What is truth?

Archive for February, 2011

Fianna Fail crushed at polls in Ireland

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 Pat Carey, outgoing Gaeltacht Minister

    

By Jasper Hamill

27 Feb 2011

The Irish electorate destroyed the incumbent party only months after the humiliating €85 billion (about £72bn) bail-out from the IMF and EU.

Exit polls suggest opposition party Fine Gael have won 36% of first-preference votes, just short of the majority needed to form a single-party government.

The polls indicate Fine Gael won 72 seats, while Fianna Fáil managed only 20, fewer than the resurgent Labour Party’s 38. Fine Gael is now expected to seek the backing of independents or Labour to form a coalition.

Fianna Fáil is estimated to have only 8% support in Dublin and may have failed to win a single seat in the capital.

Taoiseach-in-waiting Enda Kenny said the humbled Fianna Fáil party had lost touch with the Irish people.

“The lesson from this general election is that government should never remove themselves from the people,” he said. The people have voted with vigour and strength … This is a great day for the Fine Gael party.”

Senior figures in the centre-right party were bullish about their prospects and suggested a coalition government was far from inevitable.

According to an early count, Sinn Fein president Gerry Adams won in Louth after giving up his Westminster seat north of the border to run in the Republic of Ireland’s election.

 He said: “If Enda becomes Taoiseach, I wish him well.

“We will support him when he is doing things that we think are good and progressive, and we will oppose him tooth and nail when he is doing things that are not in the common good.”Conor Lenihan, a Fianna Fáil candidate who stood in Dublin South-West, was one of the first to admit defeat.“Clearly the tide was out for Fianna Fáil in Dublin,” he said.Pat Carey, outgoing Gaeltacht Minister, said: “There’s no shame in losing – the shame will be if we didn’t learn from it.”Fine Gael promised “Smaller, Better Government” during their campaign, promising to reduce the deficit by cutting waste rather than hiking up income tax.

Fianna Fáil has governed for 60 of the past 80 years and guided the country towards its Celtic Tiger economic successes. It has since been blamed for the subsequent recession which has gripped Ireland for three years.

source:http://www.heraldscotland.com/news/world-news/fianna-fail-crushed-at-polls-in-ireland-1.1087444

comment:

Fine Gael promised “Smaller, Better Government” during their campaign, promising to reduce the deficit by cutting waste rather than hiking up income tax.

Well we will see, I expect an emergency Budget and tax hikes and wholesale selling off of state assets, further job losses and further cuts in health services and introduction of water charges, family home taxes, closing down of some of the Banks and job losses there too for starters and an increase in emigration. All this will be for nothing as I still expect us to default anyway. I will be betting that the government will last only tops 24 months any takers?

Me drowning me sorrows after the general election

Ireland Crippled by Debt Votes for More of the Same

Euro bank notes

Image via Wikipedia

When Irish Eyes Are Voting

Most of the world is focused on the Middle East and Libya, and rightly so. We will look at that in a minute. (Sidebar: the White House spelled the country “Lybia” in a recent tweet. Can you imagine what the liberal media would have done to poor Dan Quail if that tweet was from him? Just saying.) And I agree the Middle East is important. But my eyes are focused on what I think is the far more important event of the day, and that is the election going on in Ireland.

I have written about Ireland before, but we need to once again focus on what are not smiling Irish eyes. Ireland was once the envy of Europe, with one of the highest growth rates in the world. It was not long ago that Ireland could borrow money at lower rates than Germany. Now rates are 6% and likely to rise with the new government. Let’s look at a few data points from a brilliantly written article by Michael Lewis, who ranks as one of my favorite writers. When he writes, I read it just for the education on what great writing should look like, as well as for the always fascinating information. The article is at http://www.vanityfair.com/….

(I am often asked about how you can become a financial writer by young people who are starting out. I have just two suggestions. Write a lot and then write some more. Writing is no different than the piano or guitar. It takes a lot of practice, and then more practice. You don’t start playing concerts on day one, and your writing won’t be worth much either, but you will get better. Second, study the great writers and learn from them. Try to copy the styles of the guys you like for practice. Take the best and make it your own style. Lewis is one of the best.)

