Varadkar’s Vassals

June 28, 2017

WE NEED TO LEAVE THE EU

In his book, p97  “And The Weak Suffer What They Must” Yanis Varoufakis gives praise to the following rather prescient observation of Margaret Thatcher, a politician he has next to nothing in common with:

“But if I were (playfully considering the notion if she were governor of the European Central Bank), there would be no European Central Bank accountable to no one, least of all to national parliament’s. Because under that central bank there will be no democracy, (and the central bank will be) taking powers from every single parliament and be able to have a single currency and a monetary policy and an interest rate policy that takes away from us all political powers.

Those words have borne true for politicians in Ireland and across Europe. Consider that new phrase ‘Fiscal Space’ that arrived on our shores only a few years ago following a visit from the troika. This means Europe dictates budgetary limits it has set for us, our politicians cannot borrow on behalf of the state to invest in the public housing infrastructure the state requires to combat homelessness.

With Ireland €200 bn in debt, political roles reduced to being the obedient and compliant messengers of European dictats  Ireland’s politicians have struggled to pretend otherwise. They pretend to have the power to end our housing crisis, to build our hospitals to build the infrastructure a growing population requires.

Instead of large-scale municipal housing projects, hapless “Help to Buy Schemes” for first time buyers has had the opposite effect of increasing prices for first time buyers.

Government  encouragement of the private sector to take the lead in increasing public housing stock on the scale required to end homelessness and extortionate rent, has failed. But politicians wishing to pretend they have the power still pretend they can respond to the mandate of the electorate that gave them their vote.

Instead Ireland is run managed by our banks and anonymous unelected officials from the European Central Bank and the European Commission more secretively by Ireland’s Economic Management Committee. Not even the European parliament as a toothless legislator can change that.

Investment in capital infrastructure in education, research and in health is bottoming out to make further burdening of the electorate of the present and the future, look dismal in the extreme.

In such a situation you would imagine that debate on whether it is wise that we should remain in the EU or exit alongside the UK would be worthwhile. but you would be wrong if you did.

We appear to have a severe case of Stockholm syndrome ..” is a condition that causes hostages to develop a psychological alliance with their captors as  survival strategy during captivity”. However this analogy is not completely fair as both our European captors and our politicians appeal to our sense of well-being promising a return to the good days prior to what Lisa Hand described as:

It was like a physical punch in the gut. Outside on Merrion Square, frozen snow glittered on the streets. But it was nothing compared to the icy chill which hung in the air of the press centre in Government Buildings on the desolate night of Sunday, November 28, 2010, as the packed room watched a group of strangers from the IMF, EU and ECB settle into seats just vacated by the Taoiseach and two cabinet ministers.

This Troika was our new government now – unelected, unwanted and absolutely indispensable. Three Kings bearing a bitter gift of €85bn for a broken nation teetering on the edge of the precipice. Thirty pieces of silver in exchange for our hard-won, precious sovereignty.”

http://www.independent.ie/lifestyle/the-week-ireland-gave-up-its-sovereignty-29796376.html

On many levels we inherit an erstwhile disastrous  membership of the EU: political disempowerment above coupled with an unelected an unaccountable European Commission, unconscionable bailout that burdened Ireland with losses that should have been shared by European banks, billions that have been lost through our loss of fishing grounds, the prospect of Brexit causing losses of €5bn annually of agri business and further massive losses as yet unquantified, disastrous and deteriorating public services that presently buckle on the point of serious short fall.

The real problem with the euro is that it doesn’t have a system of circulating surpluses and deficits among member states as exists in the US under the FED. Instead the broken economies or Europe are meant to recover through a system of bailout and austerity in which every penny lost has to be returned from borrower to lender. This puts severe stress on already broken economies such as Greece.

Devaluation for member states as a system of self-regulation is not possible so states already burdened by bailouts are further burdened by austerity.

This is a loop that cannot be broken except by the breakup of the euro. Perhaps this fact alone is at the heart of Brexit many politicians in the UK perhaps having foreknowledge of the imminent breakup of the euro itself.

Negotiations over Brexit not only flag the exit of the UK from the single market the euro represents, but also flag the very survival of a euro severely challenged as it will be by Brexit.

Notwithstanding a budget deficit that is currently under control though weighed down by over €200bn of public and private debt, a serious housing crisis disastrously managed by NAMA (who’ve alarmingly sold off housing stock to the lowest bidder rather than contributing to the supply of housing in a broken residential housing market); Ireland INC finds itself inflated by rising housing prices;  a return to a bubble economy supported by fragile banks facing what could be a greater threat to its economy than the meltdown of 2010, Brexit.

In place of flooding propaganda from both media and political sources denouncing Brexit with an arrogance that grows by the day, there should be an informed debate on whether we too should exit the EU.

The EU does not work anymore. Its unelected and unaccountable  bureaucracy has forced member governments into submission to a euro system that is proving disastrous for member countries leading them down to a path to ruin.

Without economic shock absorbers see below it has failed to deal with the financial losses of meltdown inherited through the 2008 Wall St crash and has sought to recover by a system of bailouts kicking the can into the future rather than healing the wounds that brought periphery nations such as Ireland into economic collapse.

Following 2008 Nevada in the USA went into financial collapse. Though a system of deficits and surpluses administered by the FED surpluses of states were channeled to this deficit state along with measures to rein in its banks and put the state back on sure-footing.

No such system exists in the EU. Instead vast losses were piled on the shoulders of deficit states and their taxpayers burdened with these losses through bailouts growing the gulf between rich surplus nations and deficit nations.

The policy of returning member states to economic growth has failed in Europe. Further centralisation of Europe can only mean less democracy for member states and increasing authoritarianism for member states.

EU  has drifted far from its original aspirations.

As political accountability has lessened the gulf has grown between the disenfranchised poor, the people, and their politically disempowered representatives.

Can things get worse? Sure they can:

https://www.armstrongeconomics.com/markets-by-sector/foreign-exchange/euro/european-commission/

“Once Draghi stops buying government debt, we may see a meltdown in the euro altogether.

The ECB wrote: “It is to be expected that significant developments on both the global and the European level will increase the risks posed by clearing systems.”

ECB is moving financial clearing houses from London to Paris.

Into this vacuum has stepped the far right introducing the nightmare scenario of the rise of extremism growing by the day awakening memories of Germany in the twenties and the consequences of this for democracy. This is engendered by a Europe run by a faceless bureaucracy, a European Commission that is held unaccountable to political movement by the people, a toothless European parliament that cannot legislate for the people.

Meanwhile 2 more banks in Italy have failed “Two more Italian banks failed over the weekend– Banco Popolare di Vicenza and Veneto Banca.Banks in Italy”. It will take €17bn of taxpayers money to bail them out.

This will come close to emptying the pockets of taxpayers but the story only begins here and offside hidden in the wings are a vast number of other banks in Italy struggling under the financial losses hidden away since the 2008 financial collapse tsunami that swept across Europe in 2010 until now.

Next move will be to raid depositors money with bail in as happened in Cyprus.

Varadkar’s  statement that his door is always open to the UK to talk not of Ireland also exiting with Brexit but of UK remaining in the EU shows a  contempt for the will of the British electorate who’ve voted Brexit.

Ireland does not think twice of holding referendum after referendum until the people are lied to enough to ensure their compliance with the will of compliant and obedient politicians.

I’m sure his door is always open is persuaded by his failure to attract any interest from NI politicians in Irish government calls for a United Ireland while remaining in Europe. Surely one of Fine Gael’s greatest political conceits.

Arlene Foster has just done a billion sterling deal with the Tories in the UK in return for minority support of Tory government. Her DUP party campaigned in favour of Brexit.

It will be interesting to see how much of this money will go towards the provisioning of border controls between NI and southern Ireland when Brexit comes about. For sure this money is meant to cushion and shock absorb NI from the effects of Brexit especially in its relationship to Southern Ireland.

Interestingly no similar commitment has been forthcoming from the European Commission as a buffer support of southern Ireland. Nor have Irish politicians been engaged in any public lobbying of the European Commission other than the acknowledgement of the empty acknowledgement Ireland is a special case!

In regard to the provision of housing, health and education we have to question whether democracy in Ireland exists anymore.

See this def:

” :  government by the people; especially :  rule of the majority 

:  a government in which the supreme power is vested in the people and exercised by them directly or indirectly through a system of representation usually involving periodically held free elections

Varadkar’s government’s failure to make good their promise to build social housing only 10% of which were built last year from a ridiculously low base shows political impotence.

Varadkar is wedded to further erosion of democracy and would not think twice of re-running any Irish referendum if it didn’t suit his preferred outcome. This is implied in his door open statement.

Varadkar’s future for Ireland is a Vassal Irish state with powerless politicians paid exorbitantly to groom Irish voters to accept all medicine from Europe as it plunges Ireland into deepening austerity.

The future of such politicians comes with the tantalising opportunity to progress to political positions in any number of the vast network of Brussels based European institutions who run our lives without accountability or democratic input.

The forces ranged against rational debate of an Ireland IExit proposition in support of Brexit are extensive and wide-ranging. Interest groups against Brexit range from politicians to public servants, to farmers, to the financial sector, all of whom are beneficiaries of the current status quo inside the EU.

Government budgetary considerations trundle along on receipts from a ruinous property sector, Corporation tax receipts that can collapse at a moments  notice under adverse pressures from Donald Trump to Donald Tusk, President of the European Council.

Not leaving out the security costs of a hard Brexit border and the extra tariffs charged against our exports to the UK under Brexit. Perhaps large-scale emigration endured over previous years will return to take pressure off our public services.

We should be talking to the European Commission on the question of monetary flows from the European Central Bank into Ireland from surplus EU members to help us shock absorb Brexit. We’re not.

The fact that instead the European Commission, as it did for our bailout forced us to take it on the chin for Europe without its support on burden sharing, will leave this country to fend for itself under Brexit, should be sufficient reason for our politicians to want out of the EU.

