January 23, 2017
Listening to Ireland’s pitch for financial services located in London to locate in Dublin following Brexit must be like listening to the German government during World War 1 or WW11 pitching to non participants in the conflict to set up embassies located somewhere near the Maginot or Siegfried lines of national defence just as the shells begin to fall. (1)
Eoghan Murphy minister for state (for Brexit) asked on Morning Ireland 23.01.17 if he was asked during his pitches at various forums around the world trips at taxpayers expense if property prices in Ireland would pose a problem, stated that the subject was not raised once. I humbly suggest the reason for this was that no one in their right mind was contemplating relocating to Dublin.(1a)
Falling land prices make the price of an average dwelling in the Dublin suburb is similar to the price of a 50 acre farm outside Dublin.
This is before Brexit will wipe out 50% of exports to UK of agri-production with UK opportunities to outsource their requirements at lower prices perhaps in new trade deals with Brazil/New Zealand et al.
With English the universal language of commerce, science and financial services the value of Ireland being English-speaking is moot.
On mainland Europe, Germany’s financial district would be an obvious choice to replace London – and has the added global reach that Dublin lacks, UBS said.
Already home to the European Central Bank, the Bundesbank and several global financial services firms such as Deutsche Bank and Commerzbank, the EU’s biggest economy is well primed to pick up where London might leave off, despite having stricter labour laws than the UK.
The city is already preparing for an influx of 10,000 or so bankers over the next five years – and those from London can look forward to cheaper living costs and shorter commutes.
Frankfurt also boasts the third-largest airport in the EU, with excellent transport connections across the world, and has an office vacancy rate twice that of Dublin at around 12pc, with half a million square metres of work space available in the city centre. ”
Both Amsterdam and Paris are contenders having short hops to London and Frankfurt and good infrastructure.
Dublin in the austerity grip of disappearing public services, greater political upheaval potential as the divide between rich and poor increases, looming turmoil especially in the agriculture sector due to repossessions as yields fall because of Brexit, is not an attractive venue following the triggering of Brexit under article 50.
“Yet the taoiseach and his secretary general Martin Fraser have kept firm control of Brexit policy, and appointed John Callinan, another civil servant with Brussels experience, as second secretary in Government Buildings. They set up a Brexit cabinet subcommittee under the chairmanship of Kenny and including several senior ministers. A Brexit working group is chaired by Fraser and includes top officials from the departments of foreign affairs, finance and public expenditure, as well as the IDA, Enterprise Ireland, the attorney general’s office and other agencies” (Sunday Times, 22.01.17 P8)
In one way it makes sense to have the Taoiseach lead negotiations over Brexit as when the Irish economy begins to splutter and shut down and the smugglers’ Black economy between north and south grows, held together by the illicit sale of smuggled cigarettes and cheap agricultural produce defying new border controls, Kenny can be slipped into retirement.
But it looks like the above group is a waste of time, effort and money. Better use could be made of the group sourcing new markets for Irish exports, negotiating directly with a committee from the UK parliament on common needs.
In the wake of the financial collapse of the economic project of the EU that has led to Brexit, the collapse of peripheral economies across Europe, banking collapse dangers in Italy, a collapse that will be further consolidated by emigration policies and further austerity with imminent closure of Irish corporation tax loopholes, we should ignore An Taoiseach’s efforts over Brexit tilting at windmills as apparently he is also ignored across Europe.
If unfortunately we choose to stay as appears to be the case perhaps the above group can produce a report of the effects of Brexit for Ireland, how Europe will compensate Ireland for such losses. Such pertinent questions will not be mooted by Ireland’s swans as they swim in the vast and resplendent halls of Val Halla, in Brussels…at taxpayers expense.
If we had even the semblence of a true democracy in Ireland given the implications of Brexit for Ireland, results should be put before the people in a referendum for Irexit.
Europe has failed having fallen victim to the abuse of global financial services that may lead to global collapse of the financial services industry…but that is a topic for another day.
Visiting London not so long ago, I was surprised by the vast number of cranes across the centre of London, the vast numbers of tourists, the UK economy filled with positive energy was far from collapse.
December 15, 2016
“…These were the proposed 4% yearly cap yearly rental raises, more tax incentives to be introduced for landlords, and designating more areas as ’rent pressure zones’ where the caps will apply.”
I realise, dear reader, the above may seem absurd in the following context:
There has been a massive rise in rental costs of accommodation leading to the current housing crisis including homelessness. In addition to the massive costs of house prices, young people wishing to start a family in recent years have been burdened with excessive rental accommodation costs further eroding their ability to save for a mortgage.
Flying in the face of arguments from government favouring an approach to incentivising a massive nationwide building programme from the private sector led by developers and private investors the above measures appear feeble in the extreme. The only argument between FF and FG would appear to rest on the question of extending these feeble measure further across the country.
Few will be able to afford the absurd purchase costs of new builds without the cost of new builds dramatically coming down.
The above measures ironically amount to protecting the interests of landlords at the expense of tenants.
Measures such as passing legislation even interim 5yr emergency legislation requiring owners of all vacant houses to offer their properties for rent with government incentives to do this, NOT on the table.
Large scale emergency apartment builds on government land in urban areas, NOT on the table.
Scaled taxation weighted against area based rental cost calculating excessive loading by landlords exploiting tenants, NOT on the table.
A European system eg Germany with local property development committees determining and fixing the cost of building, the quality of building, the cost of leasing and renting, NOT on the table.
In the past few years since 2014 profits for the private rental sector have risen to between 2 and 3 billion euros per annum.
Profits have mostly been pocketed by the banks.
They propose the sector continue to eat cake albeit with a little less jam confined to 4% increases way in excess of rises in the cost of living index. The profits include profit after maintenance and capital appreciation costs are taken into account.
But is there any sense to the Coveney/Cowen Rental Strategy Circus?
Consider the following:
For a new investor who uses a mortgage to buy a rental property
the larger share of rental income will be absorbed by debt repayments.
An example is presented in Table 3 of an investor in North Dublin City using a 70 percent mortgage (the maximum permitted by the new Central Bank guidelines) to buy a two bed rental property; the mortgage term is 25 years. This yields a modest after tax profit before capital repayments. When capital repayments are included the annual cash flow is negative; i.e., the
initial rental income would not cover all of the mortgage repayments. This may still be a worthwhile long term investment since the investor is accumulating equity over time and rental income can be expected to increase. The larger part of the mortgage repayments is
covered by rental income while there is also the prospect of some capital appreciation. After 25 years, the mortgage would be repaid. If asset prices were to rise by an average of 3 per cent annually, at that stage the investor would have an asset with a nominal value of almost €450,000.
Interest rates have a significant influence on the returns achieved by an investor using a mortgage. The average interest rate for first time buyers in Ireland is higher than the average interest rate on new mortgages in the euro area. If BTL interest rates were two percentage points lower
, then the cash flow on new investments would be positive. On the other hand, lower interest rates would also increase house prices and thus reduce rental yields.”
The key point to grasp in the above, dear reader, is the cost of the mortgage and crucially the cost of property.
In a fragile recovery with our banks still teetering on the brink, many of its customers with huge loans invested in Buy To Let properties, getting return on those investments is critical for banks to expect to have their loans repaid.
A dysfunctional property market occurs in a situation where banks themselves depend on a property price bubble to give then a return on their investment into lending into the property sector. Allowing the banks and private sector to set the agenda in this scenario is akin to placing the fox in charge of the chickens.
Instead of bursting the housing bubble it is in the short term interest of the banking sector to create this bubble.
Not only is our property market broken but our economy itself is being sucked dry of economic activity that would otherwise inject volatility into local business interests.
Not only is our economy sucked dry of jobs in the construction sector but the distribution of wealth into the economy as a consequence is instead appropriated by landlords deep in debt to our banks.
Keeping that bubble going instead of taking some of the steps outlined earlier appears to be the business of Messers Coveney and Cowen representatives of a dysfunctional politics with no longer the public good at its heart.
Instead they blindly oblige their so-called independent advisors controlled by banks and the profiteering private sector who lead them by the nose into an absurd Circus dealing with rental strategy nothing less than an embarrassment.
Cowen and Coveney in the present politically dysfunctional environment of New Politics would not even qualify in the middle of Winter to be put in charge of a vegetable shop situated in a field of turnips charged with the management of a shortage of turnips.
