What is truth?

Posts tagged ‘Brian Lenihan Snr’

ECB refuses to hand over November 2010 threat letter sent to Brian Lenihan

By Namawinelake

The story of Ireland’s bailout in November 2010 has been partly told in dribs and drabs. Governor of the Central Bank of Ireland, Patrick Honohan said that the Minister for Finance in November 2010, the late Brian Lenihan was “crestfallen” when he learned from the ECB that Ireland couldn’t default even on the unguaranteed debts of the banks. The Governor went on to say that Minister Lenihan was “offered no room” for negotiation on the matter. And in April 2011, Dan O’Brien in a BBC Radio 4 programme referred to a letter sent by the former ECB president, Jean-Claude Trichet on Friday 19th November to Minister Lenihan which set out the ECB position

full article at source:  http://namawinelake.wordpress.com/2012/01/09/ecb-refuses-to-hand-over-november-2010-threat-letter-sent-to-brian-lenihan/

Paddy Honohan, the Irish Central Bank and Justice for the Irish People


Christopher M. Quigley B.Sc., M.M.II., M.A.

Paddy Honohan, Governor of the Irish Central Bank, shamed himself when he
gave testimony to the Oireachtas Finance committee today.
When asked about debt forgiveness for struggling Irish citizens he retorted that it was the job of the Irish
banks to get back as much capital as possible and not “grant any gifts”. How dare he say such a thing.This is the very same person who had no problem with the following:

35 Billion in capital being GIFTED to NAMA developers on the 3rd of August 2011.30 Billion being GIFTED to Anglo Irish Bondholders through a 10 year promissory note.

17 Billion being GIFTED to the Irish Banking fraternity  to create a so called “core pillar banking system”.

All the above GIFTS are being bankrolled on the good faith and credit of the hapless Irish citizens.Irish consumers were motivated over ten years to enter into a lending boom overseen by an incompetent regulatory framework  under the command of the very self same Irish Central Bank which Paddy Honohan proudly and arrogantly currently presides over.When will the Irish people get JUSTICE from this heartless self serving mandarin?Paddy Honohan destroyed the negotiating position of Brian Lenihan and the Irish State with his mis-timed statements during the course of IMF/EU bailout crisis. For this he should have been made resign. Now he is exercising the same kind of treason on the average Irish debt consumer. Under his watch he wants blood extracted from Irish homes instead of compassion being granted.The Irish people deserve better, they need a break. They need fairness. What is good for the developer goose is good for the hard working gander.Irish citizen’s taxes will be used to bail out the banking mess for decades to come. Many of these citizens are in financial hell. Under the leadership of Enda Kenny and Eamon Gilmore the very least the new Irish government should do is to stand down this Central Banking Governor and insist that debt leniency be granted to families struggling to maintain homes and hearths. Justice and fairness are not a GIFT they are a right.



Central Bank Governor defends bailout role

The Governor of the Central Bank Patrick Honohan has defended his role in the European
Union-International Monetary Fund deal negotiated last November.He said he has no regrets about going on RTÉ Radio to tell the Irish people and the wider world what was going on, as he considered it necessary to avoid a potential crisis. He
said over the previous days there had been intense negotiations involving a lot of people.

But he said there was a sense in markets and in European political circles that
something was stalling in the process, and that something very serious was about to happen.There was concern in European political circles, including in the European Central
Bank, about the negotiations, and there was a fear of a meltdown.

He said he was trying to reassure people behind the scenes that the talks were
going ahead. Prof Honohan said he believed that he was the only person who was going to tell people what was happening, and that he had a responsibility to do that.

The Central Bank Governor said his only personal regret was that he wrong-footed
the late Brian Lenihan, whom he said could have told people the day before the
governor’s intervention, but it was Mr Lenihan’s choice not to do so.

He said the deal negotiated was not a bad one, but he felt a number of opportunities for a better deal were missed because it was done quickly.

The noted problem was the high interest rates charged by the European Financial
Stability Facility, a situation that has now been rectified.

