Letter to Donald Tusk

April 13, 2018


In its quarterly bulletin for April 2018 the Central Bank states p8 “The Central Bank is forecasting upward revisions for growth in 2018 and 2019, reflecting strong domestic momentum and the improved overall outlook for trading partner countries” the bulletin contains no deep dive into the impact of Brexit on various sectors of the Irish economy.

It’s not sure “given the complex, multi dimensional nature” of new US tax laws what the impact of these will be for Ireland…..

Turning to Brexit, any increase in trade frictions between the UK and EU 27 will generate a reduction in long-term living standards, compared to the counterfactual of maintaining the status quo…Potential risks include a disruptive UK exit from the European Union next year, an increase in protectionist trade policies, changes to international tax regimes that can have an impact on FDI decisions by multinational firms and disruptive movements in bilateral exchange rates…

The bulletin contains no deep dive into the actual reduction in living standards due to perhaps an increased overall cost of the European project on member states due to loss of contributions from the UK.

It appears to this writer the overall impact of Brexit for the UK contrary to the propaganda of the Central Bank will be positive due to lowering of its exchange rate its exports will be on the increase, tariffs between the UK and the EU will benefit the UK more than the EU.

The bulletin has little probity of the nature of lending in Ireland into the construction sector and the scandal of lack of provision of housing for both the homeless, the young people who wish to start homes, and those families in need of social housing.

It does appear that the ECB has turned off the stopcock flow of lending into the Irish economy with no developers, no large construction projects, allowed. Austerity rules!

Both the Central Bank and NAMA policy decisions need close investigation to uncover their responsibility for the bank heist that has had the profound effect of capturing politicians responsibly tasked with serving the needs of Irish people: politicians abrogating their responsibilities in favour of subservience to policies suffocating development of the Irish construction industry.

The Central Bank is keenly aware of the exposure of Ireland’s open economy to the volatility of changing international taxation and trading conditions. 14000 in arrears at IPBS only allowed debt renegotiation to the present market value bubble valuations on offer, the Central Bank has no solution for other than the ECB urge to sell these mortgages to vulture funds.

The Irish economy is largely fed by the presence of a small number of MNC’s using financial loopholes and tools that avoid taxes from goods they sell overseas channeling them into inflated Irish GDP figures and tax revenue. These loopholes are about to close under pressure from both the US and the EU.

The probability of a hard border with Brexit and its consequent impacts on trade could see Ireland with its own barbed wire fence similar to Poland’s intention for its borders.

Meanwhile to steady Irish nerves in a show of pat on the back, flattery, pumping up, acclaim, solidarity, Donald Tusk came to Dublin last week.


Donald Tusk is leader of the European Council since 2014 and previously was pm of Poland for 7 years and as we prepare for Brexit we see him quite frequently in Ireland. We had few visitors from Europe during the financial crisis of 2010/11 and subsequent bailout. As Enda Kenny sought support in Europe for Ireland’s position, he was met with a rather embarrassing silence.

We were bullied and harried by Jean-Claude Trichet head of the ECB for daring to question the odious terms of our bailout.

When inspectors arrived here demanding reforms in the banks they also were concerned about costs in our legal profession and they demanded reforms there as well. So it was rather ironic to see Donald Tusk  receive an honorary life membership to UCD’s Law Society. Perhaps this is insurance to woo support from Mr Tusk against further opprobrium of the Irish Legal profession from the EU.



Proposed reforms of the legal profession have been lying on a shelf for the past decade:

“The Bill mandates that legal-cost determinations are to be ‘published’ by archiving them locally in each county registrar’s office. This obscure arrangement powerfully inhibits legal-costs research and therefore public awareness of legal costs.”

Transparency demands that they be published and searchable on the central court website. This would also be cheaper.

Also, the recently introduced practice of allowing journalists into family law cases needs to be extended to legal costs adjudications relating to family law cases.”

Anti competitive practices abound with only a solicitor allowed to shop around for a barrister encouraged by greater fees offered by the most expensive barrister. Fees are shared between barrister and solicitor. There are cumbersome obstacles to investigating fairness and we have the highest legal fees in Europe.

This endangers democracy with legal fees obstructing litigation on matters that the public require protection.

Instead of focusing on these matters Tusk attacked Brexit stating he was furious about it.

When it becomes the will of the people against the will of the EU and the will of the democratic wishes of the people becomes a cause of fury for the EU, we should all be concerned. Don’t expect respect for the will of the people from Mr Tusk.

Rather than selling the benefits of the EU to the Irish people he chose to heap praise and compliments on Irish culture. disingenuous flattery of the highest calibre.

I would like to take issue with “I don’t like Brexit. Actually, that’s an understatement: I believe Brexit is one of the saddest moments in twenty first-century European history.”

On the contrary Brexit to be one of the greatest democratic moments in twenty first-century European history.

If Brexit fails, democracy in Europe may become a distant memory.


In Mr Tusk’s home country:

“The European Union is considering unprecedented disciplinary measures against Poland over its judicial reforms – specifically, the adoption of 13 new laws that allow the Polish government to meddle in legal matters and threaten the independence of the judiciary.”

I suppose given the above state of the legal profession in his native country it may have felt embarrassing for him to lecture the Irish legal profession on its lack of reform.

The problem for Tusk is that the EU is in a mess. Dancing on ice it cannot respond to the next financial collapse very likely precipitated by Brexit that unlike the Federal Reserve the ECB has no tools to deal with.

Crisis countries with high debt to GDP ratios including Ireland notwithstanding its inflated GDP courtesy of leprechaun economics through the central “statistics” office are fragile, volatile and extremely vulnerable to downturn.

The EU for the next crisis has no means to bail out Ireland and fellow EU members such as Italy. Greece has been a disaster and continues to be so.

Irerland’s mortgage arears crisis has not been dealt with, there are 14000 of these in IPBS up to 26% of its loan book. Instead of best deal for its customers IPBS is in process of selling these bundled loans to vulture companies.

Its spokespeople encourage such underwater loans to engage with the banks. The only write down they are willing to discuss is write down to present market value of these properties, market value inflated by shortages and inflated, market value bubble.

Instead of serving customers they would rather fleece them to vulture funds.

The Irish economy exposed to rampant excess in stamp duty fed off its previous property bubble is now experiencing an equally damaging contraction due to the economic effects of laisser faire landlord rent extraction.

Money is fueled out of the economy into a property and rental bubble instead of having capital bringing life into the economy flowing into new enterprise and new business. We are the victims of financialisation funneling capital into the hands of the few and away from economic and market investment development of our capital infrastructure that is the sign of a healthy economy working for its people.

Ireland is more and more developing like a dead cat bounce with growing infrastructural problems in the health system, in education: but most of all in growing inequality driving young teachers, nurses, doctors to flee Ireland to seek a more rewarding life elsewhere. Its preparation for the devastating effects of Brexit on this economy virtually nil.

Ireland is now reliant on a handful of MNC’s providing Corporation Tax and its tax system is weak and in need of reform.

Is there a better way?


“After much heated debate,  the government, the financial sector, and the federation of businesses agreed on a comprehensive debt-relief programme.

The main components were as follows:

For the household sector, debt in excess of 110% of the fair value of each property was written off.  Specific relief measures (administrated by a bank or a new debtors ombudsman) applied for those that could not service a reduced loan.

Low-income, asset-poor  households with high-interest mortgage payment got a temporary subsidy from the government.

Small to medium-sized firms could apply for debt relief if they could credibly document positive cash flow from future activities.

The firm had to be willing to re-engineer its operation so as to make best use of its assets. Given those conditions, the firm could expect its debt to be written down to equal the discounted value of future earnings; or alternatively, written down to the amount that the bank or other financial firm could expect, in the best of circumstances, to gain from taking the assets over and realizing their monetary value. Hence the debt relief programmes did not create new equity on the balance sheets of firms or households.

The process provoked plenty of conflicts. For example, the supreme court ruled some forms of loans in foreign currencies illegal.  The government intervened to extend the ruling to all foreign exchange loans granted to households.  These legal challenges have not yet been brought to an end, but so far 12% of the household sector pre-2008 debt has been written off.

The bottom line is that the government, the financial sector and the business sector collectively created a situation that leaves the financial sector with as good a result in terms of total debt collection as possible without the pain of sending most of the firms and many families into bankruptcy, unemployment and dispossession.

Thanks in good part to this tempered approach to debt write-down Iceland’s economy is now growing faster than most countries in Europe, and unemployment is less than 5% (having hit 9.3% in early 2010).

Of course, many Icelanders are still angry at the government and the banks, like their southern European counterparts. But at least they have a job, they pay property and income taxes, they service their reduced debt, and they can make plans for a vacation or a new car in two years’ time.

Thorolfur Matthiasson is professor of economics at the University of Iceland and member of a parliament-appointed committee overseeing equality of treatment in debt writedowns by the Icelandic financial sector.

Irish banks state they will not write off debt, but they lie, selling discounted lending to vulture funds is debt write-down for vulture funds.