Nothing short of a public housing programme led by local authorities and capitalised by government is required.
But that might lower house prices and lower rental income and the banks might not get their money back!
In the face of a list of such growing absurdities a 32 county Ireland IRExit in an economic union with Scotland, Wales, UK and possibly Norway does appear to be more attractive.
But Mr Noonan wont even enter into bilateral talks with the UK over Brexit. He leaves this to his puppet masters in Brussels who will dictate the terms of Brexit, end Ireland’s corporation tax independence, impose inter trade tariffs and conditions between Ireland and its largest trading partner, restrict movement on Irish people travelling to the UK!
While Enda Kenny and his compliant and obedient sailors navigate Ireland’s economy over the waterfall.
Legislation to provide for 4% rental increase so poorly drafted members of the opposition pointed out it provided for 8% increase. Its being redacted and redrafted today 16.11.16.
Would it be possible to have an audit of all Dail deputies with a role in the above legislation to assess how much they may be compromised by the fact that they are landlords many holding substantial holdings of property in Ireland? I don’t think so.
They’ve just given themselves their Xmas bonus and are ready to head home on holidays again after making sure their cake has cream on it and at least 4% of jam.
November 27, 2016
During the week we heard rejoicing on the airwaves http://www.thejournal.ie/central-bank-mortgage-rules-2-3095784-Nov2016/
“It was announced this afternoon that a first-time buyer will now only need a deposit worth 10% of a property, regardless of its price. However, the 20% deposit rule will continue to apply to second-time and subsequent buyers.
The 3.5 times ceiling on the loan to income (LTI) ratio remains. Requirements for buy to let borrowers and the exemptions for negative equity mortgage borrowers from the measures also remain unchanged.”
Rejoicing continued with claims that the above rule would stimulate the construction sector to build more new builds thus rapidly dealing with the homelessness crisis.
Nothing could be further from the truth. The truth is housing has become unaffordable for the average industrial wage and is quickly getting beyond the reach of young people in high paying jobs.
Provision for a large municipal building programme that will end the crisis has been avoided at all costs.
Instead media is filled with images of smiling Enda proclaiming a dynamic, progressive and wealthy economy with a solution to the housing crisis brought about by Simon Coveney. No solution and Kenny will disappear from the stage some say the sooner the better.
Teachers went on strike to protect young workers in their profession forced to take a large cut in their wages in spite of rising rents and property costs. Hospitals are at their wit’s end with numbers on hospital trolleys about to reach all time records if winter flu hits see statistics here http://health.gov.ie/statistics/ Our rivers are polluted with drinking water requiring massive investment http://www.epa.ie/water/wm/rivers/results/
There is massive propaganda in the media with attempts to manage public sector pay increases expected by the unions in the wake of Ireland seeing its return to prosperity. Most do not see this. Widespread efforts to smother increases in public sector pay follow along the lines of warnings that our continued prosperity is on a knife-edge and such demands could lead our economy to collapse again.
The implied accusation is that public sector pay increases led to our economic collapse in the first place not wanton speculation in the property market promoted by the 1% of speculators and banks abetted by government who stoked the property market to line their pockets at the expense of workers.
The ridiculous black is white mantra that increasing house prices would encourage builders to build more houses will soon be seen to be the deception it is. Developers and bankers will not build and lend into projects priced beyond what the market can afford to pay.
It’s possible our politicians are so deceived they themselves are the greatest victims of their own delusions. There is no fungible relationship between Simon Coveney’s basket of intents and policies to bring about the construction of the numbers of houses and the real world.
The real world is very simple though to have any insight into its true nature will bring a response that such views are facile, fatuous, facetious and fail to grasp the complexity and scale of the problems of the real world. Bernie Madoff used such arguments to scoff at his critics before he was sent to prison.
Construction of public housing needs to be done on a vast scale on a Municipal basis. The price of housing needs to be severely brought lower not higher vis-a-vis Simon Coveney’s policies.
This is not happening because a small dictatorial elite of FG/FF headed by the smiling wannabe dictator Enda Kenny continue to fan the flames of prosperity for the 1% against the 99%.
They do not want house prices to fall.
Present relaxation of rules will fan property crises in the attempt to continue the bubble they fear will pop because not enough young first time buyers can afford to raise the finance for Madoff property pyramid schemes.
They want rich investors in Irish property many of whom are TD’s with large rental property portfolio investments or vulture funds pricing out Irish buyers continue to make large profits from artificially induced shortages.
For them the agenda is to manipulate the media and public opinion to the view what is best for the banks and the 1% is best for all.
October 21, 2016
Notwithstanding supply shortages some developers are unable to sell properties at the current high unaffordable prices.
Coveney mistakenly confuses the inability to raise a deposit with inability to afford to pay back a mortgage.
Alarmed at the possibility of more people on foot of Coveney’s proposals taking on mortgages they simply cannot afford to pay back, the Central Bank has forced a government climb-down restricting the amount that can be borrowed to 70% instead of 80%.
(1)“The Central Bank has said that they think the threshold whereby the loan-to-value of the property should come down from 80 per cent to 70 per cent, which would ensure that nobody is overborrowing to try to avail of the grant and I think [Minister for Finance] Michael Noonan thinks that’s a sensible alteration.
“It essentially means that more people will be able to avail of it. It’s relatively minor change but it’s a change I think that’s worth doing and so he’s happy to accommodate that.”
Actually, Simon, this is not a relatively minor change, instead this makes your proposals ludicrous. It makes any savings possible under your scheme will be eaten up by the higher cost of raising the difference between what the bank will lend and what ever savings the borrower has to make up that difference.
If there is a strong uptake, house prices will rise absorbing even further any gains made to help the buyer. Ironically, the proposal has about as much value in increasing house supply and new house construction, as a ball of smoke.
It’s another case of Nero fiddling while Rome burns. Fiddle while Rome burns definition. “To do something trivial and irresponsible in the midst of an emergency; legend has it that while a fire destroyed the city of Rome, the emperor Nero played his violin, thus revealing his total lack of concern for his people and his empire.”
What Coveney should be doing is demanding from Europe a derogation from its fiscal space rules to raise capital on the open market or to invest from our pension fund in a large-scale construction project to build Olympic Village type apartment blocks in the larger cities to deal with this growing crisis. That and a whole range of building projects to build “affordable” housing for the whole generation of young Irish people shut out of the housing market.
Not to be outdone Richard Bruton is advertising for parents to be paid to undertake supervisory duties to help break the teacher’s strike. The irony is teachers were not being paid to do those duties since they were forced to do same under Croke Park hours. Inflammatory and incendiary as this move is pouring petrol on Rome burning, a greater irony is that teachers are striking not for better pay and conditions for themselves, but on behalf of the ruthless and unfair way new entrants to their profession have been penalised forced to accept rates of pay on a par way below that of their peers. Another example of how young people are being shafted by future leadership contenders within Fine Gael.
I’ve no doubt whatsoever targeting of teachers is a fallout from European austerity hawks from the troika down to impose gauging cuts on our public service bill to reduce the standards of health care and public education to that of public health and education expenditure in the US where it is lowest in the world.
This despite abundant riches being further amassed by the 1%.
(2) Meanwhile Europe is targeting Ireland’s corporate tax regime in its current proposals:
At present companies, or groups of companies, must deal with potentially 28 different corporate tax regimes across Europe.
The Commission will recommend that, instead, member states would sign up to a Common Corporate Tax Base (CCTB).
That would create a harmonised tax base so that a company which operates in several member states would know that in each member state its profits would be taxable the same way, and that exemptions, deductions and losses would be also be treated the same way for tax purposes.
Once a Common Corporate Tax Base was established, the next phase would be to create a system whereby tax liabilities would be “consolidated”.
That would effectively operate on a formula that would apportion how much tax is due to which member state.
Under the proposal, a group of companies would be allowed to add its profits and losses from all subsidiaries together to reach a net figure.
Tax would then be paid on the group’s net profit for the whole of the EU.
This will effectively bring to an end Ireland’s tax haven incentives such as Double Irish.
(3)…European heavy-hitters have been warned not to come after Ireland’s low corporation tax or we will leave the EU, too.
Our regime is expected to come under renewed scrutiny in the wake of Britain’s exit as they were our strongest ally in fending off demands for tax harmonisation.
…But Fine Gael MEP Brian Hayes told the Irish Independent: “That is the absolute red line issue. Any attempt made to cajole us [on corporation tax], as far as I’m concerned, we’re out the door.