We do indeed exist in a financial bubble many on this island benefit from. Many wish this party to continue. Storm clouds are gathering however and all bubbles are easily burst. Looks like Ireland could be one of those bubbles that Brexit bursts first.

This will happen in spite of Varadkar’s vassals putting their heads in the sand and hoping for a good outcome for Ireland under Brexit.

This will happen in spite of efforts by Mario Draghi, President of the ECB or Donald Tusk President of the European Council cementing the relationship of the European Commission and Ireland by perhaps making Enda Kenny our ex Taoiseach Tusk’s successor while embarrassingly our state crumbles under the effects of Brexit.

On such an imaginative digression, I thank you for reading the above.

 

till again

 

http://www.telegraph.co.uk/news/2017/06/26/arlene-foster-meet-theresa-may-finalise-dup-deal-prop-tory-minority/

https://www.merriam-webster.com/dictionary/democracy

The Centre Cannot Hold

June 12, 2017

https://www.rte.ie/news/business/2017/0519/876459-govt-criticised-over-aib-share-sale/

The shock of British Conservative losses clearly shows the distrust of the electorate in regard to dictum that politicians are there to serve the needs of the people not the banks.

People are revolting against those political parties and politicians in league with the banks and financial services industry who loot people through austerity and no taxes for the rich.

People want ownership of their democracy back from politicians who troll for the rich while public services are looted through austerity. The middle class disappears leaving an increasing banana republic divide between rich and poor.

Following bailout money was printed out of nothing given to the banks and financial institutions as a reward for driving financial collapse!

The rich feasted on a frenzy of investment into stocks and shares and bonds it was hoped would also stoke economic activity. This has created the irony that since 2010 the books of many large corporations show slowing economic activity while their stock prices through artificial printing of money have since gone through the roof!

A corollary of this was austerity which sought to make the poor pay for losses stoked up by the rich.

With austerity and asset support of the rich in every feasible way possible through globalisation, the increasing power of the financial sector sought new speculative interests to assert its growing power.

Under the flag of austerity the financial sector has brought pressure to bear on politicians under its control and spell to privatise public services everywhere from healthcare to education to water supply hoping such utilities could be laundered into privatised assets to benefit the share speculators in large financial institutions.

Austerity made asset stripping of public services and asset stripping of public ownership of residential housing, health care and education the norm. Lack of public housing programmes allowed speculators to drive up property prices to unconscionable levels.

Further erosion of the middle class is evidenced in the lack of affordable public housing with the control of residential property passing into the hands of rich property speculators and vulture funds to further enslave the young whose ability and right to hold private property is under challenge.

An alliance between right-wing government parties, the banks and financial institutions and rich property speculators and developers drove property prices to the bubble levels they are today.

The crash of 2008 being just a minor blip on such policies that continue to this day with homelessness and hospital trolleys the new norm while the economy becomes laundered into that which has more in common with a banana republic than a modern democracy.

Clearly young people are voting against centre right parties whose collusion with the financial centre has brought about fewer full-time jobs, zero hour contracts, unaffordable and zero opportunity to purchase property to start a family home, lack of decent health care and a collapsing and unaffordable health system.

The current leader of the Fianna Fail opposition, on the election of Taoiseach in waiting, Leo Varadkar,  stated Fine Gael needs to do more on housing and homelessness and health, while his confidence and supply agreement and support of Fine Gael joins him at the hip with Fine Gael against a public programme of public housing.

Collectively they are yoked together by the yoke of Fiscal space an imperative imposed on them by Europe. Arguably in effect these politicians are powerless pretenders offering us policies that claim far more than they can deliver.

According to Philip Ryan Sun Independent, 11 June, p5 ” TD’s came under fire from the public after the last budget when their pay was to increase by €2,700 in April. Now they will get an approx €5000 on top of this which would restore 98pc of the salary cuts they received throughout the recession”

Such political hypocrisy has become the new norm. Further examples of political hypocrisy are evidenced in the collective failures of Simon Harris, Simon Coveney and Leo Varadkar to offer mere band-aid policies to end our housing and health crisis. Many members of such right-wing parties have vested interest in buy to let properties and own a portfolio of residential housing stock. They have no interest in bursting the housing bubble or ending homelessness.

While it would be easy to declare the need for TD’s as unnecessary and obsolete in particular ministries for Health, Homelessness and Education, as they have no power to bring about policies people require, as ‘Fiscal Space’ governed by Europe and Ireland’s banks, we must retain the hope that some politicians will emerge from young voters with enough intelligence, determination and ability to prevent Ireland’s slide into Banana Republic mode.

Both Fine Gael and Fianna Fail are signed up to the odious control of our fiscal sector by Europe, both are signed up to the austerity mantra of reducing our public sector including reduced pay for new entrants. Both are signed up to reduced taxes on the wealthiest including on those working in the financial sector.

Woven into the spider’s web are bailouts of the financial sector shouldered by weak politicians lacking in public spirit and enthralled by the financial sector.

Failures in the euro zone have shown how influenced the euro zone is by its crippled dependency on the banking sector. Most of the banking sector in Italy is insolvent. Spain has just seen Santander absorb Banco Popular previously one of Spain’s largest banks.

Spain’s Banco Popular got taken over by Santander for the sum of one euro. It had approx 37 bn in toxic loans on its books.

Some shareholders will get hit but the bulk of its toxic loans will remain toxic but Santander will attempt to hide them.

Popular had its share price nose dive recently on foot of bad lending practices and losses last year of 3bn euro.

Italy is filled with banks on the verge of collapse without a Santander to bail them out.

Part 11

In our banking sector we face the imminent sale of a 25% of AIB.

In Budget 2014 Noonan changed the law to prevent insolvent institutions setting 50% of their previous losses as DTA or deferred tax asset against future tax charges, to 100%.

This could mean AIB will not be required to pay a penny tax out as far as 2050.

In a sound bite heralding the sale Noonan praised the offloading to the private sector of the bank compared to its retention as a public Bank that could be subject to political interference.

Leaving aside the raft of political appointments to the banks such as Dick Spring or Alan Dukes or the lack of regulatory laws in Ireland or the lack of any supervision whatsoever.

Consider the political boosting of property bubbles that led to collapse.

Consider the range of bubble inducing legislation over the recent while including first time buyer grants that have helped inflate a toxic bubble in our property market once again.

With such evidence we need not worry that retaining AIB as an Irish Public Bank could damage Irish taxpayers.

The evidence is clear there is far more likely risk of toxic involvement of the state in the private banking system than there ever could be in a public bank.

So what would a public Bank be like? Consider the operation of the Bank of North Dakota.

http://bankingoncolorado.org/what-are-public-banks-and-how-do-they-benefit-us/

The many benefits of this bank are that profits are returned to the state. It can support a municipal and public housing programme. It’s mandate is to support communities rather than the black hole of shareholders out for their own profit.

It can be regulated and controlled in a manner that existed prior to 1994 where deregulation of the banking sector began in earnest.

What is Noonan doing instead?

http://www.irishexaminer.com/breakingnews/business/not-acceptable-for-bailed-out-aib-to-avoid-paying-corporation-tax-for-30-years-says-burton-792435.html

The bank will pay No corporation tax for 30 years. We have a housing emergency in Ireland where 3bn from the sale of AIB needs to be invested in an urgent municipal housing programme to end the growing scandal of homelessness and patients on trolleys in hospital wards.

The sale will cost taxpayers millions in lost revenues as the bank returns to profit. It has recently provided dividends for the state a large proportion of which will be lost on the sale.

Another reason not to sell is Brexit which will put severe stress on our economy.

We could do with a bank that might be a solution to help our economy rather than exacerbate a broken economy.

It makes no sense to pay down 3bn against our overall debt levels of which this is a drop in the ocean.

It is ludicrous that 3bn if this is raised is sent into a black hole that makes no difference except an Exchequer loss that is sent into the black hole of Europe’s financial sector evidenced in the Santander Spanish and Italian debacle that could be better spent on emergency capital projects that are much-needed. Nor have I mentioned Greece.

A public bank will give us greater leverage in negotiations over Brexit. Noonan disgracefully got us a poor deal (no deal) on renegotiating our bailout debt. He defended bondholders against the public interest. He welcomed in vulture funds to Ireland and rolled out the carpet of tax-free perks for speculative interests. Tax payers and the rights of the people of Ireland were jettisoned through incompetent handling of our financial crisis. It looks like Brexit will turn out an even bigger mess.

We need to jettison Europe and negotiate our own Iexit from Europe. We should be looking to negotiate a new united Ireland with our friends in NI with the view to becoming an all Ireland commonwealth partner with the UK, Scotland and Wales.

Protecting social services, health and education should inform our negotiations with the EU and UK as we move away from the EU which has dismally failed to live up to its expectations, but instead has become a toxic and Orwellian Black Hole dooming this island to homelessness, falling standards in social services, education and health care, such standards are about to get a lot worse.

There will be no bailouts of the public sector similar to the bailouts it provided our financial sector to allow it to give perks such as the recent €5000 our TD’s awarded to themselves to keep themselves sweet.

On the one hand Irish taxpayers get to raise €3bn for our bailout lenders, on the other Irish investors in such shares can get severely burned in a Brexit downturn.

There is of course the loss to Ireland’s taxpayers of a public bank that could be managed to support the needs of Irish taxpayers rather than the requirements of looting vulture funds and asset strippers or at best blind investors who are cogs in the machine that is taking us nowhere.

 

till again.

 

Part 1

In her speech in support of Leo Varadkar in the Fine Gael leadership contest Frances Fitzgerald attacked so-called Fantasists on the left  derogating and deriding them with the terms Populist and Leftist.

What do these terms mean?

If you visit Ireland’s border regions with NI you’ll see any attempt to return to border posts of yore will be rejected by locals and the public at large in both communities.

The border through tariffs and delays will cost billions in lost revenue while the cost of servicing it through customs personnel and infrastructure has not yet even been estimated. Much less is known if the EU will contribute to its financing?