Irish banks will not write off debt to its household lenders. They are caught between a rock and a hard place with many vultures circling. The high cost of evictions legal and otherwise will leave families needing accommodation and housing.

Thank you, Mr Tusk, for this mess foisted on our economy by the ECB.

Its bailouts of Greece, Ireland, Spain have been band aids facilitating only a dead cat bounce return to growth for the main financial players in the periphery countries, not for the population at large condemned to deteriorating public sector services and low growth.

The EU with its ill designed and diseased euro is being left behind globally in a large financial mess that has not served its peripheral members well.

Yes, Europe has seen the outbreak of peace and stability but undermining this peace and stability has been the unstable and deeply flawed, built-to-fail design of the euro currency system whose faults and failures left it gravely exposed during the recent financial crisis.

Its inability to handle successfully this crisis has brought a legacy of intractable and insoluble problems for the euro showing more and more evidence of future disintegration the more time goes by.

Mr Tusk, turning a blind eye to such matters may be easy for the smug, self-serving and obedient financially well off who wish the party to continue, but from the head of the European Council, its disappointing not to hear of reform both here and in Europe to end a Europe that has failed to live up to its ideals of democracy and equality.

Instead we get a Pavlovian I’m your buddy sentimental and complacent demagoguery with Donald Tusk is more Irish than the Irish themselves. He’s your pal. But only as long as you pay up your odious bailout costs to his real pal, Michel Barniere, head of the ECB.

A demagogue is a political leader who seeks support by appealing to popular desires and prejudices rather than by using rational argument.

But hey, lets not spoil the party, I’m off to dream of leaving the EU, reuniting Ireland and joining the UK in its democratic resistance to this growing Orwellian authoritarianism and control that has become the new EU that is growing more grotesque and absurd by the day.


Colm Brazel



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…..


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

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…..




The housing report finally came out. Its added to my disillusionment with politics in Ireland that appears to be in a state of paralysis in dealing with economic and social problems.

There are 2 problems that more than any other describe the housing shortage supply in Ireland. One is lack of supply which feeds into the other problem: the other is the prohibitive cost of new homes that prevents young people having any hope of getting onto the housing ladder.

The report only refers to the vague suggestion of ‘speaking with agencies’ eg NTMA above. This means the report is holed below the water line. It does not provide a concrete solution to the prohibitive cost of housing for young people beginning families.

In a previous generation housing was affordable and a first house could be got with 1 and a half times the combined salaries of the couple asking for a mortgage. The cost of an average home far exceeds the abilities of the average industrial wage to get equity against it.

So the major part of any housing report should address this problem instead the report glosses over the problem. Furthermore we are told that the EU fiscal straight jacket imposed on Ireland means we cannot invest in housing on balance sheet and stay within EU imposed fiscal rules.

It gets worse. instead of embarking on a large-scale public housing programme procuring land, services and planning permission for large-scale development as we did in the past, the EU straight jacket requires Coveney to come up with inventive ways to bypass these rules.

So Coveney has come up with the idea that private sector development will be the way to go to reach his target numbers of new house builds. Now, wait, think of this for a moment.

Suppose you are a local builder with a plan to build a small estate of say 50 homes somewhere in one of Dublin’s suburbs.

You have the planning permission, services already in place, land purchased, ready to go, the only thing stopping you, according to Coveney, is finance; so perhaps Coveney from his €5bn will lend you the money as the banks won’t give it to you.

The Construction Federation of Ireland:

“Speaking at a CIF event in Dublin yesterday, Micheal Mahon of the Society of Chartered Surveyors said that his research showed a three-bedroom family home cost about €318,000 to build including a 15pc profit margin. That places those homes well above the estimated limit for most first-time buyers of €280,000 to €300,000.”

Amazingly there are no plans to reduce vat on new homes! Coveney will build these homes for €250,000 but cannot tell us how this will be done?

<div class=”ctx_content”>
CIF director Hubert Fitzpatrick said the shortage of new homes had long passed crisis point.

“Due to the cost of construction, many Irish homebuilders are finding residential development unviable.

“In many parts of the country, the cost of construction is so high relative to asking prices of existing houses they would be building at a loss. As a result, housebuilding activity outside the greater Dublin Area is stalled,” he said.”


So back to our local builder. Unless he is a fool he will not be lured by Coveney’s cheap money to build homes that no one can afford due to their high cost.

Coveney’s report is silent on reducing the high cost of home building so let’s call his report a dud!

Its a DUD report! Nothing but a shambolic aspirational mess.

Lets add to our disillusionment!


CSO have just released a report stating that our GDP growth levels are at 26% incredible levels! On the face of it we should be sending in the gardai to investigate the Central Statistics Office as based on their statistics using formulae supplied to them by Eurostat it turns out because of the increase in GDP we have to contribute an extra €280,000,000 euro as contribution to EU funding.

I kid you not, beset with homelessness for up to 6000 of our citizens, hospitals bulging at the seams with trollies for A&amp;E patients and waiting lists for years, the EU wants another €280ml from us.

If you are part of the group think “Think Tank” describing Ireland’s GDP growth levels as incredible 26% everything is hunky dory  you should not be reading this as I’m one of that vast group that belong to those disillusioned with politics.

“So we seem to have had two big distortions in our GDP growth figures. The first was the deprecation of assets moved to Ireland. And the second was the jump in exports from contract manufacturing and tax inversions.”

There is a dearth of precise detail in the CSO figures but for sure they evidence scamming of tax payers across the world through smoke and mirrors accountancy tricks and tax avoidance loopholes that move massive corporate pockets through mail box companies set up in the IFSC for this purpose alone.

For example, through tax loopholes in the US profits can re relayed through an offshore mailbox company setup in Ireland by an American company and suddenly all its profits are tax free.

I would suggest the sudden rise in this activity is accelerated through the alarm caused by the declared intent of US politicians in congress and in the senate and including those going for election to stamp out these loopholes. These scams are being exploited before the guillotine falls and the US legislates against corporate inversions and similar scams.


Political Irony Inversions

The irony is the longer Taoiseach Enda Kenny stays the closer to the end he gets and the more unstable his government becomes. Inevitably the more damage Kenny does to Fine Gael’s credibility with the opposition and the public.

FF can sit back and enjoy the growing chaos. Meanwhile we can enjoy the spectacle of this charade as lame ducks fail to oust the chief lame duck.

But there appears to be method to the madness.

Frances Fitzgerald becoming de facto heiress apparent to the incumbent house of cards.

This seen in the appointment of James Reilly as deputy head of Fine Gael. He rides the crest of a wave losing his seat with Don Quixote like precision tilting at windmills  winding us up with fantasies of universal health care.

At the same time hospital trollies answer hospital waiting lists as Irish doctors and nurses flee the HSE while many refuse to join the wasteful and absurd call to the under 6’s to clog up GP waiting rooms .

I guess O Reilly’s job will be to drum up some support for Fitzgerald.

Its a clear case of Kenny’s Shakespearean hubris manifested in a poor amateur drama parade  of Bruton, Varadkar and O Reilly divertingly defending Kenny’s over reaching stay in office.

According to them the emperor is clothed in expertise, leadership qualities, the success of the Irish economy, lowering unemployment, white knight of Dublin’s north inner city: Not!

Those disillusioned with politics see beneath sham falsified unemployment figures based on zero hour part time contracts, growing taxes and charges driven by austerity with plans for more debt extraction to burden the young with the cost of so-called free education!

Europe is dragging this country down itself in severe decline with banks across the EU on the threshold of failure  long term Japanese deflation  best that can be hoped for.

Enda should go immediately. The longer he stays the more lasting damage he will do to Fine Gael. Some argue the longer he stays the better!

Curiously Kenny’s relationships with fellow European leaders built on accepting on Ireland’s shoulders 42% of what otherwise would be banking losses for French Santander and German Deutchbank and other European and US banks is touted as a plus.

Folks, he would have a bad relationship with them if he had succeeded in gaining anything but a refusal from even daring to ask for a burden sharing debt write down. But he’s loved for his obediently, jovial compliance and foolish smiles and incurious obedience.

That is what is being offered to us voters with Enda Kenny whose political demise appears to be as difficult to wrestle from his drowning grip as is democracy from Mugabi in Uganda.

Actually,  you can  plot it for a poor amateur drama production, its pretty simple to ‘make it up’.

Consider the following scenario with ‘lost his seat’ James Reilly, the party still reeling from election results no doubt due in part to his misjudged anachronistic and ironic call for universal health care for all with the irony of hospital waiting lists at an all time high.

Perhaps an audit of O Reilly’s property portfolio and that of all members of FG/LB in the last coalition may have thrown some light on the absence of regulation to prevent rents rising to an all time high,  lets not digress.

Reappointment of Reilly to the role of Tanaiste with a  role to talk to FG politicians around the country to reinvigorate the party is his mandate.

His close connection to Enda Kenny and his political proximity to Frances Fitzgerald would appear to make sense if he is meant by Enda Kenny to back Frances Fitzgerald as Enda’s heir apparent.

