February 26, 2013

Ireland’s Exchange Rate Brace

Posted in Sunday Business Post · 54 comments ·
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Britain is among those few countries in the world that issues its own currency, determines its own interest rates and has no problem in getting foreigners to buy its debts – debts that it determines how and when to pay and at what value. This ability to borrow from foreigners in your own currency and pay them back at a value of your own choosing is an amazing economic and financial advantage.

There are a few other countries in this benign position: Australia and New Zealand, Canada and, of course, the US, Japan, Sweden and Norway. We used to have this advantage, but we gave it away when we joined the euro. Now we are, in essence, borrowing someone else’s currency – a foreign currency – and conditions in Ireland have no bearing on that currency. Longtime readers of this column will know that, here at least, a country’s currency – to use the words of the great American central banker Paul Volcker – is regarded as “the most important price in any economy”.

When the currency is overvalued or pegged to a much stronger currency or, in the Irish case, subsumed into a foreign currency, the trading sector of the domestic economy suffers dramatically – unless it is a part of the US supply chain. In contrast, the protected sector and the public sector get a massive subsidy because they get paid in a currency in which they never have to generate any foreign sales. The local protected sector gets paid in a currency it is not required to generate from selling its goods and services. So these people are smiling.

In contrast, traditional exporters who obtain the majority of their inputs in the local economy and turn these inputs into something they can sell abroad, suffer enormously if the currency is overvalued.
A country that adopts a permanently overvalued exchange rate for political reasons, as we have done, will become an economy with small exporting companies, a large public sector addicted to debt and a tax-induced multinational sector that is not sensitive to local prices because (a) it uses precious few local inputs other than the labour, and (b) it is part of a global supply chain, where exchange rate movements are exploited in the multinational’s treasury department.

A country like this will also get into debt quickly because the debt markets confuse a yield arbitrage (a gap in interest rates on government bonds) within a monetary union – such as the difference between Ireland’s interest rates and Germany’s – with the country’s ability to pay the debts in the future.

Of course, it will not be able to pay debts, because it is incurring debts to maintain the living standard of the protected sector. This living standard – which allows people to buy foreign cars and gadgets – is rented and mortgaged, not earned.

As such, an overvalued exchange rate acts as a massive subsidy to the domestic sector over the local exporting sector. The only way the standard of living can be maintained, if it’s not earned, is that it must be borrowed or it falls.

When a country’s unemployment rate is at 15 per cent (and would be higher were it not for huge emigration at a time when wages are also falling), few can argue that our exchange rate rising against our major trading partner, Britain, makes any sense. It is, in fact, very damaging.

There has always been a bias against local Irish small business in the corridors of power in Ireland and in the minds of the professions-obsessed apparatchiks who run Ireland and don’t actually earn the currency they are paid in. Even so, having our currency rising against sterling right now is beyond comprehension.

Sterling is falling rapidly right now and Moody’s decision to remove Britain’s AAA rating could lead to a further drop. This is being welcomed in Britain because it will give British manufacturing and services a chance to export. The country is caught in an austerity brace, where cutting public expenditure in order to reduce debts is causing the debts to remain stubbornly high because income is falling faster than debt is being paid down. This unpleasant process is called deleveraging and Moody’s move reflects the problems of achieving this.

In order to survive deleveraging, an economy needs to give its exporting sector a chance. If it can reduce the price of its goods on world markets, there may be just a slight possibility that it can get growth from exports. If these are real exports which employ local resources, such as machines, technology, land and labour, then everyone benefits.

Because the output gap – the difference between actual production and potential production (measured by unemployment) – is so great, imported inflation is not a real worry. In fact, given the huge debts, a bit more inflation would be a godsend.

This is what the British are trying to engineer via a sterling devaluation.

Now, what impact would a permanently lower sterling have on Ireland?

Well, here are the facts of our economic relationship with Britain. This is the real situation, not in the Teutonic fantasy world of our mandarins, but in the real world where we all trade and try to earn a crust.
After 30 years of Ireland tying its currency and criminally ignoring the sterling exchange rate in a bizarre effort to force more trade to Germany, officially-neglected Britain is Ireland’s largest export partner after the US. We export around €14.265 billion-worth of goods and €15.052 billion-worth of services per year to Britain.

