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IMF/ECB response to Ireland's deficit?


truthflyer

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Feb 5, 2009
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61
Considering the popular consensus is that it is only a matter of time before Ireland goes cap in hand to the IMF/ECB for a bail out, two questions.....

1) When is Ireland likely to require the assistance of the IMF/ECB?

2) How deep will the cuts be that the IMF/ECB impose on the public sector?
 

eoghanacht

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Apr 18, 2006
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1) By the end of the first qtr of next year, Decembers budget (if not before that) and the reaction to it will tell.

2)Hopefully from the top down! i mean the very top
 

the_rebubblican

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Mar 24, 2010
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We're not going to do it on our own. Before we cut anymore we should go to the EU and clarify what we can draw down if necessary. Also the 3% deficit rule will not be attainable by 2014. If we push it out to 2020 we'd make life a lot easier, even 2017 would help. The markets know it's not achievable, the next government may be forced into negotiation with Angela and Nicolas if action man Cowen doesn't do it. We're living in a fantasy...
 

jpc

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We're not going to do it on our own. Before we cut anymore we should go to the EU and clarify what we can draw down if necessary. Also the 3% deficit rule will not be attainable by 2014. If we push it out to 2020 we'd make life a lot easier, even 2017 would help. The markets know it's not achievable, the next government may be forced into negotiation with Angela and Nicolas if action man Cowen doesn't do it. We're living in a fantasy...
+1
People are going to realise this sooner than they realise.
 

eoghanacht

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+1
People are going to realise this sooner than they realise.
Is it possible to realise something before you realise it?
 

libertarian-right

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We're not going to do it on our own. Before we cut anymore we should go to the EU and clarify what we can draw down if necessary. Also the 3% deficit rule will not be attainable by 2014. If we push it out to 2020 we'd make life a lot easier, even 2017 would help. The markets know it's not achievable,
If we push it out to 2020, the deficit is so huge that it will squash us eventually with a huge burden of debt and interest repayments. How do you expect us to achieve it by 2017/2020 with such a huge deficit? That's pushing out the inevitable.
 

SideysGhost

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Nov 30, 2009
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We're not going to do it on our own. Before we cut anymore we should go to the EU and clarify what we can draw down if necessary. Also the 3% deficit rule will not be attainable by 2014. If we push it out to 2020 we'd make life a lot easier, even 2017 would help. The markets know it's not achievable, the next government may be forced into negotiation with Angela and Nicolas if action man Cowen doesn't do it. We're living in a fantasy...
Eh yeah and pushing out the reaching of 3% to 2020 means our useless politicians will borrow another €40bn or so in unnecessary additional debt that your children will still be repaying in 30 years time.

We're living in a fanstasy world yeah, but the problem is that most of the people who disagree with the current fantastical lunacy of St Lendahand are also mad bug-eyed worshippers of the Magic Money Tree.

Only a tiny tiny minority in Ireland are anywhere close to reality, as these various sects of a bizarre and discredited Belief squabble amongst themselves for dominance, and all the while the country accelerates towards the cliff.
 

Cassandra Syndrome

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I think the Feds are now finally out of ammo. With no more fresh liquidity, it will be interesting to see how the markets will react.

Food and energy inflation is another issue.
 

jpc

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Is it possible to realise something before you realise it?
Given the fantasy world that Ireland inc has existed in since 2002 would many have realised that they didn't realise there was a lack of reality around.:D
 

eoghanacht

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Given the fantasy world that Ireland inc has existed in since 2002 would many have realised that they didn't realise there was a lack of reality around.:D
I didn't realise then again it's all relative, that is to say there are known knowns, known unknowns and unknown unknowns
 