He also pointed to last week’s call by IMF head Christine Lagarde for the EFSF to
use funds to directly capitalise banks, rather than lending on to states to do the same.

He said that in this case it would be the EFSF rather than the Irish taxpayer who
owned 99.8% of AIB and big stakes in all the other banks. He said a scheme of that kind was something he had in mind at the time, that might have been worked up into a detailed scheme if there had been more time.

source: http://www.rte.ie/news/2011/0902/banks.html


This Man has changed the his tune so many times he is in effect a poacher turned gamekeeper As far as I am concerned he is a disgrace He presented the
first bank stressed tests to the nation and they subsequently proved to be an
absolute fraud just like the second one and the latest one will prove to be
just as fraudulent. Nothing he says has an ounce of credibility ,he should be
in Jail along with the rest of the gangsters who gave away our independence!

Governor of Central Bank of Ireland claims Lenihan was “crestfallen” by EU stance on bondholders

By namawinelake 

This subject has been covered on the irisheconomy.ie website. This entry adds the transcript of the programme to highlight the precise words spoken by the governor. Also part 2 of “Burning the bondholders” will now be published tomorrow]
The under-rated Vincent Browne broadcast a special edition of his week-night programme on Friday night last as a memoriam to former Minister for Finance, Brian Lenihan who died earlier on Friday after a 2-year battle with cancer. In the “pole” seat, that is the one nearest Vincent was Patrick Honohan, the governor of the Central Bank ofIreland. Other guests included Minister Joan Burton and journalist Fionnan Sheahan. Vincent started off gently discussing Brian Lenihan with the guests in the stall seats. And then about 17 minutes in he got to Governor Honohan. And Vincent gently probed the governor for his memories of his dealings with the-Minister Lenihan. And for about four minutes, Vincent tenderised the governor. And having covered the tittle-tattle about how nice Governor Honohan’s office was, we had the following:
read full article at Source: http://namawinelake.wordpress.com/author/namawinelake/


Here in Ireland we are reluctant to speak ill of the dead .and so with reluctance I say this.

Mr.Lenihan RIP, has for the last few day been canonized by his well placed pals in Irish society .Of course politicians from all sides are falling over themselves in praising this man presumably expecting to gain some brownie points .The airwaves are stuffed with praise for this man and it is becoming nauseating to say the least .I became sick last Friday when the Live line went into overdrive and one would have thought they were talking about Mahatma Gandhi or mother Theresa

Speaking of Gandhi may I take this opportunity in reminding everybody of one of his quotes?

“There is no God higher that truth” Now this been the case I am compelled to try and bring the truth back into the light of day.

Our country is the poorer because of the incompetence of Mr. Brian Lenihan. This man is responsible for the many, many years of austerity that is now been forced on to the shoulders of ordinary decent people because this man sold his country out the international bondholders, gangsters and gamblers. Mr .Lenihan chose to save his pals in the building industry and the corrupt bankers rather that stand up to them and make them responsible for their own gambling debts. Mr.Lenihan became dethatched from the ordinary people of Ireland and he became aloof and drunk with the effect of absolute power, His membership of a very select group of individuals (The Golden Circle) caused him to turn his back on the people of Ireland as he chased applause and honours from forging shores. His mind-boggling incompetence along with his former crew members has cost this nation, our independence and sovereignty and in other times he along with the other members of the previous government would have faced charges of treason and would have been shot!

Ironically he was accused of economic treason not so long ago by members of the current government and these same people are now enthusiastly  carrying out the same measures as Lenihan and his band of misfits came up with 

So I guess Lenihan wasn’t the only economic terrorist we had or have now. The central bank governor hasn’t exactly been the sharpest tool in the drawer  either!

Minster just shuffling the pack before he pulls a card from the bottom!

By Michael Brennan

Friday April 29 2011

HEALTH Minister James Reilly is planning to get insiders from his own department and the Health Service Executive to replace the outsiders on the HSE board.