Ireland imports more from Britain than from the rest of Europe combined: €16.686 billion in goods and €10.108 billion in services in 2011. Every week, €1 billion of trade is carried out between Ireland and Britain.
When it comes to trade in goods that have huge knock-on effects in terms of people’s real lives, as opposed to trade in industries that can overstate how much is made here for accounting reasons, Britain’s importance is even more significant.

According to Bord Bia, Britain is Ireland’s number one export partner when it comes to food. €3.2 billion-worth was exported there in 2010, up 2 per cent on 2009. Irish beef, for example, accounts for 60 per cent of the British market. Ireland produces enough food to feed 36 million people, while Britain has a food deficit. Ireland also happens to be Britain ‘s top food export partner, importing an estimated £3 billion-worth in 2012. Altogether in 2011, British ports imported 6.63 million tonnes of freight traffic from Ireland, up 6.3 per cent on 2010.

As well as that, the Republic is Northern Ireland’s second-largest trade partner. Forty per cent of NI exports go south of the border. Much of this trade (67.9 per cent) is done by SMEs, which are the lifeblood of Irish business and Irish employment.

This is the reality of the Irish economy as it is, not as we might like it to be. Without exchange rate flexibility, we get larger unemployment and lower wages as we are already seeing. This makes legacy debt harder to pay and exacerbates the squeeze. Yet the headlines this weekend are about how our state is going to borrow more in June and this is reported as a sign of success.

Hard to swallow.


  1. 5Fingers

    With Italy causing problems the Euro will be trading 2 to 1 pound Sterling in no time at all and we are on the pig’s back again.

    Nice site layout BTW.

  2. 5Fingers

    Hey!!! Did I get to be No.1??? Must be a bug…

  3. breltub

    This was the big one Adam!

  4. 5Fingers

    Did I get to be No.1??? Must be a bug…

  5. Ah back in action again and a vast improvement. To be picky, any chance of slightly darkening the font please?

    Our neighbours have a history of devaluation when things get a little sticky.
    Question; Does this devaluation help to defray the cost of money loaned to us by the UK govt at all?

  6. Adam Byrne

    It’s good to be back.

  7. joe hack

    Good Stuff

    The web site – I am blind – now I can see – the article you can buy Irish Punts on eBay, £1 is only €18 sounds about right ….http://www.ebay.ie/sch/Coins-/11116/i.html?_from=R40&_npmv=3&_nkw=irish+pound+note

    Seems to be a bargain the central bank should borrow euro and buy truck loads of punts from eBay we be rich

  8. denisamurphy

    It seems nothing ever changes in this country

  9. Grey Fox

    David, Not too sure about the “new look”, a tad white for my liking, but maybe it’s my resistance to change surfacing!
    Good article, my mood is not improved though, we are so far down the toilet, even getting back to the U-bend would inspire confidence and that doesn’t say much!
    Keep up the good work….

  10. Tom Crowley

    Its time to have a conversation on Europe and the Euro.
    The is a potential for austerity policies right across Europe to lead to a grassroots revolt against the euro

    “As it becomes obvious that the austerity programs produce unnecessary sufferings especially for the millions of people who have been thrown into unemployment and poverty, resistance against these programs is likely to increase. A resistance that may lead millions of people to wish to be liberated from what they perceive to be shackles imposed by the euro.”
    Following the success of 5 star movement in Italy I see parallels with the growing momentum of Irish towns starting to hold weekly marches against people of Ireland being loaded with bank debt. Just because laws were passed does not make it unjust.
    Read the article on this “Clown who has managed to capture 25% of vote.”
    If the people of Ireland had an opportunity to voice their approval or not I do not believe the result would be in support of the main political parties stance. Democracy as in the people being represented by the person they voted for is currently not functioning here.
    57% of Italians voted for parties that explicitly oppose austerity and in a major upset, the Five-Star Movement led by comedian Beppe Grillo – who has called for a referendum on whether the country should leave the single currency – received over 25% of the vote. Outgoing Prime Minister Mario Monti’s list mustered less than 10% of votes in both houses. Although Italians remain pro-EU, this election was a major blow for the Brussels cash-for-austerity consensus, and any plans for structural reform in Italy are likely to be put on ice.
    http://www.theautomaticearth.com/Finance/beppe-grillo-wants-to-give-italy-democracy.html
    In my opinion we need not a clown, as we have had and continue to have a plentiful supply in our governments, but perhaps an economist or/and journalist to step up to the mark. Anyone up for it?

