May 23, 2011

DSK’s downfall is Ireland’s loss

Posted in International Economy · 171 comments ·
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Dominique Strauss-Kahn’s economic philosophy suited Ireland’s situation, so his departure is not good news for us

Last Monday, having trashed the pitch that the England football team train on ahead of internationals with a display of over-the-hill five-a-side, I headed back into Google’s Zeitgeist conference in the salubrious surrounding of The Grove in Hertfordshire.

Zeitgeist is like a younger, techier version of Davos. It is Google’s answer to the TED talks. Many of the great and good – and, more to the point, the coming great and good, the next generation -were there.

Of course, given how many of these people have access to the most powerful people in the world and are familiar with the world of high finance, emerging businesses and power politics, the conversation last Monday morning revolved around Dominique Strauss-Kahn.

I was speaking on a panel about the future of the euro with Professor Joe Stiglitz, a Nobel Prize winner for economics. Stiglitz is no stranger to Ireland. In fact, the first time I met him was, believe it or not, in the back of a small republican bar on Cardinal O’Fiaich Square in Crossmaglen in the winter of 1992.What a young Irish economist and a Nobel laureate were doing downing pints in south Armagh during the Troubles as a British army helicopter droned overhead is another story.

But the point is that Stiglitz knows Ireland and, as the former chief economist of the World Bank, also knows and understands the International Monetary Fund (IMF).

As one of the IMF’s main critics and a consistent campaigner for the eradication of the Washington-Wall Street axis — where by Wall Street exerts too much pressure on the US government – Stiglitz is a man at the centre of the debate.

After the panel discussion, we chatted about the economic implications of Strauss-Kahn’s dramatic fall from grace.

Stiglitz was absolutely convinced that Strauss-Kahn was one of the few senior people who stood up for Ireland.

He told me that Strauss-Kahn was all for burning the bondholders and giving the Irish economy a chance to survive as a real breathing economic entity, rather than a large debt-servicing agency. Comments last Friday from the IMF, criticising the European approach to tackling the Irish crisis, suggested that this was indeed the case – the IMF realises that Europe’s periphery needs a break.

Without the help of Strauss-Kahn at the IMF, which is now clearly at loggerheads with the ECB over the future of Ireland, Greece and Portugal, the peripheral countries will sink further. This is an analysis that you will know I agree with.

The IMF realises that you can’t get blood out of a stone. It also understands that there is trouble ahead if your debt-to-GDP ratio is rising towards 150 per cent and the rate of interest you are paying means some 9 per cent of GDP in debt repayments alone is leaving the economy each year.

That is before you try to cut government expenditure. So it can’t work, not so much because the debt is so big, but because the interest rate is so high.

For example, Japan has been running a debt-to-GDP ratio of 200 per cent for ages, but because it is only paying 2 per cent for the pleasure of this borrowing – and is internally financing this – the drain on the national economy is bearable.

Strauss-Kahn realised that the case of Europe’s peripheral countries was different to Japan’s – and the IMF’s position has changed accordingly. Strauss-Kahn – a socialist – also saw no great need to protects banks and penalise workers.

Thus the IMF has been more forceful in applying the rules of capitalism to Europe’s debt problem, believing that those that lent to the banks on the periphery should pay.

The ECB’s position is quite the opposite. The Central Bank has turned the EU into a loan shark that is shafting members of its own family by borrowing from the markets at 3 per cent, lending at 6 per cent to the likes of us and pocketing the difference. This is hardly the behaviour of solidarity.

Last December, Strauss-Kahn urged EU finance ministers at a meeting in Brussels to enlarge their €750 billion bailout fund and end their ‘piecemeal’ approach to the sovereign debt crisis in Europe.

‘‘The eurozone has to provide a comprehensive solution to this problem,” Strauss-Kahn said. This precise point was reiterated in IMF comments last Friday about the Irish bailout.

Obviously this is saying that the current solution is not working and is not likely to work. Of course, Herman Van Rompuy, president of the European Council, came back last December with: ‘‘There is no need to increase the means available. There is no problem at all.”

There was a problem then – and there is a problem now. The problem is the same: EU politicians are unwilling to face up to the size of the problems in the eurozone – they want to see the world as they would like it to be, rather than how it is.

In Strauss-Kahn, Ireland had someone who was able to see two things: the size of the problem and the inadequacy of the solution offered. For Ireland, this matters. With someone at his level being able to see the size of the challenge facing us and being there to suggest realistic solutions, we might have been able to get somewhere in renegotiating the terms of the Irish loan. Without Strauss-Kahn, Ireland is left to the realpolitik of the forthcoming German and French elections.

Strauss-Kahn was leader of the IMF since 2007 and managed to change the focus of the organisation away from the neo-liberal values it has traditionally held.

On May 5, Stiglitz wrote an article noting that the IMF had realised that a nation’s economic wellbeing depends on social equality and justice. He called Strauss-Kahn a ‘‘sagacious leader of the IMF’’ and said: ‘‘We can only hope that governments and financial markets heed his words.”

Speaking at the Brookings Institute last month, Strauss-Kahn said: ‘‘Ultimately, employment and equity are the building blocks of economic stability and prosperity, of political stability and peace. This goes to the heart of the IMF’s mandate. It must be placed at the heart of the policy agenda.”

These sound like the kind of policies that Ireland needs right now – not the blinkered bondholder bailouts that Europe will continue to force on us. Whatever happened in that New York hotel room, the IMF’s loss of Strauss-Kahn is also Ireland’s loss. But his influence will remain.

The next candidate may well be from an emerging market. We should support that person. The last thing we should do is throw our weight behind Christine Lagarde of France, who has urged the adoption by the EU of a single candidate – namely her. She is not a person who has Ireland’s interests at heart.

Maybe after the queen’s visit, we should adopt the British adage, which is that, in foreign affairs, countries have no friends, simply interests.

Lagarde as head of the IMF would not be in our interest.

You can watch the panel discussion mentioned above on the future of the euro here.


  1. adamabyss

    subscribe.

    • Nina Ogden

      Come on David, neither you or Joe “World Bank” Stiglez are that naive. DSK was set up by the best anti Wall Street, City of London team you could hope for— and helped with the handcuffs by the great Irish-American NYPD. Far, far, far from the sentimental stuff he said for the credulous, he was the architect of the “last bailout”, which if it had taken place would have collapsed the entire world financial system. He was the empty chair at the non meeting in Luxembourg. He was supposed to be convincing Angela Merkle TODAY to fund just one more impossible bailout that Greece could never sustain. We’re in a transition period now and we’ll see what happens , but note that every word the IMF. EU. ECB etc utter right now is pure bluff. And for the sake of the people you’ve guided YOU damn well shouldn’t write anything to help them get away with it. The NY team that nabbed DSK know that the only solution is HR1489– the bill to restore FDR’s Glass-Steagall Act, which made it illegal for taxpayer money to bail out speculative banking debt.

      DDSK’s new nickname should be Strauss Kahn Not. The immoral repist was good at sweet taking and then screwing the poor. The Irish know an economic traitor when they see one. Cut out the sophistry and tell the truth to your readers.

      • Peter Atkinson

        Or maybe change his name to No Khan Do.All you have to do is find a person’s Achilles Heel send in the bait and stand back for the explosion.Another case of someone who couldn’t keep their mickey in their trousers.I bet we find out he also has Irish roots.Dominic Strauss Mc Khan.

        • Deco

          Well he has been living beyond his means, and he is good at spinning stories, but that does not make him Irish.

      • bankstershill

        Well Amen to that, saves me having to start this thread. Like as above David, I don’t believe for a second that you believe any of this crap even thought you wrote it. But I suppose since you write for the independent , the independent being a corporatist rag, headed by Sir Tony, one of the Empires many towel boy’s, means that your hands are tagged to a certain extent in terms of telling the complete truth even though you speak much of the truth, being forced out of a need to make a crust like the rest of us, to assume the role of shill and gatekeeper from time to time. David you are a journalist and a good one at that. F*ck your paymasters and tell it the way it REALLY is, as of now you’re on the right side of history, try and stay there.

  2. Interesting.

    However, the IMF is an overrated Institution and I think we witness a franco-german stitch up, Lagarde is high on the agenda, and with Lagarde the next IMF boss, the US will hold the World Bank position.

  3. THE GLOBAL COMMODITY SCAM: What does Goldman Sachs and Glencore have in common?…. or Bubble domination strategies block urgently required global structural reforms.

    Summary:
    Interconnectedness of real and surreal crisis, the latter being financial, the former energy. Inequality is a principle of wealth and power concentration. The real turning point is energy production. Old powers refuse deep structural changes. We have to tackle globally interlinked multilevel crisis points. But what can I do? Well, here is a practical suggestion.

    BOYCOTT ROUNDUP WEEDKILLER! Why? Read on….

    Weekly suggestion:
    With economists making more money from consulting contracts and other activities in the free markets, all economists that hold part time or full time position that are paid by the taxpayer should be required, just as politicians, to publicly declare their income streams.

    x x x x

    May 1999, the market capitalization of companies such as AOL and other dot com monsters exceeded that of any real productive economy company multifold, the dot com bubble was in it’s apex and right at this point Goldman Sachs decided to go public.

    I expressed earlier that in my opinion the commodity markets are the next bubble that is deliberately manipulated by enormous amounts of capital that parasite economies sucked out of the real economy by using financial instruments such as derivatives.

    I want to remind you here as I also pointed out earlier that it is especially commodities that are unregulated! All the FOA and UNCTAD attempts failed to date, and commodities have even lesser regulations to face than the banking sector.

    May 2011, the commodity markets are in their apex, at a turning point and extremely volatile which is another indicator for a coming mega bubble, and Glencore the largest privately held commodity trader goes public.

    Glencore was founded in 1974. It is a privately held group owned by its management and employees. Headquartered in Baar, Switzerland, Glencore employs over 2,700 people in its marketing operations in 50 offices across 40 countries. In its industrial operations, Glencore employs over 54,800 people in 30 countries. Glencore has interests in various publicly listed companies including 34.5% in Xstrata, 44% economic (39% voting) in Century Aluminum, 70.5% in Minara Resources, 74.4% in Katanga Mining, 8.8% in UCR, 51.5% in Chemoil Energy and 32.2% in Recylex.

    The well known commentators called this 11 billion IPO subdued!

    Yeah well, a side effect of this ‘subdued-my-ass’ IPO which was oversubscribed by more than $ 40 billion has brought fees of around 300 million into bankster’s pockets, the by far biggest fee pot of the decade!

    Citigroup, Morgan Stanley and other banks from Credit Suisse to BNP and BarCap in further syndicate roles were involved. – Oversubscribed means that the IPO deal received more orders than offerings were available. – This subdued IPO also catapulted the tiny picturesque swiss village Baar onto The FTSE100 index, Glencore now being the fifth largest company on the London Stock Exchange.

    With he ‘industrial revolution’ in China and over $ 2 trillion in reserves, it will be Glencore’s make or brake main future factor, but it is plausible to expect that China will always be willing to pay more to meet demands, for both, real as well as speculation demands.

    So, to no surprise, Glencore is dual listed now in London and Hong Kong.

    The 485 directors of Glencore became instantly rich with the valuation of the company at $ 60 bln they own an average of $150 million on paper each.

    With it’s CEO Ivan Glasenberg and his 16% stake, which is currently worth approx USD 9.5 billion, and 12 more lieutenants, his executives, they accumulate a total of 31% in Glencore.

    Fuck!….Excuse me?

    Back in the dot com times and as I was in this industry myself for quite some time, I cannot recall any IPO – Can you? – that concentrated that much wealth and power into the hands of their executives.

    Glencore was founded in 1974 by Mark Rich, the name sounds familiar you think? Yes, you are right, he was pardoned by Bill Clinton. – Thanks for that special blow job Bill! – Rich was indicted for trading oil with Iran. Today Glencore is the largest of the world’s big four independent oil dealers, 2010 turnover was $ 145 bln, to put it into perspective this is more than New Zealands GDP. The initial IPO floated approx 1/5 of it’s shares.

    With the new capital in Glasenbergs hands now, he will go on a shopping spree, and it would be plausible if he gets more of Xstrata rather sooner than later.

    Just like Goldman Sachs, Glencore is a true vampire squid that dominates the global supply chain. With future supply demands increasing and this aggressive further expansion in unregulated markets now in the hands of a few …. Well, go figure!

