically vanishes. The creditor has lost his "asset". No household is liable for the debt of the wound-up corporation.

    So saying "X amount per household" makes as much sense as "X amount per rabbit".

    I never said it was directly per household. I was using that as indicative purposes. I am very well aware of what external debt is anf the fact that a tiny nation like Ireland comes in the top ten in the world for total external debt period.

    For the 3rd time I dealt directly with Page 2's Monetary Financial Institutes which makes up 690 Million Euro of the external debt.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Politics.ie Member bormotello's Avatar
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    Quote Originally Posted by feargach View Post
    This external debt is mostly owned by corporations. When a corporation goes bust with excessive debt, it is wound up and the debt basically vanishes. The creditor has lost his "asset". No household is liable for the debt of the wound-up corporation.
    Iceland thought the same
    “Every country has the government it deserves.”
    Joseph De Maistre

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    Quote Originally Posted by bormotello View Post
    Iceland thought the same
    Er, are you aware that "is liable for the debt of" is a phrase with a very precise meaning?

    If all the US-based software companies in Ireland were to collapse on the same day due to excessive debt, this would have inevitable painful consequences for most households in Ireland.

    But it still does not follow that those household are "liable for the debts of" those companies.

    Those $1.2 trillion debts are owed by companies who employ hardly anyone in Ireland, and who transact virtually all their business with foreigners. They are in Ireland because of the low tax, and for absolutely no other reason.

    If those IFSC corporations blow up, the people who will suffer the most as a result live in New York, Tokyo and Rome. They only have any business with the IFSC in the same way as they have business with the Cayman Islands, Jersey, Macau, Liechtenstein and Andorra.

    I was under the impression that you read a lot of economics. How are you unaware of this?
    When you see the words "Mises" or "Hayek" in someone's post, just ask yourself: do I really want to ban paper money and go back to gold?

    You have to pity the kind of people who buy into conspiracy theories. I find the following to be the saddest words on the internet: "Re: connection between Bilderberg puppet lady gaga and viral outbreak in ukraine "

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    Politics.ie Member bormotello's Avatar
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    I thought the same until yesterday morning, when I heard Dutch finance minister on Euronews, where he mentioned that Iceland is responsible for debt of all financial institutions, which were under regulation of Iceland authorities.

    Anger over Iceland compensation decision - Financial Crisis : news, world | euronews)

    Wouter Bos, the Dutch Finance Minister, said:

    “It’s very disappointing and unacceptable for us. We’ve been extremely mild in our negotiations, we have offered the Icelandic government a low interest rate and very, very long payback times. Because we know that the Icelandic economy is in a fragile state, so we can’t ask too much of them. But what they cannot expect from us is that we let Dutch tax payers pay the bill for failure of Icelandic bankers and Icelandic supervisors.”
    Problem is that most of this debt is coming from financial institutions - Irish or ISFC, which means that those institutions are under regulations of Irish financial regulator
    I would be so certain that country could easily escape from this debt.
    “Every country has the government it deserves.”
    Joseph De Maistre

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