  11. 5Fingers

    A few things to challenge in this article

    1) A devaluation does little to defray the cost of THE biggest cost input – energy.
    2) Labour content (hours expended) of exports is getting smaller. Productivity improvements will not necessarily translate into jobs
    3) UK is our biggest buyer. No argument there. But we buy little from the UK that is originally from the UK. UK is a trans-shipment point. The only reason UK gets employment as a result of its exports is shipping and warehousing. Little else.
    4) We own little of our resources for production. Technology and Machines are all sourced externally. We rely on external input to keep that stuff going (unlike Germany). Example: Most of the operation nerve centres for Windfarms, Telecoms are not even in Ireland.

    Before we all start worrying about banks and what is owed to them – start to understand where our real dependencies are. If we give the Euro the heave ho, we might find the lights going out and little we or our UK “partners” could do about it.

    • Tom Crowley

      Before we all start worrying about banks and what is owed to them – start to understand where our real dependencies.
      Its about time the people understood that they have been robbed blind. They need to understand that the fairy tale stories they are being fed on jobs, growth, return of sovereignty are wishful thinking by politicians relying on information being fed by others in the grand european project.
      The energy question will not be resolved neither by UK or Europe. To imply staying in the euro will keep the lights on is disingenuous. Nationalise Corrib might be the only way. The UK our 90%+ gas supplier at the end of the Russian supply chain is facing up to the supply future

      http://www.independent.co.uk/news/uk/politics/energy-in-the-uk-the-coming-crunch-8501731.html
      Source http://www.iea.org/publications/freepublications/publication/ireland_2011.pdf

      You will have to put your data source for
      30 UK is our biggest buyer. No argument there. But we buy little from the UK that is originally from the UK. UK is a trans-shipment point. The only reason UK gets employment as a result of its exports is shipping and warehousing. Little else.
      4) We own little of our resources for production. Technology and Machines are all sourced externally

      Regarding 4 Aside from our FDI our strength are as the above article shows a food producer for the UK. The competitiveness which it survives on currently being hammered by the euro/ sterling exchange rate.

      • 5Fingers

        I would have said Energy is our biggest UNCONTROLLABLE cost. Your comment properly highlights this. 100% Agree.

        The monetary / financial flow link between UK and Ireland is strong. The substance of that link is questionable. I find it hard to track any data on that. But looking around and being in the manufacturing business, UK seems more like a geo-conduit than anything else.

        Competitiveness will be based on our ability to control energy. I am convinced of that. Currency and the EURO is currently the only thing that prevent shocks. If we walked away tomorrow from the Euro, and not sure how the dymanics of the change would be survived in the short term. Make sure we have a good buffer of oil I suppose.

    • bonbon

      Very good point about the physical economics that monetarists avoid like an allergy. There is always that unspoken, deafeningly silent, in-your-face, with a nudge and a wink, insistence that the economy will spring forth from the proper monetary arrangements, rates, printing, etc.

      There is no basis whatsoever in the real world for this wild-eyed illusion.

    • Max Keiser was talking about the UK the other day and he thinks they are a joke. Said their total debt is about 800% of GDP.

    • “we buy little from the UK that is originally from the UK”

      That’s interesting what you say. Could the same be said to apply to our exports? Namely that we export little to the UK that is intended for consumption in the UK and that said UK is merely creaming off the top of what we produce by virtue of it’s role as a shipping and warehousing entrepot?

      What all this would suggest is that we really are the victim of our own stupidity and lack of initiative. We should be forging independent trade and other links that reflect our own national interest and not some perceived ‘traditional loyalties and allegiances.’

      And it puts into perspective the attitude and stance of our subsidised and protected ‘public service’ who “don’t actually earn the currency they are paid in.” They have no motivation or incentive and probably never had despite 90 years of formal ‘independence’. They only let it happen so that they could see it all fail then wag the finger and say ‘I told you so!’

      They probably waited 90 years for this moment!

  12. molly

    Ireland needs to go back to its own money the pound,the euro seamed a good bet at one time not anymore .

  13. bonbon

    With German President Gauck appealing for a British EU, with English as the EU language, last weekend, one must wonder what is going on. If Italy threatens a bailout call, as Berlusconi could very well do, well, well.

    Monti, Goldman-Sachs austerity technocrat, “running well behind the essentially comical Silvio Berlusconi, he’s running behind an actual comedian, Beppe Grillo, whose lack of a coherent platform hasn’t stopped him becoming a powerful force” as Krugman wrote.