• Housing prices in Dublin had risen by 500% since 1994. Rents for homes were often 1% of the price of the home. A $1-million-dollar home went for $833 a month. That is a very clear bubble.

• Irish home prices implied an economic growth rate that would leave Ireland, in 25 years, three times as rich as the United States.

• In 1997 the Irish banks were funded entirely by Irish deposits. By 2005 they were getting most of their money from abroad. The small German savers who ultimately supplied the Irish banks with deposits to re-lend in Ireland could take their money back with the click of a computer mouse. Since 2000, lending to construction and real estate had risen from 8 percent of Irish bank lending (the European norm) to 28 percent. One hundred billion euros — or basically the sum total of all Irish public bank deposits — had been handed over to Irish property developers and speculators. By 2007, Irish banks were lending 40 percent more to property developers than they had to the entire Irish population seven years earlier.

• As the scope of the Irish losses has grown clearer, private investors have been less and less willing to leave even overnight deposits in Irish banks and are completely uninterested in buying longer-term bonds. The European Central Bank has quietly filled the void: one of the most closely watched numbers in Europe has been the amount the ECB has loaned to the Irish banks. In late 2007, when the markets were still suspending disbelief, the banks borrowed 6.5 billion euros. By December of 2008 the number had jumped to 45 billion. As Burton spoke to [Lewis], the number was still rising from a new high of 86 billion. That is, the Irish banks have borrowed 86 billion euros from the European Central Bank to repay private creditors. In September 2010 the last big chunk of money the Irish banks owed the bondholders, 26 billion euros, came due. Once the bondholders were paid off in full, a window of opportunity for the Irish government closed. A default of the banks now would be a default not to private investors but a bill presented directly to European governments.

• A political investigative blog called Guido Fawkes somehow obtained a list of the Anglo Irish foreign bondholders: German banks, French banks, German investment funds, Goldman Sachs. (Yes! Even the Irish did their bit for Goldman.)

• [And this is the kicker!] “Googling things, Kelly learned that more than a fifth of the Irish workforce was employed building houses. The Irish construction industry had swollen to become nearly a quarter of the country’s G.D.P. — compared with less than 10 percent in a normal economy — and Ireland was building half as many new houses a year as the United Kingdom, which had almost 15 times as many people to house.” [That makes the US housing bubble look small by comparison.]

• And just for fun: “A few months after the spell was broken, the short-term parking-lot attendants at Dublin Airport noticed that their daily take had fallen. The lot appeared full; they couldn’t understand it. Then they noticed the cars never changed. They phoned the Dublin police, who in turn traced the cars to Polish construction workers, who had bought them with money borrowed from Irish banks. The migrant workers had ditched the cars and gone home. Rumor has it that a few months later the Bank of Ireland sent three collectors to Poland to see what they could get back, but they had no luck. The Poles were untraceable: but for their cars in the short-term parking lot, they might never have existed.”

Now, let’s turn to that repository of all things leftist, the UK Guardian, as they write about today’s elections.

An Extra “15 Million” Homes

“Though the campaign has shed disappointingly little light on realistic options ahead, the financial numbers are scary. After 2000 the early Celtic Tiger years became a property-led speculative bubble, made worse by weak planning laws and 300,000 too many new homes. The crash saw GDP collapse by 11%, unemployment triple to 13.3% and government debt quadruple to 95%, which will rise to 125% by 2014 on IMF estimates.”

Let’s think about that for a moment and compare it to the US. We built somewhere between 2 and 3 million too many homes in our bubble, depending on whom you ask. Total Irish population (including Northern Ireland) is 6 million people. If the US had built the same number of excess homes, there would have been 15 million of them! And the banks just kept lending!

Irish taxpayers are being asked to pay French, German, and British bond banks and the ECB, which bought that debt. It is 30% of their GDP, along with the rest of the debt. At 6% interest, that means it will take 10% of their national income just to pay the interest. It guarantees that Ireland will be in a poverty cycle for decades. The ECB and the IMF seem to think the solution for too much debt is more debt. And in order to pay the ECB, the Irish must take on an austerity program that guarantees even worse recessions and higher unemployment.

