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Ireland is United States 4th Largest Creditor Nation ($264.3 Bn)

Destiny's Soldier

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From around $30 Billion in 2008 Ireland now owns $264.3 Billion of US Govt debt.

The question is: Who owns the debt should the US ever default on their repayments? Is it the Irish people or the Banks and Businesses based here?

Is this overall good for business or bad for business?

http://www.irishtimes.com/business/economy/ireland-is-america-s-fourth-largest-creditor-treasury-department-1.2650688

Ireland emerged as America’s fourth-largest creditor following China, Japan and the Cayman Islands after the US government revised the way it reports the figures.

Investors in the European nation owned $264.3 billion of Treasuries at the end of March, based on official data issued Monday. China is the largest holder with a $1.24 trillion stake. Japan is next with $1.14 trillion, followed by the Cayman Islands with $265 billion.

Ireland’s holdings are bigger than the size of its economy, which is worth about $230 billion for a population of less than five million. One potential explanation is the large number of fund managers and other companies based in the country for its tax incentives.


Note: in the webtext for image location the word "derivatives" is embedded.

I think this needs a discussion.
 


johnnypockets

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I would assume this is a reflection of how many investment companies have decided to locate here for the tax breaks?
 

gerhard dengler

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From around $30 Billion in 2008 Ireland now owns $264.3 Billion of US Govt debt.

The question is: Who owns the debt should the US ever default on their repayments? Is it the Irish people or the Banks and Businesses based here?

Is this overall good for business or bad for business?

Ireland is America





Note: in the webtext for image location the word "derivatives" is embedded.

I think this needs a discussion.
A very interest post SoD.

The $264b figure is interesting in itself - what is as interesting is the increase in holdings from $30bn to $264bn in less than 8 years.

Ireland is the geographical location for these holdings but I doubt that Ireland is the proprietary owner for these holdings.
Maybe the Belgian office has been redeployed to Ireland?
 

gleeful

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Could this be the likes of Apple holding their money offshore? US corps that make profits abroad are liable for 35% tax if they return those profits to the US - but if they never do return them, they never have to pay the tax.
 

gerhard dengler

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Could this be the likes of Apple holding their money offshore? US corps that make profits abroad are liable for 35% tax if they return those profits to the US - but if they never do return them, they never have to pay the tax.
This is holdings of US government debt.

US government sells bonds to investors in exchange for funds, on the basis that the funds will be repaid with interest at some point in the future.
 

Destiny's Soldier

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I would assume this is a reflection of how many investment companies have decided to locate here for the tax breaks?
Don't you think there is something odd about the meteoric rise in debt ownership from the crash in 2008?

The Irish Govt has form for the policy of guaranteeing unsecured bonds. Is this rise in debt ownership an indication that should the US ever default, bond holders are confident they will be bailed out by the taxpayer?

We're only $700 million behind the Cayman Islands, so in a few years we'll be in 3rd place behind the Japanese.
 

gleeful

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Don't you think there is something odd about the meteoric rise in debt ownership from the crash in 2008?

The Irish Govt has form for the policy of guaranteeing unsecured bonds. Is this rise in debt ownership an indication that should the US ever default, bond holders are confident they will be bailed out by the taxpayer?

We're only $700 million behind the Cayman Islands, so in a few years we'll be in 3rd place behind the Japanese.
Not odd at all. The US created trillions of new debt since 2008, and someone bought that. They also have a loopy tax system where they tax foreign profits of their corporations only if they bring those profits back - so they are promoting the holding of US debt abroad.
 

Destiny's Soldier

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Not odd at all. The US created trillions of new debt since 2008, and someone bought that. They also have a loopy tax system where they tax foreign profits of their corporations only if they bring those profits back - so they are promoting the holding of US debt abroad.
OK but why Ireland particularly -not the city of London for example. Why the big attraction to be based in Ireland ?

If the Irish Exchequer gets a return then good for us. But what are the risks?
 

Watcher2

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From around $30 Billion in 2008 Ireland now owns $264.3 Billion of US Govt debt.

The question is: Who owns the debt should the US ever default on their repayments? Is it the Irish people or the Banks and Businesses based here?

Is this overall good for business or bad for business?

Ireland is America





Note: in the webtext for image location the word "derivatives" is embedded.

I think this needs a discussion.
"“It’s all just foreign banks, funds and corporates based here,” said Owen Callan, a fixed-income analyst at Cantor Fitzgerald in Dublin."

Nothing really to see here unless the above quote is wrong.
 

gleeful

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OK but why Ireland particularly -not the city of London for example. Why the big attraction to be based in Ireland ?

If the Irish Exchequer gets a return then good for us. But what are the risks?
Probably here rather than London to avoid UK tax.

I don't see any risks, or benefits, to Ireland in this.
 

Watcher2

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Don't you think there is something odd about the meteoric rise in debt ownership from the crash in 2008?

The Irish Govt has form for the policy of guaranteeing unsecured bonds. Is this rise in debt ownership an indication that should the US ever default, bond holders are confident they will be bailed out by the taxpayer?

We're only $700 million behind the Cayman Islands, so in a few years we'll be in 3rd place behind the Japanese.
I have been saying for a long time on here that there is simply too much debt in the world, including Ireland.
 

gerhard dengler

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I remember reading that over half of all US government debt is owned by the American citizen.

In the event of a US default, certain holders of US government denominated debt would take precedence over other holders of US government denominated debt.
At a guess, I think it's reasonable to assume that US domestic creditors might get preferential treatment over foreign creditors in that context.
 

gleeful

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I remember reading that over half of all US government debt is owned by the American citizen.

In the event of a US default, certain holders of US government denominated debt would take precedence over other holders of US government denominated debt.
At a guess, I think it's reasonable to assume that US domestic creditors might get preferential treatment over foreign creditors in that context.
The US will never default - they will just print more money. They could pay off their entire debt today at the touch of a keyboard.
 

Trainwreck

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From around $30 Billion in 2008 Ireland now owns $264.3 Billion of US Govt debt.

The question is: Who owns the debt should the US ever default on their repayments? Is it the Irish people or the Banks and Businesses based here?

Is this overall good for business or bad for business?

Ireland is America





Note: in the webtext for image location the word "derivatives" is embedded.

I think this needs a discussion.

Ireland (I am guessing you meant Irish people "Ireland" does own anything) does not own $264 billion in US bonds.


There are investment funds domiciled in Ireland, that manage the money of insurance companies, pension funds and the like from all over the world.

They hold the debt.


You can sleep safely.
 

Eire1976

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The Irish people own no debt unless the Irish Government has been purchasing it on our behalf, considering that we can't pay our own way, I highly doubt that.
 

Notachipanoaktree

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The US will never default - they will just print more money. They could pay off their entire debt today at the touch of a keyboard.
That doesn't make you fear for the future? If not then you are a fully fledged member of the Gombeen class, and doing very nicely thank you very much, yeah?
 

Trainwreck

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The Irish people own no debt unless the Irish Government has been purchasing it on our behalf, considering that we can't pay our own way, I highly doubt that.
Quite.

WTF would we be doing €160 billion in debt if we had €200 billion stuffed under the mattress.
 

gleeful

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Just ask yourself. What will Hillary/Trump do? Now, how do we stand 2020+?
For this it doesn't matter. If one of them changed the US tax system so that foreign profits were not taxed in the US, that might see a flood of cash return to the US. They may attempt to tax those profits without the need for them to be repatriated - but that would see US bonds being sold.

More likely is nothing will change.
 


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