Government proposes a United Ireland solution in the hope the EU negotiations over Brexit will persuade the people of NI to join the south and remain in the EU.

Ireland would shift its EU border to Irish ports and borders in the UK. Such arrogant hubris is a contender for the most daft of fantasies.

Yet Fianna Fail, Sinn Fein and Fine Gael support this absurd notion that is both self-defeating and self contradicting. Erosion of democracy in Ireland has been compounded by the decreasing autonomy for Ireland under the Treaty Lisbon. This is a fantasy to peddle the notion of a 32 county sovereign and independent Ireland in the EU.

Clearly Sinn Fein and Fianna Fail and Fine Gael have some way to go in persuading the people of NI that whatever sovereignty they have as members of the UK, they should give it all up in favour of adopting the Sheriffs of Brussels to be their political masters. People of NI would have more independence in a jail.

http://www.irishtimes.com/opinion/what-are-the-legal-and-constitutional-implications-of-the-lisbon-treaty-1.737778

“.. After Lisbon our duties as citizens of the new Union would have prior claim over our duty of obedience and loyalty to the Irish Constitution and laws in any case of conflict between the two. This is because of the primacy of the constitution of the newly constituted EU over the Irish Constitution as laid down in the Amendment.

These are far from being minor “technical” changes.””

The very notion of a sovereign, ‘United Ireland’ under the flag of the EU is a contradiction.

Furthermore if Macron gets his way there will be federalism of the EU as it morphs into what Orwell foresaw as the coming dictatorship state amalgam of Franz Kafka’s ‘The Castle’ and the politburo bureaucracy of the USSR of recent renown.

Independence envisaged by United Ireland will be treated as bad, further absorption into the EU with its failed euro system, considered good.

If we are sincere about a United Ireland let’s lobby the UK and EU to help us bring it about the best United Ireland we can have.

This will mean UK and EU supporting a sovereign United Ireland OUTSIDE the EU.

In considering this argument perhaps the EU should remember the judgment of Solomon:

“”Give the baby to her, just don’t kill him!” The king declared the second woman the true mother, as a mother would even give up her baby if that was necessary to save its life.”

Giving up EU claim on Ireland in the wisdom of the disastrous impact of Brexit on these shores, supporting a new United Ireland outside the UK and EU, or amalgamated into the UK with greater powers of autonomy and self-government, would solve a great problem for people living together on these islands.

The Fantasy of United Ireland in the EU is demonstrated and perpetuated and propaganda built around it with no wish to hold a border poll to elicit support for this.

Perhaps remembering rejection by so many of Lisbon and Nice Treaties there is more appetite to be wary of democracy in favour of disenfranchising voters. This is evidence of further erosion of democracy in the EU.

Likewise there is not one word breathed regarding putting before the people a vote for Ireland to leave the EU and in a negotiated new Ireland join the UK in a new commonwealth arrangement mentioned above. This subject is considered taboo if it has been even thought about by political leadership.

Part 11

Regarding referenda to engage the people in choices about what could be a millstone around everyone’s neck, we were promised ‘New Politics’ based on consensus building following the last election.

However this has led to almost no work being carried out by the Dail in its last session.

Large decisions are sent into committees composed of members from different ideological and party affiliation where consensus doesn’t occur.

The Dail has become dysfunctional as a result with little or no legislation being brought forward. New Politics has become another fantasy with calls if this is the New Politics, please bring back the old politics.

We have instead a form of political theatre promising everything and achieving nothing.

In the background are the shades of the banking and financial industry calling the shots through its political mouthpiece held in tight rein by Ireland’s Economic Management Committee.

In the fifties in Ireland under an economically impoverished and challenged government vast housing estates were built around Ireland’s major cities to house a large movement​ of people from rural areas to cities.

Even the unemployed beginning new families were housed some in large corporation housing estates a form of social housing popular at the time.

Today if you propose public investment in similar residential housing structure  you will be labelled a Leftist and a Fantasist.

Want more fantasy?

An expensive recruitment campaign seeking to attract doctors, nurses and other health personnel back to work in the Irish health service has been a massive failure with only a handful responding over the past 2 years.

More?

Tens of thousands of jobs in the construction sector are planned over the coming years but the construction work force has been victim to collapse leading to emigration and now we have massive skills shortages.

Unable to provide affordable housing for People living here we are being fed the fairy tale construction workers enjoying better benefits abroad including housing will return to fall victim to our housing mess.

Today there are reports of whole families sleeping rough in public parks legislation to protect families from homeless favours single people while their plight is ignored.

More?

How about Ireland’s CSO(Central Statistics Office) calling a 25% approx increase in our budgetary surplus this referred to as cowboy economics from abroad.

Corporate tax receipts under pressure from the EU include the fantasy of Ireland’s governing party mounting a challenge in the European Court against Apple owing Ireland €13 bn…beggars belief.

The powers that be enjoy the belief they can make any of their fantastic fantasies reality.

With the aid of an obedient and compliant media with the discernment of  living  bacteria yet to be discovered on Mars, they make even common sense an object of Populist derision.

A highly secretive group such as Ireland’s economic management committee composed of a small number of representatives of the ruling party’s leadership ruled by the Troika and the European Commission have already scuppered investment in Ireland’s infrastructure including and especially that of social and residential housing.

Noonan refuses to stand up to the EU’s imposed rules on Fiscal Space!

Not much objective reasoning is given to examine or explain this in the media.

But you are a fantasist if you think present day government will build the property infrastructure required by the people.

Fiscal space as determined by the above entities is there to suffocate and tether Ireland’s ability as a sovereign nation to determine its own fate.

But it also maintains the status quo, its wastefulness, lack of investment and prudent management of the economy and current inequalities in our society between rich and poor.

It maintains the legions of bureaucrats and ineffectual politicians in the salary and comfort zone they have come to enjoy. There’s also the promise on retirement of further posts in Europe without possibility of the embarrassment of electoral failure.

Politicians have become mere choirboys of the EU pampered by high paying jobs​ with powers stolen from them by the EU.

We are instead governed by EU officials posing as politicians part of a pan European elite bureaucracy that serves the demands of the rich and seeks to extract as much austerity as possible upon the poor.

In simple terms this means the European Union and its Central Bank and European officials who authorise our national budget refuse permission for us to invest our pension funds, our NTMA borrowings, our proceeds from the sale of portion of AIB into construction projects similar to the above.

They’d rather we invest in reducing the debt burden inflicted on us to pay off debt ‘we owe’ to them for saving the bondholder banks of France and Germany! This debt was passed onto our shoulders by incompetent politicians with its chorus led by the EU.

Part 111

Let’s consider the word Populism. This term is especially corrosive in the way it undermines democracy itself and the will of the people.

It takes its meaning from the notion that there are underlying complexities and realities ordinary people are not capable of grasping. Instead Legions of committees at Commission level will determine for example what privately run Water Company we require to tax our water so government taxes won’t have to pay for it.

In the wings are legions of investors pressuring the EU to privatise public utilities to allow them invest their ill-gotten gains much of it money printed out of thin air and handed to them on a plate.

The casino of the financial paper private sector cannot wait for governments to divest their infrastructure to them to exact rich penalties on those who fall into the trap.

At the very highest level in the EU austerity driven policies prevent investment in transport, health and education and social services. Bailouts finance the funneling upward of rent and investment returns tax-free to the rich.

Part IV

Since 2008 investment returns on bonds, stocks and shares and property have quadrupled on foot of money printed out of thin air subsequently invested in financial paper and property by vulture funds and banks.

Today the value of stocks and shares is twice that of 2008 though economic activity fuelled by austerity and financial collapse is halved globally and heading downward.

Brexit hasn’t happened yet.

This is a paper driven financial dream fantasy fuelled by bespoke politicians charged with perpetuating this fantasy.

In order to perpetuate this fantasy pick pocketing the people and rewarding the unregulated rich growing wealthier by the day, political influence is essential

Regulating Fiscal Space and disempowering politicians is the business of the EU. Much as the Soviet USSR was governed and controlled by blindly devoted politicians Lucinda Creighton style politicians in love with the euro are used by Brussels to fan the flames of opposition to critical analysis.

The role of such politicians is to defend this financial elite within the EU, build confidence in its continuation and perpetuation and attack those who show up it’s absurd nature.

Unlike the declaration of independence of the united states and the Irish constitution all men are not created equal. Rather we are persuaded to believe there is a superior group of people who know better much as King Hammurabi described in his 1776 BC Code of Hammurabi ruling the Babylonian Empire.

These are the unelected officials of the vast EU bureaucracy that include political minions such as Frances Fitzgerald, Leo Varadkar and Simon Coveney.

We must assume given the disgraceful collapse of the case against Sean Fitzpatrick who led Anglo Irish Bank that the ODCE department of corporate enforcement, the Gardai and DPP that this SUPERIOR group of people is above the law protected at highest levels from regulation or legal control.

In housing, health and justice the reforms required to bring about a change in the political landscape might detune compliance and obedience to the status quo and the powers that be.

They might bring about political change and might even threaten Fiscal Space.

So nothing is done except the ludicrous and nefarious. Government tries to mirror the vast committee system of the EU.

Ludicrous policies built on fantasy of Public Private Partnerships are proposed in the construction of housing and residential property.

This is against the scenario that private developers know that most people cannot afford the absurd level of rent and property cost currently bubbling.

Part V

Little if any reform is possible. In our Justice Department, Frances Fitzgerald against the backdrop of political corruption meaning every position from inspector upwards is a political appointees; possibly criminal fraud in Templemore accountancy and fiscal rules; oppression and victimisation of whistleblowers; reports left gathering dust for over 2 years kicked into further inaction as they are laundered into further reports sent another 2 years into the future; no naming and shaming, no prosecutions for incompetence and worse,  cleaning up the police force of An Garda is the demand of populism?

The Troika, a tripartite committee formed by the European Commission, the European Central Bank and the International Monetary Fund (EC, ECB and IMF) still control Ireland’s finances for which spending approval is regularly sought.