    The weak dollar, inflation, and sovereign debts defaults…. can you smell it too? It is an unbearable stench in deed, but politicians will tell you it smells like roses.

    x x x x

    The political class not only failed to protect citizens from harm, on the contrary, they are in cahoots with those who caused this tremendous damage and will cause even more in the future.

    People with brains worth a cup of tea are waking up to the realities of globally rigged and largely unregulated markets and their relation to international power dynamics, war mongering and the re-feudalisation of pseudo democracies in Europe.

    People with lesser brains can be seen cheerleading the global incumbents.

    People with no brains will not want to be seen with any opinion, they continue to consume dioxin poisoned eggs, valium pork steaks and super milk, and perhaps once a year around Christmas time they put some money in a collection for the poor in Africa.

    Just as Glencore is a ‘market enabler’ so are politicians who are constantly delaying and sabotaging true structural global reforms to get rid of the less than 1% of people who hold more than 90% of global wealth, but trumpet national sentiments instead, create smoke screens and polarize entire societies to steer public anger in other directions.

    What is really subdued here is not Glencore’s IPO, but the peoples of the Nations who display nothing less but utter ignorance in face of the vested interest groups and the developments of the past few years that accelerate the ongoing rape of entire Nations and Earth resources from the Amazon to Arctic circle, leaving behind nothing but burned earth, fields of destruction, impoverished Nations, millions dead, and a few more wars on the planet as well.

    As long as the people do not stand up, show solidarity and express clear demands, the course that is set will not change.

    Ignorance is the most powerful enabler!

    x x x x

    It is late at night again and I finally come around to finish this article, my MacPro happily sucks his juices from the grid, the performant surround sound amplifier engulfs me with the 30th Anniversary 5.1 edition of Floyd’s Dark Side of the Moon that was so painstakingly and ingeniously re engineered for surround sound by James Guthrie, the fridge is cooling food, the lights are on…

    It is the year 2011, space ship voyager will enter interstellar space by 2015, and today 25% of the global population lives without electricity.

    Asking the right questions is the first step to finding better solutions. I ask why the poor are dying of starvation, why the income differentials are widening, why more than one billion people can not read or write, why 2,5 billion lack basic sanitation and why the world’s richest 20% consume 75% of resources while the world’s poorest consume only 1.5%, and why 500 private billionaires have a cash net worth of more than 7% of global GDP, twice the amount that 2.5 billion people in low income countries account for with their GDP at around 3.3%? These are the real questions to be asked!

    I don’t care much about ideologies or faith, I care about facts.

    While reckless traders reap profits with speculations on wheat and other commodities in artificially volatilized markets, global hunger is on the increase. The corpses of thousands who die in their attempts to reach Europe are not part of your daily news flash, activities of EU’s FRONTEX – Doesn’t it really sound like a fucking pest control spray? Oh well, yes, this was ROUNDUP! – is being kept out of the news. They die every day on open waters. South of the Sahara 265 million people are hungry every day. Globally, we produce more food than we require to feed all the people. The predictable future volatility in food markets will be the real reason for more violent conflicts and more migration than ever. EU’s common agricultural policies need to encourage climate and wildlife protection.

    Since 2001 we have the DOHA development agenda, but to date, policy makers fail to negotiate a deal, compromised by vested interest groups from the US who exercise sabotage. The goal of the DOHA agenda was to make trade rules more fair for developing countries. There is no progress in the DOHA talks, the history is a history of collapsed talks, our collective biggest failure to date, and the result will knock on our doors in Europe, those who survive the open waters. All the international attempts broke down due to reactionary US forces and their protectionist ‘farm bills’, five years agricultural subsidies passed by US congress. It is 2011, for 10 fucking years they jabber on and exercise protectionism.

    http://www.wto.org/english/tratop_e/dda_e/dda_e.htm

    The fight against indignifying hunger is dependent on water and energy!

    Hunger is a business in the transnationalized world of corporations and globalized finance of banksters and speculators, they are the true power brokers, not governments. 30% of globally produced food is never consumed. The manipulated stress on food caused global food prices to spike from 2007 to 2008, a crisis that was not very well documented in the media nearly exclusively obsessed with financial matters. 2010 saw riots and export bans around the world, competition for agricultural land, water and energy intensifies sharply.

    In Kenia some Massai in the poorer North people have only restricted access to water on their farms for animals and crops, not enough access because the water was redirected by the government to serve a flower company in Nairobi and their plantations instead that produces 45 million roses for the global markets mainly Germany, Netherlands and UK. The flower plant is owned by a Minister. The Massai can’t eat roses and their animals can’t drink sand. The production of one rose requires 5 liters of water, Kenia exported 80,000 tons of flowers last year. 40% of the people in Kenia have no access to water.

    We buy these flowers!

    Organized consumer power is the most underestimated way of immediate and direct political impact by ordinary citizens. Get organized and start to use the power of boycott!

    Energy is the only relevant crisis that has to be understood as a future potential, to create a new tomorrow. Energy produces food and other daily goods. Energy, water and food commodities should no longer be monopolized by private corporations and be free of deliberate market manipulations, speculations in these sectors should be banned globally, and don’t let them tell you this would be impossible, of course it is possible!

    The old and relatively new powers who monopolized energy have no intention to give up their monopolies. The OPEC was established in 1960 and monopolizes the trade of Oil. By now enough people have heard about peak oil and the relevance for our future.

    Nuclear Lobbies represent the 440 nuclear plants in 30 countries and have equally no interest in loosing their status quo, with each of the nuclear power plants generating an average profit of $ 1,5 million….every day that is! Just recently we witnessed how such a powerful lobby can operate and has entire governments in their grip. Japan is not an exception, Energy lobbies in Germany and other countries have the same if not more power at their disposal to write their own policies.

    Market enablers such as Glencore in conjunction with monopolizing intergovernmental Institutions are part of the networks that create long term dependencies, cash cows, and power dynamics that control policy makers around the globe.

    The global financial Heist has resulted in a further concentration of power and wealth.
    Global cartels will not relinquish freely their grip on power and any collateral damage, human tragedies on an immense scale are factored in.

    Hunger is a political question. The US dictate on genetically modified crops is not the answer, on the contrary. More land grabbing proposed by the World Bank (Dev. Report 2008) called for setting up training centers to train displaced farmers in industrial work reflects US policies and intensifies poverty. Support of locally produced indigenous crops are sabotaged by policies that favor globalized markets and a monopolized food production.

    Autonomy is destroyed on purpose to increase Multinational’s grip on power and profiteering!

    The direct results of the dictate on GM farming are such that in India the number of indebted small famers who committed suicide between 1997 and 2007 stands at 182,936. (NCRB data exists for 1997-2007) In other words, after 2001 one farmer committed suicide every 30 minutes on average. It is quite reasonable to estimate >200,000 suicides to date. 90% of known suicide victims were in debt.

    Often these farmers take their own lives by drinking pesticides and involving other family members as well.

    The new world order forced millions of small farmers to move from indigenous and diversified crop cultivation to cash crop, the mantra of ideologically motivated economists driven export-led growth! For millions of subsistence farmers in India, this meant higher cultivation costs, much higher debt levels, and being chained into the volatility of global commodity prices.

    It is a sector dominated by a handful of multinational corporations. The first in line is the US based multinational agricultural biotech vampire squid MONSANTO and every single suicide can be linked to them. – Globally operating seed terrorists! –

    Investments in Monsanto shares are unethical!

    Farmers who buy Monsanto’s patented Roundup Ready seeds are required to sign an agreement promising not to save the seed produced after each harvest for re-planting, or to sell the seed to other farmers. This means that farmers must buy new seed every year. Those increased sales, coupled with ballooning sales of its Roundup weed killer, have been a bonanza for Monsanto.

    BOYCOTT ROUNDUP WEEDKILLER!

    If you are serious about change, go and educate everyone you see using Roundup this summer in Ireland, don’t buy this shit. Every liter sold kills not only weed but people! This is just one example of what we can do, it does not take much, and could have a massive impact, even bring down Monsanto if it is coordinated and spreads like an internet viral through the world. Think about it, you are only powerless if you subscribe to this position!

    http://www.vanityfair.com/politics/features/2008/05/monsanto200805

    x x x x

    Pink Floyd is timeless!

    (Abbey Road Studios 1973, Dark Side of the Moon – Us and Them – Waters/Write)

    Us, and them 
And after all we’re only ordinary men. 
Me, and you. 
God only knows it’s not what we would choose to do. 
Forward he cried from the rear 
and the front rank died. 
And the general sat and the lines on the map 
moved from side to side. 
Black and blue 
And who knows which is which and who is who. 
Up and down. 
But in the end it’s only round and round. 
Haven’t you heard it’s a battle of words 
The poster bearer cried. 
Listen son, said the man with the gun 
There’s room for you inside.

    ….

    Peace
    Georg

    • BrianC

      +1

      All that is required to break from the chain of control of those that control the wealth of the world is access to free energy and water. It is technically already here but they don’t want you to have it. So we the stupid people stick to economic theories that do not work. We blindly follow technologies more interested in finding the smallest element in the universe pouring hundreds of billions into this mindless pursuit rather than look at the true facts.

      If of interest you can look at the following where Dr. Bussard, now deceased, tells all that fusion is already here but requires some finishing touches that is the theory is completed all that is required is the technical challenge of building it. Eric Lerner is endeavouring to achieve the same goal of fusion but for a fraction of the cost. And Lerner for aeons challenges the big bang theory believing those chained to this ideology are not free thinking.

      http://video.google.com/videoplay?docid=1996321846673788606#

      http://video.google.com/videoplay?docid=-1518007279479871760#

      • I can not speak on the validity of Dr. Bussard or Andre Rossi to name another, but I can speak on facts that concern the global energy cartels and multinationals who dominate the supply chain and commodities, multis who are beyond the law and who buy legislations where they see fit, and if that does not work, they do not hesitate to eliminate people/communities or even entire states if required.

        • http://www.renewableenergyworld.com/rea/blog/post/2011/05/swedish-skeptics-confirm-nuclear-process-in-tiny-4-7-kw-reactor

          The matter of fact is, that we need to break up globally operating cartels and banksters if we want to stand any chance for a different future. a future that would not be determined by 10 years of sabotage and hypocrisy such as the DOHA Agenda stands for to date, but a future that increases equality, eliminates hunger and war and finally realizes that any form of Religion should be separated from the state.

          • BrianC

            Yes I totally agree it is all about disolving global cartels.

            By the way I think you mean Andrea Rossi. So what do you think does cold fusion work. AR is supposed to be completing a contract for supply of such a system in Greece funded from his own resources having sold his US company and technologies regardS converting rubbish into energy. Would you be familiar with Viktor Schauberger. Someone built a system in Ireland using his technology. I am trying to trace it. I think I found a lead but it went cold but I believe the system is somewhere in Kerry.

            Many claim that they have successfully replicated the original tests carried out by Fleishman and Pons. They say the initial independent tests failed because the palladium metal was tampered with and not as per that used by F&P. As for Dr. Bussard his credentials are second to none.

      • bankstershill

        I hear ya, we’re like hungary blinkered donkeys unkowingly standing in a meadow of lush green grass, just standing there, and waiting for our masters to feed us a few oats.

    • “The direct results of the dictate on GM farming are such that in India the number of indebted small farmers who committed suicide between 1997 and 2007 stands at 182,936. (NCRB data exists for 1997-2007) In other words, after 2001 one farmer committed suicide every 30 minutes on average. It is quite reasonable to estimate >200,000 suicides to date. 90% of known suicide victims were in debt.”

      Mindnumbing!!!!

      Mindnumbing!!!!

      Let’s continue to not talk about it shall we?

      Georg I’m with you on the boycott Monsanto idea! Remember I mentioned http://www.avaaz.org
      Well what if there were a similar site called boycott.org which could name the offensive products and then recommend a legitimate alternative?

      (If it then in turn “sold” the alternative on a commission basis it might become a self-sustainable campaigning model?)

      Round-Up ? – Think about it?

      A Round-Up is the first step before ethnic cleansing? It may sound far fetched but it actually seems like there is socio-economic ethnic cleansing in full swing at the moment.

      Thanks Georg for the thought provoking and educational material.