He is going to appoint senior civil servants and HSE officials to replace the 12-member HSE board, which unanimously accepted his call for their resignations yesterday.

Those stepping down include UCD Professor Niamh Brennan — the wife of former PD leader Michael McDowell — and former Dublin city manager John Fitzgerald.

Dr Reilly said last night that he had made his move because he wanted to reduce the gap that had developed between the Department of Health and the HSE during former health minister Mary Harney‘s tenure.

“If we’re going back to anything, it’s to ministerial responsibility. I am shortening that chain of command, and I believe this will be for the betterment of patients through improved services,” he said.

The only survivors from the 12-member HSE board will be chairman Frank Dolphin and HSE chief executive Cathal Magee. They will be appointed to the interim HSE board, along with Department of Health secretary general Michael Scanlan and other Department of Health and HSE officials.

The board, which held its final meeting in the HSE’s offices in Adelaide Road in Dublin yesterday, will be officially abolished by the end of the year when legislation is passed.

But Dr Reilly said the structure would still remain — with the intention of keeping a good line of communication open between him, the HSE and his department. He said he would be able to get quicker reports on waiting times for patients in emergency departments.

Mr Reilly praised the retiring HSE board members for their “tremendous public service” and said they had got no pay-offs for offering their resignations.

Dr Reilly’s move is a reversal of the policy of the previous government, which clearly separated the HSE and the Department of Health. It is part of a plan to increase the control of the Department over the HSE as Dr Reilly begins his re-organisation of the health service.

The programme for Government states that the minister and the department will be “responsible for policy and spending”. It says that the HSE will cease to exist “as its functions are given to other bodies during this process of reform”.

However, the switch over to a system of universal health insurance is due to take at least five years.

Editorial comment & analysis: Page 20

– Michael Brennan Deputy Political Editor

Irish Independent


I wouldn’t be feeling sorry for the Board of the SHE they are all well looked after and have other jobs to go to .The Minister  has done a good job in getting rid of them but what is he going to do now  ?

Well of course he has friends he will now look after and we can expect to see them get the nod  this is the norm in Irish politics behind closed doors all the rotten details are kept and in a few years from now we will get to hear of the deals that this Minster is doing right now .Here is an example of rotten deals done it now appears that Brian Lenihan approved of the last bumper lottery payout to the former AIB chairman  see below

By Emmet Oliver Deputy Business Editor

Friday April 29 2011

AIB has said that Brian Lenihan rubber-stamped the €2.7m pay package for its managing director Colm Doherty when he stepped down last year.

The bank, in its 2010 annual report, claimed that the then finance minister considered Mr Doherty’s terms and conditions in November 2009 — and raised no objection.

It said Mr Lenihan approved Mr Doherty’s “existing entitlements” at the time.

The annual report reveals that AIB directors paid themselves €4.3m in 2010.

The bank revealed the sequence of events when Mr Doherty became managing director in 2009.

It said the Government’s own pay watchdog for the financial sector (known as CIROC) signed off on his contractual entitlements, including cash payments to compensate him for a cap on his overall pension benefits.

“Mr Doherty’s entitlements in lieu of pension benefits accrued above his personal fund threshold were notified to, and discussed with, the Government-established Covered Institution Remuneration Oversight Committee (CIROC) in January and February 2009,” said AIB. It pointed out that the Revenue Commissioners also signed off on the arrangements.

“Subsequently, AIB sought agreement from the relevant authorities on Mr Doherty’s contractual entitlements in the context of his appointment as group managing director,” explained the bank.

“The matter was considered in November 2009 by the then Minister for Finance, who agreed to Mr Doherty’s appointment on a voluntarily reduced salary and continuation of existing contractual entitlements, including payment of pension allowances.”

The report reveals that Mr Doherty was granted a €432,000 salary, benefits of €50,000, payments in lieu of pension benefits of €1.96m, a termination payment of €953,000 and another pension payment of €1.04m

Mr Doherty was forced to step down last year when Mr Lenihan demanded changes at the top as part of the recapitalisation of the bank.