In a recent poll, https://www.rte.ie/news/ireland/2017/0521/876875-poll-brexit-europe/, 82% of Irish repondents felt Irish politicians need to be tougher in their stance on Brexit.

One would be forgiven to mistake Michel Barnier visiting Ireland, invited to address Dail Eireann, an unelected politician, Europe’s lead negotiator on Brexit, to mistake him for a visiting head of state.

But this unelected politician has far more power than your average unelected head of state.

Likewise observing the current leadership race between Varadkar and Coveney evidenced in their abysmal failures in Health and Housing to solve the current crises in both, we can be comforted that the role of Irish Head of State in the EU could be carried out by any primary school schoolboy who knows how to do what he is told. Or can we?

Triumph was expressed in political circles persuading the EU that interests of Ireland would be attended to in the articles setting about the negotiation of the EU position on Brexit.

The European Peoples Party http://www.thejournal.ie/readme/fine-gael-fidesz-2204730-Jul2015/ make dubious bedfellows for Fine Gael.

Was it not a coincidence that a meeting of anti Brexiteers was held in Wicklow this May 17 http://www.seankelly.eu/news-and-events/496-kelly-hosts-epp-brexit-meeting-in-wicklow-

Strangely we had no visitors when we attempted to get support to burn bondholders.

Say NO to corrupt fantasy.

 

 

Till again….

 

https://en.wikipedia.org/wiki/Code_of_Hammurabi

https://www.rte.ie/news/2017/0511/874203-brexit/

http://www.thejournal.ie/shadow-banking-ireland-3-3375469-May2017/?utm_source=shortlink

 

Nepotism

April 6, 2017

Property prices in Ireland are rising substantially faster than wages and salaries. This is unsustainable. Prices today are beyond the reach of ordinary people.

The market today is sustained by shortages and vulture funds and wealthy relatives able to put up the €60000 their sons and daughters require to put up front to get onto the property ladder.

Compare to the 50’s in Ireland where housing estates around are major cities were built in poorer times. Those on an average industrial wage could afford a house.

Today the market is controlled by broken banks sabotaging the efforts of those trying to reduce prices through large building programmes.

If house prices come down, banks could crash as their unsustainable lending into the commercial, residential and buy to let market goes into negative equity.

Nevin Institute for Economic Research recently came to the sobering conclusion:

“Lack of access to affordable quality homes constitutes a significant crisis for workers, families and communities in the Republic of Ireland. Current Government plans appear to be insufficient to make a significant impact. Pressure and strain on individuals and families is a direct consequence of under-investment over many years as well as a failure on the part of a market-led and property developer-led model of housing to deliver enough houses to meet the demands of a growing population.  We propose a carefully planned programme to construct 70,000 new homes in addition to the existing stock of normally occupied housing in the Republic of Ireland. A key part of this plan is the putting in place of a European Cost Rental Model (ECRM) on lines already outlined by the National Economic and Social Council (NESC) and referred to in a recent report of the Oireachtas Committee on Housing and Homelessness.   The optimum solution, we propose, is the establishment of The Housing Company of Ireland which will draw on long-term borrowing combined with an equity injection from the Ireland Strategic Investment Fund and undertake or commission, on a commercial basis, a programme of planning, building, acquiring and renting of new homes.  This investment will supplement and further strengthen that of the Local Authorities as well as the voluntary housing associations in the area of social housing. The figure, below, summarises some of the key features of the ECRM.”

Have you seen the cranes going up recently in Dublin and Cork to build residential housing estates/apartment blocks…neither have I. Government inaction hopes to persuade private developers to get involved in delivering thousands of homes. This won’t happen as the banks to protect themselves will not loan into this market for 2 reasons, a) already mentioned above it will undermine current valuations of its lending stock b) people can’t afford the pricing. No matter how much the European investment bank get involved promising billions to Irish developers,the above 2 facts will not change. Unfortunately this makes Simon Coveney’s plans a ball of smoking  nonsense.

But remember the housing estates built around Dublin in the ’50s…..

http://www.nerinstitute.net/research/irelands-housing-emergency-time-for-a-game-changer/

The Water Framework Directive from Europe appears could be the political undoing of FF/FG coalition. The 20-member Joint Committee on the Future Funding of Domestic Water Services met today and will meet again next week to agree its final recommendations for the future funding of domestic water services.

The Water Framework Directive from Europe is a thinly disguised frame-up of the Irish people. Reckoned in excess of €8bn the cost of upgrading the Irish water infrastructure Europe has reckoned cannot be born by excessive exchequer borrowing and spending.

Unable to tax and spend through devaluation of our currency we are reined in by constrictive European Central Bank policies causing homelessness and the various crises we put up with.

The Irish Water super quango semi-state body received a subvention of €439 million in 2014 and is expected to receive €399 million and €479 million in 2015 and 2016 respectively. it’s not under the watchdog remit of the Dáil Public Accounts Committee.

IW leaks money everywhere duplicating work that could easily have continued under the aegis of local County Councils coordinated under the work of a single national committee.

Propaganda is hosed on the Irish public brainwashed to believe water charges, water meters, will curb excessive use.

95% of the excessive use is poor infrastructure with public water mains leaking into the ground, nothing to do with consumers. Are the older generation some challenged with the need to use more than the average amount of water consumption, to be levied with huge bills? Is it not simpler to ban hoses in gardens for cars and pavement washing?

This is but another reason for us to Irexit out of Europe about which there is growing support in the media, academic life, and politically.

http://www.irishtimes.com/news/politics/eirexit-could-ireland-follow-britain-out-of-the-eu-1.2864539

However little consideration so far has been given to the notion of Irexit. But Brexit is forcing Irish politics to come to grips with the implications of this move for Ireland socially, politically and economically.

http://oireachtasdebates.oireachtas.ie/debates%20authoring/debateswebpack.nsf/takes/dail2016102600024?opendocument

We don#t seem to realise Ireland is a parked car on a railway crossing with trains coming at us from both directions!

“Deputy Martin is quite right that while the challenges ahead are unknown, at least if we knew at this stage what Britain’s ask will be, we could focus on that. It seems as if the Prime Minister has made it clear that the UK does not seek any kind of Norwegian system or a Swiss system, but a bespoke British requirement. In the update she gave to the other leaders at the European Council meeting, she said she would like to see the exit process be professional and well-managed and said that would be of benefit to both Europe and to Britain. Obviously, there will be discussions and negotiation about that. I will arrange for a briefing for Deputies Martin and Adams and anybody else by the senior officials here, who will give the Deputies the details of what they have been discussing with permanent secretaries across the water. They cannot get into too much detail because the Government has not made its decision. As the weeks go on, arising from the civic dialogue and the North-South Ministerial Council, we will have a wealth of information on which we can begin to focus. However, really and truly, until the Prime Minister moves and triggers Article 50, we will not be in a position to say what the definitive position is of the British Government. President Juncker, President Tusk and everybody else have made it clear that there will not be any formal negotiation until that happens. Michel Barnier will be around to everybody in the meantime. The Minister of State, Deputy Dara Murphy, has been meeting all his counterparts. The Minister for Foreign Affairs and Trade, Deputy Flanagan, has the same requirement as all Ministers at a European level to make direct contact so that people understand in the first instance from a European perspective the importance of the peace process, the connections between Ireland and Britain and so on. I will see that Deputies Martin and Adams are briefed at the..”

Its hoped that the gradual implications of Brexit for Ireland, the threat against the €5bn agri exports, the threats against SME’s in Ireland selling into the UK perhaps considering moving there permanently to escape tariffs, the threat posed by the hard border, will gradually focus Irish minds onto an opportunity for national unity.

If Ireland were to leave Europe a new deal could unify northern and southern Ireland outside the EU. Through partnership with the UK a new commonwealth of nations Scotland, Ireland, Wales, England could defend Ireland’s interests more effectively than Ireland’s membership of the EU can do for the southern republic.

But Today propaganda from Europe assures us that we are part of a team of 27 nations in the EU and we are assured that Ireland’s interests in negotiations will be supported. Who believes that nonsense?

Where was everyone on the team when Noonan went looking for support to carry the European banks’ potential losses of €40bn.

We were asked to take one for the team.

Our obedient, compliant and subservient negotiators will also be asked to take one for the team on UK’s Brexit. To test my proposition, ask Europe who will pay (money) for setting up the Irish border controls required to police the EU?

Part11

An Garda Siochana

http://www.irishtimes.com/news/crime-and-law/senior-garda%C3%AD-welcome-inquiry-into-whistleblower-controversy-1.2987127

“Under the terms of reference,  which set out what the Commission can look into, Supreme Court Justice Peter Charleton will investigate two specific allegations, and exactly what former Commissioner Martin Callinan and Noirín O’Sullivan knew about them:

  • Firstly, the protected disclosure made by Superintendent David Taylor on 30 September 2016 in which he alleged he was instructed or directed by Callinan and/or Nóirín O’Sullivan (who was Deputy Commissioner at the time) to maliciously brief the media about Sergeant Maurice McCabe and encourage them to write negative stories about him
  • Secondly, Superintendent Taylor’s allegation that he was directed to draw journalists’ attention to an allegation of criminal misconduct made against McCabe.

The Commission will investigate any contact that took place between members of the gardaí and the media about these allegations.

The Commission will examine all mobile phone records from David Taylor, Martin Callinan and Noirín O’Sullivan between 1 July 2012 and 31 May 2014 to look for any records relating to the allegations. It will also examine all electronic and paper files relating to Maurice McCabe held by An Garda Síochána.

The inquiry will also examine whether Noirín O’Sullivan leaked a specific negative story about Maurice McCabe to RTE. The terms of reference state that the Commission will:

…investigate whether Commissioner O’Sullivan using briefing material prepared in Garda Headquarters, planned and orchestrated broadcasts on RTE on 9 May 2016, purporting to be a leaked account of the unpublished O’Higgins Commission Report, in which Sergeant McCabe was branded a liar and irresponsible.