    Austerity is less than comical, a bad joke. When will we laugh the clowns out of power?

  14. bonbon

    Moderator test, 1,2,3.

  15. Well David
    The next step is to issue Irelands own sovereign currency from Treasury.
    Revoke the odious debt, Pay off the outstanding debt with your own currency, Close the central bank, Monetize all qualified silver coin as a parallel currency to induce competition,
    Ireland is debt free and prosperous.
    Just need the balls for the country to stand on its own two feet. Time for the country to mature and be independent monetarily.
    Continue cooperation in other areas and trade.
    What is your solution David, now you have outlined the problem. It is alright to complain. What do you do about the problem?

    • 5Fingers

      No, The Irish let events overtake them yet again and let the real clowns run the show for what it really is. Ireland will continue to play it safe. “Prudence” as Blake said “is like an old woman weighed down by the cloak of necessity”.

      But maybe the solution is presenting itself whether we like it or not. Things are indeed looking decidedly unsafe. David’s article should be seen as a signpost to the inevitable rather than a call of action.

      • molly

        There’s some amount of clowns in this country the dail is full of them.
        If the 3 main party’s where wiped out who would be left to run the banana republic?.

  16. To Irish brothers proud and humble.

    To entertain the finest teams in europe is a privilege beyond compare.

    Young lads note – Celtic was first foreign club to defeat Real in the Bernabau in forty years.

    I bet you didnt know that.

    Hail hail.

  17. Exchange rates mean nowt to Paddy the Plumber. Paddy Plumber would be better off on the dole. Fucking Mug.

    All this talk of exchange rates? Means fuck all to me or the eejits next door. You are pissing in the wind. Exchange rates matter to a selfish fraction of one percent of the entire fucking population.

    The drivel from economists and politcal yes men amounts to a comedy of the absurd. Maybe these people should be put against the wall. No-one would miss them. Sad little Hitlers

    Ireland is becoming a nasty little place riddled with parochialism and small minds filled with bigotry

    Humane welfare system is compensation. Pay back time. It’s the only barrier between the political wankers and the latent rage of ignorant conservative mmasses. These bastards only have fat lard arses because you and I were were sent to hell-holes like Gallipoli to fight for some bastard freemason king. Never again.

    Angela? Nicolas?
    Cold hearted murdering scum.

    Q. How can anyone sit and listen to these people. They should be behind bars

    Think about that next time Tony give or Bertie gives a speech

    Then again the arse licking will make the headlines and keep the masses stupid and doped as usual.

    That is the real sickener.

  18. stevedonog33

    IMHO by far your best ever article regarding Ireland David. I have sensed an increasing exasperation in your correspondences recently (and with good reason), but this makes for a cogent analysis of IreLand’s economy. It also expplains why Ireland is essentially an Intellctual Property (IP)-free ZONE. The only meaningful IP here from our thriving art seen, by way of copyright. However, in terms of indigenous companies producing IP there really is very little. According to the Irish Patents Office (IPO) patents fell off a cliff here before the crisis and have been faling ever since. Ireland is a “proxy” nation. The Government is really only concerned with enticing FDI however with our massive levels of unemployment and emigration it is a failed strategy long term.

  19. molly

    What does your comment is awaiting moderation mean .david I think you should go back to the other system.

  20. 5Fingers

    Say we move back to the Punt tommorrow: 1st March

    A possible outcome:
    Price of Punt drops in days to 10 to 1 Euro. Oil at pumps jumps 10 fold in days. A tractor rotovating for 4 hours burns 150 Euros of fuel,,,now that cost becomes 1500 Punts…

    Exactly what happens next. You have 2 weeks from riots etc etc.

    I know it’s not as likely to be as dramatic as that, but can someone please explain the dynamics of a plan that will not cause outright carnage in a matter of weeks?

    • molly

      Don’t piss down my back and tell me its raining.what a movie

    • Moving to the punt will be retrograde.
      It is or was fixed to the pound.

      Any currency needs to be independent of others and settle at its own value

      Closing the central banking system is a must as any currency issued there is deby based

      New currency issued by Treasury is free of debt and interest.

      Monetizing silver coins will provide currency that circulates without being issued by government. This is money pure and simple paid for without any debt attached.

      A free people will abandon a federation of states, and likewise a federation of bankers.

      Understanding the function of money;
      understanding the principles of sound money;
      Will lead to an understanding of what is required for a free and independent prosperous people.

  21. Two points stand out about this article:

    1) “Ireland produces enough food to feed 36 million people.”

    So why do we feel that we are in a precarious situation? We have enough capacity to feed ourselves and export a surplus several times over what we need for our own purposes. True we don’t have oil, but guess what? The countries that have the hydrocarbon resources necessary to fuel a modern industrial society and related infrastructure, tend to be deficient where food production is concerned – not a lot you can grow or raise naturally in the desert. So why not set up an Organisation of Food Exporting Countries? OH FECK we could call it because that is what some people will be saying.

    Of course the reason why it’s not so simple is because we are members of a club (the EU) which like all clubs, imposes rules and restrictions on what constituent members can do – for the sake of ‘the common interest’, real or perceived. Those circumstances that motivated us to we join the European project (a largely agrarian economy which was itself was under-developed at the time) have changed in the meantime – largely as a result of our membership it has to be said. But that is still no reason not to have a critical examination as to whether the change of circumstance merits a change of course.

    In the meantime we have also joined the Eurozone, and here I agree with David. The Eurozone is like a system of dole or social welfare for our career-driven caste of political and civil servants. It’s different from the dole in the sense that people have to show up for so many hours a day but they are effectively being paid to do nothing. Nothing of any crucial importance at any rate. Having the EU presidency for six months doesn’t amount to very much, except that it might make certain people feel like they’re doing something to justify their existence.

    When you give up control of an important lever of government that is the ability to issue your own currency and manage it on the world stage, you have effectively made yourself redundant: in the long-term if not the short to medium term. And the Irish government is effectively redundant – in the long-term. It’s like a regional office of a much larger, multinational entity that is in the process of scaling down. It is being left to operate for a while because their help is needed in scaling down other operations; but once that is accomplished, they will be closed down too.

    Now to consider the other fact that David has brought to our attention.

    2) “Britain has a food deficit.”

    This is interesting because I read a distinct tone into this article that Ireland is somehow beholden to Britain – we are dependent on them for trade, etc. At a most basic level, the facts that have been alluded to show otherwise. They need us more than we need them.

    Britain needs us more than we need them. Europe needs us too but for how much longer? At the last election I was told by a Fine Gael candidate that it is only a matter of time before we are asked to leave the Euro. When that happens, will it be on terms favourable to us? Or favourable to the interests of those we feel ourselves beholden to?

    In the midst of all this, we have an emasculated government and public service that either doesn’t know, doesn’t care or doesn’t want to talk about the long-term consequences.

    Ireland is caught in an historical trap, largely of our own making. We are trading British servitude for a Franco-German version. Like most unequal relationships, it is the partner who actually holds the upper hand who is made to feel obligated and beholden: for fear that they might go ahead and play that hand. I’ll bet there are a lot of battered spouses out there who, if they stopped to think about it, would realise that that is exactly the situation.

    Then of course there are those other maniacs, sitting on bombs and weapons of mass destruction, who have made it clear that they will ride roughshod over international law, invade and interfere in the affairs of any country that does not submit to their will. They also constitute a factor that cannot be ignored and may explain the attitude of Irish leaders. Is the idea of drone strikes over Leinster House, against a backdrop of international headlines screaming for the head of some ‘Irish Dictator’ (Kenny, Gilmore, Martin, Adams, someone else), sound too far-fetched? I don’t think so. Just because Enda Kenny has had his mugshot on the cover of Time Magazine should not be cause to cherish false hope or illusions. He shares that accolade with many who have fallen from grace over the years.

    • 5Fingers

      What was our food productivity before we joined the EU.

      We need to control Energy, Tech and Knowledge a lot more than we do now. We do not have the money to do this ourselves. My gripe is that there has been little effort to gain deep control of these primary elements – but we merely live off the derivative income of use rather than control.

      If we start to pull up sticks, we need to have a plan with teeth.

      • Point about food productivity and the EU is that we needed CAP at that time to manage the flight from the land. One of Fianna Fáil’s founding policies was the ‘ruralisation of industry’, which meant keeping as many people on the land as was humanly possible to achieve. By the 1950s and 60s that policy was giving away – if it had ever worked to begin with.

        Yes, we need better control of energy and information technology. But the point to understand is that these are inputs – not the final product. If one goes by the Law of Comparative Advantage then it is fair to say that Ireland’s natural advantage lies in food production.

        That said, who knows what vast reservoirs lie beneath the seabeds of our vast territorial waters. And what’s the betting that some gombeen hasn’t already signed it all away? Didn’t they say that Ardnacrusha was a waste of money when it was built?

        • bonbon

          The Shannon Scheme was the inspiration for Franklin Roosevelt’s Tennessee Valley Authority, TVA, the model for the 3-Gorges Dams in China now. Knowing this, what actually works, have a look at these 2 programs just for example, for today :
          Arctic Development
          Ireland’s new frontier, and

          NAWAPA XXI The North American Water and Power Alliance.

          Big programs for major problems. They who belittle Ardnacrusha are leprechauns.

      • bonbon

        A Marshall Plan, see post below.

    • Adam Byrne

      A drone strike on Leinster house with all those gangsters inside would make me extremely happy.

      • Extremely happy but for how long? Once the mask is stripped away the face behind it is not so pretty. What’s Libya like these days?

      • molly

        I am thinking of starting a rebellion party our motto should be ( don’t piss down my back and tell me its raining)

      • bonbon

        Obama would organize it for you. Brennan, his “Drone Man” CIA nominee is snarling on the leash. Obama would call it democracy not regime change, what would you call it?

  22. Bill,
    It’s this sort of mainstream article which convinces me that the mess created in the EU is not being solved and that eventually either countries leave the euro or policy changes and money printing plus a massive devaluation are tried. Whatever happens gold will benefit.
    What a crazy world!
    Regards,
    Bob

    http://www.telegraph.co.uk/finance/financialcrisis/9898920/EU-Troika-rule-in-Ireland-worse-than-British-Empire.html

    Ireland fought for 800 years to be rid of the English and gave it all away within two generations

  23. bonbon

    Something very interesting has happened over at Political World. Karl Whelan has posted

    A Marshall Plan for Europe – A proposal from German Confederation of Trade Unions

    This is a sign of a break with existing policies, and addresses the physical economy. There is still a monetarist overtone (no mention of Glass-Steagall as far as I can see so far), but good work.

  24. bonbon

    Most have forgotten what a national bank and credit system should look like. Here is the model :

    Draft Legislation to Restore the Original Bank of the United States

    The FED is bankrupt, utterly, by any book-keeping. It is time for Hamiltonian banking again after nearly 100 years of the FED, bubbles and wars.

  25. Bon bon makes the laRouche news

    http://laroucheirishbrigade.wordpress.com/2013/02/18/horse-sense-in-short-supply/1:49:45 AM]

    “Was it an encounter whilst in Italy with our dear friend, former Italian finance minister, resolute Glass Steagall supporter and now prospective PM, Giulio Tremonti,

    or the provocative comments of another dear friend, Bonbon, whose tireless promotion of American System Economics on David McWilliams’ blog only the most blocked mind can ignore?

    Maybe it was a combination of influences from both of these LaRouche co-thinkers…..”

    Many of us apparently have blocked minds????????????

  26. “Prices kept falling until 2012 but since then, they have begun to stabilise and rise modestly. The market has cleared, or at least much of the process of clearing is already behind them.”

    Hundreds of thousands of mortgages are still in arrears and no action yet taken to start foreclosure.

    Two reasons.

    1. The banks get to keep the mortgage on the books at book value and do not have to account at real market or discounted value, so the can pretend that their reserves are better than they are.

    2. These houses will be delayed coming on the market and so it is a help in not driving the prices lower.

    in other words the housing market is still manipulated and the people lied to.

  27. ” The American hands the keys back to the bank, the bank sells the property and the new owner moves in. The bank takes the loss on its balance sheet and everyone moves on, older and hopefully a little wiser.”

    You are being ingenuous here. you make it sound as if people can up and walk away any time they feel like it.

    There are credit problems immediately as this action will be on the credit report right away.

    A secondary charge on the house, like a tax bill or utility bill cannot be walked from or another loan like a promissory note. you can be hunted down in the debt courts.

    A bank does not have to foreclose but could go for a court ordered sale. This will enabler the house to be sold at current market while any shortfall can be sued for in the debt courts.

    Not as easy to escape your responsibilities as you suggest David.

  28. [...] 101. You should give it a try some time. You know the drill. Please rebut point by point etc… Ireland Britain is among those few countries in the world that issues its own currency, determines its own [...]

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