      • Yes, I remember avaaz. Sounds like a good idea about boycott.org

        FWIW, I am not a Internet Robin Hood, Twitter Che Guevara, Champaign Socialist or Facebook Marxist. on top, I would not have the required knowledge how to kick start something like this.

        My motivation is that I care about facts that are relevant for recent global problems and share them.

        I am convinced that sharing such facts eventually might trigger some more knowledgable people in the Internet realm to trigger a viral to gain momentum and impact.

    • coldblow

      Coincidentally I was recently advised to use Roundup on the brambles in the garden. Never heard of it before then. Who’s the alternative?

  4. I’m not so sure DSK was as favourable to Ireland as DmcW suggests, after all, the IMF put its name to 5.8% at the end of the day. I agree though, the position on the priority of equity and employment should be the mainstay of any solution. But what happened in the hotel room has a huge bearing on how DSK’s words on equity actually meant for him.

    I’m rather a fan of Christine Lagarde and think its most unfortunate she was not consulted along with Alistair Darling prior to the guarantee.

    I’m thinking there could be quite a bit of finesse in her position that has yet to emerge purely because of the incompetence of our government.

    There is a troika of Sarkozy, Trichet and Lagarde that needs to be addressed. Sarkozy is out, Trichet is out, but Lagarde could be a more productive solutionmaker:)

    • Deco

      Considering the way Alistair Darling behaved over the Icelanders defaulting on their bank debts, I am sceptical about having Alistair Darling involved in anything, involving Ireland’s interests.

      • Just compare the UK’s path through the GFC minefield and our own path that so far has included the IMF and we’ve only begun to rev up steam for default:)

        But I do have this notion that we should discount our bondholders €30 bn with 66% a la Tim Geithner of the oxymoron Federal Reserve. Then united 32 county joined up entity rejoining the British Commonwealth of nations; but retaining our separate 26/6 co for the present. Keeping within the EU but post breakup of the Euro. Unfortunately, it’s hard to make pigs fly!

        • Deco

          In fairness, just about anybody could have done a better job at negotiating through the GFC than Comical Lenny.

          Also, it is fair to say that Alistair Darling tried an election budget, before the UK election. Highly irresponsible considering the state of British finances at the time. The whole Labour Party platform in the election was to keep borrowing and spending beyond Britain’s means. It was crazy, and Ireland is very fortunate that it stopped, and the new government stabilized matters – even if they are still not great.

  5. walnut

    DSK is certainly a loss for the Irish cause but the people to convince are the senior officals in the ECB; Axel Weber held similar opinions to DSK but he was forced out. I cannot fathom the behaviour of the ECB. They should print EUR and buy up all the peripheral debt and squeeze all those bailed out banks who are speculating against those same countries. In return for this, countries would have to balance their budgets by 2016. It would be a one off aid program to allow a more uniform EUR economic area. There is also nothing to stop the ECB from raising rates at the same time to enhance margins in struggling banking sectors in the Eurozone.

    • uchrisn

      Walnut, you make an interesting point about the possibility of bailed out banks like RBS or Hypo Real estate specualting against Peripheral goverments or banks. It is common practicee for investors to ‘hedge’ their positions. If they are long in bonds, perhaps they are short in stocks or other areas, covering possible losses and causing harm.
      I am convinced that many of the Irish banks bondholders would have made large profits already shorting the bank shares (as a normal hedging mechanism). Otherwise and perhaps also they have CDS insurance on their bonds. We go back to losses for the top global banks if the CDS get called. Hence Mr. Geithers Veto on that.

  6. Yet again, another interesting and insightful article David.

    Interesting too about you about hanging out with Joe Stieglitz in some South Armagh watering hole during the troubles.
    It’s funny, at the time of the bailout last November, I remember listening to the radio (Radio 1 or Newstalk) and Stieglitz’s approach to Ireland was quoted and despite being a Nobel laureate he was similarly sneeringly dismissed by some vacuous establishment talking heads on the hilarious and crudely anti-intellectual basis that he “wasn’t Irish” and therefore he didn’t understand Ireland and wasn’t qualified to talk about the unique Irish economic situation!
    For real.
    This actually happened on Irish radio.
    I read that Stieglitz article when it came out about DSK reforming the IMF out of recognition from the monstrous entity that destroyed South America in the 80′s&90s as it unleashed economic mayhem and social upheaval wherever it went.
    This impression of a reformed IMF was reinforced from the Morgan Kelly article where the IMF, far from being the rapacious grim reapers of old, where actually rather lenient on Ireland in stark contrast to the obdurate ECB, who seem sadistically intent on crucifying Ireland and offering us up as a ritual sacrifice to the new gods, the international banking cartels and as a horrifying warning to other delinquent states in the Eurozone.

    So when this story broke about DSK I immediately thought of the parallels with both Elliot Spitzer and Julian Assange. There is possibly much more to this story than first appears. Economist Paul Craig Roberts, who was the former editor of the Wall Street Journal, believes that DSK was possibly stitched-up.
    Certainly if you want to neutralise a troublesome opponent who is challenging the status-quo, smearing them with a salacious sex scandal is traditionally the preferred way as it is the most effective.
    I am not inclined for conspiracy theories but Qui bono? Who benefits from removing DSK from the picture? Obviously Nicholas Sarkozy is one candidate.The investment banks that want the IMF to go back to it’s old ways and who would suffer if bondholders were burned in future financial crises? Perhaps .
    Interestingly, the reforming DSK – a socialist – has been replaced by John Lipsky, a former vice chairman of JP Morgan. What direction will the IMF take now?
    At the moment we don’t know what happened in that hotel room yet despite this, there is a frenzy of lurid speculation and DSK has already been subjected to trial-by-media and has been roundly condemned.
    Somehow I don’t see this new,nicer, reformed and more humane IMF 2.0 continuing under the stewardship of Lipsky.

    • coldblow

      Yes, Krugman is also regularly discounted for not knowing about Ireland. Or for using Ireland cynically as mere ammunition in articles written for a domestic audience. You see this sometimes on irisheconomy.ie.

      I don’t know if there’s any connection (quite possibly not), but this was also something you’d hear quite often from the Unionist side in N. Ireland during the troubles (say, early 80s), ie that foreign journalists reporting on the situation in terms of a war being waged did not understand what was going in on. In fact, there was no war just the sporadic activities of a small minority of criminals. I don’t want, or know enough, to get into this but to my mind there seems to be something in common.

      • Colin

        Coldblow,

        Media always have agendas, especially the Politically Correct media. Calling the Northern Ireland situation a ‘war’ suited the Provos and their sympathisers (RTE Champagne Socialists/Chattering Classes) very much. It wasn’t anything like a war, it was simply organised thuggery, like a mafia operation. Never heard of Sicily or Las Vegas, Nevada being theatres of war. Kevin Myers has highlighted this and for his sterling work he gets slagged off as a West Brit. Ditto Eoghan Harris.

        p.s. I’m off to buy Crotty’s book ‘When Histories Collide’ now, I read some of it online on google books, and I like what he’s written.

        • coldblow

          I never read that one. Ireland in Crisis should be available at many libraries, possibly in storage. Books can be ordered from other libraries in Ireland through your own library, free of charge, via the Borrowbooks.ie website. If you want to to this while you’re at it order Myers’ Watching the Door.

  7. Deco

    Well, we really are in a serious predicament when we are relying on the likes of DSK for a prop-up. This just shows you where the entire experiment that was the last fifteen years, and going back much further has led us.

    Personally, I have no regard for somebody who is good at telling the rest of us about socialism, and who is staying in a hotel that costs three grand a night. He is married to a millionairess. This chap is a creep. He is facing allegations from a woman in France who interviewed him a few years back – when he tried to make moves on her. The lady, was going to report the incident to the police – but her mother – a socialist party member instructed her not to. I find it absolutely amazing that people’s poltical “conviction” (or maybe level of intellectual denial) would cause them to do this. This is reported in the UK Guardian – so you can find the source there, about this incident. Amazingly enough there is still a sizeable proportion of the French population which still regards this event in New York set-up. Maybe they would also like the lady involved in the Sofitel to stay quiet and say nothing.

    In any case, Ireland Inc has now got the point of relying on an aging politician, who goes by the nickname “The Great Seducer”, not getting any bad publcity. If he stayed in France, I have no doubt it would have worked. But getting nicked by the NYPD is not a great idea. They are far too keen and tend to treat the great important people of this world with indifference.

    Staying in a three grand a night hotel is not regarded as bad publicity according to the French media. Neither is lying to your wife. Maybe the French need to wake up. But that is an issue for them to resolve. Currently the French media are defiantly maintaining the superiority of the approach of keeping the people in the dark, as much as possible. A bit like here really.

    Now, let’s face it. There are many similarities between DSK and Ireland Inc. Both are overpaid. Both are messers with an innate desire to get caught, who run out of luck. Both are in the dock. Both face very serious charges. Both love living expensively. And both are married to rich spouses who are being sucked up to in an effort to get a help. Ireland is married to the Euro (DE) and DSK has Anne Sinclair. Both are effectively on Bail. Both are morally and intellectually bankrupt – and facing possible eventual financial bankruptcy. Both love the finer things in life. DSK is rumoured to be running around naked in Manhatten hotels. And Ireland has been running around naked in Manhatten a while back on shopping sprees. In retrospect neither created the impression that the idea’s originator had hoped for.

    I have a proposal – Ireland should elect DSK as President next October. Because DSK is the perfect representation of what authority in Ireland has become. Unfortunately in the age of the internet, the Irish media will have to deal with the fact that a lot of people will know what is really going on – and covering the event so as to not undermine him politically, is a strategy that may no longer work.

    DSK mar Uachtaran.

    Sometimes when you chase what you want, you end up getting that you deserved.

    Like DSK, Ireland is trying to arrogantly escape this unwritten rule of the way life works.

    If DSK gets divorced from Anne Sinclair, and Ireland gets booted out of the Euro – then we will have something new in common.

    Then DSK will be the perfect Uachtaran for Modern Ireland. And our media will be able to tell us that we are making some sort of affirmative statement about our superior sophistication over the Americans, etc…

    Of course it is also remotely possible that both DSK and Ireland Inc, might face a long, cold, dark, bleak future….We will have to see how things turn out.

    • It would make it easier politically for France and Germany if we did decide to leave the euro, I’m guessing the we would find Sarkosy and Merkel breathing a sigh of relief:)

  8. Deco

    Lagarde is a disaster for Ireland.

    The only opponent for the role, to emerge so far, is from Mexico. The Chinese are making noises. Long term they might be aiming to have this.

    From Ireland’s perspective, the most suitable candidate is the “real Minister for Finance in Ireland” – “AJ”.

    Though I am slightly concerned that without AJ, that we might get some muppet in charge, who might let the politicians lose the plot.

  9. CitizenWhy

    Yes, DSK favored a better deal for Ireland.

    But may I point out that Timothy Geithner, head of the USA money governing apparatus, squelched any more favorable terms for Ireland. The Geithner Doctrine is that banks must be rescued and kept alive, however dead, no matter what the cost to the ordinary citizen. He is the Eminence Grise of the ECB.

    Please keep that in mind during the Obama happyfest in Ireland.

    • Happyfest=Oh Mama’s Irish-american election campaign.

    • Deco

      Correct.

      There are lot of people in Ireland who seem to think that the US Democratic Party can do no wrong. That happiness is a definite outcome from giving the US Democrats as much influence as possible over the planet. That all the wrong that came from US Foreign policy comes from the rivals of the one party you can trust. Sort of like FF were once.

      You will see this being implied in RTE, the Irish Times, Indo News, Newstalk, etc… Right across the spectrum of the Irish media. We are getting a happyfest. And this is to facilitate the US Democratic Party “machine”, and it’s dodgy, but well connected politicians.

      Geithner, is a Democrat-appointed-Treasury-Boss, in a Democratic Administration. And he completely shafted Ireland. No mention of that from the Schitzo in D’Olier Street apart from a brief mention by Morgan Kelly. No mention at all from Pravda.

      Geithner also spent time working in the NY Fed, in the build up to the subprime crisis. He either did not see anything going wrong – or else did not say anything about it, to his superiors. Either way he failed to prevent a lot of funny business. And then the Democrats (they can do no wrong) put him charge of the US Treasury.

