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

[MPB]

Gump has run up the white flag. No deal on bank debt before the budget he says.

http://www.breakingnews.ie/ireland/b...ed-569416.html

Why would the ECB fund a sovereign, when that sovereign is quite prepared to force it,s citizens to pay the debts of an insolvent banking system, that is the responsibility of the ECB?

The politicians are not in charge, the bankers are.

[Baron von Biffo]

Why would the ECB fund a sovereign, when that sovereign is quite prepared to force it,s citizens to pay the debts of an insolvent banking system, that is the responsibility of the ECB?

The politicians are not in charge, the bankers are.

That's the downside of democracy - You get who you vote for.

[PaddyJoe]

Interesting blog from WSJ journalist Matina Stevis:

BRUSSELS—The debate on when the euro-zone bailout fund will be able to directly recapitalize banks rumbled on Friday, with a senior euro-zone official saying it can only happen once the new banking supervisor has established a clear track record.

The comments chime with a German view that recapitalizations won't be possible from the start of next year even if member states can pull off what appears increasingly unlikely: overcoming their differences and setting up a single supervisor for the currency bloc's banks by January 2013.

This prolonged process isn't what market participants and many of the euro-zone countries had understood following what leaders presented as a watershed moment in the euro-zone crisis last June.

So we can forget about any movement on bank debt probably for at least a year.
And that's being optimistic.
http://online.wsj.com/article/SB1000...sj_share_tweet

[Dr. FIVE]

Closer to the lead up to locals the better. Dont think they care about anything outside of that tbh

[MPB]

Any deal on bank debt will always be tomorrow, never today. That is how politicians get to serve full terms.

The insolvency in the banking system will be hidden with cheap and unending supplies of ECB money, aided and abetted by the FED.

The solution will come when the insolvency in the real economy, i.e European Citizens, smothers the Central Banks and causes the banks to do what should have happened to 80% of them 4 years ago. Collapse.

[PaddyJoe]

Draghi was in the European Parliament today:

Mr Draghi also said that the central bank can?t and won't print money.

"We should remember that the ECB cannot undertake monetary financing, cannot replace what other member states should do," Mr Draghi told lawmakers in Brussels in his capacity as head of the European Systemic Risk Board.

"This is true for Ireland, and this is true for every other case like this. It's too easy to think that the ECB can replace governments' action, or lack of it, by printing money. That's not going to happen."

It couldn't really be made any clearer, could it? As far as the ECB is concerned ever last penny pumped in to Anglo in the form of ELA will have to be repaid.
http://www.irishtimes.com/newspaper/...reaking24.html

[DCon]

Legacy debt will not be covered. That hope is gone. Time to move on.

If proof was needed:

zerohedge ‏@zerohedge

SCHAEUBLE CALLS CONCEPT OF LEGACY ASSETS A 'PHANTOM' IDEA

As discussed on the ESM thread, and detailed by Brian Lucey today, it is time for FG to grow a pair, and tell Honohan we will not be paying the Promissory Notes.

[DCon]

Shane Ross asking Kenny if hopes of a bank debt deal are melting by the day.

Quoting Regling as saying the legacy debt has not been discussed.

Kenny says it is not disappearing. The European Council meetings are complex and varied..

Kenny made it clear to Van Rompuy that the legacy debt issue is causing problems in the here and now. Says banking Union proposals need to be brought forward

On Prom Notes, Kenny says we are trying to unravel the deal. Noonan has made some progress. Trying to push out the next payment date

Kenny listing all the Politicians who are in favour of a deal for Ireland. Must not realise that the Independent Central Bank are against it.

Ross says Merkel is the most important politician, and asks Kenny how often he is in touch with her. Suggests Kenny invite her to the football game on Friday

[PaddyJoe]

Noonan negotiating through the Wall St Journal this evening:

"Our success in implementing the program has strengthened our case because Europe needs a success," he said. "There is a recognition that for Ireland to be really successful" the burden of the debt has to be lightened.

Mr. Noonan said that the June 29 summit decision to look at ways of relieving Ireland of its legacy bank costs was an "agreement made at the level of heads of state and government" and therefore nobody else could "vary" it.

"The position is that the Irish debt will peak at 120% of GDP [next year] and that is a sustainable position in terms of servicing the debt," he said. "But the servicing of that debt is putting a drag on potential growth rates. So, to achieve the potential growth rate in the economy it is important that the Irish debt is made more sustainable, which was the commitment that was made on 29th June by our colleagues in Europe."

The battle is being fought in the US press as well as in Europe. Loads of positivity from the NYT, Bloomberg, and Playboy Time on the Irish situation in the last week or so
http://online.wsj.com/article/SB1000...sj_share_tweet

[Greengoddess]

Fall in bond yields below

http://www.irishtimes.com/newspaper/...reaking23.html

Surely this is good news. What difference will it make to the economy if we can go back to the markets? We will be our own master again for onw thing. The debt overhang will still hang though. Maybe these bond markets know something we don't about the debt negotiations .

[morticia]

As discussed on the ESM thread, and detailed by Brian Lucey today, it is time for FG to grow a pair, and tell Honohan we will not be paying the Promissory Notes.

Well, if they won't do legacy debt, how about providing them with some new banking black holes??

Mortgages, anyone?? 115odd bn of which 20% at least is in dodgyville

[Greengoddess]

Progressive policy summit

http://www.irishtimes.com/newspaper/...reaking48.html

[PaddyJoe]

Fall in bond yields below

http://www.irishtimes.com/newspaper/...reaking23.html

Surely this is good news. What difference will it make to the economy if we can go back to the markets? We will be our own master again for onw thing. The debt overhang will still hang though. Maybe these bond markets know something we don't about the debt negotiations .

This Davy analyst doesn't seem too convinced. Well, you asked

The interest rate, or yield, on the Government’s nine-year bond fell by a 0.17 percentage point or 17 basis points to 4.76 per cent after touching 4.74 per cent, the lowest level since June 2010.

Stephen Lyons, analyst at stockbrokers Davy, said the generally low volume of trading in Irish government bonds meant a few big trades on any positive news could push bond yields lower. “Our view is that this is not really a new story but a positive headline in a buoyant market has given them a bit of zest,” he said.

http://www.irishtimes.com/newspaper/...325224385.html

[Dr. FIVE]

sniff

http://www.irishtimes.com/newspaper/...325223007.html

[Dr. FIVE]

Enda says he hasn't contacted PMs of Germany, Finland or Holland since the statement.