Tearing The Hair Out!
February 11, 2013
Well, the Honahan banker puppets fresh from their troika/ECB negotiations that took an unbelievable 16 months ‘fortuitously’ announced their bond deal Thursday last. According to Stephen Donnelly TD the move was ‘fortuitous’ coming in the same week as a court challenge to the promissory notes and threatened action by IBEC’s David Begg (David Begg, General Secretary of the Irish Congress of Trade Unions (ICTU).)
David’s day of protest against our treatment by bailout lenders and the ECB who’ve saddled Irish taxpayers with the losses of private Irish and European banks was in stark contrast to the general applause ringing out in the Dáil for the Honahan deal of multiple long-term bonds laundering private debt into state debt much to the delight of our lenders who’ve extracted the most that can be got at the moment out of the Irish economy without killing the goose that lays the golden egg.
‘Fortuitous’ as used by Stephen Donnelly on Marion on Sunday RTE was rather naive. A rather more wry understanding of the events of the week above would consider the announcement of a bond deal as directly targeting developing protest especially that of the courtroom.
Meanwhile we hear Honahan has been tearing his hair out at the lack of progress in the banks dealing with the growing amount of mortgage arrears.
http://www.irishtimes.com/newspaper/breaking/2012/1213/breaking16.html
“By value, the amount of mortgage debt in arrears of 90 days or more totalled €16.8 billion or 15.1 per cent of the €111.2 billion owing on Irish residential mortgages, while the outstanding balance on buy-to-let mortgage accounts in arrears of more than 90 days was €7.9 billion at end-September, equivalent to 25.5 per cent of the total outstanding balance on all BTL mortgages.”
Those were December figures. I expect figures to have jumped to €17.5 billion by now.
Now the banks are doing their best to milk this situation for all its worth. Vast amounts of time and expense must be spent by banks chasing down potential defaulters in efforts to extract blood from each one. Never mind the fairness of a deal with A differing to a deal with B or the variability of hard/soft approaches between one bailiff and another, the potential for bog-down in such an approach deserves a smile.
Not the most efficient system, is it? Where, you say,are the long-term bonds for individual, negative equity potential defaulters afraid to spend a penny lest the banks seize it? What about debt write-down? Where are the stats on the progress being made by the banks on the €17.5 billion. What, all secret, unavailable, even though taxpayers own the bank bailouts? What of the fact we are now owned lock. stock and barrel by the ECB, do they not insist on movement in this area?
http://www.thejournal.ie/negative-equity-proposals-budget-2013-650049-Oct2012/
Both in this blog and elsewhere see above attention has been drawn to the differences between the tortuous extraction of debt from those in negative equity in Ireland within the bank torture chambers and Iceland’s approach where debt was written down to 110% of current values at time of write-down following a similar plunge in property values in Iceland.
The hypocrisy of saving bondholders, European and Irish, at expense of Irish taxpayers lies in stark contrast to the Icelandic insistence the people of Iceland would be protected from the ‘Armageddon’ threat of bondholders and other lenders. One should remember and ponder on the way legislation was rammed through Leinster House in our museum ‘pretend democracy’ to facilitate the annexation of democracy in this state due to debt bondage and peonage.
Meanwhile our state lumbers on faced with looming cataclysmic emigration, €17.5 billion of mortgage debt they hide rather than write- down, the largest % GDP of private sector debt in the EMU, one of the highest austerity budgetary claw-backs in the EMU, taxation mounting on further taxation masking as ‘property charges’, 12% rise in price of basic commodities between 2010 – 13, cutbacks in education, health and most places.
Ireland has beached itself like some pilot whale on the shores of the EMU where its left to die a quietly with salaries, perks of the rich protected at all costs as the ship ‘democracy’ goes down.
Honahan has torn all his hair out on his way to dictatorial oversight of the ECB of Ireland’s squandered democratic rights. He’s about as bold and bald as prospects for economic recovery of Ireland Inc under the troika.
And I havn’t even mentioned Ireland’s budget deficit. Nuf said.
End.
Honahan’s ECB Sandwiches…Self Subjugation, Debasement, Slavery!
February 7, 2013
We hear Prof Honahan is preparing yet another proposal for the ECB. His other proposals rejected outright, he’s running out of time and options and doesn’t understand the meaning of NO!.
It’s embarrassing he’s at this point following 2 years of intense negotiations. He’s been so compliant and submissive and persuasive he risks being compared to Mrs Doyle of Fr Ted fame failing to persuade visitors to one of her LTRO sandwiches.
The process referred to above of self humiliation of Ireland Inc continues led by our failed negotiators. This time they have surpassed themselves not by liquidating NAMA overnight in Leinster House but in fraudulently pretending this move is good for Irish taxpayers, or that it will leverage support from the ECB to Ireland’s debt negotiations currently unfolding and unravelling.
800 employees of IBRC are pretended to be laid off. Lets open the can of worms, shall we?
It’s difficult to kill a zombie bank that’s already dead, but this is how its done. All assets and liabilities held by IBRC are to be transferred to NAMA, zombie central. Not only that, but the promissory notes currently held by IBRC, a private bank, are also to be transferred to NAMA.
