ESRI: No threat of Irish default

evercloserunion

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I don't know if this comes as a surprise to anybody because I hadn't heard anyone seriously talking about an imminent Irish sovereign default, but according to the FT the Economic and Social Research Institute has said that Ireland is not likely to default on its debt any time soon, despite its recent splashing out on NAMA and Anglo.

FT.com / Europe - Threat of Ireland debt default dismissed
The Economic and Social Research Institute said the net cost to the state of the bank bail-out could reach €25bn ($34bn, £22bn), or 15 per cent of gross domestic product, which is in line with the fiscal costs of banking crises in other economies.

Is the €25bn figure correct do you think?
 


T

The_Big_Fellow

No one believes that a default is imminent. It is very possible within the next ten years though.
 

SideysGhost

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Now you should all be afraid - the ESRI have a pretty solid record as a contra-indicator :lol:

In saying that, there's no old debt to be rolled over in 2010 so the Gubbermunt might get another 12 months out of this charade yet.
 
T

The_Big_Fellow

Now you should all be afraid - the ESRI have a pretty solid record as a contra-indicator :lol:

In saying that, there's no old debt to be rolled over in 2010 so the Gubbermunt might get another 12 months out of this charade yet.
The ESRI have an exceptionally poor record.

It is the compounding of debt that is our real concern.
 

Cassandra Syndrome

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Yep as Sidey says no rollovers until 2011. But what we will have this year is a failed bond auction which is a technical default and arguably worse as we cannot raise money to run the country as opposed to paying debt off.
 

An Gilladaker

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Now you should all be afraid - the ESRI have a pretty solid record as a contra-indicator :lol:

In saying that, there's no old debt to be rolled over in 2010 so the Gubbermunt might get another 12 months out of this charade yet.
They are simply the best that money can buy If only we knew how much they get paid and who appoints them
 
T

The_Big_Fellow

Yep as Sidey says no rollovers until 2011. But what we will have this year is a failed bond auction which is a technical default and arguably worse as we cannot raise money to run the country as opposed to paying debt off.
That would be likely. There is so much debt being sold this year, that unstable bets such as this state, must rank very low. We are the part of a balanced portfolio that offers high yields, high returns.
 

Conor

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Yep as Sidey says no rollovers until 2011. But what we will have this year is a failed bond auction which is a technical default and arguably worse as we cannot raise money to run the country as opposed to paying debt off.
I bet we won't.
 

WTTR

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Then our banks will be Zombie Banks for the foreseeable future

Is the €25bn figure correct do you think?
There will be a another €80billion involved in the jumbo proportion of retail mortgages which on the law of averages will eventually (within next three years) go bad.

House prices rose by 3 to 5 times between 1996 and 2007. Everything reverts to the mean; house prices first, then the mortgages.

The €80billion from foreign investors fueled the rise in houses. They are listed as Bondholders in the B/S of the banks.

If we do not bail them out; then our banks will be Zombie Banks for the foreseeable future! They will be unable to lend for productive purposes etc. Is there an alternative? Look up http://www.politics.ie/economy/127772-morgan-kelly-legend-4.html#post2597874
 

hammer

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We criticise the fact that some property owners & developers are only paying interest on their mortgages.

What are the Government doing with National Debt but only paying INTEREST :)

Can you imagine the deficit if capital had to be repaid :)
 

constitutionus

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I'm sure I read at the weekend (maybe McWilliams) that, during most of the big crashes, it was a full three years later that the defaults started happening. Which would suggest mid-2011 this time. I'm not predicting that it will happen, but perhaps that's when the biggest risk will be.
yup.

everyone knows 1929, not eveyone remembers '31 when the shyte really hit the fan again.

the possibility of ye old double dip aint gone away you know :)
 

just_society3

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Add this to other gems like:

'The property market will have a soft landing'

'The Irish banks are well capitalized'

'Cheapest bailout'

'Anglo-Irish bank is of systemic importance'

'NAMA is the only show in town'

'The property market has hit bottom'
 

orbit

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You didn't show the final graph

which doesn't include Ireland (?) but given our younger population, I would imagine that our position is not as dire as many of these.

The point that this blogger misses, is that Greece's standing in the financial markets hasn't taken a beating due to its debt position - rather it is due to its cooking of the books, where nobody knows whether their numbers can be trusted.

Also, I don't see what difference there is between new borrowing and roll-overs. If anything, roll-overs ought to be less controversial, because they don't signify an increase in net debt.
 

He3

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I don't know if this comes as a surprise to anybody because I hadn't heard anyone seriously talking about an imminent Irish sovereign default, but according to the FT the Economic and Social Research Institute has said that Ireland is not likely to default on its debt any time soon, despite its recent splashing out on NAMA and Anglo.

FT.com / Europe - Threat of Ireland debt default dismissed
The Economic and Social Research Institute said the net cost to the state of the bank bail-out could reach €25bn ($34bn, £22bn), or 15 per cent of gross domestic product, which is in line with the fiscal costs of banking crises in other economies.

Is the €25bn figure correct do you think?
Who is funding the ESRI and why?
 

Cassandra Syndrome

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