      I think we should apologise to the US for Irish-American politicians, instead of brown-nosing them like the Irish media and establishment are doing continually.

      • CitizenWhy

        Obama is what we now call in the USA a New Democrat (started by Bill Clinton). The New Democrats recognized that the corporate interest rule the USA. especially through the power to create or destroy jobs, a healthy job market being one of the main concerns of Democrats of all stripes. Ironically, Bill Clinton’s passage of NAFTA began a huge jobs decline in the US, especially in the media-neglected Midwest. The Irish born author Michael Collins (who attended Notre Dame in the Midwest) chronicles the industrial wasteland of the USA and its displaced workers. It is a bleak picture and it has been bleak since the 1980′s.

        The major job growth in the USA has been in financial services, whose headquarters are are concentrated in the liberal-leaning (that is, almost Social Democratic, the US meaning) Northeast. Thus the main bloc of the Democratic Party, including Obama, fears taking on the financial establishment. Hence Obama appointed a Wall St insider team to stabilize the US economy and keep the spread of joblessness from emptying out the financial sector.

        In effect, with the Republican Party becoming unapologetically pro-elite and pro-corporate and anti-Social Benefits, as well as rather racist and xenophobic in its populist base, the Democrats have positioned themselves like community organizers: “The corporations, especially the financials, are going to get their way, what we must do is win some concessions for ordinary Americans.”

        Of course corporate money buying legislators and judges also plays a big role in the regressive governance of the USA. No matter who wins, policy is made and the laws written by our third house of Congress/Parliament, the House of the Corporate Lobbyists. The Democrats have taken on some of these lobbyists, especially the oil lobbyists (whose headquarters are now in the Republican South). But everyone is in fear of the financial sector and its power.

        Damned if you do, damned if you don’t.

        St. Patrick, the patron saint of Purgatory, has obviously moved his base of operations down from the heavens or up from Hell Minor onto the earth. He too seems to be in league with the comfortable elite.

        • uchrisn

          The importance of finance and financial services to the US economy cannot be understated. This is why they have bailed out their banks and are forcing bondholders in other countries to be repaid in full. Their top banks have kind of a cartel going on in over the counter derivitives including credit default swaps. They are being investigated by the EU commission. I actually wrote to the EU commission to ask then to investigate over the counter derivitives outlining my concern at lack of co-operation at G-20 level and the lobbying power of the financial institutions.
          In effect much of the U.S financial industry is like a car insurance company which accepts policy payments whithout having the intention or the means to pay out in the case of an accident. So some of their customers had a bad accident, and everyone found out that they don’t have the means to pay out. This is what caused panic among all of the other people holding insurance policies. The company had to take money from the local government and has been backed by the local government for future policies. So now the local government are really hoping that there are no more accidents. In fact there were some car accidents in which innocent bystanders got injured. The policy holders don’t really mind their insurance company paying out but the local government behind the insurance company convieniently ruled that the bystanders were to blame for the accident and should take full responsibilty for costs.
          So substitute car insurance company for AIG or Bank or America or JP Morgan, car owners for senior bondholders in in Irish banks, policy payments for CDS, the LOcal government for the U.S.A. The innocent bystanders for the majority of Irish people.
          The American government know that what they are doing is ethically wrong. Of course they should bring in glass-seagull and other legislation much stronger than Dodd-Frank and allow Irelands bondholders to take losses. They just don’t want to. It all comes down to money.

          • uchrisn

            I suppose another point here would be that normally the local governement couldn’t decide that the innocent bystanders were responsible for the accident. There is a reason why the Justice system is independent of governement, to avoid interference and protecting of interests close to politicans. However the international Financial Justice system – the IMF is not independent. It would be like the judge deciding that the bystanders were innocent but the local governement having the final say and changing the verdict to suit themselves. Geithners phone call.
            The IMF was set up after WW11 when the world would have agreed to anything to get loans from the only country not destroyed through the World Bank. The US.
            The whole international Monetary system is based on post WW11 US dominance and needs to be reformed, including the USD as reserve currecny. Keynes wanted a world currecny at Bretton Woods but was shot down by the US cause Britian needed loans.
            Europe has to decide, stay with unfair U.S. dominace, or go with the Emerging markets for a newer fairer system. Currently its staying in 10 years it may be different.

          • uchrisn

            Of course the other player in the unjustness is the ECB. They don’t have any legal reason to make us repay bonholders in full so they say “If you don’t do what we want we’ll stop sending you euros and flood the other perhipery countries with euros.”

        • coldblow

          Citizenwhy

          Interesting post.

          Do you know if Gore Vidal has had anything to say in recent times?

  10. paddyjones

    Here again david is hoping for an easy way out where there is none. We will be faced with austerity and repayment of debt no matter what, there will be no default or ECB printing money to bail out Ireland.
    There is no easy quick solution , there is only years of austerity ahead.
    Just as the housewives of Ireland have adopted a strategy of austerity and repayment of debt so too must our Government. We must balance our budget within a short period of years, just you wait and see the next budget will have to cut a further 6 billion just to keep things on track. There is no room to kick the can down the road, no room to fudge the finances again.
    I say
    austerity => balance budget=> start repaying debt=> no default.
    Its tough but doable.

    • So, two rounds of austerity to date have resulted in increased debts, but you propose a third round instead. Good Luck with that!

    • Fresh thinking like that has turned our land into the land of gombeen zombies:) But it’s a parallel universe, there is fresh thinking out there:)! In spite of what Government would have us believe:)

    • Dorothy Jones

      Paddy; is this a nod to the Japanese Housewives “Mrs. Watanabe” – who have controlled most of the country’s savings since WWII?
      Hesokuri I believe is the cash stocks and real estate that Japanese housewives stash without telling their husbands.
      When interest rates were close to zero Japanese housewife traders were apparently a stabilizing force in the currency markets.
      Good on them!!!

      • Deco

        We in Ireland have NAMA wives. NAMA wives are the wives of builders who go into NAMA. The property is signed inot their names, so that NAMA cannot get possession of assets to pay of their husbands debts.

        They are a destablizing influence on Irish finances :)

        But I blame the clowns that they married, and the accontancy and legal professions.

    • uchrisn

      Paddy can you give and example of when this worked without expansion of base money supply and currency depreciation?

  11. Harold Plinth

    I saw Joe there in Crossmaglen in 1992, and wondered who he was drinking with. Was that yourself? It was fierce cold that night, do you remember?

  12. Colin

    Don’t worry David, we’ve got Enda Kenny, he’ll look after us.

    • Deco

      Yeah, the man who trained to be a primary school teacher, and was running a country in it’s economic crisis.

      Still, we should be grateful. Kenny is the first sober man to be in charge in a decade…..unbelievable.

  13. BrianC

    No matter who gets the IMF job they will do as they are told.

    Personally I do not believe there was any conspiracy against DSK. Whilst he may have spoken up for Ireland nothing came of it. If he spoke out declaring that the bond holders should bear the result of their risks it was a pointless exercise. So truthufully I really doubt he was of any use to Ireland.

    Why do we Stupid Irish keep depending on others to do what we should do ourselves. It is actually very simple. However, there are those in Ireland who will do their utmost to protect their own positions. These are the politicians the higher echelons of the civil service permeating to all those in positions of power in the civil service and especially those in the judiciary. There is no way that those with the say in Ireland will make that last call and say enough is enough and we are not paying for that which we were not responsible. They vote according to their pockets. Have these protected cohort taken any cuts of any merit equivalent to the magnitude of cuts enforced on the private sector? Have they any will to apply such type cuts? The simple answer is NO. Therefore we are borrowing to fund their cosy lifestyles.

    David as a side note the way you put across the ‘fish arguement’ in the video discoursing the end of the Eurozone was hilarious. We actually have more fish than Iceland and maybe we should refer the bondholders to our EU colleagues fishing in our waters.

    The IMF is an enforcer and they are not coy of playing the good cop bad cop routine as they are now doing with the ECB. Pure simple arithmetic shows that Ireland is not able to fund the cost of the reckless lending of international banks to Irish banks. The purpose of the IMF is to deliver the will of those who control the wealth of the world and they peddle asinine economics which countries are too weak to refute or political incumbents too happy to endorse to protect their comfortable positions. Thus the ordinary citizen in Ireland is hostage to the will those controling the ECB and the IMF and our own government has chained us to the chair of austerity so they can have an easy life.

    • Deco

      Yes – the problem is within us, the way we cannot run our own affairs economically.

      The Irish state is living beyond it’s means. The Irish provate sector spent ten years living beyond it’s means.

      At the root of the problem is the Irish concept of lifestyle. Basically, it is the driving factor behind all this excess. And it is the psychological root of the Irish gombeen mentality. Our modern Irish culture is assymetric in respect of economic activity. You “have” to be a lemming.

      Saving for tomorrow is a peripheral activity, when there are so many ‘excellent’ ways of deluding yourself today. If you are not deluding yourself, then you are a betrayl to the rest of the mainstream in this country, and somehow or other, other people should not trust you.

      But if you are a gombeen, you get trustworthiness status.

  14. Deco

    Greece – an update on the next step.

    http://www.marketwatch.com/story/greece-to-immediately-sell-state-assets-2011-05-23?link=MW_latest_news

    Presumably, we will see the same.

    The problem is that the stuff that is rubbish, that performs a lousy job and that we are better off without…the ESRI, FAS, RTE, CIE is the stuff that we will not be able to sell. So the Irish taxpayer will keep paying for these wasters.

    And the stuff that is of value, like Coillte and the ESB will probably be the stuff that we will be instructed to sell. Because our overseers will want us to sell stuff that will give them their bonds back.

    When that moment comes — that moment will be brought to you by Bertie Ahern, Patrick Neary, the Irish concept of management, the Irish Times Property Supplement, and the D4 banks. And social partnership. A joint IBEC-ICTU production.

    As well as our sovereinty, we could lose a large chunk of our national terrritory. Plus the marine resources that we gave to Brussels in return for stupid laws and P.Flynn’s pension. Plus the hydrocarbon reserves that we threw away, and that the garda lifted the pensioners off the road to make sure it all went to schedule.

    “Please support our advertising sponsors”.

    • Emperorsgotnoclothes

      +1
      Well said! Inevitably the same end-game is being considered for us. Of course, as you point out, the usual suspects will be scheming behind the scenes to ensure that the juiciest pieces of meat are sold off, with them getting a nice slice of the action no doubt. The fact that the list of crooks you present (and more) are still strolling about free as you like, and with fat payoffs, tells us everything about justice and the rule of law in Ireland. The economic/ideological fanatics and their cheerleaders are, no doubt, preparing their presentations for the sell-off (sell-out) of the few things of value we have left. Depressing.

  15. blackcase

    One German Newspapers (Zeit) turns briefly form the blind propaganda and support for their politicians re. the Financial crisis: Zeit says to German politicians (sic) “STOP LYING AND TELL THE TRUTH TO THE EUROPEAN PUBLIC” and “ITS A DISGRACE THAT GERMAN POLITICAL LEADERS AND ESPECIALLY ANGELA MERKEL ALLOW THEIR PEOPLE TO BELIEVE THEY ARE GIFTING MONEY TO COUNTRIES LIKE GREECE” Read more here http://www.zeit.de/wirtschaft/2011-05/europa-krise-gegenmassnahmen (pop it into google language tools here http://translate.google.de/translate_t?hl=&ie=UTF-8&text=Wir+f%FChrten+in+Ihrem+Auftrag+oben+genannten+Regelservice+durch.&sl=en&tl=de#de|en| ). The EU “Financial crisis” is more a PR WAR than a Finance War. And so far, the Germans/French are winning because their Press/Media are lined up behind the politicians (or maybe just plane lazy and stupid like the Irish media during the “boom”). The EU finance problem is tiny compared to USA — if all countries work on it together and the politicians of the “lending” (gambling) nations face up to the truth.