Frances Fitzgerald hasn’t been that highly visible in defense of Kenny, has she? So the plot thickens. The more time passes the more unstable Fine Gael becomes. This must be both tragic and comic.

This injects Bruton’s and Varadkar’s support for lame duck government by Enda Kenny with all the more ennui and mirth, but we’ll have to wait and see if such a plan pans out.

Just as we’ll have to wait and see if Simon Coveney rises to the task of reducing the cost of new house builds and actually builds a house that isn’t built on pyrite, mica and sand.

Meanwhile those disillusioned with such political manoeuverings look around at alternatives? Sinn Fein with its all Ireland machiavellian associations now wedded to remaining in Europe? What ludicrousness? Waffle Fianna Fail masters of the political uturn? No? Brechtian silence from Shane Ross bought off to unify and give stability to Fine Gael? What an unbroken horizon of despair?

Now supposedly independent but de facto state agencies like the Central Statistics Office in Orwellian Up is Down fashion cheer on government propaganda with leprechaun economics telling us:

““I’m not going to stand up and say the economy grew by 26 percent,” Power, an independent economist, said after the release. “It’s meaningless — we would be laughing” if these numbers came out of China, he said.”


But wait there is hope on the horizon:


There are those out there willing to say the emperor has no clothes on. So called recovery is a sham.

Homelessness, water charges, property charges, rent serfdom, calls to make students through loans pay for their education; young teachers and guards forced to take lower pay scales than their older colleagues, charity regulations in a mess, NAMA in an even bigger mess, our main trading partner rightly leaving the EU with enlightened Brexit, hospital waiting lists.

Yes there are those disillusioned with politics with their ears to the ground who don’t buy into the mantra pretence of success but who see through the shambolic and self serving politics of delusion led by those who would spread their delusions among us.

Brexit brings with it opportunity to join with those on these islands looking to bring reality back into politics, to discover a new and fairer world.

Irexit needs to be put before the Irish public as an option to escape the straight jacket of Europe and to reform relationships with NI and UK in new political and trade agreements.

A new alliance with greater independence for Scotland, an all Ireland 32 county political and trade based unified government, Wales and UK with greater ties than before and greater respect for independent voices could release these islands from the disaster that the EU has become.

The alternative is a glove puppet government wedded to its decline and the decline of Europe.




till again



'Apart from reform things, what do you do?'

‘Apart from reform things, what do you do?’

Democracy is good. We are lucky to have it.

Thinking how those without democracy could fend off of a regime like the one we’ve had, gives me the shudders.

We should be careful who we elect, have a look at this on Trump:


Worst thing that can happen following the collapse of Fine Gael and Labour is that Fianna Fail and Fine Gael would form a coalition.

This would betray all those voters who voted for independents and Fianna Fail including this blogger.

It would most likely lead to a split in both the Fianna Fail and  Fine Gael party.

It might help Kenny and Noonan escape their just rewards from  bad judgement  failure to come up to the mark on matters relating to the management of our debt.  The burden for which was  taken from the shoulders of the rich during their reign. The burden was heaped on the poor creating homelessness, crises in A&E and a false and broken property market.

What needs to happen is that a stable government be formed by a coalition of Fianna Fail and independents with independents coming together in a structure to allow them  formulate consensus on policy issues.

Such a structure with majority consensus and free debate could revitalise decision-making in Dáil Éireann.

It would also fit in with the declared aim of Fianna Fail to reform the Dáil. Free from the party whip this would allow Independents make a huge contribution to stable governance.

We would no longer have a FG/LB economic management committee that could bypass the Dáil and sign off on another bailout costing tax payers tens of billions, €67 billion being the start of the last bailout.

Trying to cobble a coalition together with enough votes to get him over the line as Taoiseach is probably Kenny’s last chance saloon before he’s ousted by the party.

He won’t succeed.unclean-waterhigh

Meanwhile  Fine Gael needs  to get its act together.

Kenny should go immediately having led his party into the Battle of Waterloo (no pun intended ) with such poor judgement reaping its devastating consequences for so many Fine Gael deputies who’ve lost their seats.

Likewise Burton should immediately go having brought the party close to annihilation.

Its ironic this so-called left of right party will likely support Fine Gael if Kenny is proposed as Taoiseach!

Michael Noonan, Minister for Finance, should step down and spend his time answering some of the following questions before the Dáil Public Accounts committee.

Its long been contended in this blog that Ireland has performed abysmally in vindicating its right to debt write down and debt forgiveness at European level.

Alongside its capitulation to European demands that Ireland alone should shoulder over 40% of the total exposure of European banks to the financial collapse of 2008, is this reason enough we should join Brexit and leave Europe to develop  fairer free trade agreements with European Scandinavian and UK partners?

But let’s leave that argument aside for the moment and examine another part of the fallout of bailout in Ireland, NAMA.

Mandy McAuley uncovers a scandal at the heart of the billion-pound sale of Northern Ireland property loans.

Critical of NAMA from its inception we need answers to the following brought to us through the recent Spotlight investigation for the BBC:


First shown: 8:30pm 29 Feb 2016 Spotlight NI

It’s an incredible story.

NAMA took over circa 900 properties in NI representing loans gone bad from developers 55 of them but the biggest loans managed by a handful, worth approx £4.5billion.

NAMA set up an advisory committee on which sat leading NI businessman and friend of Patrick Robinson,  Frank Cushnahan.

Ian Coulter, managing partner in one of NI’s biggest law firms, Tughan’s is now being investigated regarding accounts resting in an Isle of Mann account allegedly as a fixer fee for the following.

The matter is also subject to criminal and police investigation.

According to Mick Wallace TD a kick back to a politician. £7 million sterling ended up in an Isle of MAN bank account under suspicious circumstances.

The matter has been reported to US Securities and Exchange Commission reported by a whistle-blower.

Cushnahan previously was successful in persuading the NI Housing Executive to forgive most of Red Skies debts allegedly negotiating debts of quarter million sterling down  to £20000.

A director  of Red Skies he was also previously a member of NI Housing executive with allegations of conflict of interest.

He was later to be involved in a deal with NAMA.

NAMA has held a world-beating £60 billion property portfolio.

With £4.5 billion of Nama debt related to NI, NI was terrified of a firesale.

NAMA set up an advisory committee, hand-picked to sit on this was none other than Frank Cushnahan that gave Frank influence and insider track with NAMA and NI politicians.

Nama is precluded by law from selling back an asset to a defaulting debtor.

When NAMA called in  administrators for the Kennedy chain of hotels in NI,  Finance minister Sammy Wilson phoned Frank Daly chairman of Nama re concerns.

A few weeks later seemingly out of the blue PIMCO with access to trillions of investors money appeared on the scene.

PIMCO behind NAMA’s back met officials Peter Robinson and Sammy Wilson, Ian Coulter and Frank Cushnahan were at the meeting. Daly was not invited.

Nama’s NI portfolio was on the auction block but Nama did not even know. Frank Cushnahan hadn’t  told Nama he was setting up the biggest property deal in NI’s history.

Subsequently the deal went through selling the NI portfolio at massive £3 billion discount. Selling for £1bn representing a loss of £3 bn for Irish taxpayers.

Michael Noonan is silent on the issue.

NAMA has refused to appear before NI committee investigating aspects of the above.

The matter should be further investigated by the police investigating pay off’s and double dealing and conflict of interest.

NAMA’s at best incompetent handling of the above under Minister Michael Noonan should be a matter for the Dail Dublin Accounts Committee.

There is plenty of prima facie evidence something very rotten is in the state of Denmark. NAMA does operate under its own radar safeguarded from public investigation and inquiry.

Minister Noonan has direct responsibility and should bring these NAMA matters to account.

Much needs to be uncovered.

till again

I am Charlie Grexit

January 11, 2015

deflationThe euro has tumbled in world markets its decline accelerating in recent months from a high of $1.3993 last May to $1.1868 over the past few days stimulated by fears of a Greek exit and the failure of Mario Draghi’s negative interest rates and austerity to reverse its downward spiral.

Fuelling the decline is speculation of an imminent announcement that a stimulus of up to 1 trillion euros is on the cards.

Figures show deflation is taking hold across the euro zone.

Why this is bad, explained by Paul Krugman here http://krugman.blogs.nytimes.com/2010/08/02/why-is-deflation-bad/?_r=0

The effects of low growth are magnified with higher unemployment rates exacerbated in the euro zone by public health, education and social security programmes eg


The cost of entitlements have a deeper effect in the euro zone than in the US where half of US citizens got little more than one day’s vacation over 2014. Morality demands the population be served by government not exploited by a slave owning elite.

Further deflationary pressures are caused by falling property prices. In Ireland this has led to pressure from the Central Bank and government to stimulate this sector through dubious means.

Asset purchases from NAMA through foreign vulture funds combined with shortages due to lack of construction, lack of lending into the property sector, a hike of 20% on required deposits for mortgages maintain asset prices through induced shortages, have created a market that has priced real people out of the market and made it the domain only of the super rich.

