Eurozone is preparing to jettison the PIIGS: FT

He3

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Summarising - fiscal union or bust?
 


evercloserunion

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Summarising - fiscal union or bust?
Well there are several points which Munchau makes in the article, that would be a summary of one of them.
 

Slippers 2

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Even if the Irish Goverment did decide to pull out of the euro, where would they get the legal right to rob Rabobank of its Irish euro deposits and to replace them with Irish Pesos?

Bearing in mind that Rabobank's internet accounts are held by an entity with a Dutch banking licence?

I don't think I've gotten chapter and verse on where the Irish State has this power - although I've posed the question more than once.
Deposits are not money in a bank, they are a record of how much the bank owes to each customer. That's why they are under liabilities on a balance sheet (p.148).
 

ivnryn

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Deposits are not money in a bank, they are a record of how much the bank owes to each customer. That's why they are under liabilities on a balance sheet (p.148).
I wonder what Rabo would do if ordered to redesignate all Euros held by Irish residents into Punts.

Effectively, they would make a massive profit, as they could buy Punts much cheaper than the official rate. OTOH, it would count as ripping off their customers. Maybe they would convert at a rate better than IEP 1 for each Euro.
 

derm0t

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What if Ireland left the euro zone? - The Irish Times - Fri, Feb 20, 2009

If Ireland were to leave the euro zone, the currency in which your savings were held would be the least of your problems. Bluntly, the State would be a basket case. Bad and all as our current situation is, one of the few saving graces is that we are part of the euro zone and can rely on the support that being part of that larger, more stable group and currency offers.
As a standalone currency, in our present parlous economic situation and with the dripfeed of reports of questionable operations at some of our largest financial institutions, we would find ourselves prey to currency speculators. Comparisons with Iceland would be more than just a bad joke; they would be very real.
My best guess is that money in prize bonds and in any Irish- domiciled financial institution would be converted to punts or whatever the determined conversion rate was at the point of departure from the euro zone.

The situation with accounts held by institutions that would remain within the euro zone is even less clear. It is possible that these would continue to be denominated in euro, although it could operate in the same manner as Irish accounts with UK group Northern Rock.
Contrary view from the Torygraph:

http://blogs.telegraph.co.uk/news/danielhannan/100022574/what-would-happen-if-a-state-left-the-euro/

Of course, one could argue that leaving the EU – and with it the Social Chapter, the 48-hour week, the Common Agricultural Policy and the rest of the apparatus of Euro-corporatism – might suit some countries very well, making their exports more competitive and allowing them to price themselves into the market.
*

From the pov of ex-pats, there's a different implication. If your savings are in
US$, CA$, PMs or whatever, then a devalued Irish currency (punt) would
make repatriation more of an option than it is now ----- actually, repatriation
is unthinkable for many of the people I know, as it's just too expensive.

Selfish, I know.
 

Passer-by

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Funny how all p.ie's Euroluvvies were able to respond to this thread yet never dared to show their faces on the recent Intel thread (they of the six figures Yes to Lisbon campaign) on the likelihood of Intel exporting jobs from Ireland to Israel......funny that....
Nice moving the goal-posts there KN particularly coming 2 posts after Sondagefaux quotes from Munchau's article where he says:

The Schäuble proposal as it stands would require a full-blown change in the European treaties – and nobody wants to go down that route right now. Some of his suggestions are unbelievably extreme, for example depriving countries with excessive deficits of their democratic voting rights, or withholding payments under the EU’s cohesion fund. There will be no majority for any of this, let alone the unanimity that such a change would require.
I also like the way in your headline you turn one man - Schäuble - into "The Eurozone". Perhaps if he drops dead the Eurosceptics will get to see "The Eurozone" die? :)
 

Oreo Livermore

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I don't care whether he's a EU supporter or a BNP member. The man has joined the ranks of the irrational by suggesting it is possible to leave the euro. I'm still waiting for any of the 'leave-the-euro' crowd to explain how it could be done.

I explained it to you years ago.

It will have happened and you still will be saying it is impossible
 

kerdasi amaq

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Introducing a new currency; could be the salvation of the country. If it's done properly.​
 

Cassandra Syndrome

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I run an export business. If our current accounts were converted to punt we would collapse as we could no longer trade. To avoid this, we would offshore our accounts and possibly just move the whole business abroad.

It would not be possible to return the punt and remain as a free, democratic, first world nation.
And you support a socialist party? If you have no issue with all your means of production being publically owned, why are you scared of taking a risk with going Punty? ;)
 

southwestkerry

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... some weeks back I did knock about the idea that the Gers really want to get shut off problematic little nations like Greece and off course one or two more.
I still think that is what they would like to do as the euro is too well bedded in between Germany and France to decide to go it alone with their own new mark.
 
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If the Euro broke up and all the exiting countries devalued by about 40% but stayed in the EU, then there would be a massive inflow of capital into some of these countries from the core. It could be a 2nd Celtic tiger.
Clearly what we should do is connive at being ushered out of the euro in an orderly fashion and devalue by 30% and lock in the new rates. Our national debt would have to be redenominated in new punts as part of the agreement. I would have to have some notice so that I could move my savings off shore.
 

He3

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Figure this one out

"We clarified the technical arrangements that would enable us to take coordinated action which could be swiftly put into place in the event it is necessary," Luxembourg prime minister Jean-Claude Juncker told reporters today after leading a meeting of euro-area finance ministers in Brussels.

Faced with the harshest test in the euro's 11-year history, the European Union broke its taboo against aid to cash-strapped governments while insisting that Greece will overcome its debt crisis on its own.

Loan guarantees wouldn't be part of the EU package, Mr Juncker said.
EU to present Greek aid plan - The Irish Times - Mon, Mar 15, 2010
 

kerrynorth

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evercloserunion

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They are making things worse by talking in riddles. They want to give the markets the impression that they are prepared to come to Greece's aid but cannot overcome the fact that it will just not wash in Germany to do so. Going by the language it seems that no agreement has been reached and if the markets come after Greece they will be thrown to the wolves.
I agree that they need be be clear about their intentions but at the same time the EU is navigating through largely uncharted territory, legally and economically. We have to be careful in what we do and say here, we don't want to commit ourselves to anything we might regret later.
 
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A chain can only be as strong as its weakeat link. Right now, WE ARE THE WEAKEST LINK IN THE EUROZONE. NOT GREECE.

It makes perfect sense that the economically viable states should want to sever the parasite states.

There is already a working example of how the eurozone could lose a few of the weraker member states. Argentine duel currencey. During the nineties an Argentine worker was paid in Argentine dollars. When lodged in a bank, this money converted into US dollars.

We here in Ireland could do the same. Work for soverigh currencey and trade internationally in a hard currencey.

Dont be afraid to dream big dreams.
 
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anewbeginning

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What currency union could prosper with the type of clowns we have in Ireland and Greece running the country to benefit narrow elites, and never taking the longer view, about creating sustainable employment and economic development.

We spent the best years of the boom building ghost estates, or rather FF developers did, when we should have been building factories.

Had we built factories and invested in the right technology we could be today world leaders in producing wind turbines, or any number of technologies.
 

FalseFlag

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Judge a man not on his words, but by his actions, as the late David Ervine would say.
The title of the thread is a misrepresentation of the facts. Leave the lazy journalism to the red top rags.

That's a bingo!
 


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