The government that agreed to take on the bank debts is going to be voted out in spectacular fashion today. Whether one party can win or has to form a coalition government is not yet clear, but the mandate is to renegotiate the Irish debt. Both the ECB and the Germans have said that is not possible, that deals have been made. But asking Irish voters, you don’t get the sense they feel the same obligation.

Even the venerable Martin Wolf of the Financial Times agrees. Writing last week:

“So what might a new government seek to do? Its degrees of freedom are, alas, limited. Even excluding recapitalisation of the banks, the primary fiscal deficit (before interest payments) was close to 10 per cent of GDP last year. Under the IMF programme, this is to be turned into a surplus of 1.5 per cent of GDP by 2015. Given the lack of access to private markets, the deficit would have to be eliminated even more quickly without the official assistance. Again, the debt overhang would be huge, under any plausible assumptions. Ireland is doomed to fiscal stringency for decades, given its poor growth prospects, at least in comparison with its Tiger years.

“Apart from the Armageddon of a sovereign default, two partial escapes exist. The more trivial would be a reduction in the rate of interest on Ireland’s borrowing: a 1 per cent reduction in the rate of interest would save the state 0.4 per cent of GDP a year. That would be a small help, at least. A more valuable possibility would be a writedown of existing subordinated and senior bank debt, which currently amounts to €21.4bn (14 per cent of GDP).

“The ECB and the other members of the European Union have vetoed this idea, fearful of contagion. Indeed, the assistance package was partly to prevent just such an outcome. Yet the idea that taxpayers should bail out senior creditors of massively insolvent banks at such risk to the solvency of their state is both unfair and unreasonable. If the rest of the EU is determined to protect senior creditors, it should surely share in the cost of doing so. Why should the taxpayers of the borrowing country pay all? The new Irish government should make this point firmly.” (http://www.ft.com/cms/s/0/436234b8-3ebb-11e0-834e-00144feabdc0.html#ixzz1F1aZpM1L)

There are a significant number of Irish voters who wonder why they should pay any of it. Not the majority (yet), but enough. This is the Maginot Line for the ECB. If they renegotiate with Ireland, then Greece will be at the door in a heartbeat. Ditto for Portugal.

As one story I read about Ireland said, “Parties we go to now are going away parties as people, especially young people, leave for other countries with better opportunities.” The mood of the country will grow more dour.

Look at this chart. Notice how well Iceland did after it simply repudiated its debt. It wasn’t easy, and inflation is brutal, but they are better off than if they had taken on a debt burden that would have made them indentured servants to British taxpayers for decades. The ECB, the IMF, and the rest of the EU is asking Ireland to willingly fall into a lengthy depression. Would walking away from the debt, or restructuring it, be any worse?

Nominal Wages, Real Wages and Consumer Price Index: Iceland and Ireland

What if the opening negotiating line started was, “We will repay the principle, but no interest, and the timeline has to be stretched out over 25 years?” And no payments for five years. Oh, and we have about 300,000 houses you can have as our first payment.

Yes, the Irish would be frozen out of the bond market. It would result in an even more serious recession. But they could actually grow their way out of it over time. A lot faster than if they were trying to pay off the debt at 6-7% interest. And remember that Argentina, for God’s sake, got money just a few years after defaulting – twice, if I remember right! If Ireland got back on a sound footing, they could once again find acceptance in the bond market.

I know, that sounds radical. But give it a few years of austerity and see what the next elections bring. Irish debt will default, not because the Irish don’t have hearts of gold or don’t want to not pay their debts, but because they are under such a burden they can’t. And eventually enough voters will realize that. It may not be next month, or even next year, but it will come. You can only ask so much of a people. Defaulting on sovereign debt is only unthinkable in elite European Union circles. And asking German voters to pay for those defaults? Care to run on THAT platform?

This has the potential to really roil the debt markets, not to mention the interbank markets. The US is doing ok, except that job creation has been slow. A European debt crisis could throw a wrench into the world gears.