Ireland’s tax haven status and leprechaun economics regime will soon end.
(4)Times they are a changing: It’s not only on this blog you will find growing support for Ireland exiting the growing shambles of the EU. Gay Byrne is now in favour of Ireland’s exit. Let’s ignore his implied call for a rerun of the Brexit vote.
To follow on from last blog, some links on the growing mess of Deutsche bank commentary by Bill Holter:
a) Deutsche Bank Walking Dead (under capitalised) https://goldsilver.com/blog/deutsche-bank-walking-dead-bill-holter/
According to Bill Holter Deutsche bank is the most systemically dangerous bank in the world, the biggest link in the derivative chain. It cannot return from the dead. 50-77$ trillion derivative exposure, walking dead institution, once you start talking about them being solvent, game is over. Zero volatility in credit and stock markets they are in lockdown.
Deutsche Bank stock market capitalisation something like 12-15bn dollars, they are under capitalised just to get to Basil 111 requirements, then there is a 14.4bn fine against them, they have no money to cover this.
Any type of margin call will take them down…if they break the whole market goes, Italian,Spanish, Austrian banks Irish banks Portuguese banks waiting in line, amount of capital they have against the amount of derivatives they carry and are counter party for….what took years and years to grow the derivative market they will destroy markets…
Deutsche Bank is a Black Swan being pumped with air from QE that cannot go on forever. There is a limit on what can be pumped from the 99% to further inflate the assets of the 1%.
Looking forward the EU brought about a lot of good to Europe. The challenge will be to retrieve in any future cross border free trade agreements. cultural, social and educational relationships, that the bonds that have proven of real value, be retained and nourished to grow and prosper.
An inner core that has fed on the periphery to the extent that Greece, Ireland, Portugal, Spain have been forced into economic collapse by a plan promising stability, security and prosperity for all, will not hold forever.
Meanwhile Europe needs to rid itself of the legacy of a poorly constructed plan built only to serve the needs of the 1%.
October 2, 2016
Last scene of Margin Call derivatives being sold. All these financial instruments that were dumped landed somewhere perhaps inflating the Deutsche Bank hot air balloon.
Meanwhile Deutsche Bank has vowed to challenge a $14bn claim by the US Department of Justice to settle an investigation into its selling of mortgage-backed securities.
“Germany’s second largest bank by assets, Commerzbank, announced an overhaul of its structure on Thursday following what it called “current market rumors.”
The trouble with Deutsche Bank is it sits on a financial portfolio upwards of $50trillion of financial instruments.
In a growth pyramid profits can be huge. Following 2008 there has been increasing effort to regulate derivatives and conduct business on public exchanges. Regulation has paved the way for more scrutiny of financial markets and loss of investor confidence. In turn this has led to market collapse of share price of Deutche Bank. Global recession and negative interest rates have put further pressure on this bank.
It may well be if the bank is considered too big to fail TBTF that it will be broken up into manageable parts. Its too bog to bail out. The danger is that a bank run and collapse will leave investors stranded. In Cyprus there has already been precedent of Bail In. Investors should be worried at they stare into the vista of upwards of 50% loss on their deposits and investments.
Ireland’s Property Market Scam
FG have released their action plan on housing and its derelict.
In spite of its unveiling one family with 6 children turfed out of their rental accommodation last week spent a week in inhuman conditions and they will not get a house or proper accommodation of a civilised kind. Homelessness is still on the rise.
Houses are not being built as too many would bring the price down and bring those already committed into negative equity. Its Catch 22, ending the housing crisis could bring down the banks!
Worse EU fiscal rules prevent us adequately borrowing and investing in housing. We no longer live in a market economy but in an inflated Bubble pumped full of hot air and QE and borrowings all of which appear at the moment to be in slow motion self destruct mode.
One way the government could have acted to cap the ballooning property market would be to impose a tax on foreign investor firms responsible for around a fifth of Dublin house purchases.
They did this recently in Vancouver to put a brake on Chinese money pouring into Vancouver inflating real estate and putting purchase beyond the reach of locals. A 10% tax saw property prices fall within the week.
Instead we have Rent and Housing Supplements and stories of tax relief for first time buyers all of which will be pocketed by landlords in payment for their increasing rents.
I like this piece of waffle:
“DHPCLG will work closely with the ESRI and the Housing Agency to improve understanding of conditions in housing markets around the country and thereby better inform the implementation and design of current and future policy measures.
This work will involve preparing national and sub-national geographic breakdowns of actual and anticipated supply and demand, across tenure types, based on demographic and macroeconomic developments. There will also be scope for research focusing on specific housing-related themes. ”
ERmmmm I thought the document would contain an Action Plan not an aspiration to pass the book to local authorities or some other institutional invisible with committees to come up with a specific plan.
I’m reading the document looking to see on an urban and regional basis the color coded map showing me where the residential house build will actually begin next week!
We’ve had an emergency in the HSE for the past 10 years and we now know we are short of approx 6 hospitals none of which will be built.
Now we embark on a similar journey towards homelessness. At least we could build homes when we were not a member of the EMU.
<Expect things to get worse>
Till next time…
September 1, 2016
Just listened to Tim Cook, Apple CEO, on Morning Ireland state: while he is in favour of changing and simplifying the tax laws, any retroactive finding against Apple’s tax affairs is politically motivated and unfair.
We’ll look at European Competition Rules shortly to agree or not both Ireland and Apple were in breach of the ruling to provide illegal state aid to Apple by way of a sweet tax deal.
Firstly, by way of an intro lets put away the frequent political canard that FDI investment in Ireland is volatile and at the first whiff of danger Apple and its fellow MNC’s will flee our shores.
We have a relatively stable political climate in Ireland. The island itself is easily defended and safer from foreign terrorists than other countries in Europe. Our climate is cool, conducive to the setup and maintenance of large data centres.
Most MNC’s have worldwide exports and we have airlines. Our population is relatively well-educated though on its present course it is falling behind. Relations between Ireland and parent MNC countries is good.
But Tim Cooke knows the cat is out of the bag. Ireland through its IFSC services has been operating as a tax haven for years offering off the shelf deals with a nod and wink to Enterprise Ireland and FDI has flooded to Ireland to avail of these tax breaks.
Such tax breaks are morally corrupt and illegal and represent unfair advantage given to companies operating in Ireland such as Apple.
I will not delve into but instead point out there is a need to examine the constitutionality of the tax laws that operate in this state Provisional Collection of Taxes Act 1927 (‘the 1927 Act’) and the Irish Constitution. For example. the following paper:
http://www.taxandlegal.ie/ITRSept2009.pdf examines the legality of retrospective collection of taxes eg property taxes.
Be that as it may the sweet deal provided to Apple and how it fundamentally assists in the avoidance of fair taxes locally and for example in MNC parent countries eg USA needs examination as to whether such practices a=) contravene the rights to fair collection of taxes of the Irish people as set out in the Irish Constitution b=) contravene the constitutional rights of other taxpayers in other jurisdictions.
This matter has wider implications than those raised by European Competition Authority rules. We are considering here no taxes for the 1% and taxes for the 99%.
The great edifice of international tax rules has been carefully scaffolded through armies of lobbyists and legal eagles to carefully construct non-payment of taxes by MNC’s.
This scaffolding has been built and funded mainly by those seeking unfair advantage and profitable benefit for the financial interests they represent. This does not include the interests of taxpayers.
Readers of this blog will know my position supporting IRexit in support of Brexit( see last blog ) and I fundamentally disagree with the Orwellian powers given to TFEU the Treaty on the Functioning of the Union eg:
“Article 3 1.The Union shall have exclusive competence in the following areas:
(a) customs union;
(b) the establishing of the competition rules necessary for the functioning of the internal market;
(c) monetary policy for the Member States whose currency is the euro;
(d) the conservation of marine biological resources under the common fisheries policy;
(e) common commercial policy”
Realising how little our politicians know about managing our finances under such rules perhaps aided by our so-called economic management committee excluding such matters from both political and public perusal it comes as no surprise politicians deliberating on our response to findings against Ireland and Apple should want to defer decision until this coming Friday to give themselves time to inform themselves.
It’s surprising Michael Noonan should wish to squander public money in appealing this long deferred ruling by the European Commission against Ireland. Its surprising compared to the paralysed silence of Irish politicians in objecting to the odious terms of our financial bailout. The IMF had more objection to the terms of our bailout than local politicians. Its surprising given the support of the Irish government for Europe.