Finally, the Commission will look at whether a meeting took place between Martin Callinan when he was Garda Commissioner and TD John Mc Guinness in the carpark of Bewley’s Hotel in Newlands Cross in Dublin on 24 January 2014, and if so why that meeting took place and what was discussed at it.

Tánaiste and Minister for Justice Frances Fitzgerald said this afternoon that the government will move to implement O’Neill’s recommendations in full.”

I listened recently to some Garda speaking out on RTE on nepotism in the Gardai. Many of these excellent Garda spoke of political appointments and nepotism, the practice of giving jobs to relatives and friends, within the ranks. It’s not what you know but who you know. Experience, training, further qualifications at postgraduate level, expertise unrewarded because you knew the local political apparatchik does not favour you.

Often the corrupt will weed out excellence as its seen as challenging incompetence.

Noirín O’Sullivan, herself a political appointment has done little to compensate whistleblowers for their bad treatment by management, which continues to this day.

https://www.rte.ie/news/2017/0214/852663-garda-whistleblower/

“In a statement earlier this evening, Garda Harrison, who is based in Donegal, said: “Having read the heartfelt statement of the McCabe family, we share their heartache.Keith Harrison, whistleblower “I was ambitious for my career as a member of An Garda Síochána but given what has happened to me these ambitions have long passed.
“I continue to have respect and admiration for so many of my colleagues, the rank and file members of An Garda Síochána who are some of the best people I have ever met and who work in extraordinarily difficult circumstances.  However, I have no confidence in senior management of An Garda Síochána because of their treatment of whistleblowers.
I am coming forward publicly in order to ensure that the age of a culture of management failure within An Garda Síochána with regards to their attitude to whistleblowers comes to an end.I did not become a whistleblower lightly, given the devastating effect it has had on our family. “Garda Harrison continues to be the victim of actions by senior management against him that continues to this day under the watch of O’Sullivan.”
“GARDA WHISTLEBLOWER Superintendent David Taylor was sent a letter this morning informing him an internal disciplinary investigation into his case is still underway… TheJournal.ie can reveal.”http://www.thejournal.ie/david-taylor-discipline-3282433-Mar2017/”
O Sullivan should step aside at least until she is cleared of any wrong doing in relation to whistleblowers. To date she has done little to support and reinstate their good name apart from a few self serving words to distance herself from any allegation of wrong doing.
The recommendations of the Patten Report should also be implemented in southern Ireland following an investigation in the light of recent revelations of serious performance shortcomings and potentially criminal alteration of statistical reporting along with other management issues within An Garda Siochana.This investigation should be independently conducted from outside An Garda Siochana preferably lead by an individual skilled in best standards in international policing.http://cain.ulst.ac.uk/issues/police/patten/recommend.htm

I’m sure any external investigation into An Garda Siochana would recommend awarding each of the whistleblowers the Scott medal for bravery.

till again……

 

 

Ireland’s Berlin Wall

February 12, 2017

An Taoiseach Enda Kenny has met with Polish Prime Minister, Beata Szydlo. He got no support from Beata Szydlo in his quest for Ireland to be given special status in coming Brexit negotiations.

In his belief that Ireland must be imaginative re its response to Brexit, it might have been useful to visit Poland’s border with the Ukraine. Delays of up to 4 hours for border control for those travelling by train between both countries.

Depending on the purpose of visit,  the vehicle you are travelling in,  papers carried, security checks, crossing the border might take an hour or so; or you might need to join the lengthy kilometers long grid lock of vehicles that appears not to move at all and is worse than Calais.

Construction and manning of these border control check points perhaps Kenny might have an imaginative word …”former head of the European Commission’s customs procedures has told MPs. Michael Lux told the Northern Ireland Affairs Committee that customs controls on the Border will be unavoidable if the United Kingdom leaves the EU customs union after Brexit”(1)

Crossing the Polish border into Ukraine you have to pass through the Polish border then the Ukraine border. Smuggling of goods particularly cigarettes are big issues. Perhaps Poland’s refusal to accept refugees is also an issue.

If Kenny is soft on the border between Northern Ireland and Southern Ireland could Ireland become a mecca for refugees fleeing Calais. Border patrols on our coastline would have to be stepped up to combat people smuggling and a growing refugee crisis in Southern Ireland may require special European funding arrangements.

People smugglers may resort to parachuting in their delivery of human cargo by night.

By day boats ill-suited to Mediterranean waters may navigate dangerous waters hoping to reach Southern Ireland before crossing over to Northern Ireland.

It would appear inevitable that a wall will need to be built.border-fence-cartoon

The cost of this wall could be astronomical. Much resentment would be felt by many pointing to our…. housing and homelessness crisis.

Walls have a habit of keeping people in as well as keeping people out. At current rates and if further devaluations occur brought about to make the UK economy even more competitive, the thousands travelling north on an hourly basis to stock up on lower price goods, could be delayed at the border, then further delayed on way back to process import duties and other checks….

2. Currently about one out of every 4 litres of milk consumed in the south comes from Northern Ireland amounting to over 600 million litres per year.

That’s a lot of trucks requiring paperwork sensitive to any delay or waiting game.

“IFA chief economist Rowena Dwyer broke down Ireland’s relationship with the UK in numbers at the IFA’s briefing on Brexit recently. 50% of Ireland’s total beef exports goes to the UK, followed by one-third of our total dairy exports. With the UK leaving the EU, a drop in Irish exports of between €150m to €800m can be expected.”(3)

With the collateral damage of border controls I believe the figures above are vastly understated. But it’s not only border controls at Norther Ireland its border controls at points of embarkation/demarcation between Ireland and the UK in general border crossing points both at land and sea.

Currently within the Irish media or at a political level in spite of the abjuration of Enda Kenny there is no imaginative or otherwise setting down of the precise implications of Brexit. A small group led by Kenny himself is handling Brexit.

We’ve had a cabinet setting up of an all-Ireland dialogue on Brexit but nothing concrete has emerged. Its imagined that Kenny is visiting fellow EU leaders to drum up support for Ireland’s special position in regard to Brexit.

But perhaps no one apart from Kenny knows what Ireland’s special position on Brexit amounts to? Is Kenny asking that a standing army of customs officials, construction companies, be provided by the EMU to police Ireland’s new borders with the UK, for free?

 

On the face of there are no plans other than to bury the head in the sand and hope for the best. Kenny is about to bow out of politics so the fall out wont effect him much, but it will affect the rest of us.

So let’s answer Kenny’s call for us to be imaginative. Let’s demand answers that put down on the table what exactly will happen with Brexit and what the fallout will be for each Mary and Joe citizen living on this island.

The only way to effectively do this is to call a referendum on IRexit to give each citizen in the Republic a vote on whether to stay in the EU or leave. There are profound implications which should force the facts to the surface and allow each citizen to make their choice.

One imaginative solution if Irexit was chosen would be to consider the Cyrpus situation. Turkish occupation of northern Cyprus has been an issue since 1974. In recent years the following proposed solution is emerging:

“The UN plan for settlement (Annan Plan)

'Sorry! I've changed my mind.'

‘Sorry! I’ve changed my mind.’

Under the final proposals, the Republic of Cyprus would become the United Cyprus Republic. It would be a loose federation composed of two component states. The northern Turkish Cypriot constituent state would encompass about 28.5% of the island, the southern Greek Cypriot constituent state would be made up of the remaining 71.5%. Each part would have had its own parliament. There would also be a bicameral parliament on the federal level. In the Chamber of Deputies, the Turkish Cypriots would have 25% of the seats. (While no accurate figures are currently available, the split between the two communities at independence in 1960 was approximately 80:20 in favour of the Greek Cypriots.) The Senate would consist of equal parts of members of each ethnic group. Executive power would be vested in a presidential council. The chairmanship of this council would rotate between the communities. Each community would also have the right to veto all legislation”

The US, the UN, UK and IR have all had deep involvement in finding solution for the conflict in Northern Ireland.

One solution would be for this island instead of building walls to adopt a solution along similar lines to the Annan Plan above. Ireland would form itself into a loose confederacy of states with Scotland, Wales and England operating under a similar umbrella of trade, legal, constitutional and social. Instead of this island being the Irish Republic, it would change to The United Ireland Republic.

Surely the above road is better than a road that promises imminent collapse of our banks, destruction of our social services, ruination of our agri industry, all to make this a smugglers paradise or Pirate Island for foolish politicians…..

Postscript

There needs to be a criminal investigation led by an external police authority outside this country to pursue those who engineered and executed the dirty tricks campaign mounted against whistle blowers including Garda McCable that has lasted for many years corrosively in An Garda Siochana covered up with inaction from the Department of Justice and now spread to other state organisations.

The handling of the above by this Fine Gael led governent rivals the incoherent way it has approached and currently prepares for Brexit. There is no reason to assume the incoherent opposition led by FF will in any way improve on matters.

 

Till again…………….

 

  1.  http://www.irishtimes.com/news/politics/may-s-border-promises-are-nice-words-says-ex-eu-customs-head-1.2959694
  2. http://www.agriland.ie/farming-news/ireland-set-to-import-record-levels-of-milk-in-2015/
  3. http://www.farmersjournal.ie/implications-for-irish-agriculture-if-british-cast-a-brexit-ballot-212787
  4. http://www.irishtimes.com/news/politics/cabinet-sets-up-all-ireland-group-to-prepare-for-brexit-1.2816034

The Rental Strategy Circus

December 15, 2016

three-little-pigs6http://www.thejournal.ie/talks-breakdown-rents-3140799-Dec2016/

“…These were the proposed 4% yearly cap yearly rental raises, more tax incentives to be introduced for landlords, and designating more areas as ’rent pressure zones’ where the caps will apply.

I realise, dear reader, the above may seem absurd in the following context:

There has been a massive rise in rental costs of accommodation leading to the current housing crisis including homelessness. In addition to the massive costs of house prices, young people wishing to start a family in recent years have been burdened with excessive rental accommodation costs further eroding their ability to save for a mortgage.