It had been reported during 2009 that Mr Lenihan did not want Mr Doherty in the senior role and wanted the AIB board to find a suitable outsider.

– Emmet Oliver Deputy Business Editor

Irish Independent

Again another example of a minster appearing to do the right thing only to be feather nesting his own pal (softening the blow as it were) Lenihan lied to the people, of Ireland and I don’t expect any more from the current government minsters.    

None of these career politicians are trustworthy .The Current Minster was the same guy that negotiated with the last Minster of Health the enormous pay packets for the country’s hospital consultants. The Irish Hospital Consultants Association is one of the most powerful lobby groups in the country and famously described a salary of €250000 as “peanuts”. Is he the right man to get a severe cut in their salaries now??? I don’t think so!

The Minster is just shuffling the pack before he pulls a card from the bottom! This is what they do!

There needs to be a public inquiry into the events that led to the EU/IMF bailout.


Minister for Social Protection Joan Burton has said there needs to be a public inquiry into the events that led to the EU/IMF bailout.

Her comments follow former Minister for Finance Brian Lenihan’s remarks in a BBC radio documentary, that the European Central Bank ‘forced’ Ireland to take the bailout.

Ms Burton says all those who sat around the Cabinet table of the last government need to come before a Dáil inquiry to answer questions about what happened.

Three inquiries have been held into the collapse of the banks but Ms Burton says they were all held in private and none dealt with the role of the ECB or the former government.

She is in favour of an inquiry conducted by a Dáil committee.

The Government plans to hold a referendum seeking to give the Dáil powers to carry out such an inquiry, and compel witnesses to attend.

She said if Mr Lenihan was ‘bullied’ by the ECB we should know about it because it is very important to the future of Europe and for the current Government in dealing with the financial mess.

Irish taxpayers, according to Ms Burton, need to know what happened the night of the bank guarantee and in the weeks running up to the bailout, so that the country can move on.


Well done Joan Burton but it is a little late coming to this conclusion, we have been calling for this investigation now for two and a half years .I believe Lenihan and the rest of the gangsters who allowed this calamity to befall our nation should be in Jail .What proposals will Joan bring before the cabinet to bring these crooks to justice ?

Have we reneged on the IMF/EU bailout deal?

By namawinelake

(Memorandum of Understanding)

The decision by Minister for Finance, Brian Lenihan this week to postpone the next round of bank recapitalisations to after the general election was momentous and I don’t think the shock waves have been accurately captured yet. And the reaction of what are assumed to be the government-in-waiting must surely be a matter of deep concern for our lenders, as it would seem that there has been unilateral repudiation of a key term of our agreement with the EU/IMF (either a one-month-plus delay or a conditional repudiation). Let’s examine the sequence of events

1. 16th December, 2010 – Agreement with IMF/EU of bailout terms following Irish parliamentary debate and vote and IMF board meeting

2. January Exchequer Statement confirms that we have so far received €10.873bn from the EU/IMF facility (€4,979m from the European Financial Stabilisation Fund and €5,803m from the IMF Extended Fund facility) in Jan 2011. The December 2010 Exchequer Statement shows that there was no drawdown from the facilities last year.

3. 1st February, 2011- Dail is dissolved and it is claimed by Minister Lenihan that he discussed the possibility of postponing the recapitalisations with his colleagues.

4. Wednesday afternoon, 2pm, 9th February, 2011 – IMF produces broadly upbeat staff report on Ireland

5. Wednesday afternoon, 9th February, 2011 – Minister Lenihan issues statement cancelling his intention to recapitalise the banks before the general election – “the Minister has informed the European Commission, the IMF and the ECB” The Central Bank of Ireland responds in detached terms (“notes” cf “welcomes”)

6. Thursday afternoon, 10th February, 2011 – Minister Lenihan issues informal invitation to two main Opposition party finance spokespeople to write to him if they wanted the recapitalisation to take place before the general election.