And that is the heart of the problem. The Irish really do want to do the right thing. The Greeks, not so much. Portugal? Spain?

The leadership of the EU is living in denial if they think that more debt is the answer to too much debt. It is all well and good for the Germans to tell everyone to cut back (and they should) but to do so means that the countries go into recession and have even less money to pay their debt burdens. They get into a debt spiral and the only way out is restructuring, which is default by a nice name.

Somewhere, sometime, this is all going to end in tears. The EU will be better off restructuring the debt, letting insolvent banks go the way of all flesh, or financing them and letting the euro drop like a stone, which will only make their exporting companies more competitive (not good for the US and China, but we don’t get to vote in the EU). Or they can break up. I think the former is better than the latter, but that’s just me.

The world went crazy with debt. The US, Japan (where I fly to in less than 12 hours), much of Europe, and Great Britain. And now we have to deal with it. Acting like adults would be best, and recognizing that some countries just can’t assume their banking debts is just being realistic. A lot of people made bad choices and now those choices are coming home.

It is all so very sad. People are hurting. I read the blogs in Ireland and it brings tears to me Irish eyes (or the large part of me that is of Irish heritage).

There are no easy answers. No easy button. The only button we have is the reset button, for the Blue Screen of Death. That means pulling the plug and starting over. This time with realistic debt levels and bond markets.

Have a good week! Sayonara for now!

Your trying to figure out how to stay on US time analyst,

John F. Mauldin

johnmauldin@investorsinsight.com

comment:

I tried to tell people at the doors about this and got nowhere somehow they had their minds made up that Fine Gael was the answer and that getting new faces into power was going to solve the problems of our country .I suppose we are going to have to wait until people realize that the new crew on the “good ship SS Ireland” are just as incompetent as the last crew.

Committing to more debt is not the answer we just can’t pay off this huge private debt and the taxpayers will only face more job losses and social services cuts the honeymoon period will be short and we will be in the divorce courts soon enough mark my words!

The people have spoken!

The people have spoken and have once again put back in mostly the same old tired void of real ideas politicians .They will regret this soon enough as we start to see the price go up for petrol and the tolls start to bite on the roads, pay for the privilege of walking in a local forests .and the selling off of state assets like the ESB and VHI.

The cost of renewing you passport to getting a birth cert all local services will now start to creep up in costs while the services themselves will be cut to the bone.

Here in Wicklow Town, we had to wait for 30minutes for an Ambulance on Friday, I was told that we only had one Ambulance for the town and that one was Broke so we had to wait for one to come from St Columcille’s Hospital. The housing estates are awash with grit and the council has no funds to sweep them my last complaints on the potholes along the R751 were repaired last time I looked

But it would seem to be a temporary job done! at least they did something!

As I said get ready for the price hikes and the job losses that are coming and when the empty promises of the new power holders in the Dail are exposed people might be ready to embrace true patriots

Carrying the message

The Banker

Hello, my name is Montague William 3rd
And what I will tell you may well sound absurd
But the less who believe it the better for me
For you see I’m in Banking and big industry

For many a year we have controlled your lives
While you all just struggle and suffer in strife
We created the things that you don’t really need
Your sports cars and Fashions and Plasma TV’s

I remember it clearly how all this begun
Family secrets from Father to Son
Inherited knowledge that gives me the edge
While you peasants, people lie sleeping at night in your beds

We control the money that controls your lives
Whilst you worship false idols and wouldn’t think twice
Of selling your souls for a place in the sun
These things that won’t matter when your time is done

But as long as they’re there to control the masses
I just sit back and consider my assets
Safe in the knowledge that I have it all
While you common people are losing your jobs

You see I just hold you in utter contempt
But the smile on my face well it makes me exempt
For I have the weapon of global TV
Which gives us connection and invites empathy

You would really believe that we look out for you
While we Bankers and Brokers are only a few
But if you saw that then you’d take back the power
Hence daily terrors to make you all cower

The Panics the crashes the wars and the illness
That keep you from finding your Spiritual Wholeness
We rig the game and we buy out both sides
To keep you enslaved in your pitiful lives

