February 5, 2016
Austerity wolves want your vote!
The plan is to cut public services to the bone, lower taxes for the rich, implement further austerity cuts masked under the cover of making services more efficient and stream lined.
Lets look at the plan?
(1)”Mr Noonan says there is up to €10bn available for extra spending in the next five years, including abolishing the USC and 10,000 extra public sector workers.
But Prof McHale warned that the resources available between 2017 and 2021 may be less than previously estimated. Due to demographic pressure and existing benefits commitments, it could be as low as €3.2bn, he said.”
Fine Gael are also going to set aside a ‘rainy day fund’ of €2.5bn.
Wow, can we rely on the Fine Gael Department of Finance figures that differ by €7bn with the Fiscal Advisory Council. FAC at least employ some economists who will stand over those figures.
The same Department of Finance who walked us into the financial meltdown?
The Fine Gael/Labour so-called recovery and stabilisation of the Irish economy has come in spite of their best efforts to thwart it. But most people attest to not experiencing this paper based recovery seeing no difference in their pay packets other than the experience of further cuts. Falling value of the euro, increased profits for multinationals and exporters, euro’s collapse has been Ireland’s gain.
Lets map some of the road of austerity and while doing so examine the record of this outgoing government.
There has been a deep erosion of standards in education during the course of this government. PhD’s, Lectures and professors have been on strike this week drawing attention to the casualisation of Labour in Regional Colleges of education, falling standards due to excessive workloads, increasing numbers of students, temporary employment with lack of full-time work, lack or no investment in R&D.
At 2nd level, this government tried to abolish the Junior Cert and reduce the role of the National Council for Curriculum Assessment by having teachers assess their students, by designing and setting their exams and correcting the exams.
New courses dismantling the classical and traditional approaches reliant on proven methods of rote learning and deep understanding of science subjects, are replaced by teacher assessment and dumbing down so-called ‘practical investigations’ in science subjects.
Get teachers to design the course and set the exams is the new mantra of this austerity driven money-saving device. Increasing workloads for staff in education and health is the new norm.
(2) With the roll out of a new project maths course failure rate in higher maths continues to decline. “Latest figures show there are only 5,443 qualified maths teachers on the Teaching Council register, compared with 8,015 qualified English teachers and 6,628 qualified History teachers.” Having Maths in your degree is no guarantee of a job teaching maths with schools appointing who they wish to this subject qualified or not. Some like yours truly learned this the hard way having spent years adding Maths to their degree only to find on qualification no jobs advertised in maths.
Casualisation and temporary employment at 2nd and 3rd level has become the norm. There is reduction in salary levels forced on new teachers who may have luckily landed a full-time job.
To many at both 2nd and third level our educational system is crumbling at the seams.
Need I mention the Irish Water travesty of waste supported by both Fine Gael and Labour countless millions poured into a quango that grows day by day into a bigger mess with little prospect of improving our water resources.
The Fine Gael/Labour coalition have nothing to sing about.
Homelessness is growing with extortionate rent increases a severe imposition on property-owning prospects for the young hoping to start families or enter the property ladder.
Recent inquiry into the banks went ahead though the people voted against giving politicians the powers they requested believing the inquiry should be legally mandated with legally binding powers of inquiry compelling witnesses and led by a judge. They never even looked at who got the massive bonuses on a bank by bank basis in that feeding frenzy.
They quickly broke the promise of universal healthcare rowing back to limit this to free medical care for the under sixes putting further strains on the health care system stressed through too many demands.
The crisis in the A&E’s is one of horrific proportions the only concerted and failed effort of Fine Gael/Labour being to try to force doctors and nurses to move trolleys into the wards.
Stories of elderly people left for days on trolleys in any A&E should seal the fate of any government however dictatorial it has become.
No progress on the reduction of Ireland’s level of banking debt have been achieved other than the normalizing of interest coupons down to those already achieved by Portugal and Greece embarrassingly granted to us as well.
Minister Noonan refused to burn bondholders to the tune of alleged €9bn under threat from Trichet. Compliance, subservience and obedience can often mask incompetence and the evidence for incompetence is compelling. Anglo €30bn + was rolled into long-term external debt obligations legally binding that the Fine Gael/Labour coalition could have refused to pay.
But you are likely to hear the economically illiterate preach Fine Gael and Labour have had great success in managing our debt. No doubt everyday Jean-Claude Trichet and currently Mario Draghi ring Enda and Joan telling them what a wonderful example they are to the rest of Europe.
Minister Noonan’s record as minister for Finance has been one of singular obedience and compliance to the dictats of the ECB that shafted Irish people with the debt of German banks and bondholders.
Instead an Economic Management committee was established to ensure Ireland’s bailout of €67bn would be paid in full costing the toll of massive education emigration for the young, a broken property market, dodgy banks, suffocation of education, health care, austerity for the poor with the rich protected from its ill effects.
Irish society has widened the gap between rich and poor and is already on the road to Latin American style banana republic.
Stealth taxes such as USC/property charges and the much loathed Irish Water fiasco have further eroded their credibility.
FG/Labour have benefitted through the falling euro dollar ratio leading to profit for exporters and multinationals but this cannot last forever.
Evidence for a perfect storm masked by false projections on the available fiscal space show clouds gathering in the global economy.
It’s hard to know who to vote for.
Many politicians seem to be economically illiterate. Sinn Fein’s economic policy including the promise of universal health care seems shambolic, unrealistic and unachievable. A better economic policy and they would get my vote.
I’m verging towards Fianna Fail and the independents at the moment hoping FF have learned lessons from the past and that independents will hold them to account.
I’ll vote for Anti Austerity Alliance and Independents first with maybe a vote for FF hoping they’ve learned the lesson on how to stand up to the banks and financial sector and represent the people democracy has put them there to vindicate the rights of.
But I’m not hopeful that the future has anything but gradual decline for the Irish economy until wider, global economic ramifications and problems above get addressed (see last blog)
“Gresham’s law is an economic principle that states: “When a government overvalues one type of money and undervalues another, the undervalued money will leave the country or disappear from circulation into hoards, while the overvalued money will flood into circulation.”
So trillions have been magically created out of nothing and dropped as QE onto the banks. The banks looked at investing that money in manufacturing/engineering local business figured out immediately that a better return could be had by investing in the stock market pyramid.
The paper money required to develop local economies around the world instead is siphoned away onto the casino of stocks, shares and paper derivatives.
The more QE money poured in, the higher the share values went. With early investors paid off now returns are dropping off. Share values have reached a pinnacle and it will take little to collapse them. Bad news on the Chinese or American economy, threatened raising of interest rates, geopolitical conflict levels rising in the middle east.
Now the world economy is global we could be in store for an earthquake driven tsunami at any time. Meanwhile Ireland is facing an election and those incumbents for the past 5 years fill the air with populist growth forecasts for the economy with tax reductions for everyone.
Brexit referendum should focus the minds of the incoming government on economic and trade alternatives to the dissolving european monetary union which ahead seems only to promise further decline, deflation if not economic collapse riven apart by the refugee crisis or other monetary forces in the global economy.
Noonan is on News at One talking about fiscal space Department of Finance figures based on projections of inflation and growth over the next 5 years.
John McHale of the Fiscal Advisory Council says Dept of Finance is under estimating increases in social welfare payments and the cost of public health services. According to Noonan, he’s not saying fiscal advisory council are wrong only that they have a different set of assumptions.
So figures out by €7bn are not wrong is the new MATH!
I will not be buying a used car from Enda Kenny if he goes into that business when at last he gives up politics.
I won’t have to as they may offer him chair of Irish Water in the unlikely event it will still exist at that point.
Goodbye and good riddance Labour and Fine Gael.
January 21, 2016
Dear Reader, it may be worth your while to dwell for a moment on the following quotation perhaps rereading:
” However, if the credit expansion is continued and, particularly, continued at an increasing rate, an upward price-spiraling competitive race is set in motion between those who period after period receive the additional sums initially and attempt to maintain or draw additional factors of production into the more roundabout processes and those who later in the repeated sequential process experience increases in the
demand for prices of their products and attempt to retain or redirect resources
back to less roundabout production activities. The process could only
come to an end in one of two ways, Mises argued, either through a
conscious decision on the part of the monetary authorities to halt the
credit expansion or through a complete collapse of the monetary unit in a
hyperinflation. But once the monetary expansion came to an end, an
economic downturn was inevitable. The distortions in the structure of
relative prices, the misdirections of resources among the higher orders of
production and the relative income shares created by “forced savings”
would all be found to be unsustainable with the removal of the monetary
prop that had established and maintained them during the upturn. An
adjustment of relative prices, a reallocation of the factors of production
among alternative uses and a shift in relative income shares would all be
part of the prerequisites for a return to an economic situation consistent
with the underlying pattern of consumer demands and time preference
for present and future goods as they would now show themselves in an
environment free from monetary influences.“
Today we live in an era of upward spiralling credit expansion addicted with ever-increasing injections of QE as the rest of the world tries to emulate Japan in its efforts to stave off deflation.
Arguments in favour of QE that it will benefit trickle down stimulus of economic activity have proved to be spurious.
As world leaders meet in Davos global economic activity is at a standstill with predictions for a steep fall from China, eurozone, Bric countries. World commodity prices are facing collapse hitting poorer countries hardest with many of their dollar denominated bonds rising in cost as their local currencies threaten collapse.
Worse, stock markets addicted to QE have inflated prices, under threat of only rising with the promise of further QE.
Least whiff of removal of QE and return to non negative interest rates and the stock market robots threaten an avalanche of selling leading potentially to global collapse of stock markets.
“The Biggest Bubble in History Just Began to Burst
The decision by Central Banks to “inflate” the system’s debts away post-2008 has resulted in the misallocation of trillions of Dollars of capital.
The worst offenders were Chinese corporates. China has created the single largest mountain of bad debt in the world. Indeed, things are so out of control in China that 45% of all proceeds from new bond issuance are being used just to pay off interest on old loans.”
Markets are now addicted to QE. Whiff of an interest rate and they collapse. Promise of more printing of money and markets rise.