Now you see it, now you don’t. For our next trick, let’s do something about those 800 jobs. Let’s give all these people a job in NAMA to manage the IBRC portfolio currently transferring to NAMA.
Hey Presto, it’s another mess again NAMA in a Hammer Horror move, biting into IBRC taking the whole IBRC vampire into its NAMA fold of the undead.
Will the ECB issue a bond to the Irish government and risk the charge of directly funding sovereign members of the EMU and break its own rules. With NAMA, the current debt profile of Ireland’s banks, looming mortgage default threatening our banks once again, internal devaluation, austerity, is Ireland worth the risk to the EMU by attempting to bail us out with such a move.
Though secrecy surrounds the negotiations it would appear that the Mario Draghi rounds of LTRO funding of banks across the EMU extend only to the interbank market allowing participating banks to issue bonds backed by the ECB. This support of the EMU banking system does not extend to directly funding sovereigns, as a long-term bond issued to cover the promissory notes would entail.
You see there has been some concern that a future government could come in and decide we’re not going to pay the promissory notes. But transferring them to NAMA means the state has made what has been unofficially sovereign debt, official. Whatever future government we or or our children elect if the state exists (they are doing their best to collapse the state), will not have such a choice, the sovereign debt will already be theirs.
Meanwhile the compliance guards eg Prof Alan Ahearne is coaching Ireland not to be threatening the ECB. Gilmore is saying everything is satisfactory. Heads in the sand. Let’s disregard the threat of the ECB to the very viability of this state and beg, borrow or steal to repay our ‘so-called’ debt obligations however odious they may be.
The IMF and the troika may not see this as a viable course as we have endured financial meltdown only to face a second meltdown risk to our banks because of internal devaluation, austerity and the erosion of a cliff of mortgage default creeping around our banks.
The best option for Ireland, ECB, troika is to allow Ireland default outside the EMU. Attempts to save Ireland could put the EMU further at risk.
Meanwhile bond issues to banks throughout the ECB, Ireland is being treated as the ECB scarecrow taking attention away from Spanish, Italian banks hiding behind our difficulties.
http://www.rferl.org/content/ecb-bond-buying-plan-explainer/24701349.html
“According to Dalibor Rohac, the deputy director of economic studies at the London-based Legatum Institute, the plan can only do so much if indebted countries do not aggressively tackle their budget-deficit problems on their own.
“Ultimately these countries have to either fix their internal imbalances through internal devaluation, which is proving to be very costly, or they will have to try to find some other arrangement that might even involve an explicit devaluation by leaving the euro zone,” he says. “Ultimately the ECB can’t fix these countries’ fiscal problems and can’t fix these countries’ imbalances. And so we are still waiting for a solution to that longer-term problem.”
It would appear logical that we should consider leaving the euro zone if the ECB is intent on ransacking the state without providing an adequate restructuring deal on Ireland’s debt.
Its a risky option fraught with legal difficulties for the ECB to allow the Irish government to issue a 40yr bond guaranteed by the ECB at low enough interest rates to allow Ireland both reduce the principal on its promissory note obligations and pay back the bond at a reasonable cost to the state. Other permutations to such a deal exist but given the rejection by the ECB of deals proposed hitherto, it would appear there is little chance for this or other alternatives.
A major problem is that for Ireland to benefit from such a bond programme it is firstly required to be fully back in the markets,
http://online.wsj.com/article/SB10001424127887324624404578257640692205214.html
Problem is that the ECB and troika can see as well as most that Ireland is capsizing because of its debt beyond the point of rescue without default. It’s not clear that under any terms without significant debt write-down including devaluation, that Ireland can be saved as a viable country in the EMU.
For this reason there is good reason to consider ejection of Ireland from the EMU where from outside, default and debt write down is possible, whereas from inside the EMU our currency profile is beyond the limits of sustainability.
The LTRO provision of short-term funding to European banks currently beginning its payback cycle and contributing to strengthening EU banks availing of it should not be confused with the underlying economic conditions in the EMU that continue to deteriorate and show signs of weakness.
The rise of Germany within the EMU is a worrying politicisation of the ECB that is increasingly unchecked. The democratisation of EMU that Ireland signed up for has not materialised.
They created NAMA and are looking for another long term bond, monetary financing, to grow this monster NAMA into Irelandstein.
It’s time to batten down the hatches and prepare for another round of panic and mess from our negotiators.
They’ve come up with the absurd idea that unlike Mario Draghi’s LTRO where institutions including banks lend to each other in the secondary market and these bonds are backed by the ECB thus lowering the risk for investors, that ECB through monetary financing should issue a long term bond to NAMA, a state institution?
Whatever chance IBRC/Anglo/NAMA backed by another deal from the ECB supporting the state through allowing a Greek type write-down, could issue a bond for say 80% of the promissory notes, rest backed by government, that would be backed by LTRO at EMU level, is now lost.
The Irish negotiators have trashed the state and given us a shambles.
If I were sitting on the governing council of the ECB, this move would be sufficient to investigate ejection of Ireland Inc from EMU.
