World Ireland Is Second Euro Nation to Seek Aid as Banks Wobble

[The Helper]

Ireland became the second euro country to seek a rescue as the cost of saving its banks threatened a rerun of the Greek debt crisis that destabilized the currency.

The euro erased gains and Irish bonds pared an early advance after Moody’s Investors Service said a “ multi-notch” downgrade in Ireland’s Aa2 credit rating was “most likely.” The prospect of January elections loomed as the Green Party said it would pull out of Prime Minister Brian Cowen’s coalition.

A package that Goldman Sachs Group Inc. estimates may total 95 billion euros ($130 billion) failed to damp speculation that Portugal and Spain would need to tap the emergency fund set up by the European Union and International Monetary Fund after the Greece rescue.

“It probably won’t halt contagion. The sovereign crisis isn’t yet over,” said Sylvain Broyer, chief euro-region economist at Natixis in Frankfurt. “Ireland is in the middle of a difficult crisis.”

Ireland Becomes Second Euro Nation to Seek Aid

Ireland became the second euro country to seek a rescue as the cost of saving its banks threatened a rerun of the Greek debt crisis that destabilized the currency.

www.bloomberg.com

 

[Ninja_sheep]

That sucks.

I'm just so glad Switzerland isn't in the EU.
It would just be so much trouble.

 

[Wiseman_2]

Yeah... and to think Tony Bliar wanted to take us into the Euro. We dodged a bullet on that one.

 

[Jindo]

Yeah... and to think Tony Bliar wanted to take us into the Euro. We dodged a bullet on that one.

Very true

 

[Sharp]

Yeah... and to think Tony Bliar wanted to take us into the Euro. We dodged a bullet on that one.

I would not call that a bullet

 

[NoobImbaPro]

there is a saying that ireland men are the north greeks


PROVEN

 

[Wiseman_2]

Well, having said that we dodged a bullet, we're still bailing them out, aren't we? A fat lot of good the whole Eurozone is turning out to be.

 

[CatCat]

I'm not too sure.... You can't expect to have a lot to say in world politics without being a major power these days. On top of that, the current top players will probably become further marginalized than before due to rapidly rising economies such as India, Brazil, china, compared to the stagnant west. Uniting Europe as one entity does seem like a strategic plan to me in the long run.

 

[Wiseman_2]

In theory, a major trade union in uniting the EU is a good idea. In practice, it means loss of national identity, bureaucratic rules that mean participating countries must fork over monstrous amounts of cash annually, handing power over to the central (unelected) power, a weak currency that was predicted to be a failure before it was even launched, and more countries than ever being allowed to enter the Eurovision song contest (Azerbaijan? Really?).

We should have stuck with the EU trade treaties we had in the late 20th century. There was at least some prosperity back then.

 

[The Helper]

Irish unveil harshest cuts, tax hikes in history

DUBLIN – Ireland unveiled the harshest budget measures in its history Wednesday, a four-year plan to slash deficits euro15 billion ($20 billion) so it can get a massive bailout from the European Union and the International Monetary Fund.

The plan seeks to cut euro10 billion ($13.3 billion) from spending and raise euro5 billion ($6.7 billion) in extra taxes from 2011 to 2014. It axes thousands of state jobs, welfare benefits, and pension payments while raising university fees and taxes, forcing even Prime Minister Brian Cowen to concede it will hurt the living standard of everyone in the nation.

Analysts, meanwhile, feared that the size of the EU-IMF bailout — estimated at euro85 billion ($115 billion) — will be too little to save Ireland from an eventual default.

And bank shares plummeted for a third straight day on the Irish Stock Exchange in growing expectation that investors would be wiped out if the government is forced to seize total control of the country's two dominant banks, Allied Irish and Bank of Ireland.

More.

 

[The Helper]

Irish banks get downgraded as bailout fears grow

DUBLIN – Ireland's banks were hit with downgrades Friday — one to junk bond status — as speculation mounted that an EU-IMF bailout of Ireland could require senior bondholders to help cover the massive losses.

Prime Minister Brian Cowen saw his own hold on power slip another notch, as his ruling Fianna Fail party lost a special election for a long-empty seat in parliament. The winner vowed to force Cowen from office before he can pass an emergency 2011 budget being demanded as part of the international rescue.

The New York-based Standard & Poor's credit ratings agency said it was lowering Anglo Irish Bank six notches to a junk-bond B grade. It also cut the ratings on Bank of Ireland one notch to BBB+, and downgraded both Allied Irish Banks and Irish Life & Permanent one notch to BBB.

The agency said bonds issued by Anglo are particularly at risk of being discounted as part of an euro85 billion ($113 billion) rescue mission by the European Union and the International Monetary Fund. It says Ireland "may be forced to reconsider its current supportive stance toward Anglo's unguaranteed debt."

More.