It’s a Catch 22 and can’t last forever. The present deregulated monetary system has split the global economy right down the middle.
On the one hand we have a refugee crisis, homelessness, deflation, poverty, contracting markets driven by austerity fuelled by falls in commodity prices and the growing burden of financing bailouts.
On the other hand, for the rich, we have booming share values that bear no correspondence anymore to the real world; we have junk bonds fed by junk bond markets fed by Central bankers fuelling this with more and more QE.
QE and the disappearance of private property ownership for the middle class and the poor
“In what would normally be his leisure time, for example, he wrote first his world historic article and then his book on Socialism. Just after the establishment of Bolshevism in Russia, he proved that with no private property in the means of production, socialism would be a chaotic and poverty-producing disaster. No planning board could substitute for property and market. Tragically for the world, it took decades before socialists would admit, after his death, “Mises was right.”
With property turned into casino chips fed by vulture investment funds and fanned by mad max Central Bank policy and government socialism for the banks, people are suffering, social services suffering, fewer and fewer ordinary folk can purchase property instead forced to struggle to rent it.
Democracy is suffering.
Central Banks have become the new planning board politburo wielding global national power on edicts determining the future of economies similar to those USSR satellite states of the soviet era.
Capitalism and with it true price discovery led by the market place is replaced by manipulation of the money supply and the bond markets by Central banks replacing market capitalism with socialism for the banks.
Mises was a defender of freedom and capitalism.
In the 1940s Mises completed his monumental treatise Human Action, in which he reconstructed all of economic analysis on a sound individualistic foundation.
“Credit expansion cannot increase the supply of real goods. It merely brings about a rearrangement. It diverts capital investment away from the course prescribed by the state of economic wealth and market conditions. It causes production to pursue paths which it would not follow unless the economy were to acquire an increase in material goods. As a result, the upswing lacks a solid base. It is not real prosperity. It is illusory prosperity. It did not develop from an increase in economic wealth. Rather, it arose because the credit expansion created the illusion of such an increase. Sooner or later it must become apparent that this economic situation is built on sand.”
Of course we here in Ireland can testify to the veracity of the above. We had massive credit expansion on joining the euro. It was poured into an unsustainable property boom not based on an increase in real economic wealth at levels supporting the boom.
Economic activity became addicted to the boom of expanding credit lending and once this supply dried up in 2008, the avalanche of collapse began.
Let me requote Mises above:
” An adjustment of relative prices, a reallocation of the factors of production
among alternative uses and a shift in relative income shares would all be
part of the prerequisites for a return to an economic situation consistent
with the underlying pattern of consumer demands and time preference
for present and future goods as they would now show themselves in an
environment free from monetary influences.”
Global change in our monetary system is required before its defects cause catastrophy to mankind and his future. We require return of a more stable and balanced form of monetary and currency exchange based on the Gold standard.
In Ireland monetary influences choking the economic development of the Irish economy is the perpetuation and maintenance of the property bubble that has collapsed the Irish economy. Commercial and residential property price inflation combined with deflation through austerity are contradictory.
Private property purchase of a mortgage by the lower to middle class is replaced with vulture funds expropriating property funds at knock down prices in turn turning the lower to middle class into serfs paying extortionate Sheriff of Nottingham rents.
This system serves the banks as well as the decreasing number of property owners.
Irish banks are still in spite of bailout dependant on their large lending portfolios and up to €4bn of outstanding loans. Reducing the price of commercial and private property would damage the loan to value ratios of lending on their books.
The construction of affordable housing could bring about negative equity and default and thus Central Bank planning of our economy has replaced a real economy with one that is artificial and false.
It is also in danger of collapse.
NB Fitsch report here:
“Our assessment of asset weaknesses includes a high proportion of forborne loans in the system, very low yielding loans, defaulted but not impaired loans, and restructured loans, all of which add up to a high proportion of the banks’ balance sheets. It will take many years to work through all these problems, especially because many of them date back a long time. For example, the stock of Irish residential mortgage loans, both owner-occupied and buy-to-let, in arrears for over 720 days is high at EUR15.1bn, equivalent to 12% of outstanding mortgages.
While capital ratios at BOI and AIB strengthened significantly over the past six months, we believe the banks could still be vulnerable to severe shocks. In particular, we are monitoring developments in Ireland’s commercial real estate market (CRE). Irish banks are not expanding aggressively into this type of financing but the market is particularly cyclical and investment levels currently exceed pre-crisis levels. International and domestic investors are driving this expansion but the CRE sector could be vulnerable to changes in investor sentiment and significant expansion in CRE financing at BOI and AIB would therefore increase risks.”
Commercial Real Estate CRE ” International and domestic investors are driving this expansion…”
Yes, its been driven to bubble proportions. The ordinary Joe and Jane Soap cannot afford even a mortgage on a very modest home. And the whole monetary system upon this is based is in imminent danger of collapse.
Price Discovery in a Controlled Economy
Instead of building homes to house the homeless, providing basic A&E services for the old and sick, Kenny and Burton have acted like bailiffs working for the banks.
They have looted the Irish economy to serve the very banking sector that brought the Irish economy to its knees.
Its “showtime” if you are an actor on the stage with a prepared monologue fed to you by your handlers to focus on the failed efforts of the opposition to manage the economy during the Celtic Tiger years. Instead of acting in the here and now to end the housing and A&E crisis in our hospitals. The failure of FG/LB is by far the greater failure because its one based on the gift of hindsight.
It helps if you cannot think or plan ahead but wish only to maintain the status quo. It also helps if you break election promises. It also helps if you make the same promises to end the calamity of a housing and A&E crisis that you have made before but repeat them for the coming election.
Kenny’s favorite quip of ‘its show time’ is more applicable to a Punch and Judy show with demands for fairness and humane treatment of vulnerable Irish people set aside, in favour of compliant, subservient, capitulation to the demands of failed banker handlers moving the political puppet strings..
We see in the outgoing government evidence of broken promises to reform in Pensions Authority appointment of David Begg; or GSOC using the law to snoop on journalist’s phones and of course the well-known appointment of judges by political affiliation.
Democratic government has been so watered down it hardly exists replaced with secretive Economic Management Council puppet government control of decision-making by outside financial interests.
In pale contrast to the ideals of 1916, the Oireachtas has become a failed talking shop unable even to produce a watered down Banking Inquiry Report.
There is a generation of young Irish people growing up who are too young to remember the times recalled by older generations when true price discovery existed in the housing market.
There was a time when the purchase of a house could be achieved by getting a mortgage based on a few multiples of a living industrial wage, a steady job.
Price discovery determined that the cost of building a house could yield a profit if reasonably attached to the rubric of what the average Joe and Jane Soap could reasonably be expected to pay off over a 30 year period.
The system was so successful large housing estates were built across the main towns and cities generating jobs in construction with trickle down economic activity that led to thousands of jobs in retail/construction and related industrial growth in a growing economy.
Today following financial collapse and still within an economic downturn with loss of jobs and cuts in wages, the average Joe and Jane Soap see no prospect of owning a home.
Construction has ground to a halt. Shortages mean property prices are out of their reach at astronomical levels.
Banks refuse to lend to developers knowing full well the market is artificial and in a dangerous state of imminent collapse.
Keeping the Property Bubble Going
FG/LB led government has not only failed to address these problems but it has openly capitulated to both a European Central Bank and Irish Central Bank coup d’état of the Irish economy and the Irish construction industry.
The Irish economy no longer serves the people but rather the demands of bondholders and financial paper wielding bailouts of foreign banks and financial institutions.
If the ECB and Irish Central Bank worry that construction levels may impair the current loan to value of billions in lending to developers of buy to let properties and vulture property funds, they will not lend to Irish property developers.
ICB apparently are of more concern that the repayment of foreign bondholders takes precedence over the investment in construction required to serve the needs of the people.
They also know that Irish property prices are vastly inflated with dodgy loan to value ratios and are extremely risky. This puts another dampener on the Irish property sector.
The Irish property sector is in a bubble and all bubbles pop.
The following 2009 discussion on average house property costs figures somewhat dated but if anything matters have severely deteriorated since then.
We have a housing bubble with prices that are unsustainable and inflated due to banks fear of loan to value relationships collapsing.
But collapse they will. All bubbles pop.
Average industrial wage is now a little over €40k and a small development of houses in an enclave not far from here start at €750k typical of such builds in Dublin at the moment targeting high earners paying extortionate rents.
These houses while of good standard are not mansions in their own grounds but yet approach 20 times the average industrial wage!
Don’t be fooled and misled by propaganda from Davey Stockbrokers and ilk re growth projections for the Irish economy.
Such growth projections are based on expectation of massive stock inflation because of global QE, MNC export earnings increase caused by devaluation of the euro against the dollar, low oil prices that imperil the global economy and loot the third world, deteriorating social services because of austerity, temporary changes to Corporation tax auditing practices mysteriously leading to injection of almost €2bn to the public purse.
Shortages are inflating house prices
Perhaps Davos will usher in a return to a global currency standard based on gold that cannot be manipulated by governments and central banks boom and bust policies. It’s not likely to happen.
The smart money is on things to get worse before they get better.
For prosperity and human development to flourish we need to be free of a global monetary system infected by the mismanagement of TBTF banks and Central Banks and Shadow Banking in junk bond markets.
We need to return to a far more sophisticated and smarter world based on human freedom, enterprise and a currency system linked to the stability and balance given by the Gold Standard.
Japan’s Debt Problem
Debt Crisis 2016 United States of America Explained in a Simplified Way
“Uncle Sam’s Catch 22
14 trillion-dollar debt equal to total GDP for one entire year for US
He can’t raise taxes or cut spending and making the recession worse
Can’t have Federal reserve print more money without causing inflation making it worse.
If one link in the debt chain defaults, the whole lot falls apart. This will usher in a global debt crisis of epic proportions. Start preparing.”
December 22, 2015
I listened to Alan Kelly Minister for the Environment interviewed on radio RTE this morning Dec 22 speaking on the topic of housing for which he holds political responsibility as major part of his portfolio (1a).