But then considering the incompetence involved in such an ill judged decision its of no surprise. The decision will consolidate Ireland’s reputation an an international tax haven pariah.
So I could take the view this is just another example of Michael Noonan’s compliant and obedient servility to the rules of gross incompetent obedience to demands made by shadowy financial sector powers in handling our financial affairs.
On the other hand, I might take the view that the Irish government is slowly waking up to the fact that it is in the belly of a boa constrictor when it comes to Europe. Noonan’s ardour for Europe is dampening somewhat.
See article 3.1.
- Europe is flexing its muscle establishing it alone has the right to establish european wide competition rules.
- Europe can dictate Ireland’s monetary policy.
- Conservation of marine resources…we know what we’ve lost there
- Common commercial policy (do the bidding of the large group of financial lobbyists that control the EU)
Basically the sooner Minister Noonan goes the better. His bailout negotiations were a dismal failure culminating in usurious and uxorious repayment terms to Ireland. Only mitigated when it was noticed terms given to Ireland were a lot worse than those negotiated with Portugal and Greece.
Now with the latest Apple debacle he wants to challenge using taxpayers money the finding of approx €13bn underpayment in tax to Ireland in a sweetheart deal that fleeces taxpayers across the world.
Mr Noonan instead of bowing to the inevitable is bowing to the dictates of an international tax pariah system fleecing taxpayers across the world, of which he has made the Irish government a lynchpin and tax haven cog.
He has made this country look ridiculous and ludicrous in his efforts to return a potential windfall of €19bn to Apple.
Think of this. Given the level of control of our economy in 3.1 above do we need our large Dáil with all its deputies and the cost of their pensions and salaries with powers given to them that are but toothless window dressing?
We’ve had enough of fiscal rules eg extortionate bailout; Irish Water served up with homelessness; extortionate rent serfdom to our young people.
Now the new mission of safe return of €19bn of Irish tax payers money to Apple?
Please support IRexit.
The Dáil is due to debate the Commission ruling on Apple today 07.09.16. A defence bulwark in support of appealing the decision is the claim that the Revenue deal on Apple was not selective, other companies could avail of this.
Lets leave aside the investigation if this was/is true for other companies operating in Ireland, surely the whole point of the Commission ruling from a competition perspective is that inter alia Ireland being a member of the EU with EU law taking precedent over Ireland’s laws, we are in breach of European Competition rules that affect taxation policy.
It’s ludicrous to propose as a defence the right of Ireland as a sovereign nation to invite companies such as Apple into Ireland with sweetheart deals that put other European nations at a competitive disadvantage.
Over here, over here, don’t waste your tax dollars in other European countries we can recycle your profits so you pay no taxes due anywhere!! If the government doesn’t like these rules it needs to leave the EU and support IRexit as I do.
Otherwise, stop wasting Irish tax revenues on a Fool’s errand that will make us the laughing stock of the world, put us in direct conflict with a ruling supported by 28 EU commissioners and the EU itself. Its asking that we get rubber stamped as a tax haven, a Corporation Tax Global Recycling dump, to help MNC’s avoid fair taxes owed to the taxpayers of the world who need healthcare and education politicians are failing to provide.
August 7, 2016
Anybody watching the Olympics and admiring the wonderful apartment buildings built in a short number of years to house the athletes with state of the art accommodation? Wondering why we can’t build the same here to house the homeless, our student population, first time buyers requiring starter homes at a reasonable cost?
Fiscal rules imposed on us arising directly out of our membership of the EU prevent us developing this state in the way our people wish for and require.
Wondering why our Irish Water fiasco has continued to date with a committee deliberating on overturning the will of the Irish people against privatisation and off the balance sheet accounting? It’s the odious fiscal rules again.
We have the longest hospital waiting lists per capita in the EU, standards in our universities nose diving because of poor funding, rising teacher student ratios, natively educated doctors and nurses fleeing our health service and our banks coming out bottom of the pile in European stress tests.
But according to the CSO with growth rates of 28% of GDP we should be the fastest most prosperous economy in Europe. Hell no.
CSO is a state propaganda machine peddling unreliable statistics for years mostly based on sand. In this case jigging the figures from dollar based multinationals suddenly their income in euros goes up because of the falling value of the euro against the dollar; more companies from the US acquiring mailbox identities in the IFSC.
Before the practice is guillotined by incoming new presidential candidates whoever they may be.
Little tax is paid here by such companies. Hey presto we have a GDP of 28% sparking government panic wishing to predict growth forecasts of less than 1.5% to keep wage rises at those austerity levels while income rises of 10-15% are the norm for France and Germany!
You would think with rents rising to astronomical levels government would urgently address the problem as they have in Vancouver, Canada by imposing a tax of 15% on foreign property investment mostly effecting the vast amount of capital pouring into Vancouver from China.
That bubble has burst.
Nope, NAMA here in Ireland has a policy of selling off vast property portfolios tax free to vulture funds with eyes upon a quick buck in the Irish rental sector.
Irish companies and individuals pay tax on their earnings and profits; vulture funds through accountancy tricks can even set themselves up as having charity status meaning on earned profits of eg €25ml immediately exported to parent companies offshore with €250 tax paid, I kid you not.
Meanwhile we read propaganda that there is a huge rise in people from NI and UK wishing to take out Irish passports because of the UK’s wise Brexit.
They would prefer to remain in Europe!
Lets look at Europe’s economy and its banking sector for a moment.
Mario Draghi’s Negative Interest Rates and QE is quickly running out of steam.
“More specifically, 20% of the €10.4 billion ($11.7 billion) of corporate bonds the ECB bought between June 8 and July 15 had negative interest rates. Another €3 billion of company debt has been purchased since then, with plenty more negative-yielding bonds probably mixed in….
While negative interest rates are great for issuers—they are effectively being paid to borrow—this relatively new financial phenomenon has downsides, particularly for banks. European banks have announced relatively grim quarterly earnings over the past few weeks, with many bemoaning how hard it is to make money when interest rates are so low, compressing the “spread” between what they can charge for loans and what they must pay out to depositors.
ECB board member Benoît Cœuré warned in a speech last week that there comes a point when the detrimental effects of negative rates on banks outweigh the benefits of the institution’s bond-buying program. That point has not yet been reached, he says.”
In other words the EMU is running on nothing but hot air at the moment. QE is pumping billions into the banks that are being steadily suffocated by negative interest rates. Bond buying by Draghi is saving banks and corporations across the emu that without such QE stimulus would see them go under sparking the domino effect.
Loss making enterprises are being financed to make more losses while the euro itself is being pillaged and looted to have its purchasing power reduce and reduce. The savings and wealth of the 99% is being squandered away to pay for the ongoing losses of the 1%.
But global economic problems run even deeper than problems with the euro. Today across Venezuela and many countries in Latin America its currency in crisis food queues are the hallmark of an oil rich economy.
Likewise many countries in the third world have seen their GDP dropping in the face of falling mineral revenues due in part to falling commodity prices in a self reinforcing spiral of a slowing global economy and more and more fraudulent manipulation of currency movements and global financial markets serving the needs of the 1% at expense of the 99%.
The current world monetary system assigns no special role to gold; indeed, the Federal Reserve is not obliged to tie the dollar to anything. It can print as much or as little money as it deems appropriate. There are powerful advantages to such an unconstrained system. Above all, the Fed is free to respond to actual or threatened recessions by pumping in money. To take only one example, that flexibility is the reason the stock market crash of 1987—which started out every bit as frightening as that of 1929—did not cause a slump in the real economy.”
That was way back in 1996. At that time the benchmark of the gold/dollar peg was the value of gold expressed in terms of global economic activity based mostly on industrial output and industrial activity. Over the decades since 2010 financialisation has come to dominate:
“Financialization describes an economic system or process that attempts to reduce all value that is exchanged (whether tangible or intangible, future or present promises, etc.) into a financial instrument. The intent of financialization is to be able to reduce any work product or service to an exchangeable financial instrument, like currency, and thus make it easier for people to trade these financial instruments.”
The problem is financialization has long since lost its base in industrial output and agricultural activity. The means by which the financial world slices and dices financial instruments through hordes of people whose livelihoods depend on these activities has become a virtual pretend black is white falsehood world exploiting and fraudulently manipulating and corrosively damaging the global economy.
