Go Back  PPRuNe Forums > PPRuNe Social > Jet Blast
Reload this Page >

Ireland, Debt & Insolvency

Jet Blast Topics that don't fit the other forums. Rules of Engagement apply.

Ireland, Debt & Insolvency

Old 30th Nov 2010, 04:49
  #201 (permalink)  
Ecce Homo! Loquitur...
Thread Starter
 
Join Date: Jul 2000
Location: Peripatetic
Posts: 9,916
I've been saying it here from the start, to the scorn of some others, but the popular opinion is increasingly turning to the same view; the debt owed by the banks is too great for the state and people to repay. Either a large haircut - 50-75% is taken by the foreign bond holders or Ireland should default.

And taking into regard the way the central European states and bank have rail roaded this deal through to try and save their own necks at the cost of the future of the future Irish generations, I'd suggest leaving the Euro would be both practical and pragmatic.

Ireland is lost for words on economic crisis

The Irish people do not fully understand the implications of the bailout – but their anger is fuelling demands for a default
ORAC is offline  
Old 30th Nov 2010, 07:47
  #202 (permalink)  
 
Join Date: Jan 2008
Location: There and here
Posts: 1,659
According to reports contagion is spreading to both Belgium and Italy where there has been a massive sell of of debt bonds. A question. As a transaction needs 2 sides, who (in their right mind) is purchasing said bonds from the sellers ? If the potential chance of default rises, the point of holding said bond makes less sense. Who is buying them ? Unless it's some super-complicated algorithm devised by a hedge fund that magically generates profit on loss ? I'm stumped.


SHJ
SpringHeeledJack is offline  
Old 30th Nov 2010, 07:55
  #203 (permalink)  
 
Join Date: Oct 2010
Location: Wayne Manor
Posts: 1,516
Added to the above ^^ i noted that the terms of some of the bail out loans were proposed on the basis of bilateral loan agreements !

stuckgear is offline  
Old 30th Nov 2010, 08:50
  #204 (permalink)  
 
Join Date: Mar 2008
Location: London
Posts: 736
Who is buying them ? Unless it's some super-complicated algorithm devised by a hedge fund that magically generates profit on loss ?
The hedge funds have certainly been profiting from the current volatility. I wouldn't be surprised if they've devised some cunning successor to their 'naked CDO' wheeze which the EU clamped down earlier this year. Hedge funds have been driven further underground (well, to Switzerland) over recent years, as a consequence their activities and strategies have become even more opaque.
dead_pan is offline  
Old 30th Nov 2010, 09:24
  #205 (permalink)  
 
Join Date: Mar 2008
Location: London
Posts: 736
Who is buying them ?
A mate of mine who was a banker at HBOS ('nuff said) recently described to me the market for distressed debt. When a firm is thought to be at risk of bankruptcy/Chapter 13, the firm's bond-holders are often approached by speculators ('vulture' hedge funds and the like) who offer to buy their holding at a discount, thereby allowing the bond-holder a quick exit. These new bond-holders then turn the screws on those organisations and individuals who guaranteed the firm's debt in the first place, in many cases seeking damages through the courts in addition to them honouring the face-value of the bonds.

Now, in Ireland we have several major banks in serious trouble, banks whose entire debt obligations were guaranteed by the Irish state a few years back, which in turn is now being guaranteed by the coffers of the IMF and EU. I suspect the market for distressed debt is booming in Ireland at the moment...

NB Further to my previous post, I wonder if hedge funds etc were in some way driving CDS spreads up in order to make it too expensive to for institutions to hold on to Irish govt bonds etc, and then snapping this debt up at a discount knowing full well the EU and IMF will at least cover the difference.
dead_pan is offline  
Old 1st Dec 2010, 02:52
  #206 (permalink)  
 
Join Date: Jan 2006
Location: Auckland, NZ
Posts: 144
Who is buying them ? Unless it's some super-complicated algorithm devised by a hedge fund that magically generates profit on loss ? I'm stumped.
Say you've got a $100 bond paying 6% that you expect to have to take a 50-75% haircut on. I pop along and tell you that I'll take it off your hands for $50.

Would you sell?
James 1077 is offline  
Old 1st Dec 2010, 09:19
  #207 (permalink)  
 
Join Date: Jan 2008
Location: There and here
Posts: 1,659
Would you sell?
Of course! Result! etc, but what is it in the purchaser ? They take on a calculated risk that will (hopefully) rise, but.....in the current climate it seems ever less likely that the back-stop of government insurance will be there and therefore the statistical chance of it being a dog rises very quickly indeed.