Flying in the face of arguments from government favouring an approach to incentivising a massive nationwide building programme from the private sector led by developers and private investors the above measures appear feeble in the extreme. The only argument between FF and FG would appear to rest on the question of extending these feeble measure further across the country.

Few will be able to afford the absurd purchase costs of new builds without the cost of new builds dramatically coming down.

The above measures ironically amount to protecting the interests of landlords at the expense of tenants.

Measures such as passing legislation even interim 5yr emergency legislation requiring owners of all vacant houses to offer their properties for rent with government incentives to do this,  NOT on the table.

Large scale emergency apartment builds on government land in urban areas, NOT on the table.

Scaled taxation weighted against area based rental cost calculating excessive loading by landlords exploiting tenants, NOT on the table.

A European system eg Germany with local property development committees determining and fixing the cost of building, the quality of building, the cost of leasing and renting, NOT on the table.

In the past few years since 2014 profits for the private rental sector have risen to between 2 and 3 billion euros per annum.

Profits have mostly been pocketed by the banks.

They propose the sector continue to eat cake albeit with a little less jam confined to 4% increases way in excess of rises in the cost of living index. The profits include profit after maintenance and capital appreciation costs are taken into account.

http://www.thejournal.ie/houses-empty-around-the-country-2783895-May2016/

But is there any sense to the Coveney/Cowen Rental Strategy Circus?

Consider the following:

files.nesc.ie/nesc_reports/en/141_Irelands_Rental_Sector_Background.pdf

Mortgage Finance
For a new  investor who uses  a mortgage  to buy a rental property
the  larger share of rental income will be absorbed by debt repayments.
An  example  is  presented  in  Table  3  of  an  investor  in  North  Dublin  City  using  a  70 percent mortgage (the maximum permitted by the new Central Bank guidelines) to buy a two bed rental property; the mortgage term is 25 years. This yields a modest after tax profit before  capital repayments.  When capital repayments are included the annual cash flow is negative; i.e., the
initial rental income would not cover all of the  mortgage  repayments.    This  may  still  be  a  worthwhile  long term  investment since the  investor  is  accumulating  equity  over  time and  rental  income  can  be expected  to  increase.    The  larger  part  of  the  mortgage  repayments is
covered  by rental  income  while  there  is  also  the  prospect  of  some  capital  appreciation.   After 25 years, the mortgage would be repaid.  If asset prices were to rise by an average of  3  per  cent  annually,  at  that  stage  the  investor  would  have  an  asset  with  a nominal value of almost €450,000.
Interest  rates  have  a  significant  influence  on  the  returns  achieved  by  an  investor using a mortgage.  The average interest rate for first time buyers in Ireland is higher than  the  average  interest  rate  on  new  mortgages  in  the  euro  area.    If  BTL  interest rates  were  two  percentage  points  lower
,  then the  cash flow  on  new  investments would  be  positive.    On  the  other  hand, lower  interest  rates  would  also  increase house prices and thus reduce rental yields.”

The key point to grasp in the above, dear reader, is the cost of the mortgage and crucially the cost of property.

In a fragile recovery with our banks still teetering on the brink, many of its customers with huge loans invested in Buy To Let properties, getting  return on those investments is critical for banks to expect to have their loans repaid.

A dysfunctional property market occurs in a situation where banks themselves depend on a property price bubble to give then a return on their investment into lending into the property sector. Allowing the banks and private sector to set the agenda in this scenario is akin to placing the fox in charge of the chickens.

Instead of bursting the housing bubble it is in the short term interest of the banking sector to create this bubble.

Not only is our property market broken but our economy itself is being sucked dry of economic activity that would otherwise inject volatility into local business interests.

Not only is our economy  sucked dry of jobs in the construction sector but the distribution of wealth into the economy as a consequence is instead appropriated by landlords deep in debt to our banks.

Keeping that bubble going instead of taking some of the steps  outlined earlier appears to be the business of Messers Coveney and Cowen representatives of a dysfunctional politics with no longer the public good at its heart.

Instead they blindly oblige their so-called independent advisors controlled by banks and the profiteering private sector who lead them by the nose into an absurd Circus dealing with rental strategy nothing less than an embarrassment.

Cowen and Coveney in the present politically dysfunctional environment of New Politics would not even qualify in the middle of Winter to be put in charge of a vegetable shop situated in a field of turnips charged with the management of a shortage of turnips.

Nothing short of a public housing programme led by local authorities and capitalised by government is required.

But that might lower house prices and lower rental income and the banks might not get their money back!

In the face of a list of such growing absurdities a 32 county Ireland IRExit in an economic union with Scotland, Wales, UK and possibly Norway does appear to be more attractive.

But Mr Noonan wont even enter into bilateral talks with the UK over Brexit. He leaves this to his puppet masters in Brussels who will dictate the terms of Brexit, end Ireland’s corporation tax independence, impose inter trade tariffs and conditions between Ireland and its largest trading partner, restrict movement on Irish people travelling to the UK!

While Enda Kenny and his compliant and obedient sailors navigate Ireland’s economy over the waterfall.

Postscript:

Legislation to provide for 4% rental increase so poorly drafted members of the opposition pointed out it provided for 8% increase. Its being redacted and redrafted today 16.11.16.

Would it be possible to have an audit of all Dail deputies with a role in the above legislation to assess how much they may be compromised by the fact that they are landlords many holding substantial holdings of property in Ireland? I don’t think so.

They’ve just given themselves their Xmas bonus and are ready to head home on holidays again after making sure their cake has cream on it and at least 4% of jam.

 

 

 

till again

Eating Their Young

November 27, 2016

During the week we heard rejoicing on the airwaves http://www.thejournal.ie/central-bank-mortgage-rules-2-3095784-Nov2016/

“It was announced this afternoon that a first-time buyer will now only need a deposit worth 10% of a property, regardless of its price. However, the 20% deposit rule will continue to apply to second-time and subsequent buyers.housing-crisis-cartoon2-598x480

The 3.5 times ceiling on the loan to income (LTI) ratio remains. Requirements for buy to let borrowers and the exemptions for negative equity mortgage borrowers from the measures also remain unchanged.”

Rejoicing continued with claims that the above rule would stimulate the construction sector to build more new builds thus rapidly dealing with the homelessness crisis.

Nothing could be further from the truth. The truth is housing has become unaffordable for the average industrial wage and is quickly getting beyond the reach of young people in high paying jobs.

Provision for a large municipal building programme that will end the crisis has been avoided at all costs.

Instead media is filled with images of smiling Enda proclaiming a dynamic, progressive and wealthy economy with a solution to the housing crisis brought about by Simon Coveney. No solution and Kenny will disappear from the stage some say the sooner the better.

Teachers went on strike to protect young workers in their profession forced to take a large cut in their wages in spite of rising rents and property costs. Hospitals are at their wit’s end with numbers on hospital trolleys about to reach all time records if winter flu hits see statistics here http://health.gov.ie/statistics/ Our rivers are polluted with drinking water requiring massive investment http://www.epa.ie/water/wm/rivers/results/

There is massive propaganda in the media with attempts to manage public sector pay increases expected by the unions in the wake of Ireland  seeing  its return to prosperity. Most do not see this. Widespread efforts to smother increases in public sector pay follow along the lines of warnings that our continued prosperity is on a knife-edge and such demands could lead our economy to collapse again.

The implied accusation is that public sector pay increases led to our economic collapse in the first place not wanton speculation in the property market promoted by the 1% of speculators and banks abetted by government who stoked the property market to line their pockets at the expense of workers.

The ridiculous black is white mantra that increasing house prices would encourage builders to build more houses will soon be seen to be the deception it is. Developers and bankers will not build and lend into projects priced beyond what the market can afford to pay.

It’s possible our politicians are so deceived they themselves are the greatest victims of their own delusions. There is no fungible relationship between Simon Coveney’s basket of intents and policies to bring about the construction of the numbers of houses and the real world.

The real world is very simple though to have any insight into its true nature will bring a response that such views are facile, fatuous, facetious and fail to grasp the complexity and scale of the problems of the real world. Bernie Madoff used such arguments to scoff at his critics before he was sent to prison.

Construction of public housing needs to be done on a vast scale on a Municipal basis. The price of housing needs to be severely brought lower not higher vis-a-vis Simon Coveney’s policies.

This is not happening because a small dictatorial elite of FG/FF headed by the smiling wannabe dictator Enda Kenny continue to fan the flames of prosperity for the 1% against the 99%.

They do not want house prices to fall.

Present relaxation of rules will fan property crises in the attempt to continue the bubble they fear will pop because not enough young first time buyers can afford to raise the finance for Madoff property pyramid schemes.

They want rich investors in Irish property many of whom are TD’s with large rental property portfolio investments or vulture funds pricing out Irish buyers continue to make large profits from artificially induced shortages.

For them the agenda is to manipulate the media and public opinion to the view what is best for the banks and the 1% is best for all.

It isn’t.

 

till again…..

 

 

Black Swan

October 21, 2016

 

black-swanCoveneys support of first time buyers springs more out of a concern with the needs of developers.

Notwithstanding supply shortages some developers are unable to sell properties at the current high unaffordable prices.

Coveney mistakenly confuses the inability to raise a deposit with inability to afford to pay back a mortgage.

Alarmed at the possibility of more people on foot of Coveney’s proposals taking on mortgages they simply cannot afford to pay back, the Central Bank has forced a government climb-down restricting the amount that can be borrowed  to 70% instead of 80%.

(1)“The Central Bank has said that they think the threshold whereby the loan-to-value of the property should come down from 80 per cent to 70 per cent, which would ensure that nobody is overborrowing to try to avail of the grant and I think [Minister for Finance] Michael Noonan thinks that’s a sensible alteration.

“It essentially means that more people will be able to avail of it. It’s relatively minor change but it’s a change I think that’s worth doing and so he’s happy to accommodate that.”