This is a world hoovering of resources by too big to fail banks upward to the 1% powerful enough to benefit from the vast manipulation of money and markets. Steadily resources have been stripped from the middle class, from democratically built institutions, from governments and now countries eg Venezuela and Greece are wantonly being consumed by such pillaging.
In the last scenes in the movie “Margin Call”, bond traders attempt to save the bank by selling what they know to be dodgy doomed to fail assets on their books to whoever will buy them.
I suspect on the other end of these lines were mostly traders from European banks. These dodgy assets are still on the books of eg Deutsche Bank.
Acknowledging the collapse of 2007/8. Aware that the policy of printing money QE is damaging the world economy and only postponing inevitable collapse, something must be done.
Bernie Sanders calls fr 21st century Glass Steagal Act https://berniesanders.com/yes-glass-steagall-matters-here-are-5-reasons-why/
“4. The repeal of Glass-Steagall is further corrupting the culture of banking – if such a thing is possible.
Sanders was right when he said on Saturday night that “the business model of Wall Street is fraud.” The traditional practice of what Sen. Elizabeth Warren calls “boring” banking – opening savings accounts, reviewing loans, and providing other customer services – has largely been supplanted by high-risk gambling and the aggressive hustling of dubious investments to unwary clients.
The level of fraud unearthed since the 2008 crisis is nothing short of breathtaking. (The fact that no senior banking executive has gone to prison for that fraud is, if anything, even more breathtaking.) How did that happen?
Citigroup’s Reed wrote that the repeal of Glass-Steagall led to the “very serious” problem of “mixing incompatible cultures” – which, he said, “makes the entire banking industry more fragile.” He discussed the relationship-based, sociable culture of traditional banking, emphasizing its incompatibility with the risk-seeking, “short termist” mentality of investment bankers who seek “immediate rewards.”
Something much more radical than Repeal of Glass Steagal must be done. Nothing more than the repeal of the decision to end the gold/dollar peg is an urgent necessity.
“On the afternoon of Friday, August 13, 1971, these officials along with twelve other high-ranking White House and Treasury advisors met secretly with Nixon at Camp David. There was great debate about what Nixon should do, but ultimately Nixon, relying heavily on the advice of the self-confident Connally, decided to break up Bretton Woods by suspending the convertibility of the dollar into gold; freezing wages and prices for 90 days to combat potential inflationary effects; and impose an import surcharge of 10 percent, to prevent a run on the dollar, stabilize the US economy, and decrease US unemployment and inflation rates, on August 15, 1971:
- Nixon directed Treasury Secretary Connally to suspend, with certain exceptions, the convertibility of the dollar into gold or other reserve assets, ordering the gold window to be closed such that foreign governments could no longer exchange their dollars for gold.
- Nixon issued Executive Order 11615 (pursuant to the Economic Stabilization Act of 1970), imposing a 90-day freeze on wages and prices in order to counter inflation. This was the first time the U.S. government enacted wage and price controls since World War II.
- An import surcharge of 10 percent was set to ensure that American products would not be at a disadvantage because of the expected fluctuation in exchange rates.
Speaking on television on August 15, the Sunday before the markets opened, Nixon said the following:
The third indispensable element in building the new prosperity is closely related to creating new jobs and halting inflation. We must protect the position of the American dollar as a pillar of monetary stability around the world.
In the past 7 years, there has been an average of one international monetary crisis every year…
I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets, except in amounts and conditions determined to be in the interest of monetary stability and in the best interests of the United States.
Now, what is this action — which is very technical — what does it mean for you?
Let me lay to rest the bugaboo of what is called devaluation.
If you want to buy a foreign car or take a trip abroad, market conditions may cause your dollar to buy slightly less. But if you are among the overwhelming majority of Americans who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today.
The effect of this action, in other words, will be to stabilize the dollar.“
The ending of the gold/dollar peg was meant to be temporary.
It is leading to ruination of the global economy, its growing instability, it threatens democracy itself, it’s an unfair burden on the 99%.
It is leading to hunger, homelessness and war even in countries once thought to be prosperous with a bright future.
Time to end a failed experiment doomed to fail more……
July 20, 2016
|The housing report finally came out. Its added to my disillusionment with politics in Ireland that appears to be in a state of paralysis in dealing with economic and social problems.|
There are 2 problems that more than any other describe the housing shortage supply in Ireland. One is lack of supply which feeds into the other problem: the other is the prohibitive cost of new homes that prevents young people having any hope of getting onto the housing ladder.
The report only refers to the vague suggestion of ‘speaking with agencies’ eg NTMA above. This means the report is holed below the water line. It does not provide a concrete solution to the prohibitive cost of housing for young people beginning families.
In a previous generation housing was affordable and a first house could be got with 1 and a half times the combined salaries of the couple asking for a mortgage. The cost of an average home far exceeds the abilities of the average industrial wage to get equity against it.
So the major part of any housing report should address this problem instead the report glosses over the problem. Furthermore we are told that the EU fiscal straight jacket imposed on Ireland means we cannot invest in housing on balance sheet and stay within EU imposed fiscal rules.
It gets worse. instead of embarking on a large-scale public housing programme procuring land, services and planning permission for large-scale development as we did in the past, the EU straight jacket requires Coveney to come up with inventive ways to bypass these rules.
So Coveney has come up with the idea that private sector development will be the way to go to reach his target numbers of new house builds. Now, wait, think of this for a moment.
Suppose you are a local builder with a plan to build a small estate of say 50 homes somewhere in one of Dublin’s suburbs.
You have the planning permission, services already in place, land purchased, ready to go, the only thing stopping you, according to Coveney, is finance; so perhaps Coveney from his €5bn will lend you the money as the banks won’t give it to you.
The Construction Federation of Ireland:
“Speaking at a CIF event in Dublin yesterday, Micheal Mahon of the Society of Chartered Surveyors said that his research showed a three-bedroom family home cost about €318,000 to build including a 15pc profit margin. That places those homes well above the estimated limit for most first-time buyers of €280,000 to €300,000.”
Amazingly there are no plans to reduce vat on new homes! Coveney will build these homes for €250,000 but cannot tell us how this will be done?
CIF director Hubert Fitzpatrick said the shortage of new homes had long passed crisis point.
“Due to the cost of construction, many Irish homebuilders are finding residential development unviable.
“In many parts of the country, the cost of construction is so high relative to asking prices of existing houses they would be building at a loss. As a result, housebuilding activity outside the greater Dublin Area is stalled,” he said.”
So back to our local builder. Unless he is a fool he will not be lured by Coveney’s cheap money to build homes that no one can afford due to their high cost.
Coveney’s report is silent on reducing the high cost of home building so let’s call his report a dud!
Its a DUD report! Nothing but a shambolic aspirational mess.
Lets add to our disillusionment!
CSO have just released a report stating that our GDP growth levels are at 26% incredible levels! On the face of it we should be sending in the gardai to investigate the Central Statistics Office as based on their statistics using formulae supplied to them by Eurostat it turns out because of the increase in GDP we have to contribute an extra €280,000,000 euro as contribution to EU funding.
I kid you not, beset with homelessness for up to 6000 of our citizens, hospitals bulging at the seams with trollies for A&E patients and waiting lists for years, the EU wants another €280ml from us.
If you are part of the group think “Think Tank” describing Ireland’s GDP growth levels as incredible 26% everything is hunky dory you should not be reading this as I’m one of that vast group that belong to those disillusioned with politics.
“So we seem to have had two big distortions in our GDP growth figures. The first was the deprecation of assets moved to Ireland. And the second was the jump in exports from contract manufacturing and tax inversions.”
There is a dearth of precise detail in the CSO figures but for sure they evidence scamming of tax payers across the world through smoke and mirrors accountancy tricks and tax avoidance loopholes that move massive corporate pockets through mail box companies set up in the IFSC for this purpose alone.
For example, through tax loopholes in the US profits can re relayed through an offshore mailbox company setup in Ireland by an American company and suddenly all its profits are tax free.
I would suggest the sudden rise in this activity is accelerated through the alarm caused by the declared intent of US politicians in congress and in the senate and including those going for election to stamp out these loopholes. These scams are being exploited before the guillotine falls and the US legislates against corporate inversions and similar scams.