End.
ECB and the Promissory Note
February 3, 2013
Soo we’ve been living on a top-secret diet of complex negotiations seismically shifting in our favour towards the horizon of a renegotiated bailout for Ireland that would allow us to return to markets like some NewERA Lazarus that would pour molten oil on critics of Enda & Co and further enhance their standing on the world stage.
Yeah right, like the ESRI’s favorite phrase ‘revise down’ re its predictions for growth, statistically its successful predictions are on a straight line downward curve over the past number of years, ministers peddling the above nonsense are currently ‘revising down’ their expectations of a favorable deal for Ireland.
Like back seat passengers in a driverless limo carrying Bruton, Sutherland, Honahan, Dept of Fin and many others who got us into ‘promissory notes’, ‘default’, ‘the guarantee’ they realise all their guarantees and promises have been as empty as they are, so we have some murmurings coming from their bunker as they foresee failure.
Gilmore in Latin America has used the word ‘catastrophe’ if we do not get a deal. Now Sunday Indo p4, John Drennan/Daniel McConnell, according to Brendan Howlin, Minister for Public Expenditure, “Ireland’s fragile economic recovery will only be sustainable if a deal on the promissory note is secured”.
Lest you be taken in by Howlin’s words, let me explain, Ireland has had no recovery. Austerity has been eating away and eroding whatever economic muscle that financial meltdown still left intact. Another 700 jobs to go in B&Q announced this week as retail collapses into its black hole dragging with it whatever businesses have managed to survive to now.
Mortgage arrears continue to pile up with banks preparing for another bailout requirement. We have had no recovery because our debt is unsustainable and rating agencies and markets know this even if govt ministers like Howlin continue to play propaganda’s confidence card as Rome burns.
According to Daniel McConnell, p4, Sunday Independent, “..it has emerged since last weekend, intensive discussions between the Central Bank of Ireland, led by Governor Patrick Honahan, top officials in the Department of Finance and the NTMA and senior officials in the ECB have taken place daily”.
OH no! you say! Not the same guys who gave is the bailout, the guarantee, the promissory note, the ‘no bondholder shall go unpaid’ mantra. Afraid so, one gigantic mess after another.
ESRI has revised downward its projections for growth this year. How often have we heard this?
ESRI conjure growth out of nothing and then repeatedly get it wrong and they continue to offer up unmitigated propaganda undiluted by the brass neck indifference to error. Yet the same agency has been used by government to argue that our sinkhole ‘bailout’ is sustainable, the figures provided by NAMA will eventually yield a return to the state in the red?
Do you recall the days when defenders of NAMA and the bailout trotted out the 3% growth rate projections while naysayers like yours truly poured cold water on such fantasy. Well, the chicken has come home to roost in more ways than one.
Earlier promises of a sustainable reworking of our bailout terms and the dreaded promissory notes have now reached endgame. The hide and seek provided by false projections re sustainability and renegotiated terms of our bailout by a sympathetic ECB is now in endgame.
Those negotiations should send a shiver down your back. The sell off of our state forests by Coillte to an international fund fronted by Bertie Ahearn, would that raise your eyebrows? Its more than a possibility. What dreadnought further ransacking of our economy is being proposed in these negotiations?
The more cynical among us look at the negotiations above as an exercise in how to protect the higher paid in the public service from future cuts, maybe the allocation of jobs based on fiduciary service to the ECB, the softening up of Irish negotiations weak at the knees at the prospect of this state being ransacked by the troika into oblivion.
Truly we are a large can of debt worms they would like to hide their debt in.
Simple way out of this of course in to fess up and say the deal is unsustainable and walk out of the negotiations, declare ourselves bankrupt and place our case in the international court of settlements, do an Iceland. Thereafter, it would make logical and economic sense to seek help from our neighbours in the UK and NI in economic partnership.
Ireland’s economic profile requiring flexibility and fungibility into currencies such as the dollar, sterling and the euro, is currently being dragged underwater by the euro currency. Economic union has been a horror story.
EMU has yet to build a sustainable banking system about which it is far and long from agreement.
EMU initial foundation has been flawed, its initial target to draw the outer core up to living standards and economic performance of inner core countries has instead exacerbated divisions and mounting conflict which will grow further as austerity grows. Unsupervision of its banking system and incompetence of leading national agencies such as Department of Finance, Central Bank, Anglo and leaders such as Bertie Ahearn in Ireland have proven to be a toxic combination.
Lack of flexibilty in the empowerment of member states to recover economic independance means the EMU is turning into a version of the USSR with a rouble currency.
We have moved long past the idealism of shared democratic participation as the inner core led by Germany takes the EMU backward to a master slave relationship best describing another era.
Sure enough NEWera is about as new now as it sells off Ireland’s forests to Bertie Ahearn as the Treaty of Versailles(1919) was new in terms of war reparations that sold Germany to its debtors in WW1
http://en.wikipedia.org/wiki/World_War_I_reparations
A final word re the craven and incompetent silent negotiations of compliance and appeasement that have brought us nothing from ‘our negotiators’.
Resignations please!
End
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