Homelessness has been declared a humanitarian crisis in Dublin with upwards of 2500 in emergency accommodation on a regular basis including families and young children.
Last Summer there were calls for Kelly (1b) to return to Ireland to deal with the case of a young family with 3 children forced to sleep in a park.
Most he can do is organise a rent freeze. Many landlords have used the opportunity to turf out those renting with them under the pretext of refurbishing their premises.
This will allow them to set rents higher and avoid the freeze. Index linking rises in rent to inflation levels has been torpedoed by Noonan, Minister for Finance.
The solution is weak capitulation to the financial forces obstructing reform. Banks are making too much money sucking the blood from the young.
Likewise his efforts to stop developers sitting on landbanks to prevent/reduce rising prices for land with a 3% levy has been an unbridled capitulation to vulture developers. According to Kelly there are ‘constitutional’ restraints on the imposition of such a tax levy at a rate higher than this? I find this argument absurd and ridiculous.
Government never had a problem imposing taxes on cigarettes or children’s footware; it appears there are now constitutional difficulties on imposing such taxes on rich landowners. Could this be due to the numbers of rich landowners, developers and owners or rental property who are also members of government.
Both Noonan and Kenny also cite the constitutional constraints on interfering with land ownership in a constructive way. We have to decide between incompetence or lies as to the reason why they cannot change the constitution if necessary to end such blockages. The constitution is there to serve not the vulturism of a ruling elite, but the people.
To be fair to Kelly, I believe he is not telling us lies; the alternative is he just isn’t up to the demands of his job. He is being duped and his role is to dupe us.
In the same vein Kelly when asked why his proposals to shoe in shoebox legislation. During the Celtic tiger years there was widespread condemnation of building regulations, studio apartments of shoebox size, 40sq metres. New proposals to reduce to 42sq metres similar sized apartments and similar reductions in standards for other apartment sizes represent the triumph of developer greed over common sense.
Perhaps rich farmers will invest in such small-sized apartments to house their young while attending college in Dublin.
According to Kelly, developers are not building apartments because to do so because of the current sizing of apartments, they are uneconomic to build compared to office accommodation!
Spare a thought for Kelly’s argument here. Apartments can be sold for astronomical sums around Central Park in New York City, but in the midst of a housing and homelessness crisis in the city of Dublin, planners and developers and other interested stakeholders, cannot make money out of building apartments even though we’re heading for the costliest and most expensive rents in Europe.
NB think carefully about this. He’s not talking about affordable housing, he’s saying money can’t be made on the building of apartments under the current legislation because they prevent the building of shoeboxes!
I’m sorry, folks, I can’t remain objective anymore. His thinking is that of an idiot and a gombeen. The dark side of this is that his strings are being pulled by those who want him to be ineffective.
He is totally ineffective and incompetent however many lies are told to make him appear a success. He isn’t at all unique in this government. Noonan committed up €31 billion of taxpayers money to remortgage his Anglo promissory note into long-term loans we must pay back forever. Then he argued that the token interest rate reductions from sky-high 8% to clipping these odious rates with extend and pretend, was a success!
Meanwhile Kenny with a failed Banking Inquiry and a quango Water boarding of the electorate, failed to persuade ECB we should be returned senior bondholder payments of €8 bn plus. Minister Varadker is trying to persuade nurse trolls to move trollies up into wards to create trolley wards. We are lucky Irish nurses are not trolls.
Its simple, add thousands of additional beds to our hospitals, build the thousands of homes necessary to house our people. Replace those who by lies and incompetence seek to persuade us this we cannot do this.
Our balance of payments deficit and our so-called economic growth has been brought about by the collapsing value of the euro against the dollar funded by dollar dealing multi nationals and exports. The accounts of the MNC’s so opaque we cannot even account for the windfall €2bn coming to us as extra from corporation tax.
Our economy is Atlantic based not European based with little of our trade into Europe. Over the next Summer it is very possible Brexit will come to pass with Britain leaving Europe causing irreparable damage to our economy.
With the blind leading the blind, surely it is not too much to ask, we should seize the opportunity to hold a similar referendum in Ireland at the same time on our continued membership of the EU.
The European project has become an economic disaster with deflation knocking on Europe’s door, social tensions rising and political instability increasing.
Perhaps a New Free Trade agreement with a fairer resolution of Ireland’s debt profile; a new Ireland with a referendum mandating this?
Unfortunately most of the young people who could bring this about have emigrated, so I wouldn’t hold my breath.
Meanwhile lets just recognise stupidity and lies for what they are! A failed Irish Water, failed web summit, failed solution to housing and A&E crisis, failed solution to our debt crisis, we should recognise this government has failed.
Time for change.
Happy Christmas & a Peaceful New Year to you and yours.
December 8, 2015
One of the councillors involved, Hugh McElvaney – a four-time mayor of Monaghan, McElvaney, since resigned from Fine Gael, his hands and fingers replete with ornamental gold rings and gold watch, pictured sweeping imaginary bribe money into his many pockets, said it all.
Hard to believe we were not watching an episode from Fr Ted’so Craggy Island.
His performance deserved an Oscar for best iconic performance worldwide for representing corruption.
Hopefully the case will be followed up by the Garda fraud squad and his past activities investigated.
This was not some imaginary banana republic in a far off land, but Ireland in the here and now 2015.
Fianna Fáil councillor Joe Queenan, a businessman and councillor, winked at his business like advice for payment to be made to a partner of his to hide the bribes. For Queenan and McElvaney clearly Ireland is a great place to do business.
“The Mahon Tribunal of Inquiry The Final Report of the Tribunal of Inquiry into Certain Planning Matters and Payments (also known as the Mahon Tribunal) contained a total of 64 recommendations for further consideration in relation to a range of policy areas, as follows: 1. Planning; 2. Conflicts of Interest; 3. Political Finance; 4. Lobbying; 5. Bribery, Corruption in Office, Money Laundering and the Misuse of Confidential Information; 6. Asset Recovery; and 7. Miscellaneous Matters.”(5)
“One of the most significant recommendations being considered is the establishment of an Independent Planning Regulator, who could assume some of the Minister for the Environment, Community and Local Government’s planning oversight functions and who could also be charged with carrying out investigations into systematic problems in the planning system. This recommendation is accepted in principle. ”
Legislation for this has not been enacted nor is it proposed in the term of the present government.
Currently, if a complaint is made, there is no clear route for a complaint to take. It’s likely to do a merry-go-round tour of government departments. Legal obstacles will impinge on any investigation. There is no white-collar anti corruption unit in Ireland staffed with enough stick to get through the swathes of soft laws protecting the right to privacy, commercial sensitivity, possible defamation or libel obstacles. There is no legislation of a quasi-judicial kind to mount proper investigation of white-collar crime protected with vast resources of legal might
Investigates showed that even today following Mahon ignored by 40% of councillors(6) ”
- provide for the disclosure of interests, including material interests, which could influence Ministers of the Government, Ministers of State, the Chairs and Vice-Chairs of Dáil Éireann and Seanad Éireann, the Attorney General, members of the Houses of the Oireachtas, directors of public bodies and public servants, including special advisers, in the performance of their official duties;”
We should look to best practice worldwide with a view to setting up an anti corruption commission in the immediate future before the coming election.
Transparency International have produced a paper on best practice worldwide for anti corruption commissions.
“The international legal framework advises that such institutions be independent, protected from undue influence and have adequate training and resources to undertake their duties.”
“Anti-corruption commissions are mandated differently depending on country contexts; in 2008 the OECD developed a typology of the existing models:
The multi-purpose agency represents the most common model of a single-agency approach, combining the aspects of repression and prevention of corruption. This is the model on which are shaped the Hong Kong Independent Commission against Corruption and the Singapore Corrupt Practices Investigation Bureau.
The law enforcement agencies model either combines the three functions of detection, investigation and prosecution of corruption cases, or specialises in detection/ investigation or prosecution. This model is the most common in Western Europe.
The preventive, policy development and coordination institutions focus more on corruption related research, coordination of anti-corruption policies and action plans, monitoring conflict of interest regulations, elaboration of codes of conduct, facilitation of trainings, etc. This is a model that can be found in France, India, Albania and Montenegro, for example.”
Hopefully we will get an agency “combines the three functions of detection, investigation and prosecution of corruption cases, or specialises in detection/ investigation or prosecution.” That would have the powers to investigate along the lines of the RTE investigation team, then follow-up with prosecutions of the likes of Hugh McElvaney and Joe Queenan.
Look, all they had to do was examine the loan book and follow the money. The money can be summed up in one word, “bonus”.
As stated in earlier blogs, a quick audit of the 10 largest loans describing in detail the bonuses given to those who managed those loans would have shown the bonus culture feeding frenzy that led to financial meltdown.
Of course behind the bonuses was the even darker world of bribes and corruption.
With modern technology all loans handed out in the Celtic Tiger era could be audited and investigated for patterns and loops and of course, bonuses!
The bonus culture virus infected all levels in all of the banks. It led to turning a blind eye to dodgy loans. It became so endemic that throwing caution to the winds meant you saved your job while prudent risk management meant you risked losing your job.
It was a feeding frenzy bought into by government, banking employees and management, even the Regulator and Central Bank. No q’s asked by Regulator, ECB, government.
The ECB refused to cooperate with the inquiry.
Unfortunately (1)”Irish people decided in a referendum in 2011 not to give parliamentary committees the power to make adverse findings against individuals”. An array of political and legal restraints hobbled the inquiry from the start.
(2)”Conducting this kind of Oireachtas inquiry as opposed to a Levinson-type quasi-judicial examination has brought its fair share of criticism, because of the limitations such a move involves.
Those limitations, now coming to the fore, are significant and descriptions of the inquiry being ‘toothless’ are valid.
The internal documents given by advisers, legal and economic, contain a myriad of restrictions and limitations which will have the cumulative effect of rendering the ability of members to ask the kind of probing detailed questions required as non-existent.”
Absurdly, the daft draft can be legally challenged by interested parties. Its gone out to them to see if they are happy enough with the whitewash. Only then can it be published in its current form. We wont discuss all the heavily redacted docs they got to see.