Political Irony Inversions
The irony is the longer Taoiseach Enda Kenny stays the closer to the end he gets and the more unstable his government becomes. Inevitably the more damage Kenny does to Fine Gael’s credibility with the opposition and the public.
FF can sit back and enjoy the growing chaos. Meanwhile we can enjoy the spectacle of this charade as lame ducks fail to oust the chief lame duck.
But there appears to be method to the madness.
Frances Fitzgerald becoming de facto heiress apparent to the incumbent house of cards.
This seen in the appointment of James Reilly as deputy head of Fine Gael. He rides the crest of a wave losing his seat with Don Quixote like precision tilting at windmills winding us up with fantasies of universal health care.
At the same time hospital trollies answer hospital waiting lists as Irish doctors and nurses flee the HSE while many refuse to join the wasteful and absurd call to the under 6’s to clog up GP waiting rooms .
I guess O Reilly’s job will be to drum up some support for Fitzgerald.
Its a clear case of Kenny’s Shakespearean hubris manifested in a poor amateur drama parade of Bruton, Varadkar and O Reilly divertingly defending Kenny’s over reaching stay in office.
According to them the emperor is clothed in expertise, leadership qualities, the success of the Irish economy, lowering unemployment, white knight of Dublin’s north inner city: Not!
Those disillusioned with politics see beneath sham falsified unemployment figures based on zero hour part time contracts, growing taxes and charges driven by austerity with plans for more debt extraction to burden the young with the cost of so-called free education!
Europe is dragging this country down itself in severe decline with banks across the EU on the threshold of failure long term Japanese deflation best that can be hoped for.
Enda should go immediately. The longer he stays the more lasting damage he will do to Fine Gael. Some argue the longer he stays the better!
Curiously Kenny’s relationships with fellow European leaders built on accepting on Ireland’s shoulders 42% of what otherwise would be banking losses for French Santander and German Deutchbank and other European and US banks is touted as a plus.
Folks, he would have a bad relationship with them if he had succeeded in gaining anything but a refusal from even daring to ask for a burden sharing debt write down. But he’s loved for his obediently, jovial compliance and foolish smiles and incurious obedience.
That is what is being offered to us voters with Enda Kenny whose political demise appears to be as difficult to wrestle from his drowning grip as is democracy from Mugabi in Uganda.
Actually, you can plot it for a poor amateur drama production, its pretty simple to ‘make it up’.
Consider the following scenario with ‘lost his seat’ James Reilly, the party still reeling from election results no doubt due in part to his misjudged anachronistic and ironic call for universal health care for all with the irony of hospital waiting lists at an all time high.
Perhaps an audit of O Reilly’s property portfolio and that of all members of FG/LB in the last coalition may have thrown some light on the absence of regulation to prevent rents rising to an all time high, lets not digress.
Reappointment of Reilly to the role of Tanaiste with a role to talk to FG politicians around the country to reinvigorate the party is his mandate.
His close connection to Enda Kenny and his political proximity to Frances Fitzgerald would appear to make sense if he is meant by Enda Kenny to back Frances Fitzgerald as Enda’s heir apparent.
Frances Fitzgerald hasn’t been that highly visible in defense of Kenny, has she? So the plot thickens. The more time passes the more unstable Fine Gael becomes. This must be both tragic and comic.
This injects Bruton’s and Varadkar’s support for lame duck government by Enda Kenny with all the more ennui and mirth, but we’ll have to wait and see if such a plan pans out.
Just as we’ll have to wait and see if Simon Coveney rises to the task of reducing the cost of new house builds and actually builds a house that isn’t built on pyrite, mica and sand.
Meanwhile those disillusioned with such political manoeuverings look around at alternatives? Sinn Fein with its all Ireland machiavellian associations now wedded to remaining in Europe? What ludicrousness? Waffle Fianna Fail masters of the political uturn? No? Brechtian silence from Shane Ross bought off to unify and give stability to Fine Gael? What an unbroken horizon of despair?
Now supposedly independent but de facto state agencies like the Central Statistics Office in Orwellian Up is Down fashion cheer on government propaganda with leprechaun economics telling us:
““I’m not going to stand up and say the economy grew by 26 percent,” Power, an independent economist, said after the release. “It’s meaningless — we would be laughing” if these numbers came out of China, he said.”
But wait there is hope on the horizon:
There are those out there willing to say the emperor has no clothes on. So called recovery is a sham.
Homelessness, water charges, property charges, rent serfdom, calls to make students through loans pay for their education; young teachers and guards forced to take lower pay scales than their older colleagues, charity regulations in a mess, NAMA in an even bigger mess, our main trading partner rightly leaving the EU with enlightened Brexit, hospital waiting lists.
Yes there are those disillusioned with politics with their ears to the ground who don’t buy into the mantra pretence of success but who see through the shambolic and self serving politics of delusion led by those who would spread their delusions among us.
Brexit brings with it opportunity to join with those on these islands looking to bring reality back into politics, to discover a new and fairer world.
Irexit needs to be put before the Irish public as an option to escape the straight jacket of Europe and to reform relationships with NI and UK in new political and trade agreements.
A new alliance with greater independence for Scotland, an all Ireland 32 county political and trade based unified government, Wales and UK with greater ties than before and greater respect for independent voices could release these islands from the disaster that the EU has become.
The alternative is a glove puppet government wedded to its decline and the decline of Europe.
June 29, 2016
Ireland was the only member state to hold referendums on The Treaty eventually passed as Treaty of Lisbon in October 2009. Already post Brexit there are calls for greater political union in Europe I’m guessing aimed at removal of Article 50 removing the means for member states to withdraw:
Given the appalling way Ireland was saddled with no debt write down or debt sharing of Ireland’s bill for financial collapse carrying 42% of European financial losses that otherwise would have been carried by German and French banks the case for putting a referendum on membership of the EU has become compelling.
Added to the losses Ireland will incur through Brexit and added to the negative stance within Europe to Ireland’s corporation tax and arguments below, the Irish deserve a referendum to vote on their future within the future imposed on them by membership of the EU.
Ireland should also have a democratic say in any negotiations between the EU and the UK on Ireland’s future relationship re trade and borders. This is another compelling reason for providing a referendum on IREXIT.
Sinister intervention in Ireland by the European Commission on Water Charges forcing them upon the Irish electorate in spite of their declared wishes is an example of an erosion of democratic control of Irish affairs by unelected bureaucrats in the EU.
It’s not precisely the directive to have a certain water policy that galls but the audacious intervention in Irish sovereign taxation affairs that directs us to have separate water charges with a private, commercial monopoly running it.
How we raise the money through taxation should be a matter for Ireland alone. Water charges per se should not be part of the remit of the EU.
There is also the fear of undue influence by private commercial interests in the affairs of the EU wishing to dismantle public services to allow private commercial interests to loot public services for commercial gain.
This is not what membership of the EU was meant to be.
That the Irish derogation for water charges no longer applies is a result of Minister for the Environment Alan Kelly’s refusal to ask for a derogation:
“In accordance with Article 9.4 of the Water Framework Directive our exemption is embedded in the 2008 River Basin Management Plan. Any renewal or cancellation of the exemption is done in the next 7 year RBMP. And it is the Minister for the Environment who assembles and submits this plan.
This 2015 River Basin Management Plan is due on be handed into Brussels by New Years Day. Both the Irish government and the European Commission are expecting that Minister Kelly will not renew the exemption and will instead include domestic water charging as part of Ireland’s strategy.”
Kelly built no houses for the homeless and gave away our water to private, commercial interests. Enough said of compliance, obedience and incompetence as certain politicians hand over national assets without thought for our national interests or the good of the people.
Meanwhile Enda Kenny is back from his trip to the UK where he successfully alienated the full Brexit movement’s future government by his interference in UK sovereign affairs.
How come Kenny was not asked to walk the plank after his election results is another question. A weak, Irish zombie government of those rejected at the ballot box is not helping in these turbulent times.
He was quoted by one remain politician in the Johnathan Dimbleby “Great Debate” that Kenny said border controls would have to be introduced if Brexit won as if the Irish government would insist on them. Fearful images of Armageddon, barbed wire and Berlin Walls were part of his politics of fear.
Only the most limited if any border controls should be introduced.
Can you figure out how Scotland reconciles its wishes for independence with membership of the EU. They already have more independence and will have more independence in their relationship with the UK than they would ever get disappearing down the rabbit hole of the EU.