A market depending on the spending of the super rich and excluding ordinary people is a dysfunctional market that cannot last long. There are fears a whole generation will be condemned to renting from a rental market controlled by vulture funds and the rich as property is put beyond the reach of ordinary people.

It’s likely that austerity is the euro zone will put further pressure on indebted members to cut the cost of public health and social security programmes forcing countries to change their Health Service Executive into Trolley Service executives.

Government bonds under increasing pressure eg Greece to find buyers on international markets through negative perceptions re decline in the euro zone, will force pressure on Draghi to be buyer of last resort and thus lead to massive QE for Europe.

What are the implications of QE for eurozone?

One effect of QE is to drive bond prices higher and bond yields lower. This could have a negative effect on the eurozone. If the stimulus were a success, leading to stronger economic growth and inflation, then bond yields could rise as happened in the US as investors assumed economic growth and inflation would follow.

It’s a risky business but it may be the only card left to play in the eurozone’s last chance saloon. Its more likely to fail as countries such as Greece weighed down by massive debt forcing growth into the long stall, demand burden sharing and force default. In turn, this will create pressure on other countries such as Spain, Italy, Cyprus and Ireland.

Figures for 2014 show prices across the euro zone falling into deflationary levels. The effect of this is to worsen the plight of countries and individuals heavily in debt. Spending is put off in expectation of further price falls. Contracts large and small are forced to go for tighter profit margins. Prospect of Japanese stagnation and slow decline beckons.

Growth can no longer save economies already doomed with insurmountable debt burdens.

Add to the above mix the prospect of imminent defeat of right-wing parties in coming elections. From the certain defeat of Enda Kenny in 2016 to the imminent defeat at the end of this month of Greek premier Antonio Samaras both poster boy proponents of the poisoned chalice of austerity.

In Greece the left-wing Syriza party is likely to win. Alexis Tsipras has led Syriza with the banner of 50% write down of Greek debt.

Write-down sends shivers  leading to  euro tumbling in world financial markets.

Recent measures to build walls around the euro with the ESM are not built to withstand Greek default that can spread contagion to Spain, Cyprus and Italy.

It’s likely Draghi will try massive QE to stimulate the euro, stem the outflow from Greek debt write-down demands.

Part of the developing scenario may mean stay/go negotiations with Greece with no debt write-down on the table for Greece.

In such a situation Tsipras may steer Greece out of the euro looking for support from China and Russia with the euro zone choosing to sacrifice Greece to save itself.

Whether Greece stays or goes massive buying of government bonds through QE may then save contagion from spreading to other peripherals such as Spain, Portugal, Cyprus.

However, QE for the euro zone is not without its risks.

In Ireland we’ve experienced the side effects of US QE with foreign vulture fund activity in NAMA buying everything that moves. It’s likely that the purpose of QE to stimulate economic activity will stimulate the wrong kind of activity with negative downside.

Contagion of shadow banking with $600 billion only in collateral chasing trillions of derivatives blighted by cross puts similar to  mortgages in Ireland when paper deeds from single properties were used over and over again to leverage more and more blighted assets, is a tinder bed in shadow banking ready to ignite. Perhaps Grexit could lead to worldwide stock collapse of the bull market fed by QE.

Banks prefer the paper financial markets to real markets.

An example of wrong kind of activity is requirement by the Irish Central Bank to limit mortgages to those with 20% deposits requiring couples to pony up €80000 to acquire mortgage on €400,000 house. Rise in contract working and lack of permanent positions even in well paid employment make these mounts unrealisable for the majority.

The irony is  if prices are driven down by this requirement, if a large quick fix construction programme is begun, if NAMA releases its property portfolio into the rental market, this would have a negative impact on the balance sheet of Irish banks. The capital base of Irish banks would fall, negative equity and a deflationary spiral would ensue.

You might wonder what policy and regulatory framework gives rise to the above craziness from the Irish Central Bank?

If you are a member of the banking inquiry this might even whet your appetite to fall back to the years 2006-2008 to examine in detail the advice being given to the Irish financial markets at that time to the government, in particular the regulator, by the Irish Central Bank .

You might even want to talk to Mario Draghi or Jean-Claude Trichet to microsope  ECB involvement in the collapse of the Irish economy?

Mario Draghi has refused to come before the Irish Banking inquiry to answer such questions.

I thought there may be some answers given by Professor Honahan in his essay contribution to “Brian Lenihan In Calm and Crisis” edited by Brian Murphy, Mary O Rourke  and Noel Whelan published by Merrion Press before Xmas.

Regularly hauled out as an oracle on the Irish economy,  a  regular Rasputin to Irish tsars, the secret shadows of the Irish Central bank activities, are kept under wraps by Honahan.

No luck there, he gives no information away confining himself to prognostication on the performance of Brian Lenihan as minister for Finance under the shadowy grip of economic forces the Irish Banking Inquiry one doubts has the capacity to probe.

The Irish Banking Inquiry so far has no Judge Bailey Sean Dunne probity form. Honahan gives nothing away vis a vis ECB involvement with the Irish Central Bank.

How accountable was the ECB and the Irish Central Bank in management of the Irish financial crisis?

The compliance, subservience obedience and servitude of the Irish negotiating position is summed up by Honahan, P80, Brian Lenihan in Calm and Crisis:

“While he undoubtedly considered it a failure to have had to have recourse to a financial rescue package from international official sources, in fact, Brian deserved considerable credit for pushing ahead with negotiations without the ineffective grandstanding or attempted blackmail that some other countries have sometimes tried with the IMF. By embarking on the protection of the programme long before he ran out of cash, he enabled the Irish negotiators to settle on what has been a much more gradual path of fiscal correction than that imposed on other peripheral countries.”

Notice the way Honahan steers blame away from ECB by mentioning the IMF as lender of last resort. In fact IMF officials objected to the severity of the package offered to Ireland, but this was resisted by ECB who held sway as lenders over the IMF.

Blackmail is mentioned by Honahan, but facts show Ireland was blackmailed into agreement not to burn bondholders. Ineffective grandstanding is another contemptuous term used to try and stop comparisons between Iceland and Ireland, with Iceland succeeding and Ireland failing in falling victim to odious extortion by an elite cadre who had sold out taxpayers, to preserve their personal wealth and power base.

This is paid for currently by Irish people on trollies in A&E departments across Ireland with their health service in ruins.

Honahan’s role in vindicating the right of Irish people to fair treatment by external bondholders can be likened to that of Dermot MacMurrough circa 1120 who made his way to the Court of Henry II of England and offered to become a vassal to the King in return for military aid in retaking his kingdom.

Honahan and the Irish Central Bank negotiators retook Ireland for the ECB. They did not vindicate the rights of Irish taxpayers; they did not repudiate odious debt.

The terms of the bailout delivered to Ireland were subsequently watered down when other precedents for interest rate reductions for Greece and Portugal were set, that were less odious.

But its true, Irish negotiators gave up without a fight.

Perhaps Honahan will be brought before the Irish banking inquiry and given the same grilling Judge Bailey has given the Dunnes in the US. But I wouldn’t bank on it.33

At times, you would be forgiven for thinking Honahan was minister for Finance himself and that he had usurped that office.

The real shadow cabinet of Kenny, burton, Noonan and Howlin takes its orders from the erstwhile dictator Big Brother Mario Draghi with Honahan as underling.

For them, there is no third estate pillar of democracy with the right to freedom of information, the right to share this information with the public. This is a drift to extreme right-wing dictatorship unheard of in the past.

As if to emphasise this point during the past week, Censorship and propaganda stalked the land.


Vincent Browne has been targeted both by Fine Gael and Labour the same week Charlie Hebdo was targeted by terrorists attacking freedom of expression in the media.

“Independent.ie can reveal that the party has refused to allow of any of its candidates to take part in the debates in what has come as a major blow to the broadcaster”

Surely the seriousness of this attack on freedom of expression and blatant effort at censorship should at least warrant every independent in the Dail refusing to attend until this odious ban is lifted?

Perhaps FG/LB do not wish to be questioned on the claim of growth levels for 2015 of 5% for one of the most heavily indebted countries in the world, in the face of deflationary or no growth in Europe, hospitals without beds for citizens, teachers on strike to prevent standards from falling further, only part-time jobs in the public sector, mostly contract jobs in the private sector, induced shortages in the property sector.

After the Irish water fiasco and the burning of the Junior Cert fiasco, his refusal to allow FG/LB candidates  to appear on TV with Vincent Brown, will Enda Kenny to prevent political debate like Goebbels organise a public burning of books?


Till next time.






The Irish Central Bank

March 14, 2014

Ukrainian Crisis

As crisis in Ukraine deepens many are concerned that a war is being stage-managed to deflect from a growing economic crisis effecting the development of the euro area.

The following video gives some balance to the media propaganda that the democratic will of the Ukraine is being denied rather than a foreign backed neo natzi coup hidden from the general news media.


