Irish Bank Debt Negotiations : The Euro Area summit is 'a game changer' for Ireland

[PaddyJoe]

Bloomberg confirms what Gimore has been hinting at:

Ireland’s government will probably fail in its bid to secure an accord to reduce its legacy banking debt by the end of October, two people with direct knowledge of the talks said.

http://www.bloomberg.com/news/2012-0...nk-burden.html

[C. Flower]

Bloomberg confirms what Gimore has been hinting at:

http://www.bloomberg.com/news/2012-0...nk-burden.html

There was never any chance of it.

We are being manipulated and spun every step of the way.

[disability student]

There was never any chance of it.

We are being manipulated and spun every step of the way.

Exactly as no truth will ever come out from FG/Lab govt whatsoever when in power up to 2015/16. They will continue to spin and spin. They have no conscience at all as they are corrupt as FF too. Once they lied and will do so again now and in future as they can't change their leopard spots.

[PaddyJoe]

It looks like the whole 'game changer' thing is officially dead in the water now that it has been given the last rites by the IT.
Anglo Irish promissory notes? The ECB 'remains very sceptical'.
Direct capital injections in the Irish banks? 'Still in an early phase of development' and involve 'serious technical questions for which there is no obvious or straightforward solution'
Replacing the prom notes with government bonds? "This has raised legal concerns in the ECB, which wants to avoid breaking laws that prohibit the provision of direct financing to governments."
http://www.irishtimes.com/newspaper/...323741845.html

[Greengoddess]

It looks like the whole 'game changer' thing is officially dead in the water now that it has been given the last rites by the IT.
Anglo Irish promissory notes? The ECB 'remains very sceptical'.
Direct capital injections in the Irish banks? 'Still in an early phase of development' and involve 'serious technical questions for which there is no obvious or straightforward solution'
Replacing the prom notes with government bonds? "This has raised legal concerns in the ECB, which wants to avoid breaking laws that prohibit the provision of direct financing to governments."
http://www.irishtimes.com/newspaper/...323741845.html

But won't going back to the bond markets be easier? Or does going back to them raise more problems? There isn't much discussion about that in the media . In any event we are really in a place where if negotiations fail a sharp sword is needed

[C. Flower]

But won't going back to the bond markets be easier? Or does going back to them raise more problems? There isn't much discussion about that in the media . In any event we are really in a place where if negotiations fail a sharp sword is needed

We are. Do we not need to summon up a mutual support network of peripheral states ? Solo runs by Portugal, Greece and Ireland are being batted off by the larger states like irritating flies.

The next budget will change a lot and may, for a time, create conditions in which a government stand would have real popular backing. There is no chance of FG/Labour making such a stand, as the leaderships have more regard for the powerful EU states and institutions than they do for their own population who they see as geese for the plucking.

[C. Flower]

But won't going back to the bond markets be easier? Or does going back to them raise more problems? There isn't much discussion about that in the media . In any event we are really in a place where if negotiations fail a sharp sword is needed

There is, for good reason, more talk about a second "bailout" programme.

[barrym]

There is, for good reason, more talk about a second "bailout" programme.

I hate to say ITYS (I told you so) - way back on one of the many threads on the € shambles I said we'd be in a second bailout (called something else, we never have u-turns..) and we won't get any change in the loan terms, etc., etc.

This is classic media management - the IT and the others have been hand fed by the flacks of Merrion St., throughout this saga.

[disability student]

If the debt talks were going well as they -Merrion St gang wouldn't have leaked the info to IT.

This is classic media management - the IT and the others have been hand fed by the flacks of Merrion St., throughout this saga.

All the more reason to talk now about the second bailout as FG/Lab govt will have to pay PN backdating with interest from last March for the next 20 years. If that debt is to be written off (which is highly unlikely), then no need for 2nd bailout.

So more drastic & severe budget cuts next Dec and 3 next successive budgets.

The best source of info usually comes from Bloomberg,Reuters as they are more reliable than Merrion St.

[Greengoddess]

There seem to be various sources all over the media saying we are flavor of the month with investors etc. I wonder could we escape alive from all this after all.

[Greengoddess]

This for instance :
Central Bank Deputy Governor Stefan Gerlach has said that investors are expecting the Government will be successful in its negotiations with Europe about reducing the country's debt.

