Buying/Selling Irish Govt Bonds in Ireland?

retep

Well-known member
Joined
May 25, 2007
Messages
1,730
Can anyone explain to me with regard to Irish bonds, why, if the savings deposits of Irish people held within the country are stated to be in the region of €300 billion (Correction circa €90 billion!) and rising due to the uncertainty in the economy that, instead of going to the international markets and offering the prospect for Gunther in a bank in Dusseldorf or Li in Hong Kong to make a handsome profit of 7%+ p/a on Irish Ten Year bonds, why isn't this option thrown open to the Irish public as an alternative to deposit account savings on which they are probably earning a maximum of 3.55%. (Per current info in askaboutmoney.com)

Surely if the state were to offer even a 5% 10 year bond directly to and confined to the Irish citizens, this would serve to attract even a small proportion of the €300 billion in deposits into State bonds or it it just a conspiracy theory to suggest that the Irish govt has more allegience and is biased to the International bond Markets and Irish FInancial Institutions than it is to it's citizens it (they) have some sort of vested interest in seeing the institutions and the bond markets profit from the crisis rather than Irish citizens?

I know the Govt last year launched the new State Investment Solidarity Bond but that doesn't offer anywhere near 7% return that Irish Bonds are currently selling at so I'm just wondering and am well open to correction if I am wrong on my take on this?
 
Last edited:


Theoryboy

Member
Joined
Sep 13, 2010
Messages
14
If we make it to the bond market next year and the yield is still high, it may be prudent for the Government to alter the return on the National Solidarity Bond.
 

Cassandra Syndrome

Well-known member
Joined
Aug 23, 2009
Messages
16,885
Irish Household deposit savings are €85 Billion and most of that is needed in the short to mid term. If people buy bonds they would have to hold on to them for a long time or else sell them in the secondary market, which requires a large minimum value. Also the volume needed in the primary market is high.

Furthermore there was a National Solidarity Bond scheme released during the year which raised €2 Billion. Would you buy Irish Bonds? I wouldn't touch them for 20%
 

Baddaddy

Well-known member
Joined
Oct 3, 2010
Messages
548
Irish Household deposit savings are €85 Billion and most of that is needed in the short to mid term. If people buy bonds they would have to hold on to them for a long time or else sell them in the secondary market, which requires a large minimum value. Also the volume needed in the primary market is high.

Furthermore there was a National Solidarity Bond scheme released during the year which raised €2 Billion. Would you buy Irish Bonds? I wouldn't touch them for 20%
I thought the household figure was €96.2bn, with an expectation to reach €100bn next year.
 

Harmonica

Well-known member
Joined
Jul 2, 2009
Messages
5,797
Furthermore there was a National Solidarity Bond scheme released during the year which raised €2 Billion. Would you buy Irish Bonds? I wouldn't touch them for 20%
I see the advert for them yesterday & its 50% over 10 years. Have to stay 10 years to the last 40%. Couldn't bothered to work that out but its obviously below 5% a year.
 

HarshBuzz

Well-known member
Joined
Feb 28, 2008
Messages
11,815
I see the advert for them yesterday & its 50% over 10 years. Have to stay 10 years to the last 40%. Couldn't bothered to work that out but its obviously below 5% a year.
poor return for an investment with a ~40% probability of default
 

Cassandra Syndrome

Well-known member
Joined
Aug 23, 2009
Messages
16,885
I thought the household figure was €96.2bn, with an expectation to reach €100bn next year.
Its about €85 Billion. Total M2 Money supply including all other deposits is around the €180 to €190 Billion.

The broadest M3 measure fell dramatically to €181 Billion in September.
 

Tombo

1
Joined
Aug 27, 2009
Messages
5,302
It is a joke alright. I still hearing them advertise "Solidarity Bonds" with a 4% return over 10 years, when oyu can buy a 10 year bond at over 7.5%.

You can buy Irish government bonds if you have a large enough sum, via a broker.

Alternatively, said broker might know of an ETF for Irish Government Bonds.

Or another alternative, look into spread trading companies. With interest rates so low, that could be a liquid and cheap enough option to access that 3.5% annual premium you would get by not falling for the Solidarity Bond advertising bollocks.
 


New Threads

Popular Threads

Most Replies

Top