St Patrick’s Day Holiday

95% or more of Irish government ministers, some of the world’s highest paid politicians, have absconded to US and other parts of the world eg Vietnam to take part in St Patrick’s Day parade.

Eamon Gilmore TD interviewed about the high cost of these visits circa €250,000 spoke of the business generated for Ireland, a figure last year he dreamed up was circa €10ml. For example, he spoke of the new direct air routes to Canada.

It gave the RTE reporter a feel good to hear black is white.

Its a bit like Eamon Gilmore going to a football match in Croke Park and claiming his visit won the game for the winners.

On the contrary, such visits abroad often give a Banana Republic feel to observers at home and abroad. In Africa, such involvement in business by government is often seen critically as a mark of corruption, a notice that brown paper envelopes are expected to change hands at some point.

Not to be outdone, Enda Kenny erstwhile dictator of our benign republic entertained guests in the US to a call to telephone him directly if they wish to pursue business interests in Ireland.

Not that we have not learned that the business of government mixing with influential private business interests from developers et al led to our corrupt financial meltdown; that’s safely hidden away shrouded in secrecy carefully shredded from prying eye’s as demonstrated by our lack of a banking inquiry.

Business delegations do not require government ministers, letters of introduction would well suffice; Enterprise Ireland or IDA or a minor official from Department of Trade and Commerce to powerpoint the getgo of VRT/TAX, Corporation Tax and trade regulations would benefit trade instead.

Noonan and the Irish Central Bank


In a surprise move Michael Noonan has urged Morgan Kelly economist at UCD to meet with the Irish Central Bank re Kelly’s fears that property/commercial loans expose Irish SME’s; they could be subject of a new get tough experiment by the ECB following stress testing in 2014. ICB and banks maybe forced not to extend and pretend, they may call in the loans, thus devastating the Irish economy of which the SME’s are backbone.canstock8599636

The advice offered by Noonan reveals the policy making mindset of the Irish government in relation to management of the Irish economy; government is subservient and obedient to the dictats of the Irish Central Bank.

Clearly Noonan wants ICB to persuade Kelly to wear ICB blinkers.

Glove puppet relationships between the Irish Central Bank,  Regulator and government that Noonan’s comments illustrate should be the focus of a long postponed banking inquiry into the causes of our meltdown. Noonan’s comments provide a window into the relationship of government and ICB.

The ICB has a fundamental leadership role in the economic affairs of government, ICB has yet to be probed and brought to account for its role in Irish economic affairs. Its growing Orwellian Big Brother influence on government and Ireland’s economic life should be questioned and scrutinised more closely.

For simplicity, lets reduce questions  to one, what role, if any, has ICB played in our meltdown and subsequent development of macro economic policy in regard to bailout? Does the ICB have any questions to answer? 

Let’s ignore the “Over the four-year period of the Government’s plan, nominal GDP is forecast to grow by over 16%, or almost 4% per annum and real GDP growth will expand at a rate of 2.75% each year.” Pie in the sky figures no doubt from the ever inventive CSO.


The bailout was for €85bn and The Government said: “If drawn down in total today, the combined annual average interest rate would be of the order of 5.8% per annum. The rate will vary according to the timing of the drawdown and market conditions.”

The draconian and odious 5.8% was later reduced to conform with more lenient terms negotiated by Portugal and Greece. Both government and ICB failed in getting better terms. Though market conditions have changed there is no further leeway advocated by ICB.

ICB should be instrumental in demanding write down of Irish debt on the basis that Ireland was forced to take one for the team.

Advice given to the Irish government in relation to the bank guarantee we have yet to examine through a banking inquiry. It’s not insignificant that Prof Honahan of ICB has consistently denied the need for a banking inquiry probing these matters.

Indeed his announcement of a bailout for Ireland prior to its official announcement by government in Ireland arguably denied a better negotiating position for Ireland in relation to bailout.

ICB has fundamental questions to answer in relation to the state guarantee; in relation to the odious and penal interest rates attached to bailout, in relation to “There was no agreement on ‘haircuts’/discounts on bank bond debt.”

ICB as ECB bailiff 

A tougher role in regard to repossessions could have dark repercussions for the Irish economy; withdrawal of lending by Irish banks in anticipation of coming stress tests in 2014 will have negative impact; coercion of the credit union sector will have profound effect on democratic lending patterns in Ireland. All of these matters including its supervisory role of credit institutions should be independently scrutinised.

Since 2011 ICB has launched PRISM:


“Under PRISM, the most significant firms – those with the ability to have the greatest impact on financial stability and the consumer – will receive a high level of supervision under structured engagement plans, leading to early interventions to mitigate potential risks. Conversely, those firms which have the lowest potential adverse impact will be supervised reactively or through thematic assessments, with the Central Bank taking targeted enforcement action against firms across all impact why are we introducing  risk-based supervision categories whose poor behaviour risks jeopardising our statutory objectives including financial stability and consumer protection.”

ICB(Irish Cental Bank) across the credit union sector has applied tightening regulations and supervision leading to much controversy and closure of some credit union institutions. See earlier blogs.

However, Morgan Kelly’s warnings (see last blog) highlight stress test across the EMU in 2014 that may force the ICB to take a stronger line against Irish SME’s, one that could replicate across our economy, the calamitous experience of Bill Cullen with Ulster Bank part of the RBS(Royal Bank of Scotland) group. Bill Cullen claims Ulster Bank destroyed his business.


“Mr Cullen met Tomlinson three weeks ago.

The Yorkshire entrepreneur’s investigations into RBS and two Ulster bank cases has led to more than 40 new complaints from Ulster Bank customers in the Republic of Ireland and more than 50 in the North.

They are now the subject of three separate investigations including one by the UK’s Financial Conduct Authority (FCA).

Tomlinson has branded RBS/Ulster as a ‘vampire bank’.

Three months ago an Ulster Bank whistleblower claimed in the Sunday Independent that staff did close viable businesses  down in order to boost the bank’s bottom line.”

IRISH Central Bank and PRISM  (The Probability Risk and Impact SysteMTM (PRISMTM) is the Central Bank’s risk-based framework for the supervision of regulated firms)

One of the charges made against banks and the ICB was the lack of supervision of the financial sector, lack of regulation, a hands off approach that fatally led to financial meltdown.  ICB has since 2011 focused on risk based assessment and closer supervision of the financial sector, to reduce risk and to potentially avoid domino effects impacting the development of the economy by businesses such as that run by Bill Cullen.

PRISM aims to :

” operate a risk-based supervisory framework similar to that operated by significant financial regulators such as OSFI3 in Canada, APRA3 in Australia, the US Federal Reserve, De Nederlandsche Bank5, and the new Prudential Regulation Authority in the UK;”


Of particular concern to Kelly re SME sector is also highlighted as a concern for the ICB:

“The overall value of impaired loans continues to rise, albeit at a
declining rate (Chart A4). This impacts the real economy and
also the financial system, through a reduction in asset values on
banks’ balance sheets and, thus, affects banks’ willingness to
lend to the private sector. The level of distress among small and
medium enterprise (SME) borrowers is particularly acute. This
endangers not only the profitability of the banking sector, but
also has far-reaching consequences for the viability of corporates
and the employment they generate.

Credit risk is, therefore, a key concern for the domestic banking
sector. While the coverage ratio, which shows the value of
provisions for impaired loans relative to the value of impaired
loans, increased in the third quarter of 2013, uncertainties
remain about whether banks are sufficiently provisioned to cope
with the outstanding stock of distressed loans. The long-term
viability of the banking sector depends on its ability to return to
profitability. There have been some positive funding
developments such as a reduction in official sector liquidity
support, strongly supported recent debt issuance, and declines
in deposit rates, but the overall profile remains fragile and
vulnerable to swings in market sentiment.”
“Responding to the mortgage arrears resolution process initiated
by the Central Bank in November 2011 (including the
quantitative targets set in March 2013), banks have begun to
step up their interaction with borrowers so that sustainable
solutions can be proposed. It is vital that potential modifications
are affordable in both the short and the long-term and that the
changes provide sufficient clarity on what happens to the
collateral at maturity. In addition, restructuring targets have been
set to encourage banks to move distressed SME borrowers from
short-term forbearance to longer-term solutions.”

The ICB has also been embroiled in controversy in Galway with its demand that over 200 credit unions in the Galway area cut lending.

“Independent Senator Rónán Mullen has criticised the Central Bank for ordering over 200 Credit Unions to cut lending.” New rules for the credit union sector have been introduced that have been alleged to be draconian and in breach of the spirit of the credit union sector. The sector is largely voluntary and now subject of bureaucratic requirements and expensive professional expertise and software some argue is targeted at the movement to undermine it in favour of the commercial banking sector.



Mortgage and Commercial Property Lending

While there was no coverage on its 9pm news 11/12April  of the protest of 27000 teachers’ concern on the future of the Junior Cert in Irish education, full 5min coverage of Cheltenham was given including blanket coverage of Enda Kenny’s visit to Downing St; there was instead plenty of coverage across the news media tv/print of a family given a debt write-down of €150,000 on a €400000 mortgage.