“However, Fianna Fáil TD Michael McGrath said that there are huge limitations on what the inquiry can actually say.
(3)”If I believe somebody acted recklessly during the banking crisis, and if that question as put to that person in the course of evidence and they denied acting recklessly, then it’s not open to the committee to actually conclude that person acted recklessly,” he said.”
It might adversely impact on their name and reputation? Absurd, but white-collar crime gets an unprecedented level of protection and its crimes are well hidden.
Don’t ask if it should be given to acting politicians the task to investigate white-collar crime. The Irish public in 2011 in a referendum decided it would be unwise to do so. Ignoring this Irish politicians arrogated to themselves the very method rejected democratically by the electorate.
Having bought into the compromised inquiry in the first place, Pearse Doherty and Joe Higgins wish to occupy the high moral ground and accept political plaudits by refusing to sign off on it. Spare us all from wasting all our time. Reductio Ad absurdum. Their time on the inquiry would have been better spent advocating for a full judicial inquiry given the full powers it required.
More and more democracy is being eroded. Parliamentary democracy in Ireland is becoming more and more toothless eroded and corroded by decisions taken elsewhere in the financial and banking sector. Stamped by puppet so-called parliamentarians confidence in politicians at an all time low.
The result is homelessness, a generation of young people who cannot or will not be able to find or afford a home.
The destruction of free market capitalism in Ireland continues with the shocking proposal the state bad bank NAMA’s proposal to deliver a €7.4bn development programme involving 20000 new homes in Dublin and elsewhere and 3.8 million square feet of office space in Dublin. NAMA is a state bad bank and not a developer acting in the manner of a state housing association under the USSR during the cold war in Russia. Socialism for the banks is becoming the new norm.
NAMA must be one of the most secretive bad banks in the world protected with a raft of legislation from prying eyes to hide from Freedom of Information legislation with transparency a ridiculed joke.
Developers in Ireland “The NAMA scheme favours NAMA and NAMA-supported developers over non-supported developers”. NAMA has sold vast tracts of commercial and residential property to vulture funds allowing them to corner the rent/lease market and support maximizing upward only rents.
A false floor to residential properties lending has been engineered through shortages to maintain high level lending to fill bank coffers. The present government has built nothing.
White collar crime and socialism for the banking sector means as it did in the Soviet era, a crackdown by means of non disclosure, censorship, secrecy. Suddenly government announce an extra couple of billion due from corporation tax blindness.
We have no access to audited accounts detailing the source of this rise in income. Speculation on this blog is that a large amount of the increase comes from the collapse of the euro against the dollar, MNC’s deal in the dollar so any fall in the euro means more CT.
But wonders if MNC’s are declaring more because of imminent investigations at European level into CT. And if under declaration, should not an anti corruption task force investigate if under declaration or other tax avoidance has occurred in the past.
We thrive while the euro dives. Latest economic setback for the EMU is abolition of the Schengen agreement for the next 2 years.
The cornerstone of European economic unity was Schengen allowing a truck driver from Cork travel unhindered to Poland and beyond within EMU without border stops and border check delays. This will impact severely on trade in the EMU. Clearly design flaws in the euro have come home to roost and it’s not at all clear if the euro project can succeed and overcome its present challenges without dissolution on the table.
Irish water is silent on projects to harness all the flood water, build the lakes, storm drains, reservoirs needed for the future now it has lost its ticket to the billions it otherwise would have sought on the commercial borrowing markets. Its time to abandon that project and restore that enterprise locally under new democratic powers given to the Board of Works.
Hospitals and A&E’s remain underfunded under more risk of closure than development. The austerity programme is in full sail. Irish government pawns of the ECB are clearly at a loss what to do next.
till next time
November 20, 2015
“Na habair faic agus na scriobh faic, mar nuair a cuireann tu an dubh ar an gheal ta tu fuckalta a bhuachaill”
The Financial Crisis Inquiry Report in the US took 2yrs to produce:
“The Commission’s statutory instructions set out 22 specific topics for inquiry and
called for the examination of the collapse of major financial institutions that failed or
would have failed if not for exceptional assistance from the government. This report
fulfills these mandates. In addition, the Commission was instructed to refer to the attorney
general of the United States and any appropriate state attorney general any
person that the Commission found may have violated the laws of the United States in
relation to the crisis. Where the Commission found such potential violations, it referred
those matters to the appropriate authorities. The Commission used the authority
it was given to issue subpoenas to compel testimony and the production of
documents, but in the vast majority of instances, companies and individuals voluntarily
cooperated with this inquiry.
In the course of its research and investigation, the Commission reviewed millions
of pages of documents, interviewed more than 700 witnesses, and held 19 days of
public hearings in New York, Washington, D.C., and communities across the country
that were hard hit by the crisis. The Commission also drew from a large body of existing
work about the crisis developed by congressional committees, government
agencies, academics, journalists, legal investigators, and many others”
In contrast our banking inquiry into Ireland’s financial meltdown due to the limited powers restricting its terms of reference risks by way of privilege and confidentiality legal restraints, becoming a watered down cover up.
There was hope that a more targeted and precise probe initiated with the appointment of Justice Cregan into deeply questionable transactions involving the sale of assets by NAMA, would bear more fruit.
It has taken Justice Cregan nearly 6 months to produce a judgement that his investigation is botched hampered by the problems he outlines below:
The problem with Siteserv:
187. “That Dáil Eireann: notes that: — in 2012, Siteserv owed €150 million to Irish Bank Resolution Corporation (IBRC); — in March 2012, IBRC sold Siteserv for €45 million; — external trade buyers were excluded from the sale of Siteserv and there are questions about due diligence; — some bidders were also excluded from the sale and may have saved the State some money; — Siteserv shareholders received €5 million at the time of sale; — there are genuine concerns about the sale of Siteserv for €45 million by IBRC; and — Department of Finance officials have raised concerns about other IBRC sales as well; acknowleges: — the huge public concern about the sale of Siteserv; — the dissatisfaction that information, obtained through Freedom of Information (FOI), highlighted that relations and trust between the IBRC and the Secretary General, as well as officials in the Department of Finance, had broken down; and — there are now concerns about other sell-offs by IBRC; condemns the appointment of KPMG to undertake a review of transactions in IBRC as they advised Siteserv during the sale and there are public concerns about a possible conflict of interest; and calls for an independent commission of inquiry to be set up to examine the circumstances surrounding and leading to the sale of Siteserv in March 2012, and other company sell-offs by IBRC so that the interest of the taxpayer can be fully protected and transparent.” — Michael McGrath, John Browne, Dara Calleary, Niall Collins, Barry Cowen, Timmy Dooley, Seán Fleming, Colm Keaveney, Billy Kelleher, Seamus Kirk, Michael P. Kitt, Micheál Martin, Michael Moynihan, Charlie McConalogue, John McGuinness, Éamon Ó Cuív, Willie O’Dea, P.T.O. (3)
Justice Cregan has produced an interim report highlighting significant problems that obstruct his investigation. (4)
“The largest six transactions being examined involve write-offs of more than €100m while the next six involve losses greater than €50m, while it has also emerged a separate 156 transactions where losses of €10m or more were recorded are outside the scope of the inquiry’s timeframe.
As a result of the difficulties, Judge Cregan has recommended that individual sales could be isolated and examined by different commission members. However, he has concluded that under the current terms the inquiry could take “several years” and “result in substantial costs”.
The judge has recommended legislative changes to overcome claims of confidentiality by some parties.”(5)
There are questions over the advice given to Government when it set up the inquiry.
The government should appoint a tribunal of investigation of three judges and report on Siteserv before the next general election.
Investigation into the remainder of transactions should be mounted with decision on their terms of reference following initial Siteserv report.
The commission should prioritize an investigation into the Siteserv transaction. Legislation could be enacted overnight giving a tribunal of 3 judges the power to make a majority decision on any claims re privilege and confidentiality in regard to the public good.
This would firm up powers given to the banking inquiry.
Siteserv investigation with work already completed could become the basis for the first of a series of minority reports before a majority report required in specific time frame of 12 months.
The practice of tribunals of investigation a boon to the legal profession taking years instead of months to complete for a small island with a relatively small population compared to UK or US similar inquiries, must be curtailed on the basis of costs and common sense and the risk of corruption of the legal profession itself.
In summary, to avoid legal challenges, judges with impeccable experience, a tribunal of 3, can be given powers to decide whether legal privilege and the right of confidentiality, should favour the public good or the opportunity of individuals and companies and institutions, to commit crimes against the public good and have their actions concealed from the law.
HOUSES OF THE OIREACHTAS (INQUIRIES, PRIVILEGES AND PROCEDURES) ACT 2013 (2)
(3) A person shall not require the disclosure of a confidential
communication other than—
(a) with the consent in writing of the member who made or
received the communication, or
(b) subject to subsection (4), where it is determined by the
Court, upon application being made to it under this
section, that the disclosure is relevant to the investigation
of any offence alleged against the member, or is essential
by virtue of an overriding public interest arising in the
context of proceedings before a court, tribunal, commission
or Part 2 inquiry.
(4) The Court shall, in determining under paragraph (b) of subsection
(3) whether or not it should make an order providing for the
disclosure of a confidential communication made by or to a member,
have regard to—
(a) the extent to which the communication relates to a matter
of public importance or public interest,
(b) the rights and interests of any member affected,”
If required, immediate legislation reinforcing the above and authorising a number of judges to exercise similar powers in loco parentis to that of the courts “by virtue of an overriding public interest arising in the context of proceedings before a court, tribunal, commission”, should be enacted.
To give opportunity to those who would evade justice in the concealment of possible crimes in the opinion of a High Court judge, is a scandal and affront to our constitutional democracy.
There are specific circumstances when the constitutional rights of the individual or company or institution, should be set aside in favour of the right of the public good.
It should be satisfactory that such unique decision-making should be entrusted to a tribunal of 3 judges empowered to balance those rights in the specific context of a tribunal of inquiry or special investigation.