So go out and work as your body clock fades
And when it’s all over a few years from the grave
You’ll look back on all this and just then you’ll see
That your life was nothing, a mere fantasy

There are very few things that we don’t now control
To have Lawyers and Police Force was always a goal
Doing our bidding as you march on the street
But they never realize they’re only just sheep

For real power resides in the hands of a few
You voted for parties what more could you do
But what you don’t know is they’re one and the same
Old Gordon has passed good old David the reigns

And you’ll follow the leader who was put there by you
But your blood it runs red while our blood runs blue
But you simply don’t see its all part of the game
Another distraction like money and fame

Get ready for wars in the name of the free
Vaccinations for illness that will never be
The assault on your children’s impressionable minds
And a micro chipped world, you’ll put up no fight

Information suppression will keep you in toe
Depopulation of peasants was always our goal
But eugenics was not what we hoped it would be
Oh yes it was us that funded Nazis!

But as long as we own all the media too
What’s really happening does not concern you
So just go on watching your plasma TV
And the world will be run by the ones you can’t see

Comment:

Welcome to Ireland of 2011

I saw this first hand in the last three weeks  where access to the TV stations was no problem for some so called Independents that were openly supportive to the incoming power brokers  and seemed to have plenty of funds and support available to them ,but the rest of us that were true independents were excluded and without access to funds or the TV networks we fell by the wayside and the deception continues .The bankers will continue to be bailed out while the masses will pay their gambling debts

$5.4 billion worth of shady practices

The Turning Of The Sovereign Seal

by Bridget Haggerty

“On the morning of the 21st January, in Vaughans Hotel on Parnell square, a man named Tom McGuire elevated and turned the Sovereign Seal of Dáil Éireann, from the rising sun to the setting sun, from north to south and from east to west, and from Pagan to Christian to Sovereign; As in the 1916 Proclamation, claiming sovereignty over the elements, earth, air, fire and water and all there in and there of, on behalf of the Sovereign people and the Sovereign Republic of Éire.”

That caption appears on the base holding the seal and it describes what happened in the year 1919 at Vaughan’s Hotel – a haunt of Michael Collins and other revolutionaries of the War of Independence. It was also the secret headquarters of the first Dáil Éireann.

Every year since then, a member of the Maguire/Mcguire clan – the designated keepers of the seal- arrives at the official residence of the mayor, Mansion House in Dublin, to perform this little known Irish ritual which according to the records must take place and be witnessed in order for the sovereignty of all the organs of the state including the Dail, the courts, licenses and even of the nation itself to continue. Thus, at 12 noon in the Cabinet Room, with a harp playing softly in the background, the Sovereign Seal is turned once again.

The tradition has been passed down from generation to generation of McGuires. Today, Billy McGuire of Askeaton Co, Limerick performs the duty first carried out by his ancestor Tom in 1919 and then later by his father. Billy took it over from his late father in 1967.

Extrapolating the facts behind this annual ritual from a number of sources immediately raises some questions: First off – why is it that the McGuires perform it? The obvious answer would be that it was because the McGuire family were the owners of the hotel where the ceremony first took place. In 1917 the McGuires acquired Vaughn’s on behalf of the Irish Republican Brotherhood – a secret oath-bound fraternal organisation dedicated to the establishment of an independent democratic republic and to Oglaigh na Eireann (Soldiers or Volunteers of Ireland). In 1918, the hotel was the site of the 32 county Election which established the sovereignty of the Republic. On the morning of January 21st the Irish Republican Brotherhood implemeted the 1916 Proclamation which vested the soverinty of the 32 counties and the democratically elected TDs to Dail Eireann.

However, it should also be noted that the surname McGuire and its variations has a long and illustrious history in Ireland which would make it worthy of performing such an important ritual. The family is first mentioned in the Annals as early as 956 A.D. Towards the close of the thirteenth century, with the installation of Donn Maguire, the family began to feature prominently in the records. Between that time and 1600 there were fifteen Maguire rulers of Fermanagh. Following the devastations by the armies of Cromwell and William of Orange, the Irish landed aristocracy, including the majority of the McGuires fled, in 1691, with the “Wild Geese” to France and Austria and a member of the family accompanied the Earls O’Neill and O’Donnell to Rome.