The ICB has not backed or implemented a debt writedown of all mortgage debt in arrears on property purchased at the height of the boom bubble, even though original terms were often ridiculously subprime eg 100% mortgages; instead, the ICB has backed an inquisitorial, draconian, Shylock solution open to abuse of unfair influence or uneven decision making, exploiting the vulnerable.

NAMA and bank large developer loans have been written down and supported through recapitalisation of the banks, but crucially the SME sector has been ignored and banks supported in ravaging smaller loans in the commercial and mortgage sector.

The policy of looting and pillaging SME entrepreneurs with the view to large scale debt extraction on a personal one to one basis has not been sufficiently critically scrutinised. Without MABS https://www.mabs.ie/about-mabs/ citizens in mortgage and debt arrears would be left on their own to face the might of the banks.

ICB is in favour of a get tough policy on lending. Its lack of advocacy of a debt write-down scenario similar to that of Iceland is not questioned.


ICB ‘extend and pretend’ policy has had a negative impact on the Irish economy suffocating consumer demand and causing long term damage.

“The Central Bank, assisted by third party experts, has conducted
a Balance Sheet Assessment (BSA) of the credit institutions that
are subject to the Prudential Capital Assessment Review. The
requirement to complete the assessment was agreed with the
Troika as part of the programme of financial sector reform. The
BSA, together with new stress tests by the ECB in coordination
with the European Banking Authority next year, form part of the
comprehensive assessment of euro area banks in advance of
the establishment of the Single Supervisory Mechanism (SSM)
in 2014.”

BSA is contingent on recovery of outstanding loans with provision for losses ( a topic requiring detailed analysis ) uneven at best across the credit institutional sector; while PRISM ‘extend and pretend’ methods provide false accounting data projecting full repayment of loans that will never be repaid in full.

On the macro level, all boats beached or in dry dock due to the above anomalies, may sail again should the economy grow by 4-5% annually. The CSO cheerleaders of over estimation will help.

ICB is promoting a tale of ‘pigs will fly’ and ‘economic turnaround’ instead of proposing a policy of debt write-down.

The policy is so inept it is beyond belief. It is the source of all propaganda fed to politicians unable to think for themselves, reliant on false advice from ICB they are as prone to macro policy mistakes as Fianna Fail were in the Bertie era.

At that time, the ICB failed in its prudential mandate to rein in the banks.

Let’s call this error by the ICB the ‘soft landing’ error. We were fed this by FF previous to financial meltdown following 2008; the current coalition of FB/LB feed us the same mantra emanating from ICB, ‘soft recovery’.

Dead cat bounce of the economy is no soft recovery.

Black is white


“2013’s GDP figures show contraction of 0.3%, but GNP grew by 3.4%” Word on the street is that lots of pharma patents are coming to an end and that further falls in GDP output from pharma will follow.

Another factor feeding into the ‘confidence’ boosting propaganda is the return to the markets and falling cost eg “Irish 10-year yields fall to new record low below 3 pct” This follows yesterdays Spanish bond sale news


dropping yield on Spanish bonds beneath 3.7%. It would appear the inflated issuance of debt by Central banks around the world through programs of monetary easing in the US is to be used to inject more liquidity into economically unstable peripheral countries of the EMU, irrespective of their real economic profiles.

There is no change to the underlying causes of meltdown in EMU peripheral countries other than commitment to inject more credit lending and bond issuance adding to already unstable burden of debt/gdp ratios in these countries.


Its interesting to analyse the dichotomy between the story from the financial markets, markets due to US QE are flush with money looking for a home; the local economy in Ireland still remains broken by debt cf above concerns above re SME sector along with the commercial and mortgage property sector; yet, through austerity and large exposure to commercial and private debt, ‘confidence’ abounds.

Where does this confidence come from?

Some of it comes from the Draghi inspired threat that ECB will purchase bonds of EMU countries if the markets will not do so. Due to QE there is a lot of money about and large institutional investors have worked it out that investing in risky EMU countries will prevent a calamitous market crash that could cost them dearly.

The problem with this scenario is that underlying structural weaknesses in EMU economies besieged with austerity are not being addressed. The rich become richer while the poor due to austerity become poorer. This is a hidden inflationary path where the true mushrooming of debt balloons into inflationary rising stocks and shares indices that bear no true relationship to underlying economic value.

Markets are primed for a severe adjustment downward of up to 50%.

Greater attention should be given to the role and supervisory framework of the ICB in relation to the development of the Irish economy. It reveals serious judgment errors and a lack of prudential management  that puts at risk the future development of the Irish economy.

ICB sits atop a large economic mess. Its role in the mess should be subject to far more critical analysis than has been provided by media in Ireland hitherto.


Nama Republic

January 1, 2014

There are a slew of legal actions from developers fighting NAMA through the court system. This was expected by those who cautioned against the setting up of NAMA in 2009 eg.

https://colmbrazel.wordpress.com/2009/09/ Here are some. Expect more.



“Central to proceedings is the developer’s bid to have Nama’s appointment of receivers to 36 of its prime Irish property assets overturned.

In taking the case against the State’s so-called ‘bad bank’, Treasury is, according to sources familiar with the matter, prepared to do everything within its still-considerable power to secure victory, and in the process expose what it sees as Nama’s “misleading, unreasonable and entirely unacceptable” behaviour in relation to its business.”

Awaiting an upturn in the Irish economy - geog...

Awaiting an upturn in the Irish economy – geograph.org.uk – 1734903 (Photo credit: Wikipedia)

Meanwhile sales of large property portfolios are ongoing at NAMA.

According to Peter Flanagan, Sunday Independent, Dec 1, “A slew of international bidders, including some of the top US funds who specialise in buying so-called distressed debt are believed to have made first round bids for the loan books, known as Project Rock and Project Salt.

Project Rock is worth about €7.8bn in total, but a little over €2 bn worth of those loans – mostly UK commercial real estate – are up to date and are expected to be refinanced by the borrower. That leaves more than 5.5 bn worth of loans that are in arrears.

Project Salt, meanwhile, is made up mostly of Irish commercial property loans, with close to €2 bn worth of lending that is now in arrears.”

Now that Ireland has been sent into cryogenic stasis through its odious bailout, it would appear international vulture funds are ready to make a killing on the Irish property market.

Along with an increase in property prices in Dublin over the past year,  a mini property boom in Dublin, this has attracted vulture funds  into the Irish commercial property market believing the market has bottomed out. They are ready to takeover at knockdown prices the pyramids built by failed Irish property developers.

This state of affairs has not been achieved without some cost. The Phoenix project below, check out website for articles and stories surrounding the 200,000 mortgages in distress currently. The recent personal insolvency bill has given precious little relief to the vast majority ensuring that mortgage arrears and loan default has still not been addressed satisfactorily by Irish banks.


The Irish property market remains severely distressed. The extend and pretend maxim has given ballast to the view there is a small recovery in the property sector. The extend and pretend maxim of the banks works hard to hand out propaganda to all sides that the balance sheets of the banks can be made good.

Thus letters sent by banks to commercial buy to let defaulters signifying no more than the banks want their money back allow the banks to pretend loan resolution is in progress. The reality is a large part of the loan book of Irish banks is in distress and the banks refuse to mark down realistic losses.

Hopefully in 2014 stress tests on Irish banks will reveal this truth.

A large effort is underway to deny the truth. In Ireland austerity has paved the way for deflation helped by banks not lending coupled with the onerous and odious fact that given Ireland’s cocooning in the euro, unable to devalue its currency, lack of inflation with its debt burden  growing not diminishing as a result of this, investment in the Irish economy is becoming more burdensome.

By not facing the truth of debt write down/burden sharing, those in default suffer by not having the reality of their circumstances dealt with realistically by the banks. Repossession would leave the banks with a problem of selling on distressed assets. The property market  would see a further collapse in values if its true worth were tested in fire sales.

With extend and pretend Nama benefits,  banks benefit,  enabling them to set  benchmark on property prices pretending doubts about the asset base of the banks are doubts without substance; vulture funds benefit, by seeing their investment yield a return.

Local business investors and the retail sector find it more difficult to pay the scalping rent and property procurement prices, find themselves  driven from the market. The retail sector is put under further pressure.

There can even be a small mini boom  prices as a result of the NAMA and bank induced coma of the property sector.

The euro has acted like a boa constrictor for the Irish economy. Because the bailout of €67 bn given to the Irish economy is backed by the IMF and the EU and ECB Ireland is subject of a leveraged buyout that can send the Irish economy into a state of permanent stasis.

Any doubts that we received back our economic sovereignty should be banished.

The Poisoned Well

More doubts about the manipulation of property prices by Nama surfaced last Sept:


According to Daniel McConnell/Ronald Quinlan,Roisin Burke, 22 Dec, Sunday Indo
“Nama bosses Frank Daly and Brendan McDonagh have come under fire from Fine Gael’s Eoghan Murphy of the Public Accounts Committee about the agency’s decision to take a 20 per cent equity stake in the €800m Aspen property portfolio, which it also provided the finance for.” “Labour Senator Lorraine Higgins claimed a senior government figure attempted to gag her on NAMA.