  16. Emperorsgotnoclothes

    While it’s tempting to lament, from an Irish perspective, the falling from grace of Dominique Strauss-Kahn, one question we ought to consider is this — “If he were still head of the IMF, how different would our situation actually be”? My contention is that it would make negligible difference in the long term. Inevitably we are going to default and if DSK were still around then that fact wouldn’t change. It’s the powers in Germany and France who will ultimately decide our economic fate (given that Kenny & Co will never muster the necessary backbone to stand up for the citizens of this country).
    From a moral viewpoint DSK may or may not be guilty of the crime of which he has been accused. Certainly it’s natural to consider the possibility that he was set up, and for sure there are plenty who stand to gain from his removal. In the absence of strong evidence to support this perspective though we should assume that there is a victim of this alleged crime.
    From the perspective of Ireland’s economic future, DSK may have been more inclined to milder treatment of Ireland, but would his continued tenure have prevented the fate of default that surely awaits? Methinks not.
    As an aside, the revelation in Morgan Kelly’s recent article that Geithner torpedoed any hope of bondholders having to share in the cost of their foolishness and, consequently, ensuring that Irish taxpayers would instead foot the bill, was revelatory. The subsequent silence and absence of rebuttal from official Ireland only further cemented MK’s credibility. In particular though, it also highlighted the allegiance and priorities of the Irish elite (political, business, etc) who declined to comment on this. No doubt it won’t be mentioned by Kenny during his tête-à-tête with Obama!

    • Malcolm McClure

      I’m amused by the oxymoron of Emperorsgotnoclothes lamenting the fall from grace of DSK who reportedly walked naked from his shower to jump on the hotel room maid.

      • Emperorsgotnoclothes

        Very good! If only I’d realised the implications of my “name” in advance then I would have milked it for all it was worth :o) No doubt the gombeen class here will provide me an inevitable opportunity in the near future!

      • Deco

        Well spotted.

  17. dwalsh

    I dont believe for one moment that Dominique Strauss-Kahn was on the side of anyone but his employers – the world’s senior bondholders. Anyone who believes his downfall will have any impact on our situation is missguided. But it suits the elite to foster such illusions – especially now he is gone. The IMF is part of the global banking cartel that owns and controls the money (debt) creation system that rules our planet.

  18. Just bringing forward this link from doflynn from David’s last article.

    http://thechatteringmagpie14.blogspot.com/2011/05/run-to-dail.html

    • doflynn

      Thank you Georg. So much that’s so wrong, everywhere, but in trying to right the wrongs you have to start somewhere – we’ve chosen the bondholder debt that was imposed on us by the ECB as that start-point. If anyone out there is anywhere along that route on the days in question, or is in Dublin for the final march on June 3rd, we’d appreciate your support. Walk with us, run with us, call us aside for a cuppa tay and a sandwich, spread this message – whatever. For those few days, however, if we could all start walking the walk, God knows where we’d end up but it would surely have to be better than where we’re currently headed.

    • adamabyss

      I have read this exact same article somewhere else within the last few months. Who is the original author? I can’t remember.

  19. You can watch the panel discussion mentioned above on the future of the euro here.

    Yes and Gabor, so keen to point out his personal link to Blankenfein, is a waste of space.

    Personally bought Greek Bonds…. Pfff… what a peacock

    http://www.zerohedge.com/article/greek-bankruptcy-one-year-later-exposing-charlatans-formerly-lost-translation

  20. http://online.wsj.com/article/SB10001424052748704858404576128610450010924.html

    Lagarde who is supported by UK has it right, Europe needs greater coordination under a tighter stability pact.

    Our wages across the public service are 50-60% higher than UK, same or more for Europe. Gollum’s ‘my precious’ Corporation Tax needs to be harmonised with same from rest of Europe, so CT makes a fair contribution to paying back our debt.

    Our rentier bubble reignition project, NAMA, needs to be scrapped.

    We need decent senior bondholder burden sharing.

    IFSC needs to be properly regulated with an end to transfer pricing, Double Irish, Dutch sandwich and dodgy financial paper ‘investment engineering’.

    Proper investment strategies for education and third level need to follow the German model with investment from the private sector.

    We can’t have our cake and eat it, retain race to the bottom CT levels and demand preferential treatment for burden sharing.

    If in EMU, something akin to the above needs to be negotiated to restoke our economy.

    If out, burden sharing is in big time, we need an alliance with the UK, we need closer economic and political ties with the UK and our colleagues across the border. We will still need to do those reforms. Blighty needs to be our ally because the euro has capsized our boat.

    The problem is, folks, the piratical gombeens who ran our economy into the ground are still in charge.

    They may be ghosts of their former selves, on our economic Marie Celeste mess but, tomorrow, still basking in the reflected glory of our visitors, tomorrow they’ll crawl back into their crawl space shells of say nothing, hear nothing, do nothing, their only hope for the economy is to depend on the ‘kindness of strangers’ or stupidly buy a lottery ticket.

    The Irish have always believed in themselves perhaps too arrogantly so. So this crap, ‘is féidir linn’, needs to be properly examined.

    The gombeens have arrogated ‘is féidir linn’ to be synonymous with those who stoke the embers of the mess in order to hypothetically steer us back to better times.

    But the vast majority of us had nothing to do with making the mess so we should reject the sneaky offloading of burden sharing by those who made the mess.

    We need to say clearly to them, ‘ní féidir libh’ as they blithely steer the economy into default, onto the rocks.

    Enda Kenny, Michael Noonan, Alan Dukes, John Bruton, …ní féidir libh

    When the €6 bn austerity cuts come knocking on the door next two budgets, there will not be 10/20 thousand outside Leinster House chanting, ‘is féidir linn’.

    Listen closely, the words will instead be ‘ní féidir libh’:)

    • uchrisn

      “IS feidir Linn” work hard to pay back the debts of the European and U.S. financial industry in many cases incurred by the Irish insiders.
      Yes we Can.
      “IS feidir Linn” work hard to pay overpriced fixed rents and prices for a roof over our heads to the Irish insiders in turn benefiting the European and U.S. financial industry.
      Yes we Can.
      Of course we can. Its a little bit of pyscology to encourage us to show that we can.
      However I have a different idea.
      “IS feidir Linn” make European and U.S. financial industry pay for their own failed investments, in many cases incurred by the Irish insiders.
      Yes we Can.
      “IS feidir Linn” have fair real-estate prices which encourage young people to set-up homes and businesses in Ireland.
      Yes we Can.
      The Irish people don’t have a shared vision with the international community or the Irish insiders. However just a bit more brain washing by the latter and we might just achieve their vision.

      • Deco

        To be honest I don’t need patronizing from a US politician whose main economic policy has been described by Nouriel Roubini as “kick the can down the road”.

        The “Is feidir linn” argument is a load of nonsense. His own Treasury Secretary Geithner made sure that we were not going to get any write down on 30 Billion Euro of bank bond debt, when normally this is acheived. And then the boss turns us and we are falling all over overselves in awe.

        Another episode of massive numbers of people losing their self respect in a choreographed moment of lemming mass psychology.

        Based on my obsrevations of our experience, this always in a disaster. Every time the media and a certain segment of the population get in a lemming run, we end up seeing a cathastrophe of some sort.

      • doflynn

        Is Feidir Linn me arse – yes we cant, and cant is all it is. http://thechatteringmagpie14.blogspot.com/2011/05/is-feidir-linn.html
        It’s half-time, you’re in the dressing-room with the rest of your battered and bruised teammates, your little parish team is ten goals behind and fighting for its championship life against a team of All-Stars, when one of the highest-profile managers in the game sticks his head in the door — ‘IS FEIDIR LINN!’, he shouts, ‘Yes we can!’
        Yes we can alight, I’m thinking, yes we can — in my arris we can. Perhaps if one of your own star players, Timmy Geithner, ‘guesting’ for them, hadn’t slam-dunked us very early on in the game (he’s the US Treasury Secretary, and according to Professor Morgan Kelly’s recent well-publicised Irish Times article, Timmy was the man who vetoed an IMF plan at a G7 summit to force the bondholders into a two-thirds haircut on €30bn — would have saved us €20bn), perhaps if you could use some of your muscle to persuade the ECB referee and his officials to at least give us a fair break, then yes, we can still turn this mess around.
        A catchy slogan, a pat on the back, a bit of roaring and shouting at half-time — those days are gone. Leinster turned their fortunes around in the Heineken Cup final with a lot of cold analysis of what was going wrong, of what had got them into the situation where they were 22-6 behind at the break; the coaching staff came to their conclusions, made the decisions on what needed to be done, explained it to the players; only then was the catch-cry introduced, the Jonny Sexton speech — yes we can, is feidir linn.
        Any independent cold-blooded analysis of our situation will state that the only way we can turn this situation around is for the existing bondholders to take a serious haircut, and for the previous ECB-decreed payouts to be assumed by them, and that should happen NOW. The private debt is what’s killing us; we should not pay another cent to the bondholders, not another cent taken from our Pension Fund – our last few bob – and we should be working like hell to cut ourselves loose from the billions already paid out, on the insistence of the ECB. Then, yes yes yes, we damned well can. Otherwise, we damned, boss, we well damned.

    • Deco

      +1.
      CBweb – I agree with your assessment.

      Can we keep sustaining our delusions and our own nonsense ?
      Deep inside, we are desperate for somebody to tell us “yes we can”.

      The way we are behaving – Ní féidir linn !!!

    • Deco

      Actually, I have to say I was impressed with Osborne. He is only going to loan British taxpayers money where he will get it back. (Unlike that fool Cowen giving 1 billion Euro to the Greeks to bail out his pal at EU conferences, rich Greeks, and French banks).
      Osborne, also has managed to get German interest rates, even though the UK is still borrowing massively. Even the Germans must be scratching their heads over how he managed that.
      The interviewer proposes Gordon Brown as head of the IMF, and Osborne is able to present a very factual case that Brown should not be running anything. [Maid Marion on RTE thinks that Gordo would be excellent].
      So, I reckon in their moment of crisis the Brits have somebody who has a clear idea of how to get things done. Clarity in a moment of crisis is important.
      (We in comparison have Baldy Noonan – just look at the McCole debacle in the mid 1990s for an example of how he handles complex issues).

      Lagarde, is clearly taking a hardline on the bank debt issue. In doing so, she is positioning herself perfectly for a pro-Wall Street stance in the IMF. It is like as if she knows that the lobbyists will make the decision.

      It confirms my opinion that Legarde will be a disaster for Ireland in the IMF.

      However, I reckon, Lagarde, a lawyer by training, simply misunderstands the sums on a massive scale. She is taking a lawyer’s line on this. She also completely misunderstands the Greeks. For this reason, I reckon that if Lagarde gets the IMF job, with certainty this will eventually result in the eventual collapse of the Euro, and the EU.

      The most remarkable flaw in the entire interview – I don’t think one of the three mentioned the elephant in the room – Spain. Portugal was mentioned by Osborne. And nobody mentioned Belgium either – which is another mega-conundrum. Nobody mentioned German and rising inflation either, which will now require and interest rate hike.

      Actually, as an interview what really concerns me is the stuff that they left out, and which is going to be an issue in coming months.

      • Re “In doing so, she is positioning herself perfectly for a pro-Wall Street stance in the IMF. It is like as if she knows that the lobbyists will make the decision.”

        Nope, she’s a smart lady. She’s certainly not pro Wall Street. She’s sympathetic to the Panandreou and Merkel outspoken views on Wall Street shorting the peripherals. She was against the US QE effect of debasing the dollar and weakening it against the euro, thus hitting EU exports. She probably knows the euro is being challenged from without.

        Plus she’s head and shoulders above Sarkozy in terms of political finesse. As regards our own gombeen troika of uselessness, Kenny, Noonan and Creighton, she’s probably figured, if they’re swimming around and when thrown an anchor, they grab onto it, they deserve to sink to Davy Jone’s Locker:)

        Alas, we don’t have the political leadership to escape the mire, she’s not going to save our graboids:)

        see earlier ‘online’ link earlier post above, from which:

        “PARIS–French Finance Minister Christine Lagarde on Sunday said global foreign-exchange imbalances must be tackled, as the euro is the victim of a weak U.S. dollar and Chinese yuan.

        “We must reform the international monetary system so that the euro is not caught in the middle, hit by the expense of trade-offs between two currencies that are deliberately weak,” Ms. Lagarde said in an interview on television channel France 5.”

        Sorry, I disagree with you and DmcW, that Lagarde will be a disaster for Ireland:)

      • Colm,

        legal eagles, professional blinders, remember Lenihan? …Bold emphasis is mine.

        Lagarde:
        The French government, like the German government, believes that wages should not rise in lockstep with inflation…..

        Jean-Claude Juncker, has warned against massive social cutbacks within the euro zone.

        This has nothing to do with social cutbacks.