This blog celebrates the restoration of the democratic wishes of the British people that have arguably saved democracy itself from extinction. Congratulations to all Brexit campaigners who fought so well against so overwhelming odds.
Congrats to the UK on managing to drop the value of sterling. This will have a very positive effect on exports and reduce imports and should yield a healthy balance of payments result for the UK.
“The theory was developed by Nassim Nicholas Taleb to explain:
- The disproportionate role of high-profile, hard-to-predict, and rare events that are beyond the realm of normal expectations in history, science, finance, and technology.
- The non-computability of the probability of the consequential rare events using scientific methods (owing to the very nature of small probabilities).
- The psychological biases that blind people, both individually and collectively, to uncertainty and to a rare event’s massive role in historical affairs.”
While this blog campaigned virtually alone in Ireland for Brexit, pollsters and pundits and politicians got it wrong.
Not foreseeing the consequence of Brexit many in the Brexit camp have experienced a state of Black Swan paralysis and currently flounder in limbo unable to navigate a future path to address the issues Brexit has posed. At least that’s what Minister Noonan would have you believe disdainfully scorning Brexit campaigners for lack of future planning.
Not so. The description however does appear to describe well the remains of Noonan’s position on these matters.
Welcoming the positive affirmation of democracy that is in Brexit this blog will address these issues and point a way forward at least on 2 fronts.
Firstly, the UK will go through a process of disengagement with the EU while at the same time arrogating to itself responsibilities in areas previously controlled by the EU. This will require institutional changes and the inception and setting up within UK of parallel lines of responsibility within its own institutions of government and this may take some time to set in place.
It will have to renegotiate its fishery policy with the EU insisting that its borders be respected.
Independent self-government managing its own affairs responding to its own needs and mindful of the needs of the world at large is well within the remit and capabilities of the British people and its representative parliamentary democracy.
The UK needs time to apply its creative energies to this task.
Secondly, given the sad outcome of 2 great performances by both the northern and southern Irish soccer teams at European level our thoughts should wonder at what could be achieved by one single Irish team.
With Brexit our thoughts should be with joining northern Ireland as a single commonwealth entity with equal if not more independent stance than currently enjoyed by both Wales and Scotland. For this we need IRexit.
The sad state of political leadership in southern Ireland is missing the brilliant contribution that could be made by outstanding politicians such as Sammy Wilson or Teresa Villiers in the north.
Southern Ireland cannot afford to be a member of a failing EU with its largest trading partner and neighbour outside the EU; this combined with the fact our island of common interest is split in two. This could be an opportunity of ending “never the twain can meet”.
The second front upon which changes need to be made should be focused on the EU rather than the UK or Ireland.
Consider the following on the EU commission:
“The Commission remains politically answerable to Parliament, which has the power to dismiss it by adopting a motion of censure. The Commission attends all the sessions of Parliament, where it must clarify and justify its policies. It also replies regularly to written and oral questions posed by Members of Parliament.”(1)
It is noted here that a session of the European parliament is due to be convened to discuss all issues relating to Brexit.
This is much overdue following the emergence from the shadows of Angela Merkel announcing a summit of leaders including only France and Italy following Brexit. Leadership by proxy of Europe by Angela Merkel has emerged more and more into visible light since the financial collapse of southern, peripheral European states such as Greece, Portugal and also Ireland.
To observers such as yours truly this only adds to the belief that the EU is government by proxy of Europe by Germany. The implication for dodgy banks in Germany, France and especially Italy with debt to GDP hovering at 120% must have been high on the list of concerns.
Members of the European parliament apart from ex member Nigel Farage are generally a disenfrancised lot with no powers other than to rubber stamp what unelected and mysteriously lobbied and influenced members of the EU Commission allow them to rubber stamp.
But here is an opportunity for the members of the European parliament to censure the mishandling of Brexit by the commission and dismiss the EU commission.
Not a likely scenario but one I advocate. A more likely scenario is the highly paid MEP’s will churlishly say little if nothing and do less.
The European Commission has been woefully remiss in its treatment of David Cameron in its refusal to allow independent derogation for UK comply with massively deficient policies on emigration.
The EU commission has woefully mishandled the refugee crisis. It has been compromised by Germany’s go-it-alone policy.
It has allowed geopolitical concerns particularly in the alliance of inner core members such as Germany, France and Italy to exert undemocratic control over the now compromised independence of the European parliament.
It has sat by and allowed the banks of Germany and France to dictate undemocratic terms to the people of Greece.
It has allowed itself to be the pawn of external forces that have lobbied and compromised its independence challenging its role as a policy maker in Europe.
It has failed to shape policies to rebalance Europe and instead has sharpened the divide between northern and southern Europe.
It has had no effect on independent European monetary policy that instead through the European Central Bank followed a go-it-alone policy arguably in favour of monetary policies promoted by Germany looting peripheral members of the EMU.
“New EU rules on economic and financial governance help to Union resources clean up and strengthen the banking sector.”(1)
These rules show how compromised the European Commission is with lobby groups and so-called experts from the banking sector, Goldman Sach’s, Morgan Stanley, influencing and setting policy: those meant to be the subject of regulation choosing their own regulations.
The EU commission has become a toxic brake on European progress and become the pawn of shadowy lobby groups.
The EU commission is not an elected and democratic body but is instead leading member states along the path of totalitarian policies reminiscent of the previous USSR.
Dismissal of the EU commission pending its reform should be high on the agenda of next meeting of the European parliament. This is not likely to happen with even less likelihood of reform that will challenge special interest groups.
A little word on how the European Commission and the ECB have failed to help us in solving our housing crisis. Instead the following scenario is being played out across Europe in countries such as Ireland.
“The financial raiding of the American middle class is moving full steam ahead. The ridiculous structure of the banking bailouts and artificially low-interest rates caused hot money from banks and big investors to crowd out regular families in the housing market. Now here we are 7 years after the official conclusion of the Great Recession and regular American families are financially struggling while banks and big investors thrive. Today 11 million Americans spend half of their income on rent. Another 21.3 million spent over 30 percent of their income on rent. With millions of properties being bought by investors since the Great Recession hit, all that has happened is a mega transfer of wealth. You don’t build equity by renting but many people are simply priced out from buying a home.”(3)
In Ireland the European Commission has done nothing to support Ireland’s growing housing crisis.
It silently supports massive Quantitative Easing QE by the European Central Bank which has led to depreciation of the euro against other currencies.
With negative interest rates this has contributed to a global currency crisis increasingly pillaging the assets of savers and public services though austerity.
It has turned a blind eye to the odious terms imposed on Greece for its bailout while silently supporting the Highest EU debts as a proportion of GDP (2014 Q4)(4) debt levels of Greece, Italy, Portugal, Ireland, Cyprus and Belgium. Italy at 120% debt to GDP of particular interest.
EU commission needs to be dismissed.
Its management of monetary matters left to the ECB is a failure and its consequences grow more toxic by the day.
A monetary backdrop to the work of the EU commission is a global fiat currency inflated to kingdom come by the Central Banks through Quantitative Easing.
A return to a gold standard or a similar bitcoin related inter currency standard to stabilise markets and give rise to fair savings and investment in R&D is required.
This is outside the remit of the European Commission and beyond the means of the ECB but its policies favour the maintenance and continuance of this failing currency system.
In a casino driven financial economy that is a bar to further human progress with the European Commission fronting a European banking system that has become the bad bank of Wall Street and the Federal Reserve; austerity imposed on the people of Europe ; funding the rich 1% with further giveaways through Draghi’s Quantitative Easing, its time the EU itself considered its future with debt levels described by above graph.
But it would appear through lobby groups and shadowy interests pulling the strings of the EU commission both in the case of banking regulations and the above Irish Water debacle, that the EU itself is fixed upon the path of maintaining the current system of looting and pillaging the middle classes.
The concept of private ownership ownership itself as it was in the USSR may become a distant memory for those who remain in the EU…
Congrats to Brexit saving democracy itself from extinction under the above.
- How EU Works: https://eeas.europa.eu/delegations/singapore/documents/more_info/eu_publications/how_the_european_union_works_en.pdf
- Japan’s Prime Minister Abe warns of global recession: http://www.reuters.com/article/us-g7-summit-idUSKCN0YI03R
- Currency Wars: https://en.wikipedia.org/wiki/Currency_war
June 5, 2016
“Ms Coppinger referred to Mr Noonan’s previous comments to the committee where he said that “vultures provide a very good service in the ecology through cleaning up dead animals that are littered across the landscape”.