One concern is NAMA is setting inflated property prices, it may provide the finance to a private company, it takes an equity stake in that company, so smoke and mirrors, it sets the selling price and is first buyer hoping others will follow.

The whole matter of withholding commercial and residential property from the market in order to avoid fire-sales, once again, the reader can draw their own conclusions.

The dead cat bounce represented by such business activity has many questions to answer. In spite of mortgage lending being down last November on this time last year, there has been a surge in the Dublin property market.

The source of financing for such deals would be worth investigating by the PAC(Public Accounts Committee) to eliminate the possibility of market price manipulation by Bad Bank NAMA.

But PAC have other concerns re NAMA. Darragh O’Brien TD  has said, “The case for a sustained public inquiry by the Oireachtas into NAMA is compelling. The volume of complaints being received across all parties is astonishing.”

In August 2009 a list of academics, economists, signatories appeared in the newspapers:

“We therefore urge the Government to reconsider its approach to payment for loans to be taken into Nama, to pay no more than current market value – which can be ascertained even in these times – and to require the investors in the banks to bear some of the cost of restructuring the system.

To do otherwise would be economic folly.”

Government ignored this advice and bondholders were paid off.

In 2009 regarding NAMA I blogged the point:

” An enormous amount of business critical information will be collected if it hopes to manage the toxic assets. The value of this information to interested parties ready to exploit it will be extremely high and sensitive. It could very well be like a sieve with a potential for exploitation exceeding our worst fears.”

A large turnover of staff in NAMA have been snapped up into organisations run by international investors. It’s not inconceivable that NAMA is leaking information like a sieve.

Here’s how the scam might work. You get a portfolio management position in NAMA – gains you access to a lot of information right across NAMA. You see what deals are being made, what sells, what doesn’t, pricing, evaluations. Such information is gold to international property fund managers. Gaining a NAMA man must be like being given a torch in a gold mine.

To be fair to NAMA, its difficult to assess whereabouts NAMA is at present in spite of recent newspaper reports raising doubts once again: it is so cloaked in commercial secrecy laws that virtually no Freedom of Information requests from journalists are allowed.

Sharing concerns re the high turnover in staff at Nama, the PAC recently entertained the chairman of NAMA to give assurances assuaging similar concerns.

Transparency is the key word here ! Who is going to regulate NAMA. How much information will be given, for example, of the developers, bank shareholder  investments, the evaluation procedures and  nature of the toxic assets under review?

Hopefully coming court cases will ascertain what journalists have been unable to find out.

We do need an inquiry to assess directly if the public are being safeguarded from bad procedures, mistakes, incompetence, abuse, corruption.

Perhaps the most curious issue of all will be the evidence offered in support of the value put on toxic assets by a so-called independent system of independent valuers !!

NAMA may keep property off the market because a fire sale would lower property prices! In this regard, the tax payers and the business people of Ireland get to carry the high cost of inflated property prices thus making us more uncompetitive and returning us to the bubble situation where even professionals could not afford the falsely astronomical prices of recent years.

NAMA currently has no remit to discharge its affairs in a time frame of one or 2 years, it’s a lot more longterm than that! Perhaps it ought to be broken up and chinese walls set in place to protect the interests of the public. Perhaps its disposal of assets are on the basis of the worst wine kept until last.

Realistic targets and goals should be set in place and monitoring should be introduced to regulate its performance and investigate its workings. Currently it would appear the only monitoring would appear to be the monitoring of a casino high roller in Las Vegas.

NAMA at tax payers’ expense will increase the profitability of shareholder stakes in the banks, wipe out the debt of developers, create a gravy train of administrative feeders on NAMA, and burden tax payers of generations to come with a mountain of toxic debt. Though it could yet still cost the banks dearly.

There is still the valuable full blown argument that the toxic assets should have been left in the banks. They still had the best business experience to deal with rogue developers and supposedly have learned from their mistakes. The banks could have dealt much better than NAMA could.

Nama pusillum

Nama pusillum (Photo credit: Wayfinder_73)

Instead a state bureaucracy was created with developers who ran their toxic portfolios into the ground now on the state payroll. Are you having doubts about the Agency’s methods yet?

Opportunity given to developers working for NAMA to abuse their position and benefit from insider dealing have surfaced in the McKillen case:


The main struts of Paddy’s case hinge on the following:

“1. Paddy’s loans aren’t NAMA eligible assets.

2. Paddy wasn’t given enough time to re-finance his assets

3. NAMA valuations are lower than Paddy’s valuations

4. To be associated with NAMA is damaging to your commercial reputation

5. NAMA offends the Constitution and EU rules with respect to property rights”

Added to above is:


An allegation that NAMA undermined McKillen by selling off property loans he was associated with to the Barclay brothers with whom he is in commercial dispute.

Chief Executive of NAMA, ” Mr McDonagh said he believed there had been “a carefully orchestrated operation” to damage NAMA and undermine the financial interests of the State.”

In the absence of full disclosure of its business model in all its aspects, its impossible to accept the existence of an “orchestrated operation”. So far NAMA has cases ongoing against two of its former employees for leaking information.

Of critical interest is 3 above. Depending how the property market returns, other developers may choose to follow suit. State legal costs range in McKillen to €6-14mil to be borne by the taxpayer.

NAMA as a Hedge Fund?

In many ways NAMA is a hedge fund gamble by the Irish government to lock in investors, the Irish Tax Payer and the Bond Holders who fund NAMA.

While the rest of the world is steering clear of this type of investment having learned from the mistakes of others, we seem to be prepared to go where others have become undone before us!!

According to the Agency it is now making significant progress on managing the €72.3 billion of loans it has acquired from the five participating banks and maximising the return for the taxpayer.

But the taxpayer has few tools to monitor, assess and evaluate progress. An independent inquiry by Ireland’s PAC has about as much chance of coming into being as an open inquiry into Ireland’s banking collapse.

To pin the detail and bring clarity to this, we need to insist on more information, not smoke and mirrors, on how NAMA is going to work.”

Corruption involves more than the misappropriation of assets, eg  monetary or property assets. When an institution the state is responsible for or the state itself becomes corrupt or incompetent, power itself becomes corrupt.

I listened ruefully to Stephen Donnelly on NAMA


nb http://www.thepositiveeconomist.com/paying-back-irelands-outstanding-debts-the-bad-the-ugly-and-the-unexpectedly-not-so-bad/

“Basically, what this note is saying is: we have enough money to last us until the end of 2013. By the end of 2013, we hope to have found a way to go back to borrowing from the private sector. Until then, we’re ok. Under previous plans, there was only enough money to last us until mid-2013, so this means we have six more months to work on the country’s financial situation and come up with a solution.

– €11,882 million: this is the amount of maturing debt that we need to pay back in January 2014. This is a big stumbling block. We have two years to find that amount of money – and to pay it off, Ireland can’t use its remaining assets at that stage, which would only amount to 10 billion euros. Besides, using them would mean we’d be left with nothing at all.

– €67.5 billion: this is the amount we owe the EU and IMF, and it’s only part of Ireland’s huge outstanding debt, which is close to 200 billion euros. The problem is that, for a long time (as long as there was enough money to go around), European governments racked up debt instead of trying to balance their budgets.”

It is not feasible to overcome the debt situation with the range of financial disciplinary measures that will cripple the economy and kill the patient in order to cure the illness….

Raison d’être of NAMA and Ireland’s possibility to pay back its bailout at every juncture hinges on growth of 3-9%. None of these figures are achievable in the current climate in the euro zone.

External Deficit procedure and Fiscal Treaty Rules

Michael Andrew FF ireland-republic-of

Freedom of Information rules….NAMA not obliged to publish itemised accounts only an overall account  cost us €30 bn..You can see what is for sale on its website….opportunity for corruption is enormous…..eg selling under the market price

Ireland’s Debt Profile


Credit Ratings


http://www.ntma.ie/business-areas/funding-and-debt-management/debt-profile/debt-projections/    ”

The Ratings

DBRS, Inc. (DBRS) has confirmed the Republic of Ireland’s long-term foreign and local currency issuer ratings at A (low) and maintained the Negative trends. DBRS has also confirmed the short-term foreign and local currency issuer ratings at R-1 (low) and maintained the Stable trends.

….. The IMF projects the Irish economy will expand 0.6% in 2013 and 1.8% in 2014. However, these supportive factors are balanced by significant challenges: the fiscal deficit is still large, the public and private sectors are heavily indebted, and the banking system continues to face deteriorating asset quality and weak profitability.

The Negative trend reflects DBRS’s assessment that risks stemming from the external environment remain skewed to the downside and that the expected primary fiscal balance in 2014 is still short of its destabilizing threshold. However, the trend could be changed to Stable, potentially in the near term, if there is greater evidence of a sustained economic recovery and fiscal consolidation remains on track.”