7. FG finance spokesperson, Michael Noonan issues statement in which he says “if Fine Gael is in government will await the results of the solvency and liquidity review before we recapitalise the banks”. These reviews are due to be completed by Barclays Capital, the Boston Consulting Group and Blackshore by 31st March 2011. Work has been ongoing since January so there is the possibility that the results may be published earlier than 31st March.

 8. Labour party leader, Eamon Gilmore said, according to the Irish Times, “his party would not put any further capital into Bank of Ireland, AIB and EBS building society before renegotiating the bailout with the International Monetary Fund (IMF) and the EU”. I cannot find a statement on the Labour website on this subject.

9. General election on 25th February, 2011 with constitutional statement by An Taoiseach that the next Dail will meet on 9th March, 2011. The likelihood is that the next government will be a coalition and the usual post-election horsetrading may delay the formation of a government. For what it is worth, Paddy Power are offering 1/10 odds-on that the next government will be FG/Labour. I recall Paddy Power not being on the money with the outcome of the British general election in May 2010 but the only fly in the ointment I can see in our election is the uncertain role to be played by independents and small parties as my own sense is there is a palpable hostility/apathy towards FF (mostly)/FG/Labour. The reason for mentioning the likely outcome of the election is that above are the positions of the two main opposition parties likely to be in government, on the recapitalisation. So where does this all leave the agreement with the IMF/EU. We’re taking their money but not honouring commitments on the use of that money. The hope on the IMF/EU’s part must be that this is a temporary hiccup and this agreement term will be honoured in April 2011. I can’t find written statements from the ECB or the IMF or EU reacting to Minister Lenihan’s decision but press reporting suggests muted concern. I can’t help but notice that we have €11bn of the bailout funds plus €126bn from the ECB in our banks and yet we seem to be unashamedly delaying (or something more serious in Labour’s case) a key term of the deal.

Comment :

What about to notion that we haven’t seen the real extent of the problem? Perhaps we are only seeing the tip of the iceberg what if the hole in the banks is three times bigger or even four times bigger can we really believe a word any of the players to date .Brian Lenihan, Patrick Honohan Allen Dukes Brian Cowen and even the ECB with their Bank stress tests, none of their figures have been proven right on the on the contrary they all have been wrong.

For my money I bet the hole is so much bigger and we will have no choice but to default. By the time we have the full figures on the Banks derivative positions in CDS, s ,and OTC,s  we will be in for a nasty shock and Lenihan knows it!

The use of derivatives can result in large losses because of the use of leverage , or borrowing. Derivatives allow investors  to earn large returns from small movements in the underlying asset’s price. However, investors could lose large amounts if the price of the underlying moves against them significantly and boy has the underlying assets prices moved and it is down down down so its not going to be good news comming from the banks .

Has Bank of Ireland really been deceptive over bonus payments?

By Paul Clarke

Bank of Ireland has been paying bonuses. In fact, it may have been paying many millions of euros in bonuses since accepting state aid in 2008, much to the outrage of the Irish taxpayer.

But has the bank been actively hiding this fact, or has the government just been slow in chasing up the details?

Parliamentary questions now seems to be the place where details of Irish banks’ remuneration practices come to light. It is, after all, an easy way for politicians to score some points and create more scathing banker-bashing headlines.

Some new controversy has emerged over the fact that BoI may have been paying some performance-related bonuses since coming under the government bank guarantee scheme, despite telling the Department of Finance in December that nothing had been paid over the course of last year.

Joan Burton TD highlighted this fact during a December parliamentary question, and has since described the payments as “one further act of deceit” by BoI, while Brian Lenihan has assured us that an “urgent investigation” was underway.

But is all this just a matter of semantics? BoI hasn’t revealed any figures about bonus payments, but said in a response to the Department of Finance enquiries on 1 December that no performance-related bonuses were paid “with respect to the financial years to March 2009 and December 2009”.

However, it also added:

“A small number of people at middle management level received payments which reflected either guarantees which were agreed on their joining the Group or deferred payments where the historic performance criteria had been achieved and the payment was deferred over several years. For commercial reasons BoI do not disclose the amount of such payments. The bank advises that it had no legal discretion in these matters.”

In other words, performance related bonuses are not being paid, unless the bank already has contractual arrangements to do so, and it’s suggesting it isn’t necessary to divulge figures. What’s more, it’s made no attempt to see if it is legally bound to pay these, as AIB did over the now well-known deferred 2008 bonus payments for its capital markets division.

Undoubtedly, BoI has been evasive on this matter, having avoided producing any figures on bonus payments, despite the fact that all the other Irish institutions under the guarantee have, but you can hardly accuse it of active deception.

Instead, surely it’s the government’s responsibility to chase this matter up, considering the political sensitivity around banker bonuses in Ireland and the greater influence it now has on the institutions. By failing to do so, it gives yet more ammunition to the opposition parties and fans the flames of public outrage over banker bonuses.

Below is the table submitted to Brian Lenihan by Irish banks (BoI excepted) detailing their bonus payments over the last two years. Most have drastically scaled back both the sums paid out in bonuses and the number of people receiving them:


source: http://news.efinancialcareers.ie/newsandviews_item/newsItemId-30419

MINISTER FOR Finance Brian Lenihan has started an investigation into millions of euro in undisclosed bonus payments paid to staff by Bank of Ireland since the Government’s bank guarantee scheme.

Last year the bank told the Government it had not paid any performance-related bonuses to staff since the guarantee in September 2008.

Following subsequent queries by Department of Finance officials, it has emerged the bank did not disclose millions it paid out as part of contractual bonuses, which also have a performance-related element.

Neither the bank nor the department would comment last night on the scale of the bonus payments or how many staff benefited until investigations are completed. However, one well-placed source said the figure would be at least several million euro.

Other banks covered by the guarantee scheme have paid out a total of almost €46 million in bonuses between 2008 and 2010.

Anglo Irish Bank was responsible for some €20 million in bonus payments in the last months of 2008. AIB also paid out about €20 million, the bulk of which went to overseas staff. The sums recorded for Bank of Ireland were nil.

The latest information on bonus payments has come to light following a parliamentary question by Labour’s finance spokeswoman Joan Burton TD.

She said yesterday that the bank’s failure to disclose the payments was an “act of deceit” and an “astonishing display of arrogance and contempt” for the Government.

Minister for Finance Brian Lenihan said the bank’s chief executive had acknowledged the difficulties caused as a result of the misinformation and apologised unreservedly.

Mr Lenihan said he was undertaking an “urgent investigation” into bonus payments made since the guarantee scheme and of additional payments the banks may have intended making in the future.

The Minister said previous information given to his department that indicated that no performance-related bonuses were paid to staff was incorrect, as it did not take into account “contractual bonuses” which were performance related.

A spokesman for Bank of Ireland yesterday said there was never any intention on behalf of the bank to mislead the department.

He said some of these bonuses had not been classified as performance-related and were typically paid because of legal obligations or arrangements which predated the bank guarantee scheme.

Ms Burton, however, said it beggared belief that the bank did not have data on bonuses at their fingertips. “It is money from the taxpayer and a State guarantee that are keeping the Bank of Ireland afloat,” she said.

source :http://www.irishtimes.com/newspaper/ireland/2011/0117/1224287681930.html

What does the IMF/EU Really Really Want?

The International Monetary Fund (Headquarters ...

Image via Wikipedia

Brian Lenihan and Patrick Honohan inform us that the EU/IMF deal is not written in stone, that it can be ‘renegotiated’ (even, it seems, the interest rate). For progressives, the issue of renegotiation is paramount for, as it stands, the bail-out would force us into (a) squandering our assets and cash (Pension Fund, NTMA cash balances) on a futile attempt to bring the deficit into Maastricht compliance by 2014/2015; and (b) piling private bank debt on to sovereign debt. So what is it that we should be demanding in a renegotiation? What are the key points to rally a consensus around?

