Wednesday, 24 November 2010

Ireland needs the IMF .................

By way of introduction, here's a really simple over view.  Irish banks were given 'easy credit' during the 90as and into the 21st Century by the European Central Bank (this is quite different from the funds given to the Irish Government by the EEC as grants etc etc). Interest rates were low, and there was an almost endless supply of credit. The Irish Banks then lent that money to property developers, corporations, mortgage holders. Many of these loans were suspect from the start. They also bought Derivatives as an 'investment'. In fact the vast bulk of the money the Irish Banks borrowed was gambled on derviatives.

This 'new' lending business made the shares of these Irish banks rise to such an extent that they were overvalued, that is to say the banks did not have the REALISABLE assets to back those share prices.

When this became apparant, the share prices tumbled, and then the 'economic crisis' hit.... and now they are technically insolvent. If they were any other business, they'd be placed into administration and creditors would be paid of with what ever resources available. Being that these banks are High Street Banks the first to get paid off HAVE TO BE THE HIGH STREET CUSTOMERS., the desposit accounts, the cash that is realisable.... the rest get what's left....

Instead what is happening is this : the Irish Government is borrowing more money (at interest) to give to the Irish banks (as loans, or by buying shares, thus nationalising the banks) to strat to pay off the European Central Bank debts of the Banks (close to 500 billion in total!).

The first 100 Billion Euros will cost an extra 6.5 Billion Euros annually in interest alone...

And so the Irish people are being FORCED to underwrite these transactions. And pay yet more interest. They are being FORCED to pay for debts they did not incur.

Letting the banks collapse would cost about 3-4 billion if the Irish Goivernment guaranteed all the Oridnary Irish Account holders....

1. This article reveals who the Irish Government are borrowing money for to pay - and it has nothing to do with Irish peoples pension funds, nor any real threat to the banking sector...

"on one side we have Ireland whose bond holders, its people, have between them a total GDP wealth of 0.207 trillion euros.  Who are being FORCED, against their will, to pay Anglo Irish bank's debts to its bond holders, who between them hold 20.8 Trillion euros."


"With a bold and brilliantly conceived thesis, skillfully and cogently threaded through more than 500 pages of trenchant writing, Klein may well have revealed the master narrative of our time. And because the pattern she exposes could govern our future as well, The Shock Doctrine could turn out to be among the most important books of the decade."
- William S. Kowinski, San Francisco Chronicle"

"In THE SHOCK DOCTRINE, Naomi Klein explodes the myth that the global free market triumphed democratically. Exposing the thinking, the money trail and the puppet strings behind the world-changing crises and wars of the last four decades, The Shock Doctrine is the gripping story of how America’s “free market” policies have come to dominate the world-- through the exploitation of disaster-shocked people and countries.

At the most chaotic juncture in Iraq’s civil war, a new law is unveiled that would allow Shell and BP to claim the country’s vast oil reserves…. Immediately following September 11, the Bush Administration quietly out-sources the running of the “War on Terror” to Halliburton and Blackwater…. After a tsunami wipes out the coasts of Southeast Asia, the pristine beaches are auctioned off to tourist resorts.... New Orleans’s residents, scattered from Hurricane Katrina, discover that their public housing, hospitals and schools will never be reopened…. These events are examples of “the shock doctrine”:"

Here's a documentary on her book. The book itself  is way better, 'thoroughly well researched and referenced (so ya can check the facts for yerself!) .... cos ya gotta know the detail and the scope to REALLY get it... 

3. And here's my song : Ireland needs the IMF like Anne Frank needed a Drumkit, like the Children need The Vatican, Like Ghandi needed a haircut!

..... and here's hoping that Anne frank would take this in pretty much the same way, were she alive to day. Her spirit is.

Sing along and ENJOY it! The Chorus is built for harmonies!

Resist. Learn. Grow strong!

Kindest regards


Do what you love, it's Your Gift to Universe

Bookmark and Share


alastair said...

Fact. In this deepening global depression people are all too aware that those who hold the monetary wealth very rarely deserve it, and if some deserve a little more than the rest of us then it should only be a little bit more for working selflessly. There are several billion of us who could very easily take it all back and redistribute the world's remaining resources. There may even be enough for everyone's basic needs while healing the planet.
The most important wealth in coming decades is going to be social capital, and money can't buy that. Money cannot buy good parenting, home produced food, and a healthy place in a sustainable community. In terms of enlightened self interest it would be best to give the money back and start growing some social capital.

corneilius said...

Well said Alistair. I agree.