There are no signs of the kind of economic recovery that can make Ireland’s debt sustainability prospects more positive than negative.

Winter may see the dead cat bounce, but one swallow won’t make a summer.

Happy New Year.


Banking Inquiry

May 18, 2013

Jean-Claude Trichet at the Karlspreis award 2011

Jean-Claude Trichet at the Karlspreis award 2011 (Photo credit: Wikipedia)

Part 1                                    

An Irish Banking Inquiry

 300,000 of Ireland’s mainly young people have emigrated (1), no jobs for those remaining, unemployment rates of 14.7%, in reality closer to 28% when hidden buffers disguising true figures are removed.

We have an economy driven to meltdown following an economic joyride by the previous administration; an economy of failed austerity and a culture of national dependency on bailout.

This was brought about by the current administration’s disastrous policies of ruining the economic engine while  in their garage.

We should at least be able to look forward to a banking inquiry.

We still need to hold to account those who got us to where we are. You are more likely to see some of these people who refused to burn bondholders from our previous administration and our current administration,  who agreed to odious debt burdens on Irish taxpayers, who compliant at the behest of their master puppeteers in the troika, have brought this economy to economic national dependency and lost our sovereignty, receiving awards and honorary doctorates eg Enda Kenny receiving one from Boston College today!

There would appear to be no great pressure coming from our European partners and the troika as to the urgency of carrying out a banking inquiry in Ireland. Veritable silence in fact. Mario Draghi, President of the European Central Bank, when have you heard him speak out on the urgency of a banking inquiry in Ireland?

We need to get to the root of what caused financial meltdown in Ireland. We need also to know who exactly were the leading insiders who stoked the mess, what actions taken and what advice was given.

It’s easy enough to do this before an Oireachtas committee with proceedings held in camera taxpayers can watch.

Of no great interest  is the large-scale policy of lending stimulated by a bonus culture among banking personnel that led to rules being bent and good practice set aside. Cast aside were the managers sitting down examining the ability of borrowers to pay back conservative projections of their lending obligations measured with conservative lending practices; in place of widespread irresponsible lending practices fed by a bonus culture and demands that targets be reached at any cost.

What matters is that leading personnel, Ireland’s top ten or 20  players in the Dept of Finance, the Central Bank, the Regulators Office, FF and FG ministers for Finance, be deeply questioned as to their role in decisions taken. Perhaps also representatives from the Central Statistics Office should be asked to give account.

It’s noticeable current growth projections by CSO/Dept Finance invariably fall short of projections without anyone being held accountable. CSO practices the current canary in the mine whereby its forecasts are tempered by the caveat that growth projections are given on the understanding that growth will occur in Europe and elsewhere.

There will be growth if there is growth. Right.

What? This is base propaganda and not science. We need forensic application of empirical science not false propaganda fielding trumped-up stats fueled by bubble speculation on growth in the EMU.

We need for balance a group of 10 developers who can be questioned on how they got their Finance.

Representatives from the ECB, if possible Jean Claude Trichet should also be quizzed on the role/leadership played by ECB in Ireland’s response to its meltdown in particular terms offered for bailout. Add in some representatives from the EU and the IMF.

60 days over 3 months should establish the facts helped by powers of inquiry given to PAC (Public Accounts Committee), eg compelling attendance/assistance to PAC under legal sanction of contempt.

Selective amnesia maybe can be dealt with through laws demanding imprisonment for contempt of court. But I wouldn’t bet on it.

Part 2          

The collapse of the market economy in the EMU

Much mileage is made in Ireland on purveying the view the Irish Financial meltdown was caused by a simple banking collapse due to massive over lending in the property sector fueled by incompetent oversight and management of state finances.

You’ll hear the phrase ‘nothing to do with exotic derivatives’ meaning the writer usually understands little of these funds, or misunderstands and does not appreciate their impact on currency collapse and property speculation. Yet it was the bundling of property mortgages into toxic derivatives that fueled the Wall Street collapse in 2008 that precipitated the collapse of the Irish property market.

Countries like Germany love this view.For example, Finance ministers of Germany, Netherlands, Finland have signaled any future banking deal in the EMU will not retrospectively be used to finance Ireland’s banking debt.


Ireland’s property bubble and Celtic Tiger years were fueled much more by external conditions than local conditions. Let’s have a look into the engine that runs on bubbles to get a better overview of our financial meltdown. Perhaps PAC in its inquiries should focus much more on this aspect to get to the root of Ireland’s financial collapse.

There are 2 stages to its collapse: one is due to our ‘banking property bubble collapse’ fed by loose unregulated money supply at ECB level; the second is subsequent to it, call it a combination of austerity, banking bailout, that has led to the destruction of Ireland’s market economy leading to unemployment/emigration and a new pretend/virtual economy fueling toxic financial resources into the financial sector.

Dr Heiner Flassbeck, Economics Professor, Hamburg University


has spoken of the lack of clear regulation that led to the Wall Street meltdown and that continues to this day “endangering democracy and the moral ground upon which our societies were built in the past”

He’s asked that governments need to be prepared to step in to restrict the movement of the financial markets. Instead governments are collaborating with proponents of deregulation and toxic Zeppelin stimulus of the financial sector through QE1/2/3/4 in the US and currently in Japan leading to massive distortions in financial markets.

These markets are no longer market driven but stimulus driven virtual constructs manipulated by forces in the financial sector and banking purveying the falsehood that stimulating the financial markets will kick-start labor markets.

Unemployment in the EMU is currently 12%+ and growing steadily.


A good example of distortion of the financial markets and destruction of the market economy is in the case of commodities. Manipulation through shorting in these markets has led in the past year to enormous market fluctuations in real commodities with investors running away due to the realisation markets are controlled and driven down by financial forces in the banking sector that have taken control away from market driven influence.

Financial sector forces have forced bailouts on economies such as Ireland, Portugal, Greece to the detriment of the free market economy in each of these markets that has been driven underground with unemployment and emigration and a growing divide between rich and poor.

Countries such as Ireland are becoming more dependent as they become more enslaved by the financial sector. Similar to satellite states in the previous USSR countries across the EU are no longer free market driven economies, but enslaved to the demands of the financial sector for austerity and the supply of national tribute through taxation and massive lending with punitive interest rates.

According to Flassbeck “monetary stimulus is not working”. According to him we have not even “the pretension of a real market”. Currently there is huge subsidization of the financial markets through QE and through zero interest rates.

Support for this view comes from Max Keiser who is even more pointedly direct in his views than the exhortation  of Flassbeck for the management of the financial sector by competent governments willing to step into the breach and make difficult decisions.


Keiser’s critique of the ‘sacred Dow’ warns that the massive explosion in the DOW over the past year is a false sign of recovery in global markets. Like Flassbeck he points to the crisis painted in unemployment figures unresponsive to the DOW index.

Explosion of the stock market (Max Keiser) is hyperinflation, interest rates are low if any, employment/spending/wage rates are low, the currency of the future is The Dow

How much QE and manipulation can the DOW and the financial markets take before eventual collapse.

In Japan, “The stimulus program will be affordable because under Haruhiko the Bank of Japan is committed to printing as much money and buying as many bonds as are out there.” undermining other currency areas eg china forced to compete with the Japanese currency which in the last 6 months has devalued by 30%. However the Japanese bond market is Fukushima and its  crashing. It too is undermining currency stability locally between China and Japan.

In Ireland support for the false Zeppelin toxic balloon of the financial markets has led to taxpayers being raided to pay bondholders, austerity, destruction of the local economy, mass emigration, destruction of health/education services, 25% + unemployment and “selective amnesia” on behalf of those who engineered Ireland’s economic collapse.

Ireland undoubtedly has been effected by a global heist of market economy economics by the financial sector.

Instead of hyperinflation through currency manipulation, manipulation of the financial markets, commodity markets, exotic derivatives distorting world trade, a cleansing of the financial markets needs to take place before it’s too late. Dodd Frank won’t do it, Basil 111 and FTT won’t do it, nothing less than a reset to currency exchanges anchored to freedom from manipulation money supply will do it.

At one time under gold the financial markets served the concept of market driven economies. In the dollar there was relative currency stability until Nixon separated the dollar from gold in 1971:


The experiment has been a failure. IT’s time for a new global currency agreement partially based on gold and including other factors to be agreed by world leaders. It would appear this will not happen before global currency collapse. Around us are plenty of indicators our currency system is off the rails.

The irony is austerity is fueling the financial markets, the financial markets are fueling global currency collapse. Now the financial markets have plundered taxpayers, next up are depositors in their banks.

Lending was fed through the financial sector through the ECB to Ireland. Ireland’s deregulated financial sector rose to the toxic occasion. It’s time Ireland replaced incompetent government with competencies of Icelandic calibre to take on its delinquent financial sector agents in government and its other decision making arms in banking, Dept of Fin and Central Bank/Regulator/Developer relationships.

A banking inquiry is a first step. Will it ever happen or will selective amnesia and coverup dupe democracy in Ireland.

1. Emigration patterns: