September 27, 2010

Recovery is going to be local

Posted in Debt · 194 comments ·

Iceland’s main interest rate was lowered on Friday to 6.25 per cent, while its ten-year debt is also trading around this level. Ireland’s cost of long-term, borrowing rose on Friday to 6.5 per cent.

So Irish interest rates are now higher than Icelandic interest rates.

Icelandic interest rates are now lower than Irish rates: just take that in for a second.

The country that defaulted on debts, shut down its delinquent banks, burned the bondholders, allowed its currency to fall and did everything ‘wrong’, according to the Irish establishment now, is regarded by the financial markets as a safer bet than Ireland.

Think about it. Iceland is a country where the residents refused to allow international bankers bleed the country dry and put the policy of making the people stump up for the banks to a referendum.

Obviously, the people rejected the idea of paying foreign banks what the banks demanded.

More sensibly, they said Iceland would restructure the debts so that Iceland can survive.

Last week, the Icelandic Supreme Court ruled that Icelanders who took out foreign currency mortgages and loans did not have to pay them back because the loans were illegal.

If you were to believe the propaganda from the Irish government, such a move should have caused interest rates to spike upwards – as investors panicked.

But the opposite happened.

Investors looked at Iceland, which has seen its unemployment peak at just above 7 per cent and growth has returned, and concluded that it was going the right way.

The reason for the markets’ reaction is that financial markets are forward looking.

You win some, you lose some, but the key is to stay in the game.

The more it looks like Iceland is on the right track to growth, the more the markets will forget what happened and will look to a profitable future in Iceland. But you can only be profitable if the country is growing; what really scares investors is a country with a death wish.

So, two years after the crisis, Iceland’s interest rates – the key barometer of market confidence – are falling. In contrast, two years after our crisis, Irish interest rates are rising.

Our international reputation is in doubt. Last Friday, our Minister for Finance suggested that this might be because economic commentators had been too negative.

RAF pilots in the war had an expression:’ ‘You only take the flak when you are over the target.” It is hard not to conclude that, the closer a commentator is to the truth, the more flak he takes from the establishment which has told so many stories and sold so much spin that it doesn’t know what the truth is any more.

The truth is that – as this column has been arguing for over a year and half now- our banking policy is verging on the financially suicidal.

We in Ireland were told that, if we knuckled under and slashed our budget deficit and kept our banks afloat by giving the innocent the bill for the guilty, we would be rewarded by the financial markets with lower interest rates.

This was never right. It was always wrong because that is not how the world works.

The markets want growth and anything that strangles growth scares them.

Those of us who argued that the government’s policy would fail were ridiculed.

Yet again, official Ireland has been proved to be wrong, criminally wrong. But these spats really don’t matter; what matters is how we are going to get out of this.

The recovery here in Ireland is in our own hands. It will be local and it will happen when local people decide they have had enough and it is time to start the fight back.

Last year, I travelled to Iceland to see how they were dealing with the crisis and I was amazed at the feeling of local solidarity.

In little bars and cafes in remote areas, they constantly said tome that they would get out of this on their own, by promoting their own local industries and produce and selling it to other Icelanders.

In a tiny village outside Reykjavik, a few local shopkeepers said they would figure out how to get people into their village to boost business.

Undoubtedly, the government’s defiant stance towards the foreign banks instilled a sense of national solidarity, and it was impressive to see.

In the last week, I have seen the same spirit in Ireland in two very different communities.

Last Saturday night, I was in a bar called Murrays in Graiguenamanagh, listening to a brilliant ceili band, the Darty Ceili Band from Sligo.

I was at the Graiguenamanagh Town of Books fair, which is an annual event with the aim of turning Graig’ into Ireland’s book town, not unlike Hay-on-Wye. This is the dream of a local businessman and he is drawing on all the town’s resources to make this happen.

The next day, as I strolled on the most beautiful walk up the canal on the river Barrow from Graig to St Mullins, it seemed so obvious: our recovery will be local.

This was reinforced on Friday night in Clifden, where the arts festival was in full swing. I found myself listening to a combination of Breton and Armenian music out on the western seaboard, and the place was full of locals and tourists.

The point is that the Clifden Arts Week and the Graiguenamanagh book fair are just examples of what is going on all over the country, despite – rather than because of – the government.

These are local initiatives, which wouldn’t happen without the indomitable human spirit to do something for ourselves.

The organisers of both events put in huge amounts of work behind the scenes to make sure that, for a few days, extra people come and visit the town and spend a few extra euro in the shops and bars.

These few extra euro all add up and, if the initiatives are successful, more and more people come back.

Here are two small examples of the locals using culture to liberate the economy.

This is what we are good at in Ireland: locals coming together to create an atmosphere, normally using literature, music and the arts, in order to help ourselves to help ourselves.

This is the communal energy which exists in all small towns and villages, all over the country. It is there. It is ready to be harnessed organically and this is the sort of local spending which creates local jobs.

All we are asking of our government is not to make any more elementary mistakes.

Don’t lumber us with debts we can’t pay.

We don’t need a huge banking system.

We don’t need to be world-beaters. We can explain to Germany and France that we are weak and want to start small again.

This is how economic recoveries happen.

They don’t start on the bond trading floors of London.

They start inside the minds of all of us.

The recovery will be more GAA than IDA, less bond market, more farmer’s market.

All we are asking the government to do is to not make the problem they caused in the past ten years any worse.

This is what the Icelandic government did. Is it too much to ask?

  1. paulmcd

    Excellent article!

    • paulmcd

      People should distribute this article to friends, family and extended family members – first, second and third cousins at every remove.

      If Anglo or other bondholders receive (have received) a cent of the hard earned incomes of 1.8 million working citizens, sanctioned by bloated fat cats in the upper echelons of power, then those responsible should be held criminally responsible and face the consequences of their actions.

    • skyward

      Coffee shops, therapists, dry cleaners and other service providers etc, while they are important to keep our economy moving and help spread cash, are not going to increase the wealth in this economy.

      As a previous poster said, it has to be manufactured or taken out of the soil and sold for foreign currency before we see any appreciable growth in wealth.

      This is where the unions are deluded. Keeping unproductive public sector workers in employment will not magically increase our GNP.
      They seem put their faith in some 21st century “loaves and fishes” miracle.
      Our exchequer coffers are empty. They cannot continue plunder what’s not there.

      • paulmcd

        The services mentioned will contribute to the wealth of local 26-county State if they are provided to visitors from beyond the frontier.

        Surely we can do something more imaginative to help fill the tens of thousands of empty hotel rooms.

        Fianna Fáil has a record of shooting itself in the foot where these matters are concerned as retailers in border locations will understand.

        • paulmcd

          I admit that FF are so clumsy and incompetent and have allowed the situation to deteriorate so dramatically that they would seem to be FOOTLESS at this stage!

        • Deco

          If the stupid travel tax was eliminated, and the airport charges for Cullen, Dilger, and the other FF cronies in dublin Airport, were dropped, then…..the tourists would surge inwards, and those hotels would be booming.

          It is really, really obvious. Obvious to the point that the clowns in Kildare Street/D2, could not possibly see the sense of it.

          • ray_m

            As someone who has worked in the tourism sector in pricing, price yielding and product packaging I can safely say that the €10 travel tax is not the issue everyone makes it out to be. We as a tourist destination need to look at the value for money we provide as a destination, and market ourselves properly to compete with destinations that are stealing our market share. How do we compete with Spain, France, Portugal? Do you know? The travel tax has little to do with the problem.

      • paulmcd

        One of the major reasons for Iceland’s recovery is a BOOM IN TOURISM.

      • roc

        You need to ask yourself the question, what is wealth, really?

        Tell me, if I work to provide high quality food and drink to my fellow countryman, or raise his social and cultural existence through my service, or repair his house, fix his car, or draw him a picture, have I not increased the wealth of this country?

        I realise we are continually told (and there is a certain type of truth in it) that to create a really worthy ‘wealth’, we should be staffing the production lines, writing software for other production lines, or making trillions of pharmaceutical pills for these same workers whose work tends to make them sick quite readily.

        One thing to be aware of is that the ‘wealth’ you are creating through your labour in such roles is of the type that is most easily siphoned off by governmental and other plutocratic interests into cash and other benefits to their own.

        Perhaps I’m exaggerating or labouring the point here, but there’s a certain truth in it that’s important to realise – as John Ruskin said, “The only true wealth is life”.


    Completely agree that the recovery will be local… it will start with local coffee shops, holistic therapists, etc

    We support these in Ireland with

    • Ravished By The Sheer Implausibility Of That Last Statement

      I for one can’t afford to buy a coffee in a shop and would rather die than give money to irrational charlatans dispensing snake oil; it’s like paying tax witout having to.

    • yadayada

      If we’re not digging it up, making it or growing it, it’s not going to improve our level of wealth. Unless we can persuade foreigners to give their money to our hucksters of course.

  3. michaelcoughlan

    Yeah I hope Peter Sutherland read this article in the Sunday Business Post!

    • Deco

      If suds read this article he would be fuming. Suds is a big institutional thinking. He thinks only in terms best understood by Freud. The rest of us are sheep as far as suds is concerned.

      • SM

        Sutherland can kiss my ass. He has no interest in the welfare of Irish people. He’s an internationalist and worst kind of capitalist. He’s the chairman of Goldman Sach’s which is his reward for being a good boy in the EU commission.

        A highly capable man. Capable of destroying local businesses so large international companies can suck up the trade instead.

      • michaelcoughlan

        Open letter to Peter Sutherland.
        Dear “Suds”,
        Don’t you think that when you address this great Republic, this great nation, you should find yourself some manners and take the marbles out of your mouth! It is also worth remembering that the reason God gave you two ears and one mouth is because he meant you to use them in at least that ratio!
        On your recent appearance on the RTE News you blathered on about how the idea that the bank bondholders taking a hit on their “investment” in Irish banks was an error in theory and in practice. Hmm…. so you say. You then offered empirical evidence to support your claim which was; Nada, nothing, not even a sausage! In Mr McWilliams’s article he offers unambiguous evidence which flatly contradicts you. You suggested that “only” 5bn Euro could be saved in any case. 5bn Euro saved in a country the size of ours Mr Sutherland equals approximately three thousand Euros less My Wife, my daughter and I will be nailed for by the Irish Government!
        I unlike many people am delighted you suggested that the Public sector should have pay cuts but unlike you I would be more discerning in who in the public sector should have their salaries trimmed! Let me enlighten you as to where the axe should fall and the reasons why. People like Brendan Drumm should be asked to return their bonuses considering that on his watch an elderly man bled to death from a stomach ulcer on the false grounds that no bed was available for him in the hospital he presented to or the fact that a child in a children’s hospital in Dublin had the WRONG kidney removed. The saving of Drumm’s bonus alone could be used to employ an extra two front line health care staff in Ireland’s health disservice.
        Let me point out to you Mr Sutherland the never ending monumental fuck ups of the various companies of which you have been or are associated;
        AIB Dirt scandal when you were Chairman;
        Shoddy Health and safety Practices in BP leading to the blowing up of the rig in the Gulf with the loss of 11 employees and the worlds greatest oil spill not to mention the halving in value of the share price of BP;
        Wait for it; a WORLD BEATING $550m fine for Goldman Sachs in the US for betting against its own dodgy financial products.
        When you were a director he near bankrupting of Royal Bank of Scotland leading to its 70% plus public ownership:
        and you have the AUDACITY to show up on Irish TV and address the citizenry of Eire!

      • paulmcd

        Yes, Deco, and judging by the inertia of the great Irish public, that would be DEAD SHEEP to be swept up and carried along by the FLOW as defined by Suds and his ilk.

        • uchrisn

          Mr. Sutherland is the chairman of the European headquarters of a bank. This bank would be negatively affected if the Irish banks are not bailed out with taxpayers money. He is doing what he is getting paid millions to do by coming to Ireland and making public statements to encourage the bank bailouts. The media shouldn’t give him so much coverage. He is a servant to a private bank, not the Irish people. Really this should be stressed more in media articles. Currently they are portraying him as kind of a genius who kindly comes over to help us out with free advice. Quite annoying.

  4. Art1980

    Where is everyone, only four blogs late Monday Evening. I don’t bother to read David’s articles on a Sunday, rather wait till Monday online for the added work of Deco, John Allen, furrylungs and the likes. great Article, Dermot Galvin drilling home the same message on the Late Late show Friday night. Perhaps the Gordan Gekko’s of this world will be investing more in local markets and it’s people.

  5. Ravished By The Sheer Implausibility Of That Last Statement

    Your 2 examples don’t exactly fill me with optimism and confidence for our immediate future, will our uncompetitive tourism industry rescue the inner cities and long term unemployed, patients on hospital trolleys. In fact a Khmer style return to year zero seems more plausible and attractive
    Could we please have some more concrete suggestions for extracting ourselves from this cess pit of our own divising.
    I for one am emmigrating to my great shame

  6. DarraghD

    It’s hard to see how a government that believes that the only people who can create jobs are FDI allied organisations, can come to a place in it’s mind where a recovery is locally based.

    This government hasn’t a clue, everything is soundbytes and politically embedded statements, “green jobs” this and “knowledge economy” that. If bullshit sentences and stupid and meaningless politically encoded catchphrases were tradable on the bond market we could sort out all our financial woes by lunchtime tomorrow.

    The dogs on the street know that a recovery must be local, fair play to David for shouting “rubbish”, at an attempt by this crowd of inept wasters to call a continually worsening unemployment crisis, all caused by the want of a simple plan that is locally based, a recovery.

    Only in Ireland could a politician get away with coming out and saying that even though we are now in double dip territory, and even though tens of thousands more people are unemployed now than six months ago, that guess what lad’s, relax, sure we’re in recovery now.

    • coldblow

      Yes, we are literally blinded by an endless stream of BS. If it stopped people’s minds would clear a bit and some progress might be made.

    • Ravished By The Sheer Implausibility Of That Last Statement

      I believe the current economic climate is so bleak that there is very little incentive for entrepreneurs to take up the challenge here, anyone with the oppurtinity will leave for more clement climes.

  7. malone

    The problem with The Irish people is that they lack confidence in themselves and in their own country. As somebody pointed out , they will give greater heed to something that is said from a foreigner about Ireland than what an Irish person would say.

    The Irish rely too much on the idea that somebody should come and give us jobs instead of the notion that we can it for ourselves i.e. the huge support that is given to multinationals.

    Irish people are very slow to stand up and fight
    for something.

    I heard a comment once by a foreigner about Ireland
    which was interesting ,” The Culture of Ireland seems to be against Entrepenurs and small buisness, If you fail in buisness you are deemed to be a failure and will not be given a second chance ”
    Contrast this with the American culture which seems to be that you are not experience enough until you have failed in buisness 3 or 4 times, (somebody here could have mentioned this before )

    Irish people are slow to change , listen to the critisism still of the Luas

    I think until these matters are resolved can Ireland and the Irish stand and really be called a modern nation.

  8. Philip

    This coming winter, try a piece of Irish engineering for a change if your oil boiler is one the way out…Grant Engineering in Co Offaly. Regarded as one of the best in UK and Ireland.

    Look at Newbay, The Now Factory and indeed Iona. These are marvellous examples of Software Engineering in the telecoms/mobile phone business.

    Take Moffett Wind Turbines. More Irish engineering. These will not fall down in Irish conditions (some of the nastiest conditions in the world).

    Any more? I believe all are Irish owned and run. But I think we need to start singing their praises…even bloody Ryan Air – who has done a great job of fixing up Aer Lingus (still in my opinion one of the best reliable airlines you could pick).

    The list needs to be called out. No Semi-States. Must be privately owned and Irish run. We need to sing them out.

    Also, we need to bias ourselves from FDI (not eliminate). I think we do not need anyone foreign telling us how to run our affairs. That should clean out Price Waterhouse, KPMG and tbe rest of those wasters who have added nothing to our commercial or administrative lansscape – indeed quite the opposite. We have plenty of Irish expertise to take their place.

    Can you imagine a plethora of Irishmen being allowed to give advice to the German Government? Being engluish speakers leaves us too open to a poor opinion of ourselves.

  9. If bondholders get burned Thursday next, there’ll be a seachange in Irish politics. If not, there’ll still be seachange, but a more painful one for everyone.

    Either way, we need lots of corrections before people can dance at the crossroads again.

    Self enablement/liberation/determination/enterprise of local communities, structured around support for quality of life/opportunity for local family life; who would not want that?

    • I should also add we need to build a channel that allows us to compete at the very highest levels of international expertise. This should support local gifted/smart people to gain skills that eventually can get poured back into the country, locally, or on the global stage. How to facilitate that based on a meritocratic system, more emphasis on science/math, or etc, could be worth thinking about ?

  10. Deco

    Ah finally somebody has found an economic recovery. Except it is in a country that did the completely obvious.