Meanwhile Irish businessman Denis O’Brien has scrapped the potential $2 billion flotation of his Caribbean and Pacific islands telecoms company Digicel less than 72 hours before its shares were due to begin trading in New York. There are questions over the awarding of the mobile phone license and concerns over his acquisitions in media and the right to free speech.
Fintan O Toole writing in the Irish Times,(6) echoing concerns re O’Brien’s efforts to curtail free speech and his media acquisitions “I have never, in 37 years in journalism, come across any editor in any country who would not regard the banning of a report of a parliamentary debate as an attack on the most basic function of the media in a democratic society.”
If he has nothing to hide, he should welcome transparency.
I share growing concern that the truth involving corruption and abuse of the public interest as soon as unearthed is being buried by those hiding it. (7)
The scandal of politicians evading tax brought by a whistleblower with supporting documents has not seen the light of day(7). It would appear insiders have a large wagon train of means to hide corruption encircling them. Lancing the boil of corruption should be tackled with renewed energy by those who seek the public good.
Digicel is loaded with dollar debt from companies trading in currencies other than the dollar. That debt is growing as both deflation in Europe and in the US in increasing. The euro has taken a large fall against the dollar exchange rate.
The bubble in bond markets and stocks and shares of recent years fuelled by QE1 and QE2 and QE3 is running out of Q’s to support it.
Japanese recession beckons for the euro area even before the current refugee crisis.
In which case there are many more bubbles other than O Brien’s Digicel that will POP.
But that is another story.
November 8, 2015
Sharon was clearly annoyed Paddy Cosgrave had pulled out of the interview below perhaps realising he had answered all questions and it was now time for colleagues to give their response to similar questions.
Sharon had no sympathy for Web Summit’s objectifying incompetence shown by the Taoiseach’s dept in lack of liaison to address the needs of the Web Summit to improve its service to attendees.
O Connor ends his piece in the Independent with the arrogant assumption “And remembering that the last people who promised to make the world a better place were totalitarian regimes”. This linkage with totalitarianism is usually reserved for the left and for those who criticise those who hold the reins of power in FG/LB.
But generally O Connor in the past has shown quite an amount of intolerance for hard working and talented ‘nerds’. He should make friends with them.
Instead we had totalitarianism in action. Sharon’s questions were piqued and vindicative and dismissive in their non engagement with Daire’s logical and calm responses. This was not the media acting as the Fourth Estate guardian of democracy.
This was, how dare the Web Summit question the competence and professionalism of An Taoiseach’s department in ignoring efforts to improve Dublin’s infrastructure and its ability to host large events. Clearly An Taoiseach’s dept has taken upon itself this remit for itself and it did not like the challenge to its unilateral arrogation of such power to itself.
Another example of how RTE journalists tow the line is the following from Miriam O’Callaghan, but let’s allow RTE’s Claire Byrne set the stage:
In the following interview she gives the nudge to Michael Noonan, observing that
“Byrne remarked that Greek Finance Minister Yanis Varoufakis seemed to have ‘a bit of a a swagger’ and asked Noonan what he thought of him:
Noonan given the hint and opportunity takes it:
“He’s a bit of a rock star, I wouldn’t have the same sense of fashion.”
“He reminds me a lot of when RTE used to bring in academic economists and experts…they were very good in theory but they weren’t very good in practice.”
Noonan was also asked if Ireland had asked for a debt write down, he said:
“We asked for a debt write down but not in so many words. We asked for a debt write down by suggesting ways forward that would result in a debt write down.I asked Mister Trichet for his approval to burn the single bondholders…he refused.
We pursued it to the point where to act unilaterally would have risked the country and I wasn’t prepared to do that.”
What you should notice from the above is the lack of probity, the tricky lack of questioning, the absence of challenge to Noonan’s claims.
Ahem, not good in practice because no one put into practice eg Morgan Kelly’s warnings.
But let’s not digress. Mister Trichet would argue he was never asked by the obedient and compliant for permission to burn the single bondholders.
I recall at the time government excoriation of the notion of burning bondholders was at the level of a pandemic.
Of course none of such informed views critical of Noonan would be allowed on RTE.
Take the ongoing housing crisis. Noonan has not been brought onto any Primetime or serious political analysis programme to answer and account for his department’s role in the current housing, rental and homeless crisis. Such questions as:
- Can government set aside 1 billion next budget to build a set number of starter homes to respond to Dublin’s housing crisis and similar in other major cities.
- http://www.independent.ie/business/irish/state-pension-fund-takes-10m-hit-as-chinese-shares-slump-31487213.html Should not Irish Investment funds target strategic investment locally instead of losing paper money internationally.
- Is there a policy to starve the development of housing infrastructure to facilitate foreign vulture funds pillaging and looting of Irish housing residential and commercial stock to drive out private ownership and replace it with a rent only property system.
- Are both the Central Bank and Dept of Finance creating conditions favouring a housing bubble to maximise the return on lending to developers at the expense of the young people of Ireland and their housing needs.
- Is it government policy to drive young people and the homeless to emigrate rather than provide housing, jobs, healthcare and education for them; to replace them with a 1% unburdened of taxation, the road to a banana republic of intolerant totalitarianism looting the poorer members of society.
…is another example of full on full-blown effort to shower a storm of negatives onto an unsuspecting interviewee…
“Its as if we haven’t had this conversation so far, let me remind you once more…”
Yanis response in defence of repeated refusal by O’Callaghan to engage with his answers.
O’Callaghan at the end of the interview makes the embarrassing comparison, we succeeded(????) in negotiating terms for our Promissory Note very favorable to us.
Its embarrassing in the sense the terms were forced upon us by our ECB creditors who were afraid that
a) a subsequent government in Ireland would catch itself on and refuse to pay it at all, or negotiate as Greece did succeeding in getting a debt write-down
I was curious to hear Claire Byrne chairing a discussion on our housing crisis with various spokespeople.
One member of the panel ventured the remark that Alan Kelly, Minister for the Environment, that his housing department had not even spent their budget on housing for this year.
Claire Byrne immediately jumped in to say RTE had been on to the Dept this morning and were told that the budget would be spent in the 4th quarter of this year.
What I’m curious about is whether RTE now insist on a list of points or questions that will be raised by panelists to allow them to vet any exchanges? Big Sister thought control?
Light weight interviews for government spokespeople have reached ridiculous proportions. In Health Leo Varadkar vacant and pensive answers as to why 90yr old people are on trolley’s in A&E are obediently lavished with subservient attention and acceptance, “Well, we are dealing with a lot of variables here, any one of these can lead to that situation. We are working to make improvements.”
Yes, we do have a kitchen cabinet minding the stove for invisible interests.
There is no, “the buck stops here”. There is radical contrast between what the minister says, propaganda, and the reality described by Health Care professionals in the field. Kenny and Varadkar have swallowed their own propaganda and now believe nonsense.
Another A&E for drug users and the violent to protect the decent public? Instead austerity coupled with the agenda to run down hospitals and promote private health care for those who can afford it, is the new agenda.
We used to have Question Time and the Fourth Estate Pillar of Democracy. Today we have investigative journalism reined in and a bevy of PR ladies for Fine Gael / Labour ready at all times to sling mud on legitimate free speech in defence of democracy. Irish Water protestors can rot in jail for all these media tigers care.
Minister of State for Primary Care, Mental Health and Disability likewise recently ventured to her interviewer that her department had to lobby others for changes, so, go figure whose running the show?
Lest I be accused of misogyny let me say that the charge of propaganda grilling of those who challenge vested interests in favour of the status quo, is not in any way gender based. In RTE lacklustre probity when it comes to government spokespeople is not at all gender based, but extends across the board.
I believe there is a new Saturday Night Show host, but I can’t remember the presenter’s name, must be very shallow. Then there’s Tubridy, stonily shallow. There again I’m no great expert on RTE and avoid it, when I can.
RTE should bring back Question Time and allow the Irish public to ask the questions.
October 22, 2015
How can it be one of the most heavily indebted countries in the world can be booming while the rest of Europe stagnates under deflation and Japanese like recession? Welcome to the world of fantasy economics where boom is bust, bust is boom!
When times were a lot poorer in Ireland, government found the will and the way to build relatively sufficient corporation, county council housing estates that became affordable housing for the poor and lower middle class young people beginning families.
Large tracts of land south and north of the city were given over to these projects and the city and its population spread and grew over time.
At least families had a roof over their head.
Today so-called informed commentators scratch their heads baffled that government can’t or won’t build in the middle of an emergency homeless crisis? For example, Dublin City Council, which has a housing waiting list of 20,000, last February set out details of homes it intended to start building – about 750 between now and 2017 at 18 sites in the city.
Whether these will ever get built is another question.
Alan Kelly, minister for the environment has just announced a paltry 22 modular kit houses to be built before Xmas in Dublin. He should be building 2000 of these to make way for a greater supply to other segments of markets in the near future.
But if these are built and the price of property falls to reasonable levels, developers with loans in rent to let properties may see their returns fall and be unable to meet their debt repayment obligations. This in turn could bring down the banks. Catch 22.
So government is in league with the banks to screw the young people of Ireland and turn them into serfs, without property rights, indebted to developer landlords scalping their right to a home, forcing growing numbers into homelessness.
Game, set and match to developer landlords, vulture funds and the 1% who can raise rent at will to extort any profit margins they wish from an obedient and compliant government.
What has changed over the years to bring this unimaginable mess about? The origins of this debacle go back in time.
In 1971 the global currency based on the dollar switching from a peg on gold convertibility into a new fiat floating currency.(1)
From 1944 onward the dollar became international reserve currency pegged to gold bringing relative stability to world currency markets. Nixon intended the dollar’s removal from Bretton Wood’s would be a temporary measure.
Bretton Wood’s following changes would continue in its previous role anchor to global currency movements.
Instead, release of the dollar from its gold peg, introduction of derivative based financial paper money vehicles for trading in bonds, the way was opened for those operating the financial markets in large banks and financial markets, to develop and play a global financial casino for financial markets.
Financial markets ballooned inflated with money printing through QE with trust evaporating while paper trails led to Enron to subprime markets in the US or to under the counter deals made with Greece.
Financial collapse came in 2008 though many argue this as mere precursor to what lies ahead.