Actually, Simon, this is not a relatively minor change, instead this makes your proposals ludicrous. It makes any savings possible under your scheme will be eaten up by the higher cost of raising the difference between what the bank will lend and what ever savings the borrower has to make up that difference.

If there is a strong uptake, house prices will rise absorbing even further any gains  made to help the buyer. Ironically, the proposal has about as much value in increasing house supply and new house construction, as a ball of smoke.

It’s another case of Nero fiddling while Rome burns. Fiddle while Rome burns definition. “To do something trivial and irresponsible in the midst of an emergency; legend has it that while a fire destroyed the city of Rome, the emperor Nero played his violin, thus revealing his total lack of concern for his people and his empire.”

What Coveney should be doing is demanding from Europe a derogation from its fiscal space rules to raise capital on the open market or to invest from our pension fund in a large-scale construction project to build Olympic Village type apartment blocks in the larger cities to deal with this growing crisis. That and a whole range of building projects to build “affordable” housing for the whole generation of young Irish people shut out of the housing market.

Not to be outdone Richard Bruton is advertising for parents to be paid to undertake supervisory duties to help break the teacher’s strike. The irony is teachers were not being paid to do those duties since they were forced to do same under Croke Park hours. Inflammatory and incendiary as this move is pouring petrol on Rome burning, a greater irony is that teachers are striking not for better pay and conditions for themselves, but on behalf of the ruthless and unfair way new entrants to their profession have been penalised forced to accept rates of pay on a par way below that of their peers. Another example of how young people are being shafted by future leadership contenders within Fine Gael.

I’ve no doubt whatsoever targeting of teachers is a fallout from European austerity hawks from the troika down to impose gauging cuts on our public service bill to reduce the standards of health care and public education to that of public health and education expenditure in the US where it is lowest in the world.

This despite abundant riches being further amassed by the 1%.

(2) Meanwhile Europe is targeting Ireland’s corporate tax regime in its current proposals:

At present companies, or groups of companies, must deal with potentially 28 different corporate tax regimes across Europe.

The Commission will recommend that, instead, member states would sign up to a Common Corporate Tax Base (CCTB).

That would create a harmonised tax base so that a company which operates in several member states would know that in each member state its profits would be taxable the same way, and that exemptions, deductions and losses would be also be treated the same way for tax purposes.

Once a Common Corporate Tax Base was established, the next phase would be to create a system whereby tax liabilities would be “consolidated”.

That would effectively operate on a formula that would apportion how much tax is due to which member state.

Under the proposal, a group of companies would be allowed to add its profits and losses from all subsidiaries together to reach a net figure.

Tax would then be paid on the group’s net profit for the whole of the EU.

This will effectively bring to an end Ireland’s tax haven incentives such as Double Irish.

(3)…European heavy-hitters have been warned not to come after Ireland’s low corporation tax or we will leave the EU, too.

Our regime is expected to come under renewed scrutiny in the wake of Britain’s exit as they were our strongest ally in fending off demands for tax harmonisation.

…But Fine Gael MEP Brian Hayes told the Irish Independent: “That is the absolute red line issue. Any attempt made to cajole us [on corporation tax], as far as I’m concerned, we’re out the door.

Ireland’s tax haven status and leprechaun economics regime will soon end.

(4)Times they are a changing: It’s not only on this blog you will find growing support for Ireland exiting the growing shambles of the EU. Gay Byrne is now in favour of Ireland’s exit. Let’s ignore his implied call for a rerun of the Brexit vote.

To follow on from last blog, some links on the growing mess of Deutsche bank commentary by Bill Holter:

a) Deutsche Bank Walking Dead (under capitalised) https://goldsilver.com/blog/deutsche-bank-walking-dead-bill-holter/

According to Bill Holter Deutsche bank is the most systemically dangerous bank in the world, the biggest link in the derivative chain. It cannot return from the dead. 50-77$ trillion derivative exposure, walking dead institution, once you start talking about them being solvent, game is over. Zero volatility in credit and stock markets they are in lockdown.

Deutsche Bank stock market capitalisation something like 12-15bn dollars, they are under capitalised just to get to Basil 111 requirements, then there is a 14.4bn  fine against them, they have no money to cover this.

Any type of margin call will take them down…if they break the whole market goes, Italian,Spanish, Austrian banks Irish banks Portuguese banks waiting in line, amount of capital they have against the amount of derivatives they carry and are counter party for….what took years and years to grow the derivative market they will destroy markets…

Deutsche Bank is a Black Swan being pumped with air from QE that cannot go on forever. There is a limit on what can be pumped from the 99% to further inflate the assets of the 1%.

Looking forward the EU brought about a lot of good to Europe. The challenge will be to retrieve in any future cross border free trade agreements. cultural, social and educational relationships, that the bonds that have proven of real value, be retained and nourished to grow and prosper.

An inner core that has fed on the periphery to the extent that Greece, Ireland, Portugal, Spain have been forced into economic collapse by a plan promising stability, security and prosperity for all, will not hold forever.

Meanwhile Europe needs to rid itself of the legacy of a poorly constructed plan built only to serve the needs of the 1%.

 

 

till again

(1) http://www.irishtimes.com/business/budget-2017/coveney-defends-70-mortgage-threshold-for-help-to-buy-scheme-1.2836721

(2)https://www.rte.ie/news/business/2016/1019/825341-eu-commission-to-launch-controversial-tax-proposal/

(3)http://www.independent.ie/business/brexit/eu-has-our-corporation-tax-in-its-sights-after-uk-quits-34835831.html

(4) http://www.independent.ie/business/brexit/we-should-leave-eu-on-same-day-as-british-gay-byrne-backs-irish-eu-exit-if-brexit-happens-35139500.html

Last scene of Margin Call derivatives being sold. All these financial instruments that were dumped landed somewhere perhaps inflating the Deutsche Bank hot air balloon.

Meanwhile Deutsche Bank has vowed to challenge a $14bn claim by the US Department of Justice to settle an investigation into its selling of mortgage-backed securities.

 

 

http://www.cnbc.com/2016/09/29/amid-deutsche-bank-woes-rival-german-lender-announces-a-major-overhaul.html

“Germany’s second largest bank by assets, Commerzbank, announced an overhaul of its structure on Thursday following what it called “current market rumors.”

 The lender said Thursday that it would make a net reduction of 7,300 jobs at the company and will stop paying dividends for the time being amid a drive to sustainably increase its profitability by 2020. The cost of the restructure would be in the region of 1.1 billion euros ($1.2 billion), it said in a statement, and the plans would be ratified by its supervisory board on Friday.”

The trouble with Deutsche Bank is it sits on a financial portfolio upwards of $50trillion of financial instruments.

'If you really cared about me, you'll swim back to the boat and get my bottle of wine.'

‘If you really cared about me, you’ll swim back to the boat and get my bottle of wine.’

In a growth pyramid profits can be huge. Following 2008 there has been increasing effort to regulate derivatives and conduct business on public exchanges. Regulation has paved the way for more scrutiny of financial markets and loss of investor confidence. In turn this has led to market collapse of share price of Deutche Bank. Global recession and negative interest rates have put further pressure on this bank.

It may well be if the bank is considered too big to fail TBTF that it will be broken up into manageable parts. Its too bog to bail out. The danger is that a bank run and collapse will leave investors stranded. In Cyprus there has already been precedent of Bail In. Investors should be worried at they stare into the vista of upwards of 50% loss on their deposits and investments.

 

Ireland’s Property Market Scam

FG have released their action plan on housing and its derelict.

In spite of its unveiling one family with 6 children turfed out of their rental accommodation last week spent a week in inhuman conditions and they will not get a house or proper accommodation of a civilised kind. Homelessness is still on the rise.

Houses are not being built as too many would bring the price down and bring those already committed into negative equity. Its Catch 22, ending the housing crisis could bring down the banks!

Worse EU fiscal rules prevent us adequately borrowing and investing in housing. We no longer live in a market economy but in an inflated Bubble pumped full of hot air and QE and borrowings all of which appear at the moment to be in slow motion self destruct mode.

One way the government could have acted to cap the ballooning property market would be to impose a tax on foreign investor firms responsible for around a fifth of Dublin house purchases.

They did this recently in Vancouver to put a brake on Chinese money pouring into Vancouver inflating real estate and putting purchase beyond the reach of locals. A 10% tax saw property prices fall within the week.

http://www.thejournal.ie/house-price-dublin-property-cso-2-2990654-Sep2016/?utm_source=shortlink

Instead we have Rent and Housing Supplements and stories of tax relief for first time buyers all of which will be pocketed by landlords in payment for their increasing rents.

I like this piece of waffle:

http://www.housing.gov.ie/housing/homelessness/coveney-launches-homelessness-pillar-under-rebuilding-ireland-action-plan

“DHPCLG will work closely with the ESRI and the Housing Agency to improve understanding of conditions in housing markets around the country and thereby better inform the implementation and design of current and future policy measures.

This work will involve preparing national and sub-national geographic breakdowns of actual and anticipated supply and demand, across tenure types, based on demographic and macroeconomic developments. There will also be scope for research focusing on specific housing-related themes. ”

ERmmmm  I thought the document would contain an Action Plan not an aspiration to pass the book to local authorities or some other institutional invisible with committees to come up with a specific plan.

I’m reading the document looking to see on an urban and regional basis the color coded map showing me where the residential house build will actually begin next week!

We’ve had an emergency in the HSE for the past 10 years and we now know we are short of approx 6 hospitals none of which will be built.

Now we embark on a similar journey towards homelessness. At least we could build homes when we were not a member of the EMU.