    Authority is a curse in Ireland. Nearly always filled by spoofers, ditherers and pretenders.

    Everytime a productive enterprise starts in this country, the local authorities, quangoes, and government bodies are rubbing their hands with glee over the opportunity to have some poor unfortunates slaving in order to provide rates and stealth taxes to the state.

    The state, incompetently managed, wasteful with resources, biased in favour of cronies, and staffed with nepotists, is a hindrance.

    David is correct – anything that happens in this country happens despite the state. It was put to me like this

    ” Aircraft flying over the midlands looking for farmers spreading shite on the wrong day of the year, in the hope of being able to land a fine. All sorts of shite being shoved into NAMA in the hope that nobody would notice that millions were being lost into thin air. ” And the GP want it so.

    “Long Term Economic Value”. Those turkeys don’t know what value is. When it is front of them, they levy it, tax it and drive it abroad. And when there is no value in front of them, they tell us “Long Term Economic Value”.

    David – thank you once again for saying what very badly needs to be said to get this country fixed. There are some idiots that should be lined up and fingered as impediments to ordinary people getting through. They all have something in common. They all have titles. Most of them are useless, clueless, and paid above 100 K per year by the tax payer. Classic example that fool from Donegal SW who thinks that the IDA cannot operate without her. Fact is the IDA are delighted that she will not show up. She made a clown of herself in the Dell saga.

    A bunch of lawyers running an economy. They understand how to suck out of the economy, but they know nothing about how the economy operates.

    • Original-Ed


      You’re so on the ball – it’s the 880 quangos that really pisses me off. With only a working population of 1.8 million, it’s almost one quango for every 2,000 workers.
      The Catholic Church doesn’t has less coverage for it’s parishioners. It’s blatant nepotism of the first order..

      • coldblow

        And that might not be the worst of it. There’s possibly an argument to be made that, in toto, if they all did nothing at all they’d do less harm. Probably not true of some, but applies to others.

  11. FAiken


    Your point about being ridiculed reminds me of a quote:

    “All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.” – Schopenhauer

    I’m afraid to say, we may be just starting the second stage.

  12. Deco

    Another initiative which deserves a mountain of praise is the local initiaive in Co.Clare, where locals formed a co-operative and built a wind farm. This is a substantial acheivement in Ireland, where the tariff system is biased oppressively against competition by local scale initiatives to the ESB.

  13. I enjoyed reading this article .Here is my opinion:

    Icelandic Laws – their laws are based on the natural order of things , thus all good things come from the bottom up .This means People Power .This is known in Icelandic as ‘folkthing’.Their laws are are based on the old Irish Laws known as The Brehon Laws that we once had and were extraordinary and evolved very well in the times then and would have done so to our modern time had it not been taken from us by the English Common Laws.Common Law is in fact a very uncommon concept that entrusts the Monarchy /Insiders with the real decision making .We only need to remind ourselves of Fergie and her money dealing sting ; and

    Irish Laws : We are ‘told’ that they are based on common laws but the reality is that they are common laws from our english landlords that have been re-legislated for Idiots ( only) and should you have a conscience and with a job in civil service , shut up and if you dont have a job ‘just emmigrate quickly ‘and take your garbage with you; and

    Famine : We have as a nation a mixture of conflicting ideas from north and south europe over time and it is my belief that those that arrived after the famine do not suffer fools gladly and are opinionated and the old Irish are stuck in their ways from trauma of the recent famine that has not left the psych and still shows their signs in tribal ways .We need to break that mold and ‘VOTE’ ; and

    Foreign Currency Loans in Iceland : the concept of the recent supreme court rulling in Iceland is something we cannot expect happen here because our EU membership holds us closer to Bonn and ECB and we must instead ‘suffer the consequences’ ;

    Suds : He is just a Greedy Fat Cat who must leave his offals behind before going to heaven.He makes Kown a Saint.

    • Deco

      Suds should return his pension (51 K pa) for being an Attorney General for Garrett the Clueless. And he should also hand back his pension from AIB, for being Chairman of AIB, in the 1990s (Was that before, after, or during the DIRT saga ?).

      • Deco

        If we are paying two pensions to that useless spoofer, then we should reclaim our self-respect and embarrass him into coughing them back…

        Imagine this, we are borrowing money on the international market at 6% to provide two pensions for suds. This is disgraceful.

  14. Garry

    Have to say I’m surprised by the news of Iceland.

    Not arguing with it, just surprised. I’d heard reports the economy they were growing, and I put it down to, well when you hit bottom the only way is up… Would be very interesting to see what life is like for the average Icelander these days. Hope its going well for them.

    With us, we’ve yet to hit anything close to bottom, its going to be a long drawn out affair.

    But great article.

    The government and economy is not being run in our interests, so it is up to everyone to resist in whatever way we can. Give the tax man as little as possible, move to cash as much as possible and try to ignore the bastards for as long as possible.

    Cowens session captured it perfectly.

    So he drank 8 pints? I’m assuming these were paid for from public funds (either directly or FF get taxpayer funds) Pretty safe bet they were expensed back somehow.

    Now our deflict is 25% so that means we borrowed money to pay for 2 of Cowen’s pints, (25% of the total 8) we had the money for the other 6.
    If we cut public spending by 25% the fucker would still have had enough for 6 pints more than plenty.

    Now if he was a normal man, 2 pints on a work do when he’s the boss and has to be up early would have been pretty standard. But the fat mess has no self control he borrows our money to keep drinking.

    And then tries to spin some bollocks about how hes entitled to it….

    Same with the rest of our taxes; the pigs will just keep slurping at the trough, and nobody will say “Youve had enough fatty”

    We don’t need a huge banking system, a national assets management agency, 800 quangos, jobs for every FF family member, a huge public service.

    We need to keep as much money as possible local, in the black economy if necessary, away from the tax man, away from the politicians.

    • Deco

      I was told that Cowen’s booze, and the entire Ardilaun Hotel junket was paid for by the Department of the Taoiseach.

      Now there’s an idea. Can we scrap the Department of the Taoiseach. That would save us money ? It is obvious that it is being wasted.

    • Malcolm McClure

      Garry: I’m surprised that you are surprised by the news from Iceland. I posted about it here at 6:09 pm on Friday and I was surprised that nobody bothered to respond to the point.
      Even this afternoon, only yourself and John Allen (obliquely) have taken up David’s challenge to ‘think about that for a second’. This is probably the most profound and withering condemnation of FF policy over the past two yearsthat we have seen yet, and still the majority of bloggers here still don’t ‘Get it’. Instead they wtter on about local initiatives which was very much a secondary point in David’s article.

      Wake up, people!

      • Garry

        I work odd hours these days, one of the ‘perks’ of having customers in the far east… they pay so its all good.

        The news about the rates for Iceland is stunning…. would be very interested to hear more about whats going on in Iceland.

    • Zaphod

      For the last 2 years I have paid no rent for my workshop/store…I instead give the landlord my time for 20 hours a month.
      For me it’s I.T support, but it could be almost any service. The government sees and gets nothing from this transaction, it’s between us, it’s local.

  15. paddyjones

    In essance DMcW is saying burn the bondholders in Anglo….this is not going to happen. FF are adamant that this will not happen because it will damage us further. In any case the bonds are worth 14 billion and are guaranteed by the government.
    I can’t help but feel DMcW is getting increasingly desperate in trying to find solutions to our debt and deficit problem. There is no easy way out of debt you just have to bare it and pay it back.
    The deficit is where we are bleeding and this has to be stopped, the Germans will make sure that we can get back to a balanced budget. In fact the deficit is just as big for 2010 as it was for 2009 we didn’t make any progress even though the budget was cut by 4 billion last year. The government are taking one step forward and then two steps back. Our budget deficit for 2010 will be over 20% because of Anglo and INBS.
    What David wont say is that we need to cut much deeper for 2011 maybe 6 or 7 billion to make any progress.
    Over the course of the celtic tiger years thousands of people became entropeneurs and what happened to them….they got burned and then they didn’t qualify for social welfare.
    Emigration is the only way out for tens of thousands of our young people, those people with mortgages and families have to sit tight and hope for the best.
    Austerity is the new religion.

    • michaelcoughlan

      Hi Paddy,

      Your post is sincere but I have news for you regarding this part of it “There is no easy way out of debt you just have to bare it and pay it back”. Even if we want to continue paying it back we can’t because the debts are too big. The reason Mr McWilliams wants’ to default on the debt is because he knows sooner or later we will default anyway but if we do so now we won’t have so much toxic financial shit on the sovereign balance sheet.

    • paulmcd

      The bonds should also be protected by insurance taken out by the professional investors.

      If they failed to insure that is not our problem.

      These professional investors provided the means for Anglo to leverage to unsustainable levels. As professional investors they would have been aware of the red-flag warning of a financial institution growing at double-digit rates.

      Hundreds of institutions operating similar models went bankrupt in the 89/90 financial crisis; and today in the USA they continue to fail.

  16. NO HOPE

    It is too much to ask David. We have the most incompetent Government in the history of this Universe. To ask for anything other than a kneejerk reaction and bluster is way too much. They paid 34 million for advice about the banks and then did the opposite of what the consultants suggested?

  17. martino

    I am glad to hear Iceland’s situation is improving. I remember being impressed by their Prime Minister when he appeared on Prime Time last year, explaining, in perfect English, why his country would not be held accountable for the wanton negligance of Internation Finance.

    However, I think it is wildly optimistic to believe Ireland posesses the moral back-bone to emulate Iceland’s approach. Firstly, I see Irish society as being very fractured socially in terms of class, urban/rural, age and attitudes. In fact I see Irish social solidarity as being dangerously weak and getting weaker all the time
    : consider here recent unquestioned mass immigration. This is different to Iceland where blood bonds are strong amongst the people. In Ireland national morale is vey low. Secondly, I can’t see any politician in Ireland having the moral courage or the depth of vision to take us out of financial serfdom. As in the olden days, it’s local chieftains looking after their own patch-to hell with the rest. No-one is thinking nationally.

    As for the recovery being local, I don’t know. Does selling home made cakes to each other or reciting poetry to one another really represent strong, productive economic output? I don’t think so, as nice as it may be and all.

    Where Ireland can improve is in the production of quality food, both for export and for domestic consumption. If you walk in to a grocery shop abroad you will see a wide range of goods produced in that country. Here the market is a homogenous monoploly. Take chocolates, sweets or even beer, for which we’re oddly renowned, for example. We don’t produce that many different brands-the range is depressingly limited to a few blue chip names.

    The first time I went to Poland I was expecting bare shelves in the shops; this was about five years ago. I was amazed at the range of quality Polish produce available. From sweets to beer, the range was far greater than what was available here, and remember Ireland was always a ‘free-market’ economy.

    So we need to start making things we need, and not just over-priced organicy stuff that foodies and lovies enjoy. To be honest, apart from Tayto I can’t really think of an Irish brand I regularly consume, O Folan’s jams maybe. I don’t drink Irish beers because they are too expensive. I can buy 6 cans of imported beer for the price of 2 cans of Irish beer. Now, what’s wrong there?

    As for cafes and restaraunts there is potential there too, but again the prices will have to come down, especially the price of wine which is given free with a menu in Spain.

    Good luck to Iceland and good luck to us. I think you’re right David to propose defaulting and returning to a smaller scale of things but we need a sense of unity before anything can be achieved.

    As an aside, I overheard a conversation today about four investment bankers playing golf in Ireland at the weekend. All were cocaine addicts and joked with the caddy, the one relating the story, that cocaine addicition amogst bankers is one of the main reasons the world is in the state it is now. I can believe it.

    • Deco

      The joke will rebound on the bankers. Cocaine consumption greatly increases the probability of incurring serious heart attacks. The process that they become addicted to, causes serious strain on the smallest muscles in the heart. Once damaged, repair is virtually impossible. In fact it is often undetectable. You will see all sorts of medical problems showing up in future years. Nothing something to be laughing about. Tell the caddy. But make sure the caddy doesn’t tell the four knowitall bankers.

      Arrogance always precedes stupidity, and stupidity precedes disaster. We have seen a lot of that in our society. Bailing out the clowns will not stop that process from continuing.

  18. Ravished By The Sheer Implausibility Of That Last Statement

    Nationalise all hydrocarbon reserves
    Sell the army
    State dissolution of all religous cults and forfeiture of thier funds and property.
    Lottery to cull a third of all civil servants with no compensation.
    Ditch our dependance on Europe and U.S in favour of dependancy on China
    Eat the rich

    • Deco

      Dependency on China is not smart. As some poster commented a few months ago.

      ‘When dealing with the Chinese, it is on their terms. They sell to you, and they buy everything from their own’. It is not exactly a formula for success in the long term.


    “Its so nice to know we’re not the only country with drunken morons”

    Begorrah, I guessed he was a nightclub stand up comedian myself. I didn’t quite get that St Patrick’s Day Obama joke:
    last Paddy’s day

    “Greeting once used by President Regan to guests gathered in the White house, On St Patricks Day you should spend time with saints and with scholars, so I’ve got 2 more stops to make……

    Since finding out KOwing did a standup recently, now I get it!

    Hopefully Irish Conan O Brien back soon, I’d nearly forgive Leno and invite him over to do a regular show from Dublin.


      Unemployment Sept 2010 in Iceland 7.9%

      “Medical products and pharmaceuticals
      Iceland is an exporter of medical products, including prosthetics, diagnostic equipment, and medical software; the 2003 value of these exports was 13.5 billion krónur.[24]
      Actavis, a generic drug manufacturer, purchased U.S.-based Amide Pharmaceuticals in 2005 for between $500 and $600 million,[25] as well as the generics business of Alpharma Inc.; Actavis had 2005 sales of €551 million and a net profit of €81 million. Its shares are traded on the Icelandic Stock Exchange and the company is part of the ICEX-15 index.[26][27]
      deCODE genetics, a worldwide leader in the field of biotechnology is also based in Iceland.”

      They are certainly on the rebound!

      • No sniggering or enNUI at RTE or at Ireland’s Greatest (tax exile?) Bono , who’ll be championed by RTE’s Dave Fanning on RTE this evening. Pravda RTE La la land!

        • Deco

          To tell you the truth, I am now rationing my time, so that I watch very little RTE.

          In fact, if you want to make a difference, forget about television, and focus on the internet instead.

          • Only way I can do it is multi task, watch tv occasionally, while eg tapping this, chat with family, while wondering should we all try to emulate Bono by not paying taxes and becoming a tax exile..already hopping around the channels, that’s just too ridiculous to watch! Don’t tell Jay Leno they’ve chosen a tax exile for that competition. LOL

          • adamabyss

            Yeah and give up on football. I can’t abide Match of the Day any more, even just to see the goals. The presentation and ‘critique’ is abysmal. I think I’ll just watch the World Cup once every four years, the RTE coverage is okay when Giles, Dunphy et al debate. This coming from an ex-semi-professional player still playing at a decent (over 35s) level. Money has just ruined the sport, like many other things in life. Glad I won’t be wasting the time on it any more. God, we sound like a bunch of grumpy old men!

          • Deco

            “Beer and circuses”. It applied to Ancient Rome, and it applies today. Fill the masses with junk while they get robbed hand over fist over their future.

  20. Deco

    Interesting reflection on the concerted, continued, and measured efforts of big business to create our number 1 social problem.

    worse that getting something for nothing, is celebrating nothing as if it were something. This is pure drivel, and the commercial establishment is 100% behind it. Essential to the fact that we blew the binge, was the fact that a lot of the money was pissed up literally against a wall, in a stupendous and pointless euphoria, ‘proud to be Irish’ and all that rubbish.

    • Fortunately in my early twenties gave it up, saw close up some destruction it wrought as well. Only very occasionally have a beer. I’m sure we all have observed similar. I sorta have the view genetically some will take a beer who are already programmed to be alcoholics. They will already have to swim against the stream to avoid alcoholism. We need programs like this, adult and school level. If you need your head clear for what you do, you shouldn’t go near it. Sad our young are corralled into a pub drinking culture beyond which for some there is little choice of entertainment. Gombeen predators in the drink industry are always ready to pounce!

    • adamabyss

      I was pontificating about this all last week which didn’t make me very popular. It wasn’t because I have given up drinking (which I have, but I’m not preaching to others and if someone wants to have a drink in moderation at the right time – then fine), but because it’s a case of all the numbskulls falling for the advertising line again – as if ‘Arthur’s Day’ means anything to this country – but the ignorant masses swallow it hook, line and sinker. No wonder elections are a waste of time – 90% of people are born stupid and stay that way.

  21. Deco

    Excellent US Cartoons covering the recession.
    The one I think that might be available for translation to Ireland is # 2.
    Just write ESRI on the window, and have Cowen pop his fat boozy head out, with a pint glass in one hand telling the people in Galway that the recession is over….

  22. Deco

    Excellent US Cartoons covering the recession.
    The one I think that might be available for translation to Ireland is # 2.
    Just write ESRI on the window, and have Cowen pop his fat boozy head out, with a pint glass in one hand telling the people in Galway that the recession is over….

  23. Colin

    Great Article David.

    However, I think its time you realised that there’s no point staying here and trying to change things. The gombeens rule the roost. They won’t let you succeed. The curse of St. Munchin has gone national.

    Can you write an article about where the best places to emmigrate are? I’d love to read something which keeps the flicker of hope alive. Anyone who thinks Official/Insider Ireland will change its ways are deluded.

    • Black Cat

      I second that post – I am always glued to the posts from people who have already emigrated and are describing what life is like elsewhere

  24. Colin

    Still laughing at the cartoon with Obama sitting around the table with his surviving economic advisors (Homer Simpson, Fidel Castro and Mickey Mouse)……brilliant!

    • Ravished By The Sheer Implausibility Of That Last Statement

      I for one would certainly prefer Sarah Palin, surrounded by oil barons, milton friemon, arms dealers and environmental rapists, not to mention Jesus

      • Colin

        I’d prefer Mullah Omar, surrounded by the Taliban, Karl Marx, Afghan Poppy Growers and CND Activists, not to mention Mohammad.

      • Black Cat

        Sure isn’t that Castro there? Calling someone a socialist isn’t an insult in my book

        • Black Cat

          Ad What’s wrong with CND activists, aren’t they just harmless hippies?

          • Colin

            Well, if it wasn’t for that shower of gobshites, we’d have a nuclear power plant in Carnsore Point generating cheap, clean, non-fossil electrical power, resulting in much needed cheaper electricity prices for industrial and residential sectors. We could even have made money from exporting Electrical power to our neighbours.

          • paulmcd

            Without factoring in the cost of disposal of nuclear waste and its containment over a period of tens of thousands of years then there can be the illusion that nuclear power is “cheap”.

            Nuclear power is probably the most extreme form of obliging future generations to carry the can.

          • adamabyss

            The hope is they’ll find better ways of disposing of it in the future. I, for one, am fully behind it.

          • Colin

            Just to clarify, I got CND Activists and anti-Nuclear Protesters mixed up, even thought I reckon both groupings are very very similar.

            Nothing wrong with the CND Activists per say, but had the USA & UK & France taken the position which the CND Activists advocated, you can bet your bottom dollar the Soviets couldn’t have believed their luck, and the “useful idiots” would have triggered the beginning of WW3 with the Soviets winning hands down.

            But, you see, the do-gooders in the West know that they’ll never be held accountable for their idiocy, because there are only two possible outcomes; (1) they are ignored and their agenda could not be tested, and (2) their agenda is implemented and results in the destruction of them and their opponents in the West, resulting in them being written out of history by the victorious foreigners.

            The art loving section of the Easter Island population advocated cutting down the island’s trees, resulting in the entire population suffering, ending in extinction.

        • Colin

          Castro is a left wing dictator, in the most despotic sense.

          • Black Cat

            I’ve nothing against nuclear power stations, my dad used to work in one and he said they’re as safe as houses but I always associate CND activists with being against nuclear weapons

    • Deco

      We need an Irish equivalent.

      Biffo surrounded by empty pint glasses, ESRI reports, Vote Yes for Jobs posters, Suds, the Ditherer, Bill Cullen, Rody Molloy, Calamity, and a clown from Duffy’s Circus.

  25. ouldbegrudger

    There’s another difference between us and Iceland….
    In Iceland, they are going to put a few bankers and members of the former government on trial.

    • Ravished By The Sheer Implausibility Of That Last Statement

      They are almost self reliant in electricity generation from indiginous renewables and have been able to protect their own currency

  26. Black Cat

    Check this post on my sisters blog to see the amount of produce she got at a farmers market in Cork City for E45 Euros I always thought those places were prohibitively expensive

  27. Some interesting snippets appeared on television last week regarding Iceland and the Euro.
    The Icelandic Prime Minister was talking about Iceland’s potential when the Arctic starts
    producing oil and gas. They are already training people for off shore related work such as
    search and rescue and Iceland is geographically positioned in a area which will make it an
    ideal base for the service and repair of aircraft, shipping vessels, electronic navigation
    equipment and so on. In Iceland people have hope

    In Berlin last week there was a meeting of economists from around the globe and one of the
    Germans was talking about the future of the Euro. He said that a lot of economists believe
    that the Euro will fail very soon because the concept is fundamentally flawed as it attempts
    to bring together 16 economies that have nothing in common. He also said there was a slim
    chance of the German Government putting the matter to a referendum and according to a recent
    poll about 53% of Germans said they would vote to leave the Euro. What would that mean for
    Ireland you wonder

    There was camera work showing people demonstrating on the streets and police wielding batons.
    This news was on the Russia Today channel which is on the Sky package. None of these news items
    appeared on British or Irish news outlets. Hardly surprising

    With regards to a recovery starting locally I don’t hold the same hope. What good is culture when
    you dont have much food in the house and in Ireland right now there are many people who are in this
    situation. I know this because I have seen it. Cupboards are going bare to fill the bank’s coffers
    and it is an affront to human dignity that in such a wealthy country old people are going to freeze
    and die from hypothermia this winter. Oil suppliers are now demanding payment up front, even from
    those who have a good record of paying on time. Such casualties are not exactly going to be enthralled
    at the message that culture is to be our saviour. Nonsense they would say

    Co-operatives, second hand clothes shops and domestic appliance repair services are now far more
    useful than poncey rip off cafes charging 3 Euro for a coffee. Where there is muck there is brass and
    any one who believes this might do well because although at the moment people are still too comfortable it is only a matter of time before they have no choice but to mind every last cent

    You can forget about attracting massive numbers of tourists here unless there is a paradigm shift in
    the Irish concept of value for money. Just because your bills are massive does not mean others will
    help you pay them and besides there are other places to go and soak up culture at the right price
    where the weather is better

    The government believes that the Irish people are at the apex of Maslow’s hierarchy of human needs
    and capable of becoming a nation of super humans. Of course we all know this is not the case

    Their trouble is that they have being getting their arses licked for so long that they believe their
    own BS. The fact is that when people are riddled with fear, insecurity and long term unemployment they are not exactly in any state of mind to be inventing the next great gift to mankind. Besides Ireland has never been a nation of inventors

    As for being an entrepreneur the thought of it is hardly appealing it is? In Ireland they still show
    the apprentice which gives out the message that you have to lick the arse of some narcisstic gombeen
    and be called a plonker every five minutes. No thanks, go and sell your own wares mister

    People should learn a practical skill that they can trade with rather than blindly follow the higher
    education route. We already have thousands of highly educated idiots who don’t do any real work and
    some of whom got to where they are either by accident or through nepotism. Do we need all these non producers who are on large salaries with pensions to match? Hopefully someone will come in, tear down the system and rebuild it because it is a pure waste. Drive the average house price down to 100k and cap public sector salaries at 75k. If there are any moaners then feck them. Tell them to get on the train to tumbucktoo

    The unions are alright jack and 500,000 have been cut adrift and left to sink or swim and only when
    enough middle class people among he 500k have decided enough is enough will we see any move for change.

    The country is now more divided than ever and the way it has been divided suits the establishment –
    they are very smug about it too. The unions have proved by their actions that they support the
    establishment and they are traitors

    I believe more than ever that the vast majority of the Irish media and politicians are in cahoots
    and that they either don’t have a clue or plain just don’t give a damn. If anything the apathy is
    getting worse because there is no desire for change. There is a long way to go yet and in the meantime
    we are supposed to care whether FF or FG are ahead in the polls. The Irish media are parochial and
    pretty pathetic

    • Black Cat

      I’m loving the irreverance

      • Cheers folks.

        There are some people worthy of respect Black Cat:
        Vinnie Broon, Our Host, Eddie Hobbs, Shane Ross, Joe Higgins. Im sure not everyone would agree but there you go. I would vote for James Connolly if he was alive today but they just don’t make them like him anymore.

        Add John Hume and Mary Robsinson to the list. I am not sure about Bono because as he always looks like he is wearing a smirk.

        Banks, political parties, the media, multi nationals, trade unions, the religious, the GAA, Brussels etc are not worthy of our automatic respect and their modus operandi should always be questioned. It is our duty as individuals to ask questions in search of the truth even if it means ruffling some feathers. More importantly we should always question ourselves.

        Irish people need to become more independently minded and lose their penchant for automatic reverence to those in authority. It is up to us all as individuals to challenge the lies and fallacies on the agenda and correct our masters, neighbours and fellow workers when they are talking nonsense.

    • Dorothy Jones

      Pauldiv, great commentary!

    • Malcolm McClure

      Well put.

  28. Black Cat

    Is voting labour equivalent to supporting the Unions? I always voted labour because I thought it was a vote for the lower classes

  29. Peter Atkinson

    Firstly have we been overlooking the obvious.We have acres of land crying out for development.Yes development.Development of our primary industry agrculture.Pardon me if I have this wrong.We buy the seeds.We need machinery and labour to sow and reap the crops.We sell the crops on fresh.We can also set up factories to prepare them ie washing, chopping bagging etc.Factories needed for this activity.More jobs.The list goes on and on for the value added chain.I am sick to the back teeth listening to the hi tech sector.Cloud computing is the latest buzz.Cloud cuckoo computing more like it.A couple of slick mick geeks coming out of college designing the latest on line computer game so that the unfortunate kids of this country and every other for that matter, sitting in front of their flat screen 50 inch TVs turning into zombies, obese and out of condition.And thats what they call the smart economy.Its the new get rich quick building industry.Hello. wake up Ireland.As David says the recovery will come from inward.The agri industry is huge and we can be part of it.

    ps I hope when thunder thighs Coughlan gets to the US they detain her as part of the extraordinary rendition program.They may even get some answers out of her.Something that the poor unfortunate gobshites in this country can’t manage.

    pps why do the RTE interviewers always pop the big question at the top of the hour to the politicians knowing that they have to head off for the news on the hour.Really makes you wonder.

  30. Everywhere I read about the Banks, it is always the same story.

    HRE, Hypo Real Estate 2008, Chancellor Angela Merkel comments on bonus payments ‘We will make sure this will never happen again!’ – Wrong! –

    2009, HRE reports 2,2 bln losses, and additional taxpayers bails out money is shoveled into the Bank. Hearings in the german Parliament bring no results. Merkel’s government ring fences the Bank with legal eagles, no relevant information gets into the public realm. By now a total of 140 bln was pumped into this Zombie Bank. A few weeks after the latest bailout, Bank management hires Solicitors and succeeds to insists on 25 million bonus payments for 2009, the year they made 2,2 bln losses and got another 40 bln taxpayers money.

    Folks, this is the same story everywhere. Bankers and politicians are complicit!

    In Ireland since two years now this story is unfolding. The damage caused to this country is beyond description.

    Who do YOU trust? I suggest you trust your own reason,and no one else. When I look at the level of incompetent and blatantly inept politicians at work, it is sickening to the bone, and this counts for the whole lot of them.

    No one in the political establishment in Ireland has any credit left with me personally, not single person, it is a clique, and they all are in this game since decades.

    Without a new constitution that is debated by the public, bankers and complicit politicians in jail, and new people coming forward, nothing will change here.

    Yes,…. look to Iceland!

  31. “The recovery will be more GAA than IDA, less bond market, more farmer’s market.”

    Christ Almighty, but what a comment.
    From a man that could wipe the floor with the lot of them and their talk of recovery.

    Pure simplicity.

    Start at the bottom and work up, starting with the half million poor hoors who lost their jobs through no fault of their own. Nail these lying, grubbing soft talking charlatans of politicians to their own self serving mast and drive on.
    They’re abjectly disconnected from their people and all the Buinniocht and spin won’t disguise it now. They’ve lost the people and we don’t need an SBP poll to confirm that.

    The show’s over boys. Get over it. We’re not going to starve so ye can suck the tit of the country dry.

    Wheeling out The Great Satan to tell us it’s all wrong won’t work. When Sutherland heads off to his little pied a terre down our neck of the woods in West Cork ,he’d do well to look around at the poverty surrounding him on those open fields.

    The Celtic Tiger was, and is still,a euphemism for unfettered greed. A distasteful reminder of why we wanted distance from our colonial masters.A concept that has left our social fabric in tatters.

    We do not need advice nor scarcely concealed malignant pressure from an ape of the bastards we died to free ourselves from.

    We have only one right, our right to decide at our front door what we stand for. And we choose democracy as a general rule, for the good of all, weak or strong, rich or poor,notwithstanding that sometimes, this democracy concept may not individually suit us. But we accept it as a general rule for the common good.

    Take away that right, take away our general acceptance of democracy, our ability to choose and determine our security and future, then the people will react to preserve that which they hold dear.

    Family, Community and Security.

    Thank you David McWilliams for sending what will probably turn out to be a seminal warning to these clowns of fools.

    Thank you for your courage and selflessness. It has cost you dear and you will have my support at all times.


    • Malcolm McClure

      Furrylugs and David: I agree that supporting local initiatives is a viable survival strategy but growth of the Irish economy requires organization and co-operation on the model established by the multinational companies, not by the GAA.

      The praiseworthy objective of the GAA is to support and nurture a local sense of identity that reaches its acme at the county level. The GAA then pits the counties against each other in pursuit of the Sam, thus vitiating against inter-county co-operation at even a province level. Does the GAA encourage the formation of an interprovincial championship? Is there any meaningful national GAA team to compare with that supported by rugby fans?

      In contrast, the multinational model is hierarchical at all levels, like the Catholic church. Modern Irish people distrust hierarchies, believing that every man Jack of us is as good as his master.

      Think about that for a few seconds.

  32. Homesick

    I don’t see Seanie Boy paying back his debts, so there is a way besides paying back. Borrow $1m it is your problem, borrow $1bn and it is the bank’s problem. The amount Anglo borrowed from the bondholders is their problem, not the Irish taxpayers.

  33. murray

    As usually a brillant article with very good points.

    However after watching “Frontline”.
    I conclude that the Final Wave of debt and Corruption is ready to wash over us.
    The IMF wolf is at the door and Fianna fail
    (The Rob the Public Party) fall among themselves like something out of Zombie movie.

    Brian “Our Plan is Working” Lenihan still acts like a gobshite and takes advice from his ‘friendly’ bankers.

    Labour and their offering of a political pairing to bale out the tramps in Fianna Fail, coupled with their display on Pat Kennys show really showed themselves up.

    Labour in my opinion was our last ray of light.
    This is now gone…..
    Useless the lot of them
    (Fianna Fail, Greens, Fine Gael, Labour)

    (Sadly) I suggest every young person reading this to pack their bags and leave this corrupt country now.
    Even if you have a mortage, throw the keys back and walk away.

    It gives you a chance at life.

    Better that, than a Fianna Fail gombeen smirking at you when you lose your government job when the IMF comes in
    (in the knowledge as an insider that he will saved)

    Better that, than knowing that your local GAA player has a better chance of securing a job than you.

    Better that, than some Fianna Fail crony winking at you as you stand in the dole queue.

    Better that, than a life of slavery.

    As Mary McAleese states
    “Your country, your call?”

    • Deco

      The Irish Labour Party were in power for a spell in the 1990s, and they put loads of cronies in state jobs. The term used at the time was, “FF have been doing this for years, now it’s our turn”. And with that the fun began. Nepotismo time.

      The big turning point for the ILP was Dick Spring (he who stayed in the Walldorf Astoria, even though Fitzpatrick Hotels offered good deals for Irish officialdom, and even though his wife’s relatives were still resident in NYC). Spring moved the ILP upmarket. It became the trendy party. And when it became the trendy party, the working class were shoved aside. The usual old rhetoric was kept to keep people on the ground fundraising. The level of patronizing increased. And SIPTU remained paymaster general. But the main function was to to be some sort of well connected bureacratic nonsense outfit who were all knowing and masters of PR. Kind of like FF, but with much more media savvy, and with softer sell techniques. And a little bit snootier than FF. They let themselves down by their clowns like Joan Burton, Micheal D, Joe Costello, Liz McManus, etc.. Because they are committed to not allowing RTE getting privatized, they get surprisingly soft media treatment.

      Maybe we need several new political parties across the spectrum. The current arrangement is an oligopoly pretending to be something else.

      As for “McUseless”…FF insider, lawyer who ignored Article 45 concerning the Anglo Legislation, overpaid, another pretender, and underworked. And deserving a pay cut.

  34. Deco

    I think it is now clear that Gilmore wants to be Taoiseach, but he wants FF to stay in power. Maybe he should just transfer across.

    I am begining to think this is just a pantomine. Gilmore does the point scoring routine, when he sees an opportunity, but is covering up a fair bit alos for his own cronies.

    Calamity is responsible for FAS. Shane Ross has a book out called “The Wasters”, and FAS occupy centrestage. Calamity was due questioning on Thursday, so her jaunt to Boston was a perfect means to avoid the questioning. The problem with the FAS debacle is that Gilmore’s old Democratic Left pal, Des Geraghty is in the line of fire also, as he is a NED in FAS, and has been strangely silent about all of this debacle. So it suited Gilmore to prevent FAS being a topic of discussion.

    On top of that ther is the HSE slush fund that is lodged with SIPTU, and all the waste going on there.

    It is in Ireland’s interest that Calamity does not go on any more trade missions. But the needs of the Irish Labour Party to avoid another debate about FAS is more important in Gilmore’s mind. Another gangster.

    • coldblow

      Deco, interesting analysis here and above. RTE were going on about ‘pairing’ yesterday and it never crossed my mind this might be at the bottom of it. I had assumed it was because they couldn’t think of anyting better to talk about (could be that as well, though). You mentioned Phoenix recently and I left a comment on the last thread about it (below the ‘rumour’ comment on p1).

  35. murray

    Is there any good guys left?

    Where is our Moses, Obama, Gandhi
    our modern day Saint Paddy to banish to snakes away?

    What is her or his name?

    Maybe its an individual reader of this blog?
    Does anybody want of give it a go?

    Surely, we sure be able to say to our kids
    that true monsters dont really exist!

    • Deco

      Well, I don’t know. I wish there were.

      I mean Joe Behan basically stuck his head out for the sake of principle and got kicked out of FF, because that sort of behaviour is just not on.

      And Senator Shane Ross has been lambasting Irish business culture, and the cronyism that exists for two decades. Ross has been warning about the bad practices, and corruption for a long long time.

      Eddie Hobbs exposed this country for being consumed with the need to rip-off other people, and all sorts of sinister maneovres concerning business dealings.

      David McW told us about the property market being a scam and a fraud. He told us that the debt would sink this country. He told us that we were uncompetitive, and losing our way.

      George Lee went into the Dail and showed that it is true what they say “that an honest man would not last 12 months in the Dail”.

      Constantin Gurdgiev has poked holes in the government statistics to expose the spin that is put on them. Grudgiev has displayed that state policy in a whole range of areas is counterproductive, badly conceived and wasteful

      Morgan Kelly said some very critical things about the state of the banks in 2005, and was ordered to keep his mouth shut by “our advertising sponsors”.

      Brian Lucey has been lambasting NAMA since it’s creation, and has been shoved RTE for good as a result of his commentary.

      We are not short of good capable people in this country. Once you rule out lawyers and politicians, your options greatly increase.

    • Black Cat

      I nominate Deco

      • Black Cat

        I remember an english woman being interviewed on tele and every penny she owned was in an Icelandic bank and she was having to rely on friends on relatives as she couldn’t get any of her money for herself or her daughter. Surely there is a bad side to defaulting if ordinary savers are hurt like this woman was – even if she did invest badly

        • Colin

          You have to ask the question, why was every penny she owned in that Icelandic bank? Did it have anything to do with a greater return on her money?….you know….good old fashioned greed? What was wrong with spending some of it? or giving some to charity? or paying off some loans or debts she may have had?

          You must approach these stories with a skeptical mind.

  36. Your Anatomy :

    Sometimes we think we have the best looking bodies in the world . Sometimes others think we dont.Does it matter ?

    Many believe that we will be left with Euro Loans should we leave the Euro Zone.I believe we may not be left with Euro Loans .If I am right I think this seriously does matter.

    Lets revisit the concept .We are a basket of currencies .The Irish Banks are regulated by the Government and can devalue should they decide.What do they devalue ? Essentially they devalue whatever is within their remit . That means all your monies on deposit / current account in any bank .It does not differentiate any other notes denominated in Euros in the banks.All monies in bank circulation are essentially Irish Punts by an agreed exchange rate since inception recognised under the Finance Acts that have an agreed medium of exchange rate with others from Euro Zone countries .What Irish Punts are not are currencies issued by foreign countries .Between all countries it is only ‘ a medium of exchange’ or a ‘ basket’ determined by the ECB so the exchange rate is the only remit of the Irish Government and/ or ECB .

    There are two kind of loans .Those borrowed by the Irish Borrower and those by the Irish Bank / Central Bank.By virtue of any devaluation by the Minister it follows that monies on deposit in Irish Banks and Loans by Irish curtomers should all devalue and the borrower gains.Cash Notes are not within the Government remit where it is not denominated with the letter ‘ T’ .So the value of your cash is worth the exchange rate of the issuing country .

    When a default happens Irish Borrowers Loans devalue too because they were issued to the borrower by the Irish Bank and not a foreign bank.

    So what happens Irish Banks Loans ?This is where we begin to allign ourselves with the recent Supreme Court decision in Iceland .Circuumstances are not the same but they resonate a rhythm of familiarity.

    Maybe having a big loan is the new look fashionista .Now this could be real people power for all of us .

    Helga is beautiful and exercises and eats a healthy diet .Her German bank have not yet told her that her non calorie deposits with them are anorexic.

  37. 20yearsagrowin

    “The only thing necessary for the triumph
    of evil is for good men to do nothing” …Edmund Burke

    “If you don’t know where you’re going
    you might wind up someplace else” …Lawrence Berra

    “Define reality, face into it
    and do something about it.” …Jack Welch

  38. Labour Party gombeen turnaround to allow MAry attend conference of ‘career counsellors’ while the Dail sits.. media and LP think it important she should go on these trade missions. I don’t. Its the unbelievable gombeens at work again. Anyone else think this is a banana republic fetish. Banana republics attendance of the minister lets everyone know who Mr 10% is in no uncertain terms. In our case it gives the message of croneyism, favouriticism, who swings the bat. Fair dues state occasions, but trade fairs!

    Its part of the whole infection of business in Ireland by the state and visa versa!


    Bond yield, 6.8%.BOI and AIB share price 50 cents.What a mess.

  40. Art1980

    A lot of talk about Mr.Suds – if I ever met the man I’d say to him “What good is it for a man to gain the whole world, yet forfeit his soul”. Of course men like these have no morale conscience, how could they.

    A thing that baffles me is why pensions are paid whilst one is still in emoployment and to be paid more than one!

    Totally agree that to much attention is given to multi – nationals, while yes great to have them remember 50% of the Irish economy is made up of small to medium size business. As Deco is pissed with the quangos (880 if true is mind blowing for the population of this country), I’m pissed with the discouragement of entrepreneurship – you fail, good luck, especially when there are wasters out there with no intention to work and are given housing and welfare payments!Ireland is known to have one of the biggest counts of entrepreneurs per cap and now is the time we need them more than most on the export front.

    Btw I’d love the break down of the Investment strategy aims for 300,000 new jobs – link below.

    • Deco

      i wonder….if Ben Dunne was running Ireland….would he say 300000 new jobs or 299000 jobs….oh sorry, I am insinuating that this is some sort of advertising gimick.

      I know of an enterprise run and operated by a large enough family, in the East of Ireland, who went to their local authority with a plan to expand production, and export into Britain. Their expansion would require 1Million Euro. They saved up, and had even secured the backing of their bank, to provide loans, so that they would have the capital.

      And the local authority had two requirements.
      Pay 20000 Euro to an architects practice. (and hints were given as to which architect to select).
      Pay 80000 to the local autority.
      It was a case of 100000 for nothing.

      At which point they said, listen they decided that were absolutely furious. They realised this whole “enterprise” thing is a racket, so that they would be working hard and taking the risk, and other lazy wasters were sucking them dry. They scuttlled the entire plan, and left it. They informed the bank that they had enough. They would not expand. They suddenly realised that “enterprise” itself was a scam for propping up cliques. But they have told me that they might invest in another country, if they can be assured that such nonsense does not occur elsewhere. They have decided not to expand, but to leave it as things stand and to put aside any money they can for their own future.

      This is how the state works in Ireland. The state is in the “gombeen” business, trying to enlarge their cut, and trying to get something for nothing. I did not know about this myself, until Eddie Hobbs launched his Rip Off Republic show with a massive sneer at the Minister for Fun, Johnny Cash.

      Quangoes are a serious problem also. Just ask anybody in the aquaculture sector why they sector is lanquishing.

      Even without the credit crisis, there would be a massive upheaval in retailing in Ireland as a result of the punitive rates collection process. Many shops have let not family staff go, because they cannot pay for them. But local authorities are still sending councillors on fact facting missions to Majorca, etc…

      Colm McCarthy knew exactly what needed to be done with all this institutional deadweight. But McCarthy has been kept out of the media at the behest of ICTU and FF who are the main beneficiaries of the oversized state system.

  41. Where is THE TRUTH?

    Government unveils new plan to create 300,000 jobs strengthening exports by 1/3….. Ahem…. sure!

    Edzard Reuter is a remarkable man, he was CEO of Mercedes Benz from 1987-1995. His father was a popular social democrat, and the family had to flee to Turkey after the Nazis came to power.

    He is 82 now and gave an interview to DIE ZEIT. He studied mathematics and theoretical physics in Berlin after the war, later switched to law.

    Asked about what multiples of the average industrial worker he would think to be normal for CEO and other top managers, he said that something in the region of 40-50 times should not be exceeded, anything above that would be un ethical. – To put that into context, bank managers made around 300 times that much. –

    He is a strong supporter of political participation and understands the democratic deficit as the main problem in what I would call our social paralysis.

    He continues to emphasize that he see’s nothing but lies, everywhere in Politics, nothing but lies and procrastinating. A political Gras roots movement is required in his opinion, young people are required to come forward to play a part. He also thinks that this financial crisis is far from over.

    I second that!

    • 1/5 of our entire GDP has been wasted and burned in Zombie banks while the public was indoctrinated with LIES about systemic relevance.

      FF, FG, Labour and Greens are still playing their turf war games wasting precious time, time we do not have.

      Ineptness and incompetence rules in Ireland, brown nosing EU agendas, and maintaining status quo at home.

    • michaelcoughlan


      I said in a previous post that the English soccer players have clauses in their contracts which activate if the highest earner in the team gets a pay rise allowing their own lower salary to rise in a pre agreed ratio between their salary and the highest earner. Finally the penny is dropping with others that the way to distribute the wealth more effectively in Ireland isn’t to tax the rich out of existence but to close the gap in the body corporate between the bottom earners and the top earners. Do any of you reading the contributions to this blog ever want Ireland to become the 51st state of the US.? I certainly don’t and this point made by Georg R Baumann is where to stop such an outcome in its tracks!

  42. murray

    “It is clear now that the only party guaranteed not to do a deal with Fianna Fail is Fine Gael,”

    As much as I hate to say this, I think Fine Gael Fergus O’Dowd is right in this.

    I am very, very disappointed in Labour flip to the dark side.

    Labour seem to be sucking on Fianna Fail tit now.
    Well done Lads,
    Make sure you don’t choke on the milk now!

    Jaysus, the whole thing seems like something out of WWF westling match.
    Actually more like “The Thick of It”
    A joke from top to bottom.

  43. coldblow

    I posted this before, but it’s relevant here:

    David says in his article that the Icelandic Supreme Court ruled last week that it was legal not to pay back foreign-currency mortgages and loans.

  44. Question:

    Does anyone have a source or an idea how I can research how many members of the legal profession are in government and ‘opposition’ parties?


  45. Right Wing Populists

    Since I joined Davids site, I frequently made this a subject of my contributions.,1518,719842,00.html

  46. Art1980

    Deco – 300k is a nice round figure for their avertising campaign INDEED! I must say that’s shocking to hear about your friend’s family business, can you imagine how many more cases of that goes on. All the talk of the smart economy, some of the best and very successful self made men & women I know ranging from lates twenties to pensioners weren’t the most acamedic people but had a raw energy/ talent for business on both a sales and ideas front – again thing that stands in the way of these talents of the country – well it us saddens me and all the more so when they take the ventures overseas!

    • Deco

      Art, the whole thing is about hard sell. In fact it has been for over two decades. These production targets are bit like the old Soviet Union nonsense. The difference is that everybody in the USSR knew it was a joke. Here a sizeable proportion of the population still expect truth rather than lies from central authority.

      Concerning the family who were in business, and who wanted to expand, they are OK. I mean they got a shock to their naivity. But they are lucky, because they sussed things out and figured it was not worth the point. They realised that it was all about other people using ‘authority’ as a means for sucking them dry. It shows you also what local ‘authority’ has become – a means of providing “something for nothing”.

      It is the people who cannot find work, because of this sort of nonsense, who are the real unfortunates in all of this. I do not think this is an isolated event. When I heard it, I realised what is really going on in this country.

      There is also a lot of seething resentment over the way that local authorities get rates from shops and commercial businesses, regardless of whether or not their are making a profit. From what I have been hearing there is far more resentment towards local authorities than quangoes. People who were in business for generations and who love their business are being closed down by a combination of local authority crack pots, advertising, income decreases for their customers, and Anglo financed shopping malls. The Irish town centre is being finished. In return we will see ugly bland boring McMall complexes with the same collection of British chain stores and the same over charged substandard junk in every area.

      Meanwhile here we have that fool, Gormless who wants to introduce another layer on top of four overlayered wasteful local authorities. A Mayor and supporting staff. More jobs for the well connected. This is madness, and it will end in state bankruptcy.

      Given the damage that Anglo has done to the Irish landscape, we owe it to ourselves to allow it to sink.

  47. As we approach Black Thursday? 30/09/2010, when the currency markets and bondholders may go crazy at the cost of Anglo, I wonder if demotion of our euro back to ERM status is on the cards, or if its time to dust off our old punts.

    Before the Euro ERM 11, currencies in ERM were allowed to float up to 15% range of the euro. Bumping us back to ERM would allow devaluation.

    Pegging Anglo bondholders to a punt/euro devaluation would help as well.

    Apparently in Dublin today there was a huge convoy seen heading for Sandyford, overhead helicopters, large convoy of vans, garda, army.

    Printing presses?

    • coldblow


      Were you, or whoever reported this, reading this from irisheconomy or is it coincidence:

      Quote (not our Tull though)
      “29. tull mcadoo Says:
      September 26th, 2010 at 7:27 pm
      If I recall correctly, the NTMA bought back all the old punt debt and issued shiny new Euro debt with new coupons at the Euro/IEP conversion rate of 0.787964. Presumbly, we would do the same but at what rate. If its 1.0 then we stuff the lenders with IEP debt at an overvalued exchange rate. If we did it at the exchange rate on d+1, I assume we get stiffed.
      There is also the small problem of secrecy. Any hint of exit and you have massive capital outflows out of the banks. Moreover, bank external borrowings will be in currencies that appreciate against the euro. Result, a liquidity and a solvency event. Perhaps you could post a watch on the CB printing centre in Sandyford to see if there is a sudden increase in truck traffic. A large whirring sound at night might also give the game away.”

      While there’s no such thing as secrecy in Ireland I think JC’s observations from 2,000 years ago (previous thread) probably apply here too.

      • coldblow

        JC: that’s Caesar (on rumour) not Christ.

      • Hi ColdBlow,

        Nope hadn’t read that. I was driving back from Wicklow and heard this strange bit on Joe Duffy regarding reports people seeing the convoy. They were speculating on what was being moved, someone mentioned ‘printing presses’.

        The wikipedia link is part of my own research into our currency options I probed through google and came up with ERM status as opposed to ERM 11 and it seemed to be a way out, to devalue and stay attached to the euro in a way that might better suit us..

        Looking at above Euro/IEP conversion rate it seems it refers only to a denomination of old punt debt with new euro coupons. Regarding debt and devaluation I’d imagine the ECB could be in on a new deal for Ireland Inc allowing sovereign debt to be written down to debt at an agreed discount to new IEP value, plus Anglo bondholder debt the same. But all this is me thinking aloud…and caveat emptor rules apply.

        If we had smart people in control of our fiscal situation, you would be thinking along the above lines, it would also come from less than smart people of which I may be one:)

        Note point made by Tull above ‘bank external borrowings will be in currencies that appreciate against the euro’ is mistaken as such borrowings could be authorised by the ECB Stability Pact though borrowings would be expensive, say 7.7% But they are bumping up to spreads of 6.8% at the moment.

        Could I be right?

  48. Philip

    Did I hear 7%? Anyone for 7%… What is the breaking point??

    • Pure speculation on my part but I reckon 7.5% is the breaking point to trigger a bailout, possibly the following has been already triggered and a deal under “Financial Stability Facility” is on the cards? If not, why not?

      see here:

      “At the heart of the plan to underpin the finances of indebted eurozone nations is the European Financial Stability Facility, a special purpose vehicle with €440bn of loans at its disposal for troubled countries.

      Klaus Regling, the EFSF’s chief executive, took office on Thursday with little fanfare and few details about how it would work should a problem economy need emergency loans.”

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