        You yourself sharply criticized the German trade surplus a year ago, but then you changed your mind.

        What has really changed fundamentally in the last few months is the source of German growth. – This is not true, the level of increase in domestic demand is no sign of a changed policy at all, it is partially also a seasonal and psychological phenomenon. The export strengthened further, and here significantly in weapons trade. -

        2013, when the EFSF is scheduled to close down. What happens after that, if Greece’s debt still amounts to 150 percent of the country’s gross domestic product? Will the markets ever have confidence in Athens’ efforts?

        That will depend on whether Greece, as well as Ireland, live up to the commitments they have made to us, the ECB and the IMF. The credibility of these countries depends heavily on whether they keep their word. – Yeah right. So if the EU/IMF demands are met, the markets are opening the doors for us again,. Of course! Dream on.

        President Sarkozy has declared the reform of the global monetary system to be one of the main objectives of the French

        The G-20 is the only forum in which it makes sense to discuss these issues – Cough cough…. Sure, we have a well documented history of G-20′s success stories. Do we not?

        • Re “on whether Greece, as well as Ireland, live up to the commitments they have made to us”

          Problem is ECB pills for Ireland/Greece are not working.

          Also Greece is not even taking her pills. And the Greek villagers don’t like the Frankenstein dreamt up for them by the ECB:)

          • Dorothy Jones

            Nobody does it better……
            than Namawinelake yet again:
            Article on Greek default scenario of this afternoon 24 May 2011; lessons to be learned for us.

      • CitizenWhy

        Osborne, like DSK, wanted to give a fairer deal to Ireland. But Geithner of the US bullied them out of it.

  21. uchrisn

    Dr. Stiglitz talks very much sense. It must be nice to be hanging out at a coming together of so many smart people like that you’d learn so much. I agree with what he said that Irelands corporate tax regeme is unfair. Their is definatly tax dodging going on by mainly US companies, Simon Johnson also points this out. This should be cleared up by Irish authorities who once again are turning a blind eye. I don’t see the big issue of raising coporate tax a little.
    If Dr. Stiglitz says that Straus Kahn was an ally I’d tend to believe him on that. Ireland should accept it is a tiny country and the argument really is about foreigners not caring how, but wanting their bad investments refunded. All foreigners are united in wanting their money back. The IMF is supposed to refer a little but Ireland has basically no representation there and it is controlled by the U.S. its main contributor. DSK may have been an ally but the people who put up the money have the final say – the US government.

  22. Deco

    What is Brute up to now ?

    http://www.independent.ie/business/irish/change-of-tack-as-bruton-reveals-admiration-for-ecb-2655129.html

    I suspect he is chasing another well paying post in the ever growing and gigantic EU bureacracy machine.

    • Deco

      Don’t worry. Brute has no influence on government policy – his brother is only a senior minister in the cabinet – though I have forgotten what exactly he is responsible for – because I have not heard a word out of him since he was appointed.

      • The sheisters in College Green were basking in the glory of Katie Taylor, Henry Shefflin of 7 All Ireland’s, Brian O Driscoll of Leinster epic winn et al.

        Right there we had the new cabinet.

        Great opportunity lost to sell off all our political and media croaking grunters:)

        “Very valuable commodity next, wide political experience, each one ready for a future career in banking…oops, sooryy Alan, you’ve got a career in a bank already…Well, future careers in European and global banking, errr, sorry Suds, yu and Brutal have one…Well, future presidential material, nod, nod, wink, wink, John”

        Don’t ye know Brutal is being prepared as El Presidente ….

        • From your link Bruton “I have great admiration for the people in the ECB; they’re dealing with situations that were foreseeable but entirely unforeseen by every organisation and institution. I think we should pay a lot of attention to what the ECB says.”

          Lovely example of Irish Gombeenism.

          Applying the laws of logic, the ECB is not an institution. The Black ninjas of Foresight are missing and have to be found. Every institution and organisation could foresee but didn’t foresee.

          Needs a new word, the Bruton ‘brutism’ lol

          I think we should NOT pay a lot of attention to what Bruton says:)

          • Oh, on the contrary, we need to pay very close attention what he is saying, unfortunately….

            More than 500 operations are approved to trade in under the IFSC programme. The centre is host to half of the world’s top 50 banks and to half of the top 20 insurance companies. Merrill Lynch, Sumitomo Bank, ABN Amro, Citibank, AIG, JP Morgan (Chase), Commerzbank,BNP Paribas and EMRO are just some of the big-name operations that have chosen to locate in the area.

            Just some is right….there are other very interesting brass plates on the wall as well.

            http://www.independent.ie/business/irish/green-ifsc-business-plan-is-finally-ready-for-vetting-2653744.html

          • Unfortunately, he won’t be singing like a canary about the IFSC as much as you’d like him too, though I believe he’s mooting a new green paper portfolio that should rival the property bubble:)

            Still IFSC…the ‘wild west of global finance’… needs a spotlight from the likes of Kathleen Barrington et al and will have to be overhauled regarding rules on financial instruments if global debt shenanigans are ever to be addressed

            http://www.thepropertypin.com/viewtopic.php?f=19&t=30394

          • Deco

            “I think WE should pay a lot of attention to what the ECB says”.

            What’s this WE business, Kimosabe.

            Brute seems to be telling us that the ECB is boss.

            Do the septic banks in the IFSC know that this is Brute’s line ? I imagine that they might not be too pleases with their Ambassador or Special Envoy or whatever he calls himself these days.

            Or maybe it is a return to the good old days when the IFSC and Irish banking create a veneer that everything is of impeccable standing.

    • coldblow

      Just thinking, on a broader note, if I were wealthy and on the inside track I think I’d be pretty happy with Bruton’s performance, as with that of all his precdecssors and successors for that matter. It’s not all bad news.

    • Deco

      Well, without any doubt whatsoever, I am convinceed that Brute is cleaning his snout for another rendez-vous with the EU trough :)))

  23. coldblow

    On yesterday’s early evening news I saw a report from Charlie Bird on Obama’s visit. Do they manufacture this stuff purely with an eye on future series of Reeling in the Years?

    How does the saying apply here? History is enacted first as embarrassing self-parody and then repeated as… well, just repeated.

    This has gone far enough. We all know what happened. Now, I want everyone to pause and just reflect for a moment on what they’ve done. Face it, acknowledge the shame, and move on. And see that it doesn’t ever happen again.

    People could see what was happening, and they stood idly by…

    • Deco

      Coldblow – at an individual level, there are citizens who make individual decisions not to be fools for the system – to do their own independent thinking.

      But the system itself is continually modifying the message to keep a high enough quantity of fools believing in the whole Ponzi-scheme and high asset valuation/high leverage/high debt model.

      Maybe it will only end in a massive derivatives crash that will wipe out everything. I think for the sake of civilization it would be better if it ended as a result of greater intellectual awareness. Both right and left are bought into Ponzi-nomics. It is the one thing that the media, the right, the left and our corporate advertising sponsors can all agree upon. the need to rebuild the ponzi-scheme.

      • CitizenWhy

        Well put.

      • History would suggest that it will not be a ‘soft landing’, on the contrary, too may interlinked peaks are happening here – Feedback loops! – and G-20, G-8 or any finance minister meetings will not contribute to the solutions, the last four years gave enough evidence to say with reasonable confidence, they will make it worse!

        Left- Right-Wing categories are post cold war thinking and totally irrelevant.

        Only with international and swift progress on many fronts human tragedies on immense scales are perhaps avoidable, I am not so sure about this anymore when I look to the key indicators.

        I expect massive losses to happen, the first dramatic changes will be in Asia, and Africa of course will suffer tremendous losses as well, and these are not economical losses I speak of.

        The intellectual competence of those who currently make future decisions is no reason for hope either.

      • coldblow

        Obama drank the whole pint and paid for it out of his own pocket.

        He did you know. I saw it. Charlie saw it too. At one point the glass was half full.

        And then the car got stuck up on the ramp. He wasn’t in it at the time but it made a jarring sound though.

        On the day he was a great perfomer once again but that’s really down to us. Just think, despite all the gloom, in the space of a few days we’ve taken both a Queen and a President to our hearts. We know how to relax and enjoy ourselves. Aren’t we wonderful? I bet he was impressed. I bet anyone was.

        • Deco

          I was expecting Darby O’Gill to pop out from under the counter, and for the little people to start singing a tune at one stage……

          No sign of the pot of gold. But there is 7 Billion Euro on deposit in the Isleof Man branch of Anglo – if that is any use…

    • uchrisn

      good link, according to Neil, Short the Euro against the Swiss Franc.

    • coldblow

      He says that he thinks things will come to a head sooner rather than later and that when perceptions finally change it will happen quickly. I think that’s the usual pattern.

  24. On the Souvlaki Front:

    Private Deposits down E 31bln January – April
    Business down E 40,6 bln
    Foreign capital down E 7,9bln

    By all means, this is what I call the beginning of a bank run.

    Secretary general of Greek Banksters Club was on TV on Tuesday trying to calm people by stating deposits up to 100k would be guaranteed.

    According to the plan, Greek is supposed to implement a total austerity package of 22bln until 2015.

    Laughable!

  25. ECB forced policies are equal to a protracted default

    Good article in DER SPIEGEL

    http://www.spiegel.de/international/business/0,1518,764299,00.html

    • “The national central banks determine which securities are placed on the list and under what conditions. “The ECB has no obligation to supervise the central banks, nor does it have the ability to monitor individual central banks,” explains an ECB spokesman.”

      Ooooohhh, what a disastrous and dumb oversight perhaps fed by greed at a time everyone was making money from the ponzi.

      Maybe next time they’ll do due diligence and make sure their Central banks are not stuffing their ovens with dynamite:)

      Looks like there’s to be a big blowout!

    • BrianC

      Great article. The EU Monetary system is a sham.

      Morgan Kelly nailed it ‘the ECB is now the owner of these banks’. The ought to give him a Nobel prize for straight talking.

      At the moment the ECB just can’t accept the situation for what it is as there are others who will not permit them address the bare blatant facts until they extract as much cash out of the system to pay down their exposure to the debacle. The default should happen now and clear the decks and reprime the markets with new funding. That is their standardized economic accepted way of doing things. It means they retain complete control of all wealth generation. As the markets reignite start to grow generate and accumulate wealth the market will eventually return to the same default square having passed through the mandatory recessionary depression and deleveraging squares. Ground Hog economics.

    • Dorothy Jones

      Spiegel article’s good Georg; one of it’s better ones.

  26. PMC

    Nasty little slideshow of images here in the NY Times re Obamas visit to Moneygall

    http://www.nytimes.com/interactive/2011/05/22/magazine/20110522-obama-ireland-ss.html

    • Colin

      You’ll find folks like them in every country, especially USA.

    • PMC

      Absolutely, but the images have been crafted to depict Ireland as a backwater – Playing up to the stereotype of simple people living on a miserable isolated windswept island with not a bean between their ears.

    • Deco

      These pictures provide some indication of how tough life in Ireland can actually be.

      We are lucky that they left out beggars sitting on the steps of hotels owned by multimillionaire tax exiles along the quays. We are lucky they did not show pictures of ghost estates, or have built houses. We are lucky there were no pictures of the A&E (or ER intake room as they say in the US) with drug addicts and drunks beating up staff members. We are lucky they did not show pictures of former bankers living in mansions, or swanning aroung Malaga – while the country is broke.

      If they really wanted to rub our noses in the dirt, there is a lot of material available for the purpose.

    • Colin

      The subjects in the photos were probably bounced into taking those photos at those locations. They are simple innocent country folk who are not media savvy. You wouldn’t see Johnny Ronan or Rosanna Davidson agreeing to a photo request from a NYT photographer in locations like a bog, a field, a driveway with a banger parked, or with rubbish bags in front of them. The subjects were just being agreeable to the photographer – the don’t complain culture in this country which allows restaurants and other service providers to get away with murder because Irish people won’t complain.

      I like the one with the 91 year old and his loyal happy dog sitting in front of him though.

    • coldblow

      I didn’t think they were bad at all really. Well, they probably chose the redheads deliberately. Most of us know Moneygall only as the place you race through before you reach the toilets outside Toomevara. If it does some good, good, of course, but it’s just so, well, OTT. The stereotypes are probably valuable from a tourism and goodwill point of view but the Irish throw themselves so forcefully into the role that you sometimes wonder if they believe it themselves.