Reforms through Dodd Frank have been piecemeal.
Fixing the financial system as practiced through the method of Quantitative Easing have exacerbated problems leading to a worsening situation for global markets now facing deflationary debt crises from Latin America, Asia (Japan now China). Yen and yuan and euro compete with each other in the race to the bottom through mutual devaluation.
QE printed money, gave it to large financial institutions, who poured it into stocks and shares that have heavily inflated their value similar to inflated property prices in Ireland’s housing and property bubble. Yields going forward appear to be on the precipice of collapse especially in china. On a global level a large reset would appear to be about to come into play and the euro is at risk.
Meanwhile banks through devious means have abused their power once again manipulating global commodity markets eroding trust and fairness and corroding the health of the global financial system. http://www.rte.ie/news/business/2015/0928/730777-swiss-investigation/
“Swiss competition authorities said today they were investigating UBS, HSBC, Deutsche Bank and four other banks on suspicion of price fixing in the precious metals market.
The Swiss Competition Commission (COMCO) has today opened an investigation against two Swiss banks, UBS and Julius Baer.
It is also looking at Deutsche Bank, HSBC, Barclays, Morgan Stanley and Mitsui, it said in a statement.”
Global debt ceilings have rocketed skyward, lower interest rates and currency devaluations fed by deflationary spirals have brought the world to a debt ridden cauldron where future development is benchmarked against impossible odds placed by debt repayment obligations, pension and social security obligations and growing demographic turbulence led by wars and a refugee crisis.
Negative interest rates indicate a collapse of interbank lending and collapse of the financial system.
Deregulation of financial markets led to Property markets subsumed into a worthless counterfeit of paper derivatives gathered into large tranches by financial institutions and marketed and exchanged for what value can be sought..
Government response has been accompanied by a massive austerity transfer of wealth from poor and middle-income upwards to pay for losses of the 1% in the ongoing financial crisis.
As a result of financial meltdown, the rich have become richer and the poor poorer.
A fall in property prices could be the beating wings of a butterfly that will set off the storm of a massive downward spiral in the value of vulture funds, stocks and shares based on property.
Protecting the banks and the financial players means, for example, those cheap housing units will not be built in Ireland though they can be built by GOAL in Zimbabwe!
Low interest rates and cheap lending eventually the cause of massive bailouts has also led to the unfolding debacle of homelessness fed in turn by massive weight of debt built on property speculation. Both rents and property prices increasingly affordable only by the rich.
In Ireland, repayments for bailout are being harvested though raids on public services and the pillaging of public utilities. Workers in the public services, gardai, teachers, health services are now being employed as temporary workers on lower pay scales replacing permanent, pensionable jobs on higher pay.
Government budgetary deficits allied to bailout reparations is used as a stick to renew the Celtic Tiger based on property speculation rather than real value vested in health and education and business enterprise.
In insidious, unsettling divide and conquer, young people find themselves hired into the public service, if they do find a job, its at half pay scales of their older colleagues.
Euro’s devaluation pain and deflation is Ireland’s gain: this boosts exports allowing exports sell cheaper abroad.
While this small island can benefit from such quirkiness of macro economics, the world’s potential for economic progress is at high risk of collapse.
The previous Breton Woods system needs to be revived to overhaul a global currency system no longer fit for purpose growing closer to collapse.
Currencies across Latin America, Asia now the emu face devaluation and a race to the bottom.
The world’s global reserve currency, the dollar, lies fallow beset by massive debt.
The euro faces Japanese deflationary recession even if its refugee crisis is resolved.
Yet projections for economic growth range anywhere between 3 and 6% for Ireland next year.
Decreasing cost of oil, lower interest costs on debt and windfall for multinationals paying corporation tax posting a huge increase in euro based profit through their dealings in $. Ireland is told its booming.
Multinationals are for the most part dollar denominated in their trade with the rest of the world. The irony is the value of their dollars with the dramatic fall of the value of the euro against the dollar, has led them to post massive increase in corporation tax.
Not that they pay a lot to begin with Ireland’s rate of Corporation tax near lowest in the developed world.
Recent budget has protected multinationals from making greater contribution to Ireland’s tax take ensuring, for example, multinationals pay virtually zero contribution to Ireland’s universities at the same time expecting them to deliver graduates of the highest educational calibre.
Further such windfalls to the exchequer depend on further falls in the value of the euro against the dollar.
Flushing the chain on the value of the euro on world currency markets makes Euro’s loss Ireland’s gain!
Egregious saving of the Irish banks and the Irish financial sector by government has been at the expense of outright pillaging of Irish public services.
Emigration and falling employment standards have been accompanied by a massive transfer of wealth from the poor to pay interest to foreign bondholders in German and French banks on foot of a €67bn bailout the bill for which is paid for through austerity.
Property speculation that led to Ireland’s financial collapse has been restored to its former glory as a means to speculate casino wealth for property developers and investors in financial markets many of whom are in ministerial positions in government acting as guardians of their nest eggs.
Homelessness is a key result of central government’s failure to build sufficient and affordable housing to deal with a growing crisis. According to government, the money is available, they point to the failure of local authorities to act.
Most of us know if we have the finance, we can build. So let’s call this a lie.
Vast tracts of Dublin await action on development funding and these areas can be moved into action fast to fill up housing shortfalls. However, inaction has dissected the problem into many parts with the view to obstructing and obfuscating solutions that are obvious.
Government has cheerleaders who see their borrowings return to profit.
Artificially created shortages generate further profit for this group. It is their key concern not to bring about affordable housing, but to protect their profit margins.
Behind government are large institutional groups who’ve bought into the Irish property sector and wish to reap large rewards in controlling the rental sector.
Large vulture funds have also come to play welcomed by NAMA who’ve sold them large slices of the Irish market against the more prudent way forward of dividing and allowing competition to flourish among Irish bidders.
NAMA, having played a distorting role in the property market, is touted as its possible saviour as future provider of construction projects. The fox is being put in charge of the chickens. But no development expertise or experience except in the financial area, this is no barrier for such government led fantasy.
Meanwhile there is reported discord in cabinet between Alan Kelly and Michael Noonan.
Noonan’s voice is one of caution against imposing rent ceilings that would drive out and dry up the rental sector.
Noonan should also be seen as a point guy for the banks who applaud the return of high property prices ensuring negative equity and the future return of their lending is safe.
Who can imagine anyone getting out of the property business with the present levels of profiteering available, but there again for the most part you don’t have to be very intellectually endowed to do what you are told by those who manipulate puppet strings in the financial sector.
Let’s just say Alan Kelly has failed to address problems in the property sector and leave it at that.
Faced not only with Irish Water, homelessness and shortages in the Health service, other problems have emerged for government.
Web Summit co-founder Paddy Cosgrove ran into a brick wall in trying to get An Taoiseach’s department to deal with practical issues such as a specific traffic plan, controls on hotel rates during the Summit, a solution to WiFi issues at the RDS, discounted public transport for attendees, and garda escort services for approximately ten VIP guests.
Instead of dealing with practical concerns above, it would appear the Taoiseach having scored a goal in having the web summit in Dublin, took the ball from the opposition’s net and made his way back to his own goal, where he deposited the ball and lost the match.
As is the norm in such circumstances this match was lost much further back in time.
Growing dictatorial power of this Taoiseach FG/LB government and their grip on business and financial dealings in general are mounting.
Through Ireland’s economic management committee of Kenny, Noonan, Howlin and Burton any stamp put on Ireland’s future by its current and erstwhile European management team of Angela Merkel, the EU and the ECB, will be well licked.
In return, Kenny in his leadership of this team expects subservient and blind obedience in return.
It’s a cause for concern both Dublin and Cork Chambers of Commerce are both finding their powers eroded into the hands of central government. Dublin needs an independent mayor with powers similar to those of Boris Johnson, mayor of London.
The development of Dublin should not be left in the hand’s of An Taoiseach’s office.
The city of Cork also fears amalgamation of city and county and erosion of its power to address the needs of the city it is best qualified to address.
Compliance and obedience and silence on a critique of the powers that be however inadequate and incompetent they may be, it would appear the message was lost on Paddy Cosgrave and he took his business elsewhere.
Signs of this transmogrification of Ireland into a banana republic increase by the day.
Homelessness and crime are on the increase. Propaganda proclaiming the happy hour of growth and recovery based on government policy not due to external factors beyond our control, is rife.
Government is becoming more right wing and centralist, the rich are becoming richer and the poor are becoming far poorer with policies that extract more from the 99% to give to the ‘recovery’ of the 1%.
Key services such as health and education are both starved of funding the quality of Ireland’s health service continuing to deteriorate with acceptance by those in government that a trolley based service over the winter months is on the cards.
Ireland’s fantastic Four of Kenny, Noonan, Burton and Howlin in government have failed the political mandate given to them by the people who elected them to harness their new abilities and work together to save Ireland from former friends turned enemy, the financial sector and the ECB.
Rather they have become the unwitting pawns of the ECB and financial sector in the transmogrification of Ireland into a closed protectorate where democracy of the Abraham Lincoln kind is perceived as a threat rather than a badge of honour.
Enda gave us an early Xmas pantomime opening the possibility of an early November election with soothsayers like yours truly proclaiming ‘look behind you’ to 1995 and 1997 that election date would be better held on April 1.
The mess caused by such useless speculation threatened the outcome of the toothless banking inquiry.
Added to the mess of the water charges white elephant and lack of progress in dealing with the housing crisis, disastrous state of our health service, the people will take all of this into account, when they get to vote.
Iceland has sentenced 24 bankers to combined 74 years in prison. Ireland is a haven for bankers and is no Iceland.
September 17, 2015
“More than 4 million refugees have fled Syria since the war there began in 2011. According to the UN’s refugee agency, almost 1.8 million have gone to Turkey, more than 600,000 to Jordan and 1 million to Lebanon – a country whose population is just 4 million. “
By signalling Germany is willing to accept up to 1 million refugees the tide of migration has headed towards Germany; the dangerous journey this involves, Germany’s Angela Merkel must take responsibility for.