The first question is: what does the EU/IMF really want? The answer is fairly straightforward.

  • After three years, they want the Irish economy to re-enter the international bond markets.


Full stop. That’s the end-game. Anything that brings us closer to that is good, anything that takes us away from that is bad. What are the conditions upon which the Irish economy can re-enter the international markets? Or, put another way, under what conditions would markets begin lending to the economy at a sustainable rate?

  • That the Irish economy is capable of generating revenue to pay off future debts.

That’s it. There’s no debate over the end-game, only means. On this basis we can put Honohan’s comments in perspective:

‘We can be confident that, if a new government were to want to substitute alternative measures which were both economically efficient and of equal fiscal effect, it would receive a sympathetic hearing from the funders.’

That poses no problems for progressives. As has been shown (here and here), an investment programme combined with ‘growth-friendly’ fiscal consolidation policies would not only have ‘equal’ fiscal effect, but better, far better.

Of course, many will – with some justification – claim the IMF / EU are so ideologically blinkered that they will insist on an austerity programme, regardless of how it impacts on our ability to exit the Stabilisation Fund in three years time without a default. Maybe. However, the best argument against any escalation of commitment that the IMF / EU may suffer from in the future is . . . their own projections.

A key metric that will determine our re-entry into international markets will be the ‘debt-sustainability’ measurement. This measures how sustainable our accumulation of debt is. If the interest rate on the debt (as a percentage of GDP) is higher than the nominal GDP plus the ‘primary’ budget balance (the ‘primary’ balance excludes interest payments), then the debt can be considered unsustainable. If the interest rate is lower, then it is sustainable.

This is what market analysts will be examining, among other things. So how does this play out? Let’s compare the projections put forward by the Government, the EU and the IMF for 2012 – the year before we are to exit the Fund. We will use the Government’s projected interest rate of 3.9 percent (as a percentage of GDP).

Debt Sustainability The Government believes that by 2012, considerable progress will be made in both reducing the deficit and promoting growth. The EU doesn’t. The IMF is slightly more optimistic than the EU – but their projections were published in October; since then, all forecasters have revised growth downwards and the deficit higher.

Even with the IMF’s more optimistic projections, though, the Irish economy will still be in negative territory even in 2015.

However, the shrewder in the markets will also be looking at debt sustainability under GNP. They will realise that our GDP suffers from a soufflé effect owing to the impact of a modern multinational sector that is at times only tangential to the Irish economy. What would the numbers look like then?

  • According to the EU projections, debt sustainability would deteriorate to -7.6 percent.

Therefore, the question we can ask the EU is: do you really think, on the basis of your own projetions, that markets would lend to us? The answer is obvious.

And while otherwise fiscally healthy economies can survive a couple of years in negative territory, especially during a recession, an economy with a debt of 114 percent of GDP (the EU’s estimate for 2012) is not healthy.

Even though this will be an important measurement for debt analysts, it will not feature in the economic debate here. After all, we were told by domestic commentators that all throughout 2009 and 2010 (until it became untenable) that international markets were ‘impressed’ with out austerity budgets and that we were not like Italy, Spain or Portugal.  This despite the fact that since early 2009 Irish borrowing costs were the highest in the EU-15, save for Greece.

So what does the IMF/EU want? For Ireland to be able to exit the Stabilisation Fund and return to borrowing on international markets by the end of 2013. On their own projections this is not likely to happen.

This opens the door to renegotiation – using their own data. This opens the door to an alternative economic programme, one that prioritises growth because that is a key element in the debt sustainability measurement; one that emphasises deficit reduction through employment, in order to raise revenue and cut unemployment costs.

There is much to have a chat about.

source: http://www.irishleftreview.org/2011/01/13/imfeu/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+irishleftreview%2Ffeed+%28Irish+Left+Review%29

MaX Keiser report 112

Greenspan total denial  just like Brian Lenihan and Cowen in Ireland it seems that people in power think that they have an inbuilt right  never to be wrong !what arrogance !

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