Mr Gerlach told RTÉ News that investors were "pricing in" further political developments and expecting there would be changes over the coming months.

He said sentiment towards Ireland had turned and people are now anticipating that Ireland will return to the markets very soon.

Mr Gerlach said investors are expecting yields, or interest rates, on Government bonds will continue to fall.

He said that as an investor you'd want to buy those bonds now and "pocket" the gains.

Reduced interest rates would mean better access to credit for firms and households.

There was a "much greater belief" in the financial community, he said, that Ireland was on the mend.

The yield on Irish bonds has fallen significantly since the ECB announcement on Thursday that it will begin buying government debt in larger quantities.

On unemployment, Mr Gerlach said it should fall well below 10% *but it was hard to say how many jobs had been permanently lost to the economy.

"If it is going to be 7%, 5% or 3 % I just can't say," he said.

[C. Flower]

This for instance :
Central Bank Deputy Governor Stefan Gerlach has said that investors are expecting the Government will be successful in its negotiations with Europe about reducing the country's debt.

Mr Gerlach told RTÉ News that investors were "pricing in" further political developments and expecting there would be changes over the coming months.

He said sentiment towards Ireland had turned and people are now anticipating that Ireland will return to the markets very soon.

Mr Gerlach said investors are expecting yields, or interest rates, on Government bonds will continue to fall.

He said that as an investor you'd want to buy those bonds now and "pocket" the gains.

Reduced interest rates would mean better access to credit for firms and households.

There was a "much greater belief" in the financial community, he said, that Ireland was on the mend.

The yield on Irish bonds has fallen significantly since the ECB announcement on Thursday that it will begin buying government debt in larger quantities.

On unemployment, Mr Gerlach said it should fall well below 10% *but it was hard to say how many jobs had been permanently lost to the economy.

"If it is going to be 7%, 5% or 3 % I just can't say," he said.

Yes - I heard that - a bit contradictory, to say the market had already priced in a deal for Ireland, and suggesting that bonds are still cheap.

[PaddyJoe]

Herman von Rompuy tweet this afternoon:

Herman Van Rompuy ‏@euHvR
Ireland is making such good progress on all fronts that since July Dublin is back to the international bond (cont) http://tl.gd/j7ajnq

There's a concerted offensive at the moment to big up Ireland as a shining example of how austerity works. It's designed for consumption in Spain and Italy.
The problem is that our debt levels are just as unsustainable as they were a year ago when a wide range of economists were screaming blue murder.
Maybe I've missed this 'game changer' but our debt as a % of GDP will continue to rise to at least 115% over the next two years.
Without growth and debt write downs we're still in an unsustainable position.

[PaddyJoe]

That 'game changer' deal needs to be done soon. Citigroup warned today that Irish debt levels will become unsustainable and investors will suffer losses unless growth improves.
CSO figures released today showed that GDP has contracted by 1.1% year on year since this quarter of 2011.

All of the optimism that Ireland can raise money in the markets and avoid a debt restructuring is premature as the nation struggles to emerge from its worst recession in modern history, said Michael Saunders, Citigroup Inc.’s head of European economics in London.
“Ireland faces an almost impossible task to get back to fiscal balance,” Saunders said. Visits to the country showed “life is tough, very tough and not getting that much better anytime soon,” he said.

“A lot depends on what kind of deal they get on the banks,” said Saunders, who has been in his post since 2003. “Will it significantly reduce the debt level? I’m not sure it will. If they don’t get relief, they are going to find it hard to fund themselves on a sustained basis at a tolerable yield and will be looking at some sort of second bailout program.”
Ireland’s debt may peak at 119 percent of GDP in 2013, the European Commission said on Sept. 18. That’s up from 25 percent of GDP in 2007.

http://www.bloomberg.com/news/2012-0...ro-credit.html

[Greengoddess]

That 'game changer' deal needs to be done soon. Citigroup warned today that Irish debt levels will become unsustainable and investors will suffer losses unless growth improves.
CSO figures released today showed that GDP has contracted by 1.1% year on year since this quarter of 2011.


http://www.bloomberg.com/news/2012-0...ro-credit.html

What does soon mean, PJ? I wonder what will change the game in the wrong direction. Will it be something sudden an shocking or a slow slide into default . I also wonder what will happen if we need another bailout. Or if we go back to the markets will there be more problems.