the_rebubblican

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Mar 24, 2010
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If we push it out to 2020, the deficit is so huge that it will squash us eventually with a huge burden of debt and interest repayments. How do you expect us to achieve it by 2017/2020 with such a huge deficit? That's pushing out the inevitable.
If we get a Eurozone wide derogation on the 2014 return the markets would ease up on our borrowing costs. I'm not advocating avoiding cuts and raising taxes, I do think that the speed and burden of retrenchment and tax raising will stun the economy for years so much so that we'll lose a lot in relation to fellow EU economies. Germany and France have flagrantly broken the 3% rule in the past. If it suits France to avoid meeting their obligations by 2014 they'll just do it. If we do it we'll be marginalised further. There should be a way to provide a road map to the 3% limit which would be easier than the route taken. If this was endorsed by the EU it would lift sentiment here and sentiment abroad about us. As it stands we'll be pushed to the shadows and margins if we accelerate ourselves so quickly into deflating the economy. It's a delicate balance, it requires leadership and political nous...so we're f**ked...
 

Cork1234

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May 21, 2010
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I would say late 2011.

Hopefully crippling. Hopefully they will shove croke park up their h***s
 

libertarian-right

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If we get a Eurozone wide derogation on the 2014 return the markets would ease up on our borrowing costs. I'm not advocating avoiding cuts and raising taxes, I do think that the speed and burden of retrenchment and tax raising will stun the economy for years so much ...
But you dont realise, taxes/cuts will be needed to fund the interest repayments for the national debt that will kept rising due to the deficit not being cut and dragged out over more then a decade (2020). 1.9 billion spent last year on interest repayments, so far its 2.2 billion for 2010. NTMA predicts nearly 25% of income tax will go towards the interest payments by 2014 and that's going by Fianna Fail's plan to reduce the deficit!! How in God's name can we prolong that to 2020? Both cases are doomed to fail. We've reached the point of no return.
 

derm0t

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334
Hopefully it'll occur during the watch of the current FF/Grn/PD Junta.
 

SideysGhost

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IIRC we've borrowed enough this year already to see us through till around May 2011. I'd expect a spring/summer 2011 election, leaving the incoming Govt to deal with the unexploded landmines of all the short-term borrowing that needs rolled over in 2012.
 

LeDroit

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Mar 11, 2010
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1,771
We have ourselves funded until this time next year. Even if our bond spreads increase or our deficit increases we're funded for another year.
 

Ulster-Lad

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Oct 26, 2006
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Ireland cannot afford debt, warns former IMF chief

Well being as the OP had the other thread closed on this for posting a link and not commenting this seems a god place to post the comments from the link.

A former chief economist at the International Monetary Fund (IMF) has warned that by 2015 every Irish family will be in debt to the tune of €200,000 and that the children born in Ireland this year "will be paying off debts for decades to come".
He has also warned that Ireland was effectively insolvent, with little chance of servicing its debts under current government policies, and that "financial markets are beginning to see Ireland as Europe's next Greece".
Ireland cannot afford debt, warns former IMF chief - Irish, Business - Independent.ie

Ireland has been truly let down by this government. Of course they will deny this but the facts speak for themselves.
 

the_rebubblican

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Mar 24, 2010
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We've reached the point of no return.
True we've reached that point, asking a country to roll over and die for perception that suits international markets and our fellow EU countries is too much a price. It's too steep a deceleration is my point, time to ask our masters for another way out. Greece will go first of course but a change in policy will have to come.

Ironically it's becoming clear that all that this government has done as a mere holding policy. They'll pass the poison chalice on next year when the really hard choices will be made.
 

truthflyer

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Feb 5, 2009
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Next relevant question is, how long will it be before Ireland and the other PIGS nations are given a carrot/incentive to leave the Euro???
 

Cato

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Aug 21, 2005
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True we've reached that point, asking a country to roll over and die for perception that suits international markets and our fellow EU countries is too much a price. It's too steep a deceleration is my point, time to ask our masters for another way out. Greece will go first of course but a change in policy will have to come.

Ironically it's becoming clear that all that this government has done as a mere holding policy. They'll pass the poison chalice on next year when the really hard choices will be made.
Bingo. If you think things are bad now wait until the land-mine that FF/Greens have left behind explodes after the next election. The next government will have some serious decisions to make and will not be able/permitted to put off the ugly day as the FFs and Greens have.
 
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