The solidarity and partnership model of european cooperation has been torn to shreds by this crisis. Once again unilateral decisions by Germany translates cooperation and partnership into the newer model of forceful compulsion of member states to cooperate and partner with Germany on its unilateral decision-making process.
In contrast to Germany’s policy for mayhem, the UK has adopted a more cautious and enlightened approach:
“…. the former international development secretary Andrew Mitchell called for a “massive diplomatic effort” to allow for the creation of two safe havens in Syria to shelter the refugees. Military forces from Britain and other countries from the EU and the Middle East, acting under a UN chapter seven mandate, would protect the safe havens that could be based near the Turkish border in Idlib and Daraa province in the south-west of Syria by the border with Jordan. This would involve enforcing a no-fly zone.
In contrast to Merkel’s policy of ‘fools rush in’ pouring toxic fuel on the crisis that encourages families to undertake perilous and dangerous journeys to arrive at German borders that now have an open and closed policy erratically closing in consequence of overwhelming numbers, the UK has adopted a more measured approach.
Mitchell told BBC Radio 4’s Today programme: “We need a serious effort now to protect the millions of people who are on the move in this second world country where up to half the people of the 20 million population are now either over the border, heading for Europe, dead or displaced.”
There are 2 aspects to this crisis. The first is the reality of perhaps millions deciding to become refugees with intent to flee from oppression and violence to pursue a better life for themselves and their families. The second is the actual movement and perilous forced march nature of escape from oppression.
The best way to deal with the crisis is through cooperation among nations including Russia, EU, US and the UN to stabilise the politics of Syria and bring agreement and immediate ceasefire to warring parties.
Inducements such as aid to redevelop the economy, health and education systems should arm negotiations. A disarmament Treaty that would not be welcomed by arms sellers. Emergency crisis talks should be convened at the UN which appears to do little to nothing. Obama has already signaled the solution to the refugee crisis should focus on solving conflict in Syria.
The other aspect to this tragedy is the movement of people. Up to 4 million Syrians amongst other nationalities represent this growing and moving tide of humanity.
“They tried the shores of Libya, the islands of Greece, and the plains of the Balkans. Now it has emerged that Syrians fleeing civil war have found another route to the safety of Europe: the Arctic Circle.
Dozens of Syrians have trekked to the far north of Russia this year in an unlikely bid to reach a little-known Arctic border crossing with Norway. Up to 20 Syrians a month are then crossing into the tiny Norwegian town of Kirkenes,”
Perhaps the sight of thousands of army trucks/ships and other means of transport sent by Angela Merkel to the borders of the Balkans and across to Turkey to transport refugees safely to Germany might give observers food for thought, but this would be one way to address the health and safety needs of refugees.
Instead it would appear Angela Merkel is hiding behind the Schengen Agreement assuming refugees will get safe passage across Europe at their own expense in the form of an extended holiday journey road trip. Germany has now closed its borders thus breaking Schengen and its promise to receive refugees.
Merkel has shown no concern at the plight of such refugees as they endure incredible danger on the way to hoped for safe havens in Germany or elsewhere.
Insufficiently worked out and still unclear Germany’s invitation ignores the reality of upwards of possibly 4 million people on the move from these refugee camps (see map).
In contrast UK policy has been to take a measured approach. Britain has grasped the nettle of the dangers posed by the movement of vast numbers of refugees doing a perilous journey without any safety net in place. Ireland’s response has been chaotic and mindless in comparison.
“As the prime minister prepared to make his statement, the former international development secretary Andrew Mitchell called for a “massive diplomatic effort” to allow for the creation of two safe havens in Syria to shelter the refugees. Military forces from Britain and other countries from the EU and the Middle East, acting under a UN chapter seven mandate, would protect the safe havens that could be based near the Turkish border in Idlib and Daraa province in the south-west of Syria by the border with Jordan. This would involve enforcing a no-fly zone.
Mitchell told BBC Radio 4’s Today programme: “We need a serious effort now to protect the millions of people who are on the move in this second world country where up to half the people of the 20 million population are now either over the border, heading for Europe, dead or displaced.”
“The former cabinet minister said Britain would not deploy troops on the ground though he said this should be given serious consideration. “This is not the offensive action by troops that people in Britain sometimes recoil from.” he said. “It is a defensive action. It would need to be done under the UN charter, probably with a chapter seven mandate that allows them to defend themselves … It would need massive capacity to defend themselves.”
A safe haven policy negotiated in Syria and surrounding countries eg Turkey given a ceiling of 6 months to process refugees and direct them to countries wiling to receive them would allow countries to prepare for their reception and provide for their welfare. This would also give time for diplomatic efforts to push to resolve the crisis in Syria perhaps inducing under safety nets those who wish to return. Its clear following a war in Syria now heading for decade long duration, many refugees have given up waiting for end to conflict.
Merkel’s mess is compounded by the growing crisis on its borders. UNHCR since April 2012 has expressed concern at the behaviour and attitude of Hungarian authorities to asylum seekers.
Concern has been raised at UNHCL level since 2012 on Hungary’s attitude to refugees. Indeed Germany’s ignoring of the contents of this UNHCL document on refugee asylum seekers in Hungary amounts to German provocation of Hungary that could lead to the breakup of the European Union.
Member states of the EU are now in open conflict on how to deal with the crisis. Germany has by comparison shown irresponsibility at best, incompetence at worst with questions arising as to its policy motives that inform the mess.
Compounding the mess created by Merkel we have the nonsense ‘partnership and solidarity’ response of Ireland.
Uncritically swallowing the chaos wholeheartedly from Angela Merkel instead of working with the UK on a common and caring structured response based on both the UK’s and Ireland’s opt out of the Schengen agreement, we have contributed to the mess.
According to Joan Burton, we are to accept up to 5000 refugees. Naturally there is no budget allocated for this.
Somewhat like our bailout it appears the policy is the begging bowl where we accept bailout or in this instance accept 5000 refugees and ask for compensation to pay for this later?
Some have proposed using ghost estates to house refugees perhaps creating a District 9 class of untouchables in the manner of an internment camp? No one knows! Our history of direct provision for refugees does not augur well for the welfare of incoming refugees.
What we do know is that government following nearly 5 years in office have failed to solve the homeless crisis, the housing crisis, the renting crisis, hospital waiting lists and a hospital trolley service. Emigration remains at high levels and our unemployment levels are also high. We are in the middle of a homelessness crisis.
Asylum seekers in Ireland have been interned in a direct provision service criticised locally and internationally. Our reputation in this area is not good and the above does not augur well for asylum seekers.
The refugee crisis needs to be addressed in a caring and informed manner by competent policy makers.
Meanwhile war in Syria exacts an even more deadlier price.
September 1, 2015
Good luck to Agriculture Minister Simon Coveney attempting to persuade farmers the fall in commodity prices for dairy, beef and grain is only a temporary glitch in the markets. Good luck with his efforts to persuade the EU to grant €800ml aid to Irish farmers to build storage to take meat out of the market place and hold until prices improve.
IFA president, Eddie Downey, “accused Mr Coveney of making big promises about opening new markets in China and the US to Irish products when the reality had been completely different, with just €500,000 worth of beef sales to the US rather than the talked-about figure of €80 million-plus.”
The reality is that farmers, water protestors, and the general public see through the myth that prosperity is returning to our shores. Young people at the lower levels of the public services eg in education enter at salary levels lowered from scales paid to those at senior levels.
The economy is worsening except for those at the top.
Growth in senior management grades in the HSE has a counterpart in the scandalous and disgraceful cuts to services of some with the greatest need for support in terms of their disability.
For example, recent cuts have meant a group of 28 parents advocating for services for their care now aged 18yrs, from a mainstream provider proven in provision of adult services for those with the severe needs of autism, have been denied such services.
In place of dedicated, proven, mainstream services, parents have been redirected to another service without record or means to work in this area, to provide a cover of 3 days per week. This has severe impact not only for the parents and their care, but for the future development of services in this area.
Such a predicament and scenario worsens when measured against the policy to provide free medical care to under 6’s and over 70’s for those who can well afford to pay. This is symptomatic of a generalised worsening in services for all but those who do not require such services.
In spite of this salary scales and levels of management at top of the HSE continue to grow. See inmo link below.
Irish Financial Services Industry/lending professionals at all levels
“Morgan McKinley August monthly Employment Monitor for July 2015 demonstrates an increase in professional jobs by 31% (July 2014 v July 2015) and 11% (June 2015 v July 2015). Focusing more particularly on the banking sector, as lending within the commercial, corporate and retail banking continues to recover, there is a growing need for lending professionals at all levels. The recent announcement of a pay rise by one of the country’s leading financial institutions will no doubt serve to make these roles even more attractive.”
The financial services industry and the banks who brought about Ireland’s economic collapse with their tooth and claws in austerity for Irish public services, are rebounding from their setback in 2008. While the economic prospects of those at the bottom of the tree decline further, those at the top of the tree, the 1% are mushrooming.
Forget services in education and health, infrastructure, product/service development, harnessing the creative energy required to develop the future of mankind, lets all print money and sell loans to each other. Lets have a system designed to pump all the wealth from the bottom 99% up to the top 1%. I digress.
All is not well with the financial sector. Consider the following:
“the World Bank’s three industrial commodity price indices – energy, metals and minerals, and agricultural raw materials – experienced near identical declines between early 2011 and the end of 2014, of more than 35 percent each, and will continue to contract this year. Prices of precious metals are also expected to decline by 3 percent in 2015, on top of the 12 percent decline seen in 2014. Again, ample supplies, weak demand, and a strengthening U.S. dollar have weighed on prices of these commodities as well.”
Venezuela, Brazil, Argentina are but a few of the Latin American economies facing economic decline followed by collapse due to the surging dollar and falling oil and commodity prices.
For six years, the world has operated based on faith and hope that Central Banks somehow fixed the issues that caused the 2008 Crisis.
QE adding $10 trillion in debt to the US system and the frenzied printing of money in Japan, Europe, UK adding more debt to previous stockpiles of debt, that has already caused 2008, has only one upside, to delay the inevitable collapse that in global market terms has potential to be far worse than that experienced in 2008. This has already begun.
The derivative market that uses the global bond bubble that has mushroomed from $80 trillion in 2008 to over $100 trillion today has grown to $555 trillion in size. Like a nuclear reactor in meltdown it is fast getting beyond the ability of central banks to control.
According to Graham Summers “Sovereign governments, large corporations and even municipalities have used derivatives to fake earnings and hide debt. NO ONE knows to what degree this has been the case, but given that 20% of corporate CFOs have admitted to faking earnings in the past, it’s likely a significant amount.”
“Corporations today are more leveraged than they were in 2007. As Stanley Druckenmiller noted recently, in 2007 corporate bonds were $3.5 trillion… today they are $7 trillion: an amount equal to nearly 50% of US GDP.”
“5) The Central Banks are now all leveraged at levels greater than or equal to where Lehman Brothers was when it imploded. The Fed is leveraged at 78 to 1. The ECB is leveraged at over 26 to 1. Lehman Brothers was leveraged at 30 to 1.”
In January 2015, the Swiss National Bank (SNB), backed into a corner by the ECB’s QE program, had a choice: print an obscene amount of money to defend the Franc’s peg or break the peg.
The SNB chose to break the peg. In a single day, the bank lost an amount of money equal to somewhere between 10% and 15% of Swiss GDP. More than that, it let the Franc appreciate… in a country in which 54% of the GDP is based on exports.
Central Bank of China is beginning to lose its grip as the Chinese economy succumbs to a dual property and stock bubble.
Turmoil on the markets with global currency volatility from the euro to the yuan driving a global downturn of unprecedented proportions is focusing minds on the obvious and emerging truism that the financial sector controlling the markets is not the solution to this global currency crisis, but is rather its principle cause.
The printing of monopoly money is skewing market economies across the world driving down the price of real commodities, impeding the creation of real and productive businesses and economic development. A global stock market and property bubble crash whose worst excesses are currently felt in China, but whose flames are fanned across Latin America and Europe, will soon be felt everywhere.
The rise of the value of the dollar pegged against other currencies with debt denominated in dollars as economies attempt to stabilise rising debt levels will inevitable lead to decline in GDP across the globe. This will inevitable lead to default eg Venezuela and Greece.
The effect of such defaults could lead to a tsunami effect the best outcome for which would be a switch back to a more stable global unit of currency based on a fixed exchange rate pegged to real commodities such as silver or gold.
The axiom that the development of the financial sector leads to economic growth has been shown to be a false truth and the sooner the 1971 decision to take the dollar off the gold peg is reversed, the better for the world.
The stockpiled trillions in debt creation since then is a testament to the fact that currency bubbles in a fiat currency are about as helpful to economic growth in the long term, as daffodils are as global reserve currency.
August 19, 2015
An unfair, biased, or hasty judicial proceeding that ends in a harsh punishment; an unauthorized trial conducted by individuals who have taken the law into their own hands, such as those put on by vigilantes or prison inmates; a proceeding and its leaders who are considered sham, corrupt, and without regard for the law.
Political policing has come to Ireland. Do you think if Joan Burton was actually imprisoned in her car or if their was one whif of danger to her safety, Joan would have rung the local gardai who would have descended in force to guard her safety.
Let’s hope a decent barrister will ask to see all mobile phone records and ask the relevant questions.
Perhaps the garda in charge of operations should answer the question as to how Joan Burton allegedly remained a prisoner in her car for 2 hours. Was police time wasted? Could she not have acted sooner to call a garda?
The whole matter would be ludicrous and laughable if not for its sinister side. Perhaps this is a prelude and warning of further kangaroo courts to come targeting protesters across the country.
Joseph Goebbels Hitler’s propaganda chief I’m sure would also have made similar opportunity out of the moment to mount efforts to tar and feather water protesters with similar propaganda.
Perhaps police entrapment was involved.
We look forward to analysing proceedings.
It’s worrisome that the Director of Public prosecutions has allowed water protesters to be victimised in this way. Apparently its one rule for farmers protesting another for working class people.
Burton’s remaining time in office would be better served going after bankers who’ve so far for the most part escaped the rule of law. Or indeed investigating possible collusion between regulatory bodies, developers and politicians in Celtic Tiger years.
Apparently its never been easier to get away with white-collar crime in Ireland
Perhaps if Joan Burton were charged with wasting police time more resources could be given to this neglected area.
Doubting Thomas’s may even have reason to believe the ‘imprisonment’ was staged by both Burton’s entourage and the garda as a form of police entrapment?
The whole saga does not reflect well on the politician involved, gardai and the judiciary.
However, everyone who values free speech and democracy in Ireland should protest at this abuse of our democracy. Particular attention should be given in a public inquiry as to the role of the DPP in pursuing this matter.
Increasing the rent supplement will not end the Housing Emergency mushrooming in Ireland, it would in any case only be pocketed by buy-to-let landlords.
Young people are under attack from unscrupulous landlords with unconscionable rents due to artificially induced housing shortages created by the banks to protect wealthy clients and their developer loans.
Consider this scenario: Banks in Ireland remain in a fragile state. Large and outstanding loans to buy-to-let landlords during the boom years are not risk free. If property prices sink, these loans risk going into default.
FG/LB in collusion with the central bank decide on a policy of inducing housing shortages to fatten the sacrificial lamb of property developer loans held by the banks. Banks are already feasting on high rents and ridiculously high property prices.
It’s the old story of the rich 1% with enough political connections in FG/LB to pursue policies in their favour to the exclusion of the needs of the 99%. Such a possible scenario is worthy of consideration.
The price to pay is that some fall under the austerity wheels and face homelessness.
Enda Kenny has promised a package of measures to address the emergency. Ironically, he has known of this emergency for quite some time.
In much the same way he promised that measures would be taken to demand debt relief for our banks duly trumpeted and reneged upon since June 2012, Kenny has been endlessly announcing his ‘waiting for Godot’ means to address the emergency homelessness crisis due to worsen over the coming months and years.
At the stroke of a pen, he could impose a tax on tax-free development land forcing the end of developers sitting on their pot of gold and refusing to sell until the market
He could immediately open a series of caravan/mobile home parks as an interim measure that would at least take people out of B&B’s and unsuitable hotels.
NAMA is withholding large property banks from the market and it too should be forced to divest its stake in rising property prices that risk return to Celtic Tiger mistakes..
Irish developers are being refused loans to begin construction supporting the housing needs of people in Dublin.
Kenny’s policies have not only goosed the construction industry but high rents are leading to the closure of viable retail businesses throughout Ireland while Kenny’s odyssey of own goals continue.
Behind all of this farcical paper based economy is the dominance of the financial services industry driving the real economy to its doom.
The servicing of loans to the banks, the development of lending by the banks, has turned a real economy into a paper based exercise in financial Tom Foolery forcing young people to emigrate, the destruction of an economy through austerity.
The propaganda that the economy has turned for the better translated means we are at the point that by stealing from taxes set by the state to pay for social services including education and health, we have returned gambling debts of the rich to the rich to enable them relaunch casino investment practices while the rest of us still pay the tab.
Kenny’s castle is built on sand
The enormous downturn in the value of the euro against the dollar from 1:40+ to 1:10 dollar/euro exchange rate has been a great boon for exporters in Ireland and has lured more US holiday makers to Europe.
While this has been a boon to large business in the export area for the euros held by the 1%, this has been a hidden tax on the general population of 99% forced to pay higher for a range of imported goods from energy products based on oil to imported household items imported from China.
It’s a fragile recovery based on Zeppelin hydrogen rather than the oxygen of a real economy. Germans used hydrogen as a lifting gas that increased lift by about 8%.
Hydrogen fires had never occurred before the one that brought down the Zeppelin.
Let’s hope Kenny’s promise of a rise to pensions and free medical cards for the over 70’s will not further divide older people from the young who do not live in mortgage free houses and are not unaffected by the financial collapse.
That particular policy will need to be watched carefully as we approach the winter months with the possibility of doctor’s surgeries overwhelmed with young and old seeking free services while those in serious need go to the back of the queue.
Nama could immediately release large vacant property banks to deal with the crisis.
Kenny’s agenda is not to allow this to happen, to keep property prices high,
to inflate banking profits in this illusory paper economy of ours.
Growth of circa 5% has been promised for the economy for next year as the world enters into an economic disaster with parallels depicted in the movie A Perfect Storm.
Unemployment levels down for June in spite of Summer month optimism.
There are increased unemployment levels for the young and proportionately 2:1 female to male ratios in those losing their jobs.
Higher taxes vat receipts can partly be explained by higher cost of imports.
Effectively the euro has undergone a massive devaluation against the dollar. In the short-term this has given us an economic boost mainly through increasing exports that benefit from a lower exchange rate against the dollar. Tourism from the US also gets a boost.
But there are negative sides.
China could be reaching pay-up time for empty ghost cities built on disastrous lending to developers during its boom years built on lending. Currently it is attempting to brake massive sell-off of investment stocks with parallels to 1929 in the US. China faces the danger of imminent recession.
€86bn bailout to Greece is not without its critics.
Ironically, Kenny has attacked the proposal of debt relief for Greece (I kid you not) in spite of his own aborted failure to succeed in this area. The IMF is now strongly suggesting it will not be part of such a bailout if there is not debt relief for Greece as part of the bailout measures for Greece.
The coming Autumn will decide the fate of Greece if debt relief is not on the table. If it is, banks in Greece and France will take a large hit thus weakening the euro area further.
Meanwhile some argue that 12.5% of GDP as repayment of debt interest by Greece is sustainable.
What is more than sure is that the Zeppelin of recovery built on servicing the financial sector at the expense of the real economy is doomed to failure and will lead to more and more bush fires adding to decline rather than recovery.
Meanwhile young people are asked to pay the piper as they are led into the world of higher taxes and rent increase further eroding their standard of living while being denied the right to own their own property and raise their families in a world threatened by increasing exploitation of the 99% by the 1%.
Welcome to the new Orwellian world of financial paper based Zeppelin economies built on the fires of property and stock based investment that threaten to burn out of control at any moment.