Recent Economic Perspectives

There has been some coverage in recent days on the Government's policies in regards to stabilising the economy and working towards regaining our economic sovereignty.

I'm posting some of these perspectives here.

I know this a very contentious issue and like everyone else I am against paying for banking debts that should never have been our responsibility.

I think these perspectives show the longer-term strategy the Government is taking and the potential for much larger benefits for the country in the future.



Dan O’Brien  (Economic Editor  The Irish Times) Today with Pat Kenny -  25^th January
http://www.rte.ie/radio1/todaywithpatkenny/2012-1-25.html
“The ECB is taking a position that there is an enormous market for this senior bank debt. It’s a vital part of the European banking system, the ECB felt that there has been no default anywhere on this type of debt in the Eurozone, it felt that you introduced this level of uncertainty then you deal a hammer blow to an already extremely weakened European banking system, and the extra costs across the entire banking system would far exceed gains to Ireland for not paying, so given its role to look at the European wide situation – Its view has been that it is better to do that and ensure that peoples are paid off rather than to introduce a hammer blow to the entire system.”  

"There has been a huge transformation... Yesterday a five year bond went below 6pc and that is back into the territory where governments can effectively borrow. For the first time since September 2010– it has tipped its toe into the bond market– it says that there is considerable interest.  

“...It is a positive signal that we are going in the right direction. There is a possibility we can exit the bailout on time.”

Richard Curran  (Deputy Editor Sunday Business Post) - Morning Ireland - 25th January
http://www.rte.ie/news/2012/0125/morningireland.html

"This is a judgement call rather than something that we are legally obliged to do… The clear signals from the EU central bank and international markets are what else would you not pay. There might be longer term consequences.  The ECB is saying we do not want a new front of uncertainty opening up that the Irish Government is not going to honour senior bankholders, even if it is a dead bank".
 
"We  could save billions if we get a restructuring of the promissory notes and a deal further down the road."

“Part of the reason we are having cuts is we that cannot pay our way anyway. Whether we pay back the Anglo bondholders or not, we are running up a deficit from the cost of running the country.”

Tony Foley (Economic Lecturer) - Morning Ireland-  20th January
 http://www.rte.ie/news/av/2012/0120/media-3173200.html
"Greece's debt is much larger than ours, its correction process is much weaker and less successful and its economic potential  is way below  our economic potential. We are not as badly off as Greece.... At the moment  I wouldn't see that there is any possibility that we would follow the Greek situation."