Enda Kenny meanwhile has refused to carry out an inquiry into the smoking gun of Nama’s involvement in sale of NI portfolio to the Cerberus vulture fund. Hard to believe the interests of Irish taxpayers appear to be served more in NI and the UK in these investigations than shady coverups on the home turf led by Kenny and Noonan.
Cerberus won the auction by offering Stg£1.241bn for loans linked to the Northern Ireland properties. The reserve price was Stg£1.24bn. The issue has also raised troubling questions for RTE’s Primetime.
The markdown could have been as high as $5bn.
“Another Stormont committee is carrying out a separate investigation into a controversy surrounding Cerberus’s purchase of Nama’s loan portfolio in Northern Ireland.”
The sale is also being investigated by the UK’s National Crime Agency (NCA).
This sale is also subject of investigation in the US.
While a red carpet is rolled out for vulture funds and shady dealings in NAMA we turn a blind eye to, taxpayers are being hosed with a media onslaught from another quarter:
The trickle of propaganda from the Irish media led by RTE is turning into a daily flood of stories campaigning against Brexit with cataclysmic claims this will lead to the collapse of the global economy, collapse of the EU.
If such a litmus test of the global economy and the EU leads anywhere near such fearful outcomes, then there already is something rotten in the global economy and EU institutions that requires lancing. Voting for UK to stay in the EU will not avoid such outcomes.
Currently the global economy and the EMU are on the brink of failure. Japan, Russia, South America and the EMU(European Monetary Union) even the USA all belong to the list of ever increasing debtor economies that drift towards economic collapse as debt levels ceaselessly rise and choke the remainder of the living economy.
The rise of shadow banking since 1970, deregulation and a mushrooming global financial sector that grows bureaucracies and casino usury economics is a now an ever present danger to world growth and development. Derivatives, stocks and bonds the chips of modern finance have overinflated values by 50%, commodity prices due to manipulation by TBTF (Too Big To Fail) banks have fallen to values as low as those that triggered the collapse of Lehman’s that began the financial collapse of Wall Street in 2008.
In Europe, peripheral nations are hoovered of public taxes to service the lender bailout banks of Germany and France. Insider nations such as Italy, Spain and France are also in decline and at risk of submerging due to lack of economic growth.
Democracy itself struggling under the snake eyes of economic collapse in Greece and elsewhere across Europe has seen a rise of militant right wing opposition movements from Austria to France to Germany itself toi name a few.
Should Britain vote to join the totalitarian and anti democratic movement that grows within the EMU that bank rolls the rich with QE(Quantitative Easing) and imposes austerity on the poor, the middle class a disappearing species?
Increasing taxation and disappearing public services in health and education are the hallmark of a growing totalitarianism as evidenced in Ireland’s recent water controversy debacle.
Bureaucracy, unfair process, futility of dissent, absurd undermining of common sense and democratic will of the people lead inevitably to a failed totalitarian experiment we’ve already experienced with a failed USSR now failing within its newer incarnation, the EU.
Ireland was led by the ECB into financial collapse then we were stuck for the bill for this. Our politicians cosseted and enticed by Brussels with low tax, political appointments to the European parliament and its various commissions with extraordinary salaries seize the opportunity for unelected office.
Yet these politicians in the European parliament have no power to propose or pass laws as the European parliament itself is controlled by mysteriously unelected bureaucrats.
Thousands and thousands of bureaucrats and administrators in the European Commission and yet we’ve had financial collapse, deregulation of our construction industry, pyrite and mica collapsing residential property across the country.
We have ghost estates and a useless government enthralled with their subsidised salaries from Europe unable to get a write down on unfair and odious debt levels heaped upon us from Europe.
Croneyism, protectionism and the barriers they create are costing European consumers higher prices for foods and goods protecting uncompetitive industries and preventing competition.
Every continent is outgrowing Europe with its protectionism, over regulation, tariffs and trade barriers the World Trade Organisation tries to tackle.
Switzerland did not join the EU and is wealthy and successful on the free trade agreements it has negotiated with Latin America, China and America. Europe’s biggest companies are in Switzerland and it has a very successful financial sector.
This must trouble the scaremongers faced with accounting for Switzerland’s success.
No doubt there is an elite of politicians and members of Ireland’s financial sector profiting immensely from European from membership of the EU. Given the losses already incurred and that lie ahead for Ireland’s 99% arguments that point towards returning prosperity should be treated with caution if not disdain.
In the EU decisions are taken from the top and imposed on the bottom. At the top an elite cadre of politicians aided by an even vaster cadre in their thousands of unelected bureaucrats regulate the agenda from the top and impose their will on the bottom 99%.
A perfect example of this democratic faultline is Irish Water the Irish people voted against in the last election. Its now been revealed to us that the European commission require water charges to be imposed on the Irish people in spite of the democratic will of the people.
Expect this unhappy circumstance to be but the tip of the iceberg. So much so the need for an Irish parliamentary democracy in such a system now has to be questioned if it has been so sterilised that it has no democratic usefulness in a european context.
Consider the success of Switzerland the polar opposite of the EMU. Multinationals proliferate successfully there. Incomes are more transparently equitable, low taxes and its a super democracy. The prime minister does not decide if a referendum is to be held. 50,000 signatures mean a referendum must be held.
None of this Irish Water nonsense. Politicians are forced to fulfill the will of the people not the will of a financial elite or the will of so-called enlightened bureaucrats unelected and based in Brussels.
UK’s referendum on 23 June many people voting will have felt the frustration of Kafka’s K, with some unknown purpose defined by the unknown asked to vote for some unknown quantity defined by an unknown and distant European bureaucracy sent to them by the unknown sending them into the unknown.
Hopefully they will vote against caving in to remaining in the EU and emerge from its growing shadow to work towards a renaissance and development of a new democracy bringing prosperity to the people of the UK.
But see how big business including banks and the multinationals and those from the services industry have infiltrated the EU to demand through lobbying their special interests including successful ratification through the EU and the World Trade Organisation in The Brussels Business link below.
Their special interest represent an attack on the very fabric of democracy and national governments ensuring that absurdly any investments be protected from national laws. National laws including setting taxation nets to protect the public are now subsidiary to WTO and EU commission laws that require compensation to large corporations should national parliaments pass laws requiring fair taxes.
Secrecy and lack of transparency is the hallmark of this new Orwellian EU dominated by the interests of multinationals seeking to topple the influence of democracy itself.
As stated in one of the links below, “in democracy, it is one man, one vote; in Brussels, it is 1 euro, one vote. The ‘think tanks’, friends of Europe, research labs, lobbying groups are filled with representatives of companies lobbying their own special interest. These are the unelected unknowns creating this new Orwellian world pillaging and looting the remains of democracy with democratically elected powers that be already bought by financial interest groups.
The irony is the very success of these interest groups is self defeating as evidenced in the decline of Europe in recent years with the vast problems it faces ensuring a high probability of its own self destruction.
In recent years efforts have been made to reform the EU. In particular trojan efforts were made by Commissioner Kallas https://en.wikipedia.org/wiki/Siim_Kallas
He tried for a number of years to bring legislation forward for a Register of lobbyists to enhance transparency and legitimacy in decision making. In the end such efforts were watered down and the European Transparency Commission introduced a voluntary code. Who blocked it, no one knows.
Similar efforts at reform were made following the financial crash of 2008 and a think tank to consider regulation was set up of members ‘wise men’. It transpired all members of the think tank were connected to all of the leading financial and banking institutions including Lehman’s and Goldman Sach’s financial institutions that had most to lose through regulation. Regulations proposed amounted to zero. Not a single member of the think tank was in favour of regulation.
Europe has become a tool of the 1% to exercise their control over the 99%. Democratic control of Europe is slipping away fast. Perhaps the UK referendum is Europe’s last chance to not only save the UK but also Europe itself from the Orwellian unknown unknowns that lie ahead.
European slow metamorphosis into an entity not imagined in its creation is one that needs to be brought under democratic control before freedom and democracy are lost and Europe’s dream becomes a nightmare. Europe has already had its share of such nightmares.
Martin Durkin’s documentary on Brexit contains many of the above arguments in favour of leaving the EU. See link below.
Draghi’s Keynesian Monetary policy stealing the public’s money through printing fake counterfeit QE
(3) Finian Cunningham