 

<Expect things to get worse>

http://rebuildingireland.ie/Rebuilding%20Ireland_Action%20Plan.pdf

http://www.irishexaminer.com/ireland/simon-coveney-outlines-plans-for-housing-solution-403718.html

nb  http://www.housing.gov.ie/housing/housing

http://www.housing.gov.ie/housing/housing-policy

http://www.housing.gov.ie/housing/rebuilding-ireland/minister-coveney-visits-galway-promote-rebuilding-ireland-action-plan

http://www.telegraph.co.uk/business/2016/09/26/the-deutsche-bank-crisis-could-take-angela-merkel-down–and-the/

https://goldsilver.com/blog/is-a-46-trillion-lehman-brothers-event-just-around-the-corner/

 

Till next time…

Anybody watching the Olympics and admiring the wonderful apartment buildings built in a short number of years to house the athletes with state of the art accommodation? Wondering why we can’t build the same here to house the homeless, our student population, first time buyers requiring starter homes at a reasonable cost?poor_europe_chappatte

Fiscal rules imposed on us arising directly out of our membership of the EU prevent us developing this state in the way our people wish for and require.

Wondering why our Irish Water fiasco has continued to date with a committee deliberating on overturning the will of the Irish people against privatisation and off the balance sheet accounting? It’s the odious fiscal rules again.

We have the longest hospital waiting lists per capita in the EU, standards in our universities nose diving because of poor funding,  rising teacher student ratios, natively educated doctors and nurses fleeing our health service and our banks coming out bottom of the pile in European stress tests.

But according to the CSO with growth rates of 28% of GDP we should be the fastest most prosperous economy in Europe. Hell no.

CSO is a state propaganda machine peddling unreliable statistics for years mostly based on sand. In this case jigging the figures from dollar based multinationals suddenly their income in euros goes up because of the falling value of the euro against the dollar; more companies from the US acquiring mailbox identities in the IFSC.

Before the practice is guillotined by incoming new presidential candidates whoever they may be.

Little tax is paid here by such companies. Hey presto we have a GDP of 28% sparking government panic wishing to predict growth forecasts of less than 1.5% to keep wage rises at those austerity levels while income rises of 10-15% are the norm for France and Germany!

You would think with rents rising to astronomical levels government would urgently address the problem as they have in Vancouver, Canada by imposing a tax of 15% on foreign property investment mostly effecting the vast amount of capital pouring into Vancouver from China.

That bubble has burst.

Nope, NAMA here in Ireland has a policy of selling off vast property portfolios tax free to vulture funds with eyes upon a quick buck in the Irish rental sector.

Irish companies and individuals pay tax on their earnings and profits; vulture funds through accountancy tricks can even set themselves up as having charity status meaning on earned profits of eg €25ml immediately exported to parent companies offshore with €250 tax  paid, I kid you not.

Meanwhile we read propaganda that there is a huge rise in people from NI and UK wishing to take out Irish passports  because of the UK’s wise Brexit.

They would prefer to remain in Europe!

Lets look at Europe’s economy and its banking sector for a moment.

http://wallstreetonparade.com/2016/08/is-deutsche-bank-as-dangerous-to-financial-stability-as-citigroup-was-in-2008/

Mario Draghi’s Negative Interest Rates and QE is quickly running out of steam.

“More specifically, 20% of the €10.4 billion ($11.7 billion) of corporate bonds the ECB bought between June 8 and July 15 had negative interest rates. Another €3 billion of company debt has been purchased since then, with plenty more negative-yielding bonds probably mixed in….

While negative interest rates are great for issuers—they are effectively being paid to borrow—this relatively new financial phenomenon has downsides, particularly for banks. European banks have announced relatively grim quarterly earnings over the past few weeks, with many bemoaning how hard it is to make money when interest rates are so low, compressing the “spread” between what they can charge for loans and what they must pay out to depositors.

ECB board member Benoît Cœuré warned in a speech last week that there comes a point when the detrimental effects of negative rates on banks outweigh the benefits of the institution’s bond-buying program. That point has not yet been reached, he says.”

In other words the EMU is running on nothing but hot air at the moment. QE is pumping billions into the banks that are being steadily suffocated by negative interest rates. Bond buying by Draghi is saving banks and corporations across the emu that without such QE stimulus would see them go under sparking the domino effect.

Loss making enterprises are being financed to make more losses while the euro itself is being pillaged and looted to have its purchasing power reduce and reduce. The savings and wealth of the 99% is being squandered away to pay for the ongoing losses of the 1%.

But global economic problems run even deeper than problems with the euro. Today across Venezuela and many countries in Latin America its currency in crisis food queues are the hallmark of an oil rich economy.

Likewise many countries in the third world have seen their GDP dropping in the face of falling mineral revenues due in part to falling commodity prices  in a self reinforcing spiral of a slowing global economy and more and more fraudulent manipulation of currency movements and global financial markets serving the needs of the 1% at expense of the 99%.

“In 1996, economist Paul Krugman (Nobel Memorial Prize in Economic Sciences, 2008) summarized the post-Nixon Shock era as follows:

The current world monetary system assigns no special role to gold; indeed, the Federal Reserve is not obliged to tie the dollar to anything. It can print as much or as little money as it deems appropriate. There are powerful advantages to such an unconstrained system. Above all, the Fed is free to respond to actual or threatened recessions by pumping in money. To take only one example, that flexibility is the reason the stock market crash of 1987—which started out every bit as frightening as that of 1929—did not cause a slump in the real economy.”

That was way back in 1996. At that time the benchmark of the gold/dollar peg was the value of gold expressed in terms of global economic activity based mostly on industrial output and industrial activity.  Over the decades since 2010 financialisation has come to dominate:

https://en.wikipedia.org/wiki/Financialization

“Financialization describes an economic system or process that attempts to reduce all value that is exchanged (whether tangible or intangible, future or present promises, etc.) into a financial instrument. The intent of financialization is to be able to reduce any work product or service to an exchangeable financial instrument, like currency, and thus make it easier for people to trade these financial instruments.”

The problem is financialization has long since lost its base in industrial output and agricultural activity. The means by which the financial world slices and dices financial instruments through hordes of people whose livelihoods depend on these activities has become a virtual pretend black is white falsehood world exploiting and fraudulently manipulating and corrosively damaging the global economy.

This is a world hoovering of resources by too big to fail banks upward to the 1% powerful enough to benefit from the vast manipulation of money and markets. Steadily resources have been stripped from the middle class, from democratically built institutions, from governments and now countries eg Venezuela and Greece are wantonly being consumed by such pillaging.

In the last scenes in the movie “Margin Call”, bond traders attempt to save the bank by selling what they know to be dodgy doomed to fail assets on their books to whoever will buy them.

I suspect on the other end of these lines were mostly traders from European banks. These dodgy assets are still on the books of eg Deutsche Bank.

Acknowledging the collapse of 2007/8. Aware that the policy of printing money QE is damaging the world economy and only postponing inevitable collapse, something must be done.

Bernie Sanders calls fr 21st century Glass Steagal Act   https://berniesanders.com/yes-glass-steagall-matters-here-are-5-reasons-why/

 

https://berniesanders.com/yes-glass-steagall-matters-here-are-5-reasons-why/

4. The repeal of Glass-Steagall is further corrupting the culture of banking – if such a thing is possible.

Sanders was right when he said on Saturday night that “the business model of Wall Street is fraud.” The traditional practice of what Sen. Elizabeth Warren calls “boring” banking – opening savings accounts, reviewing loans, and providing other customer services – has largely been supplanted by high-risk gambling and the aggressive hustling of dubious investments to unwary clients.

The level of fraud unearthed since the 2008 crisis is nothing short of breathtaking. (The fact that no senior banking executive has gone to prison for that fraud is, if anything, even more breathtaking.) How did that happen?

Citigroup’s Reed wrote that the repeal of Glass-Steagall led to the “very serious” problem of “mixing incompatible cultures” – which, he said, “makes the entire banking industry more fragile.” He discussed the relationship-based, sociable culture of traditional banking, emphasizing its incompatibility with the risk-seeking, “short termist” mentality of investment bankers who seek “immediate rewards.”

Something much more radical than Repeal of Glass Steagal must be done. Nothing more than the repeal of the decision to end the gold/dollar peg is an urgent necessity.

“On the afternoon of Friday, August 13, 1971, these officials along with twelve other high-ranking White House and Treasury advisors met secretly with Nixon at Camp David. There was great debate about what Nixon should do, but ultimately Nixon, relying heavily on the advice of the self-confident Connally, decided to break up Bretton Woods by suspending the convertibility of the dollar into gold; freezing wages and prices for 90 days to combat potential inflationary effects; and impose an import surcharge of 10 percent,[11] to prevent a run on the dollar, stabilize the US economy, and decrease US unemployment and inflation rates, on August 15, 1971:[12][13]

  1. Nixon directed Treasury Secretary Connally to suspend, with certain exceptions, the convertibility of the dollar into gold or other reserve assets, ordering the gold window to be closed such that foreign governments could no longer exchange their dollars for gold.
  2. Nixon issued Executive Order 11615 (pursuant to the Economic Stabilization Act of 1970), imposing a 90-day freeze on wages and prices in order to counter inflation. This was the first time the U.S. government enacted wage and price controls since World War II.
  3. An import surcharge of 10 percent was set to ensure that American products would not be at a disadvantage because of the expected fluctuation in exchange rates.

Speaking on television on August 15, the Sunday before the markets opened, Nixon said the following:

The third indispensable element in building the new prosperity is closely related to creating new jobs and halting inflation. We must protect the position of the American dollar as a pillar of monetary stability around the world.

In the past 7 years, there has been an average of one international monetary crisis every year…

I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets, except in amounts and conditions determined to be in the interest of monetary stability and in the best interests of the United States.

Now, what is this action — which is very technical — what does it mean for you?

Let me lay to rest the bugaboo of what is called devaluation.

If you want to buy a foreign car or take a trip abroad, market conditions may cause your dollar to buy slightly less. But if you are among the overwhelming majority of Americans who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today.

The effect of this action, in other words, will be to stabilize the dollar.[14]

The ending of the gold/dollar peg was meant to be temporary.

It is leading to ruination of the global economy, its growing instability, it threatens democracy itself, it’s an unfair burden on the 99%.

It is leading to hunger, homelessness and war even in countries once thought to be prosperous with a bright future.

Time to end a failed experiment doomed to fail more……

 

till again