The Mcguire titles, which died out in about 1795, were acceptable to the French court to which they had given their allegiance while serving in the many Irish regiments. Maguires appear in the archives of Europe’s capitals, from Paris to Copenhagen and from Madrid to London.

John Francis Maguire (1815-72), the son of a Cork merchant, founded the still popular Cork Examiner newspaper and played a major part in politics – he was Mayor of Cork four times.

In 1880 Thomas Maguire was the first Catholic to be made a fellow and was Professor of Moral Philosophy at Trinity College.

Sam Maguire served Michael Collins as intelligence officer and later was important in the GAA both on the field and in its administration. Considered by many to be the GAA’s founding father, Sam always wore the Sovereign seal on his jersey; the Sam Maguire Cup awarded to the winners of the All Ireland Senior Football Champions is named after him.

Other questions remain unanswered as of this writing. Does ‘The Keeper of the Seal’ bring it with him to the Mansion House each year and then takes it back with him after the ritual is performed? And is the seal that is turned the original one from 1919? It would appear from some of the videos in which Billy McGuire appears, that the seal goes with him where ever he does. But it’s not known for certain if it’s the orginal. The plan is to investigate further and try to fill in these gaps.

The Seal Itself
The Irish sovereign seal consists of a harp with 12 strings. The Harp is a symbol dense with meaning. In form it incorporates the ships compass, the horizon, the moon, the triangle and parallels of geometry and as such is an ancient compendium of knowledge. The Romans followed the Harp in their design of Rome. Its importance in Ireland for ceremonial and later official use makes it, as a symbol, key to Irish civilisation and history.

Variations in the number of harp strings make their appearance on a wide range of Irish documents and other items. For example, there are eight strings on the harp symbol of the Army, 9 strings on the passport’s harp, 13 on official documents of Dail Eireann and 14 on coins.

In court our judges sit under a 13 string Harp which is in reference to the Trinity (one in three) and ties their work to the Irish Constitution. Historically, the Sovereign Seal of the Irish Republican Brotherhood had 6 strings while that of the Fenian Brotherhood had 5.

Billy McGuire, who is the current President of the Republican Brotherhood, invests in all of this a great deal of important symbolism, and indeed, has tried to reprimand the president for flying a standard containing a harp with the wrong number of strings. And, according to Mr Maguire, peace in Ireland will not be truly reached until the British monarch removes the Irish sovereign seal which still takes up a quarter of the royal standard. Not many people know that.

It is also a strange anomaly of Irish history that the Seanad sit with their back to the Sovereign Seal which is on the back of their chairs. This happened because members of the house initially sat facing symbols of the British Crown. This practise is something that Billy McGuire would also like to see changed.

What this writer finds curious is why this custom receives so little attention. Somewhere in the pile of notes there is a notation that the turning of the seal is what grants a licence from the people of Ireland to the government to perform as they, the people, desire. Yet strangely, there seems to be an obvious absence of political leaders at the ceremony. Did they attend at one time and then, once Ireland became a Republic decided they didn’t need to anymore? Delving into the notes simply raises more questions than it answers. But one thing is for certain: there is an old Irish proverb that says “Never make a custom or break a custom.” Given the somewhat tenuous circumstances of dear old Eire today, this writer would be making sure she was in attendance at the Mansion House every January 21st to witness and celebrate what is essentially Ireland’s Independence Day. Perhaps a nice fireworks display over the GPO would be a grand touch as well.

Radio: Interview with Billy McGuire

Video: Billy McGuire; Keeper of the Sovereign Seal
Video: Turning of the Sovereign Seal, 2010 (Not very good quality)

Copy Sources:
W.J. McGuire’s Irish History of Sovereignty

TNS Radio

Irish Independent/Liam Collins

Limerick Leader/Anne Sheridan

Photo Credits:
Collage showing the harp on official documents: We the People

Mansion House entrance: Dublin Rocks/Mark Wrafter

Photo Credit: Turning the seal at the Mansion House in 2008/McGuire’s Irish History of Sovereignty

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