      It reminds me of that bit I mentioned before from ‘McCarthy’s Bar’ where the tourists were crowded into the ‘traditional’ bar at Bunratty (Durty Nelly’s) while the locals were drinking in the fake bar in the theme park next door. How do you begin unravelling that? Where do you separate reality from fantasy? Also reminds me of the bit from Amusing Ourselves to Death where Mother Theresa is given an award at a ceremony in the US for services to humanity and receives a polite round of applause. Later on a roar of approval greets the person they have all really come to see: Meryl Streep.

      Then again, here’s another way of looking at it, from Finfacts:

      http://www.finfacts.ie/irishfinancenews/Analysis_Comment_5/article_1022369_printer.shtml

    • Well, I really had to think whether I should comment here or not, but what the hell, I make a remark as a professional photographer myself.

      Please keep in mind, they are not designed to slander colleague Kenneth here!

      So, as a result of this visit as Kenny, other politicians and leading voices form the tourism industry remarked on Tele, we will see a boost in tourism. Right.

      These pictures leave nothing but a poverty stricken and depressing impression. They appeared in the influential NYT and leave nothing but a feelings like, the last place on earth i want to go to.

      I agree with PMC’s conclusion how pictures and text!were crafted.

      And so in the weeks since the news broke, houses have been painted (thanks to a donation of morea than 900 gallons of paint from DULUX)

      As a photographer I know how to do that, and I know how you could have chosen to show this in a very different light.

      Disgusting!

      • coldblow

        Georg, you’re right to say what you think. Just looked through them again but to me they only looked like a set of snaps. I’m the first to admit I have no eye for this.

        • I look at and work with pictures every day. Pictures are chosen for the emotive character that they transport.

          The emotive character in this set is specific.

          I could prove it in a somewhat lengthy analysis on the grounds of the underlying arc of intent that is also evident in the text, but after all, they are just pictures that are out there for a moment in the public attention span.

          However, it is stereotype really! As Ireland’s PR manager, none of them would have made it to the shortlist to be delivered to NYT!

          • doflynn

            Totally agree with Georg; as someone who works with snappers all the time, their work can make or break any article, regardless of how well written. “A thousand words” is a gross undervaluation of a good pic. Those were good pics, but the story they told…

    • CitizenWhy

      Many ways to interpret. One could be that these are people the Celtic Tiger left behind. Another is that these are people who represent the future for most Irish. The Protestant priest looked normal,if a bit too authoritative.

  27. Must read! Bill Black’s (suberb!) response to Bloomberg Roger Lowenstein’s Wallstreet whitewash

    Lowenstein should stick his dick back into his Sequoia fund, leave it there and spare the world his unbelievable intellectual diarrhea!

    http://www.businessweek.com/magazine/content/11_21/b4229060222515.htm

    Bill’s response 1 Part here:

    http://neweconomicperspectives.blogspot.com/2011/05/in-praise-of-sorkins-praise-of.html

    • Which brings me back to my conclusion that all this can be described as a class war per definitionem.

      Only, the aggressors faced no opponents at all, but victims, victims that subscribed to this position themselves by allowing their governments – especially in Ireland – to be the executioners that slaughter the working class and their assets, which is still a ongoing process.

      Society at large is guilty of ignorance beyond any doubts, but not what Lowenstein and others implicate to distract from the real culprits and add insult to injury. Lenihan’s and other EU Finance Ministers stance of ‘We all partied…’ is in the same league of Lowenstein’s arrogance and deliberate lies.

      It is the grey mass of people who are ENABLERS, always has been, therefor the Muasher doctrine works.

      This grey mass of indifferent and conformist ‘good citizens’ that chose to not put pressure on the system and demand what would be righteous and just.

      Thanks Bill Black, thankfully someone responds to this crap.

      • CitizenWhy

        George, here’s another angle class war in the Western world.

        Harvard people gasped when they heard just how bad things are financially for Americans. Normally they spend their time congratulating themselves for running the US financial system that has brought ordinary Americans to the brink of disaster.

        http://www.bnet.com/blog/harvard/the-financially-fragile-american-consumer/11694?promo=713&tag=nl.e713

        • Deco

          The entire Asset price model system of over leveraging an economy is unravelling.
          i) Peak oil,
          ii) the lack of expenditure (due to declining real incomes) in the direct labour sector of the economy, (globalization),
          iii) inflation as a result of the accomodative monetary policy and all the asset price bubbles(Greespan, Bernanke, Gordon Brown, Trichet, etc..).

          But the experts (both monetarist and Keynesian) in Harvard have not designed a model for this yet….

          Chances are they will favour a repeat of the same disastrous previous policies as the “solution” to the problem that they created in the first place.

          Print-Baby-Print.

          • over leveraging…. Bingo!

            Tell me, did that stop since 2007? I don’t think so!

            My respect for the majority of economists has left the building since long btw. as they are enablers to a high degree, and still holding up the flags of their system. They spent years with problems on a small scale, write paper after paper about it, but only very few economists are dealing with the real picture, the grand scheme of things.

            The majority is a breed of sucker uppers, out there to make a kill as quick as they can.This majority was so overwhelming that it was possible with the Insiders help who were also beneficiaries – cui bono – to ridicule those with plausible warnings.

            Remember the letter of the DOF senior civil servant, sorry the name slipped me at the moment, he described the sam phenomenon.

            The academic world of economy is infested by conformist and yes sayers.

            Again, cui bono, and they never stopped, on the contrary, their war chests are filled to the brim and the re shaping of our future is in full swing.

            The goal was clear! Dismantle power of governments and take over with debt control, privatization of the peoples assets, the slaughter of labour force and citizen rights, once that is done, people will be standing in line to work for slave labour, as is the case in germany already.

            They changed the laws, and implemented this slave labour market to get them out o their unemployed statistics. There are 16,000 companies in Germany that act in this function of being the parasite, in between the clsoe to 1,000.000 workers and their employers, they can hire and fire, pay sub standard wages and make insane demands on workers.

            They implemented a two class labour force, and those in the slave labour market stand no chance to make it back into the first market with a full time contract. Apart from that, it comes in handy in a crisis, they just can be fired, no questions asked.

          • CitizenWhy

            Yes, let’s be clear about this: CDOs and other complex debt derivatives allowed banks in effect to print money, that is, multiply “money equivalents” many times over, putting more cash into the trading economy, but with these debt derivatives backed mainly by a willingness to buy them (buying collapsed when the financial wizards realized this).

            The banks multiplied debt (that is, their version of cash/money) far beyond the ability of the world’s economy to pay back those debts, and did so without any government regulation. In other words, the printing of money was privatized.

            The inventors and traders of these debt derivatives grew rich, the rest of us paid for their losses.

            I’d rather government monopolize the ability to print money than leave the printing of money in the hands of banks and their speculating traders.

          • Deco

            Georg – you hit the nail on the head several times there.

            Citizenwhy – are you not afraid that when the government has a strong regulation of something, that this always ends up with seeping corporate infestation of the political process.

            Just look at the Wall Street insiders on Penn Avenue.

          • CitizenWhy

            Deco, In answer to your question: “Are you not afraid that when the government has a strong regulation of something, that this always ends up with seeping corporate infestation of the political process?” You point out the Wall Street infestation of government.

            Wall Street infestation started under Bill Clinton precisely to bring about deregulation, a goal achieved. The infestation grew to total dominance under deregulation. Under the old US regulatory system,the large commercial banks (Chase, Citi, Bank of America) would have been protected from the doomed game of derivative speculation. Then it would not have mattered if Lehman and Goldman Sachs went under.

        • This collective gasp should be understood as an embarrassment to the entire academic circle of economists.

          Respondents were asked to answer a simple but telling question: Could you come up with $2,000 in 30 days to pay for an emergency?

          24.9% of respondents reported being certainly able to raise $2,000.
          25.1% probably able.
          22.2% probably unable.
          27.9% certainly unable.

          Which is derived from a study here http://papers.nber.org/papers/w17072 that….

          You may purchase this paper on-line in .pdf format from SSRN.com ($5) for electronic delivery.

          Screw them!

    • uchrisn

      Actually a Greek Default has been predicted for so long now, it wouldn’t have as big an effect as people think. The ECB are scaremongering, remember the ECB are representing the financial industry in the 4 biggest Eurozone countries. They want taxpayers to pay for Greece rather than banks.

      • uchrisn

        Christine Laguarde is talking up a weaker Euro, not so good for the financial industry or the Germans, good for the workers and the periphery. The ECB may have to get those printing presses going yet.
        An expansionist monetary policy would help Ireland and especially the unemployed. The U.K. was helped in ’92 when it dropped out of the ERM precisely for that reason.
        Really Ireland Greece or portugal have no say in the ECB. Even if there are only 12 countries in the Euro. Thats why we should leave. It benefited the UK and Sweden in 92.

        • CitizenWhy

          Germany has been whining that the US and China are deliberately undervaluing their currencies, and that these undervaluations are hurting the Euro (that is, Germany). Well if these accusations are true, doesn’t it make sense to lower the value of the Euro?

          • If the debt is denominated in euros, which it largely is to German, French banks, this will debase the debt owed to these banks and weaken them accordingly.

            The real fear is the German folk memory of the Weimer Republic which did precisely this to pay for the WW1 war reparations, but this race to the floor led to inflation and rampant runaway hyperinflation, as it could do now, not only for the euro but for the dollar.

          • coldblow

            I think I read somone somewhere arguing that the Germans etc have deliberately talked up crises in Greece and Ireland, from time to time and without pushing it too far, so as to weaken the Euro.

            Dunno if I read that right and, if so, if there’s anything to it. Anyone got an opinion?

    • Deco

      I read articles by John Maudlin posted on Marketoracle.co.uk – and his assessment of the PIGS crisis has been better than most in recent months.

      Effectively, he is saying that Greece is on it’s last chance, and will eventually run out of money or time or friends or all three.

  28. CitizenWhy

    The article details how the ECB is a bad bank, with dangerous exposures and overvalued (but unsellable) toxic assets.

    http://www.businessinsider.com/ecb-enormous-bad-bank-2011-5

    • Above is based on:

      http://www.spiegel.de/international/business/0,1518,764299,00.html

      Kindly given by Georg earlier link. It is well worth a careful read. Basically it shows how the EMU is approaching a blowout similar to 2008.

      The only question is, who is going to be Lehman’s?

      My own view is there are two ways for the EMU/ECB to jump. The first way is the Lagarde preferred way, ‘print more money’ and pour it onto the peripherals in return for pledges of reform.

      This risks inflation and currency debasement plus if funded bilaterally by countries across the eurozone would carry risk asset backed securities upon which it could be based would be less than AAA.

      The second way is to deem peripherals insolvent and achieve voluntary expulsion of eg Ireland and Greece.

      This would have a contagion effect but would be less damaging long term than above.

      In Ireland’s case, there is the possible cushion of an economic relationship with UK that could be built upon.The problem with the former course is that it pours good money after bad.

      The best yardstick of which way to go should be governed by the principles of equity and employment. We need to drastically attack the haemhorrhage of 15% unemployment.

      Euro bailouts in Ireland’s case have been pillaged by the banks and those who got us into the mess; e.g they’ve been poured into the black hole of NAMA, waste everywhere in the legal industry, public service pay, where money went on pay not new better services or more jobs, bailout is not being translated into jobs. It has failed miserably and made our economic situation worse.

      Greece and Ireland need to leave the EMU and concentrate on lowering costs and generating jobs.

      Leaving the EMU shouldn’t mean leaving the EU. But I don’t believe all the king’s horses and all the king’s men can’t put the new euro together again.

      If the above is done properly, the new euro can be the PuntNUA:) Feel free to plagiarise these views:)

      Note deregulation and the sick unregulated financial industry of CDO’s and derivatives that caused the problem for Lehmans and other banks brought down by these securities lie ready to explode the ECB:

      from link above:

      “”We didn’t have enough bonds to submit to the ECB, so we built Emerald 5,” says the EBS employee. Many others did the same.”

      Until globally the global debt problem of unregulated toxic securities is fully dealt with, real economic progress built on equity and employment and not casino fairy money, won’t happen:)

      • CitizenWhy

        You say, nicely put:

        “The best yardstick of which way to go should be governed by the principles of equity and employment. We need to drastically attack the haemhorrhage of 15% unemployment.”

        I fully agree. The same is true in the US but a policy of “Save the banks at all costs” gets in way.

        • ….I fully agree. The same is true in the US but a policy of “Save the banks at all costs” gets in way…..

          That’s it…. you can save the banks or society… not both.

          • Deco

            Except we get told that you must save the banks in order to save society. And this message is the only available remedy in the entire Brussels mandated area.

  29. Deco

    We had Comical Lenny.

    Now, we have comical Kenny.

    http://www.independent.ie/national-news/taoiseach-admits-to-not-asking-crucial-questions-2656567.html

    Unbelievable. Maybe it is not a great time to talk about economics. And besides they might not want to talk about it either.

    But this is a bit like Cowen going for a full round of golf with Seanie Fitz and a former RTE Head turned political lobbyist, and not discussing the state of the banking system, or the construction sector.

    Do these lads actually forget about their responsibilities for long spells ?

    • Deco

      Of course I should emphasize that the article was written by Fionan Sheehan who is well connected to FF.

      • BrianC

        Regardless of who wrote it Kenny affirms that he did not ask any relevant questions when meeting key influencers and decision makers.

        Kenny is a hapless witless useless non entity intellectually challenged with no useful skill set that reinforces below standard politics in Ireland.

        Kenny is just reflecting his past political performance of twenty odd years which was worthless. He now finds himself in a postion of authority and power by default where the Irish electorate was too stupid to do the right thing and elect change. The Irish are now saddled with the same product in different package promoting the same old ways and now the public seem to be happy with sound bite politics.

    • Colin

      The pity is that this story is not unbelievable. It would be unbelievable if Kenny had tackled the hard issues with Obama and Cameron. He didn’t. He doesn’t want to. He’s too busy shaking people’s hands and telling everyone who’ll listen that Ireland is open for business. He should also tell his missus to stay away from the Harney dessert trolley, she’s not a good image for mna na hEireann abroad.

    • coldblow

      Two issues in the article: asking Obama about burning the bondholders, and the plagiarism of Obama’s speech. Yesterday’s Six-One News ran a piece about the latter (of course) but did I miss some discussion of the former?

    • Mr Kenny said he was not aware of Mr Geithner’s view on the bondholders

      Now, how likely do you think that is?

      I think that’s a big steaming pile of pig shit!

  30. Deco

    More stories about power, and accountbaility and media non-involvement in the French state.

    http://www.independent.ie/world-news/europe/sarkozys-sleaze-file-on-strausskahn-2656657.html

    Unbelievable. No wonder CJH modelled his career on Mitterand….another rogue.

    We know that Sarkozy was diamtrically opposed to the IMF position concerning bailouts. With all this information Sarkozy effectively had DSK over a barrel – he could practically control the IMF via blackmail.

    I am reminded of the words of Benjamin Franklin, and what happens to people when they become entrapped in debt.

    We are the victim in all of this – because we are not being allowed to apply Capitalist consequences for capitalist misadventure.

    This entire debacle proves that the EU and the ECB is extremely compromised.

    • Yeah, the real world of politics, backstabbing, lies and corruption.

      • Ireland is no democracy, as many other countries in Europe are no longer democratic, but oligarchic instead.

        The take over of governments by the honorable men and women of the corporate kleptocracy is no fantasy of a handful of conspiracy idiots.

        It is the reality we witness every day, and it is enabled by….

        THE PEOPLE!

  31. Praetorian

    Professor Noam Chomsy:

    “I’m never asked “What should I do?” in the third world. When you go to Turkey or Colombia or Brazil, they don’t ask you, “What should I do?” They tell you what they are doing. When I went to Porto Alegre, Brazil, for the World Social Forum, I met with some landless campesinos, and they didn’t ask me what they should do; they told me what they were doing. These are poor, oppressed people, living under horrendous conditions, and they would never dream of asking you what they should do. It’s only in highly privileged cultures like ours that people ask this question. We have every option option to us, and have none of the problems that are faced by intellectuals in Turkey or campesinos in Brazil. We can do anything. But people here are trained to believe that there are easy answers, and it doesn’t work that way. If you want to do something, you have to be dedicated and committed to it day after day. Educational programs, organizing, activism. That’s the way things change”.

    ["Imperial Ambitions" by Noam Chomsky. 2005]

    • coldblow

      From Ha-Joon Chang’s “23 things they don’t tell you about capitalism”:

      15: People in poor countries are more entrepreneurial than people in rich countries

  32. bankstershill

    Strauss-kanhn gone ! , who was probably the most powerful man in Europe. This is akin to Caesar being assassinated by the Roman senators. What does that really mean ?. For a start it represents a faction fight among the highest echelons of the international financial oligarchy. I don’t think David grasps the historic significance of this event. Before his arrest kanhn was coordinating with Obama , little Timmy Geitner and Helicopter Ben for another round of bailouts both for Wall street and The EMU via the likes of Greece and Portugal. On the morning of his arrest he was on his way to see Merkel to continue with these arrangements. But now ,NO MORE BAILOUTS. The good news, no more inflation ( sorry David I know how you love inflation). The inflation we have been seeing this last year is primarily originating as a result of insolvent banks using the bailouts to speculate in essential commodities such as oil and food. Another round of bailouts would have meant the destruction of the dollar and Euro currencies through the hyperinflationary effect of another bailout which would have spread chain reaction style throughout the globe as other nations would have been compelled to ‘import’ the inflation to stay competitive. But now that aint gonna happen, we get to keep our savings and rightly so (again sorry David, i know you like the idea of ordinary folks having their savings wiped out). The bad news, but only if you’re a parasitic, sociopathic investment banker and in the following order,
    NO MORE WALL STREET
    NO MORE CITY OF LONDON
    NO MORE IFC,
    NO MORE INTERALPA LOOTING.
    The big one is coming. Buckle up.
    P.s , when it happens try to avoid areas in which the order of business is the pillage and rape of the third world, e.g. IFC, The COL ect, as devastated brokers and/or investment bankers could possibly land on your head and which is not good for your health.

    • Colin

      http://www.youtube.com/watch?v=9UPJ-euBzSM&feature=related

      Dear Enda,

      When you go, will you send back, a Bailout from America?

      McCreevy no more
      Sutherland no more
      Lenihan no more
      Neary no more

      Cowen no more
      Bertia no more
      Hurley no more
      Harney no more

      • Enda, I(OU)Reland’s answer to the Sheriff of Nottingham, citizen quisling, craven excuse for uaisleacht

        http://www.merrionstreet.ie/index.php/2011/05/taoiseach-enda-kenny-speech-to-introduce-president-barack-obama-at-college-green-dublin-23rd-may-2011/

        “A cháirde
        Today, with President Obama…..we draw another circle.
        One in which we tell the world of our unique, untouchable wealth.
        Wealth that can never be accumulated in banks, or measured by the markets or traded on the stock exchange.”

        He’s going to do an Iceland Olafur Ragnar Grimsson and get our money back from bondholders.

        “Because it remains intact and alive….deep inside our people.
        In the heart-stopping beauty of our country.
        In the transforming currency of the Irish heart, imagination and soul.
        This is our Uaisleacht….. it has sustained us over the centuries.
        We pass from mother to daughter, father to son…
        In our dreams and imagining….
        In our love for our country…. our pride in who we are..
        Long into what must be….and will be…. a brighter and more prosperous future ”

        Nope, it’s gone. For a second there I thought he was going to do an uaisleacht and return the stolen pot of gold:)

        • Re “Wealth that can never be accumulated in banks, or measured by the markets or traded on the stock exchange.”

          A country’s success expressed in successful economic management and enterprise is a form of uaisleacht that can be accumulated in banks, or measured by the markets or traded in the stock exchange!

          Enda, you just don’t get it, Ní Féidir leat.

          Default beckons the gombeens!

  33. Dorothy Jones

    To quote from Paddyjones in an earlier:

    austerity => balance budget=> start repaying debt=> no default

    Managers/Housewives alike cannot manage what they do not know.

    It would be useful to have the answers to a few very simple questions in order to put basic financial measures into place; good housekeeping:

    1. When will Greece default?
    2. What efect will this have on Ireland?
    3.

    • Dorothy Jones

      Aplogies..and for the typing errors
      3. Is the irish state incapable of meeting certain payments currently?
      4. Will the banks be incapable of issuing money; with or without Irish default?
      Angela Merkel may see another Greek bailout as the lesser of two evils but the German taxpayer is at their limit.

      • Dorothy,

        Your questions could not have chosen a better timing! :)

        1.
        The IMF (per Reuters, saw it on Eurointelligence) made a statement that they will force Greece into default if the EU does not up the ante with payments until 2012. Now, we have to take that with a shovel of Salt, the IMF is a political institution.

        Your question can not be answered of course, but the chaos that exists within the EU alone is massive. The left hand does not know what the right is doing applies here.Dysfunctional democrazy at work. By July Greeks are supposed, I doubt it, to run out of cash.

        What is high on the agenda in Brussels now is to grab Greek assets, and here Gold plays a major role in the games they play. See date of press release, it explains why your timing is excellent!

        http://www.gold.org/download/pr_archive/pdf/gold_as_a_source_of_collateral_pr.pdf

        This was to be expected, it is part of the plan to steal peoples assets after they were burdened with impossible debts which they never signed up for.

        2.
        O.K. plain and simple, any default, Ireland or Greece will bring down ECB crack house policies, they are more than likely over leveraged with crap papers they accepted from banks.

        3.
        We are insolvent! Current debt repayments are made by taking on more debts, only these are conditional and the EU/IMF executer is the ‘government’, this is no government, it is a puppet government that plays PR games with the public.

        4.
        The undemocratic institution of ECB can do whatever the Hell they want to do. If they choose to print money, they print it, if they choose not to, they won’t. The ECB is a political and ideologically locked in Institution that went ballistic in purchasing government bonds, and the future will prove that they will choke on it.

        As it is all interlinked throughout the EU and we are at the point were the political incapacity towards useful decisions that benefit the people and not the criminally insane banksters, they will kick the can further down the road, and effectively they will be the ultimate cause for the break up of the european union as we know it.

        Without debt massive write downs on both private households, and banking as well as an arrangement to stretch maturity of parts of sovereign debts, the short term situation is impossible to solve and will only increase in intensity.

        The resignation of German President Koehler and short thereafter Axel Weber happened for the very same reason. Central Banks left their assigned territory and started to involve themselves by purchasing bonds.

        This move was the biggest error in history of banking, and it had implications so severe and on all levels of society that both Koehler and Weber resigned. I think they should have made a protest note but they are not designed this way, but anyone a little closer to the action knows this to be true! They disagreed on the change of CB’s policies, they knew too well their implications, CB’s had thrown independency out of the window, and both Koehler and Weber strongly disagreed on that step.

        Angela Merkel is a political opportunist, and she never had any perspectives worth mentioning, in my view she is the worst chancellor in the entire history of the Bundesrepublik.

        You are right to think that the German public view on a third bailout is leaning towards a NO.

        Just my 0,002 grams of Gold. ;)

      • Hi Dorothy,

        We have National Pension Reserve funds currently raided to recapitalise the banks so we can waste money until that runs out.

        The question is whether we can grow as an economy under the reparations, 10% of total tax take.

        http://en.wikipedia.org/wiki/Economy_of_the_Republic_of_Ireland

        We’ve frontloaded €6bn cuts out of the €15 bn cuts in expenditure for Recovery Plan 2011-14, EC said we would have growth of 3% in 2011, but it’s now revised down to 0%.

        So, the economy instead of growing is beginning to eat itself.

        When an economy eats itself, its debt burdens grow proportionately to the health of the economy. 10% of 100 is 10; but if I no longer have 100 but say 80 due to emigration or a contracting global economy hitting my GDP, I still need to payback 10, so this is 10/80 = 12.5% and so on until I cannot afford the growing reparations eating at the countries economic livelihood…

        This begins gradually, then accelerates fast in a process that is worsened by deflation.

        We’re currently in the eye of the storm but headin for a blowout…..On the other hand, some people do well in a downturn:)

        • oops another €8 bn to come out from taxes, cuts in services, sale of state assets before 2014…..while the economy is contracting and Grendel NAMA is doing her worst..interesting times ahead:)

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