SHJ
SpringHeeledJack is offline  
Old 1st Dec 2010, 13:38
  #208 (permalink)  
 
Join Date: Oct 1999
Location: Ireland
Posts: 627
I've been saying it here from the start, to the scorn of some others, but the popular opinion is increasingly turning to the same view; the debt owed by the banks is too great for the state and people to repay. Either a large haircut - 50-75% is taken by the foreign bond holders or Ireland should default.
I agree ORAC and so do lot of others. Ireland I believe will inevitably default. The debt is too great and the interest rates too high. It will be extremely difficult to implement the cuts needed sufficiently to service the debt and there seems to be an assumption of growth that borders on the insanely optimistic.

The new government coming in 2011 will have a problem. I personally believe that any new government with a left wing element will have huge problems implementing the cuts needed. The amount of inertia in the public service is enormous and thus far they have shown little movement in terms of cuts. They will also probably want to renegotiate the terms when it becomes clear that they will be unable to service the loans.

It's far from over.
corsair is offline  
Old 1st Dec 2010, 14:20
  #209 (permalink)  
 
Join Date: Oct 2010
Location: Wayne Manor
Posts: 1,516
at what, 9% ?

so to resolve debt, the answer is to taken even more and even more expensive debt.

Ireland would most likely have been have been better off defaulting and letting the representative countries, like the UK bail out their over extended banks directly.

it seems politicians trying to find solutions to problems they have created, well outside of their level of expertise, don't under the concept "when you're in a hole, stop digging!"
stuckgear is offline  
Old 7th Dec 2010, 14:51
  #210 (permalink)  
bnt
 
Join Date: Feb 2007
Location: Dublin, Ireland. (No, I just live here.)
Posts: 714
Ireland's Budget Speech is in progress right now. If anyone outside the country fancies a laugh, you can watch online at RTE News. If anyone inside the country fancies a laugh, you'll be pleased to hear that alcohol tax won't be increased this time.
bnt is offline  
Old 7th Dec 2010, 21:37
  #211 (permalink)  
 
Join Date: Apr 2010
Location: anywhere they will will have me
Age: 78
Posts: 32
A piece in the Telegraph stated that the euro may well colapse,woopy do bring it on,taking with it the the whole eu farce hopefuly
skyfish2 is offline  
Old 8th Dec 2010, 15:24
  #212 (permalink)  
Uneasy Pleistocene Leftover
 
Join Date: Feb 2003
Location: Gone, but not forgotten apparently?! All forums marked "Private"...
Posts: 316
I regularly read the Economist magazine.

It may be interesting for some to read this article concerning Morgan Stanley featured in last week's print edition:
With $273 billion of client money Morgan is a minnow—its eight largest rivals all manage more than $1 trillion.
I believe that the author mean't to say $1 trillion each x 8 = $8 trillions "under management".

When compared to what the USA (and Federal Reserve), together with what the EU (and ECB) have managed to come up with in comparison (more precisely measured in the 10s or 100s of billions), in their joint efforts to somehow "safeguard western civilisation from financial armageddon", I would suggest that the capitalists have won (or at least their investment banks).

Next time I see a Ferrari parked nearby, I'll be glad to pee all over it (CC cameras notwithstanding). Not that the owner would necessarily notice...?! "The successful" businessman or whatever, will already have made his mind up. That is to continue the charade for as long as it lasts.

Why should taxpayers in developed countries be expected to cover the losses of their fellow citizens (if indeed the case - there may be another tangent to explore here...), when it's quite clear that wealthy 1st world citizens possess assets easily sufficient to shoo off any threat to the Euro for example, if they merely chose to do so. You may run and hide, but you will eventually be uncovered.

$8 trillions or thereabouts, managed by as many corporations as you have fingers on 2 hands. Buy a bottle of Scotch, indulge yerselves and sleep well tonight - it works for me. Tomorrows another day...
airship is offline  
Old 8th Dec 2010, 18:08
  #213 (permalink)  
 
Join Date: Mar 2008
Location: London
Posts: 736
I wonder what percentage of this $8 trillion is 'real' money i.e. backed by assets we all understand, and not those weird ethereal pseudo-assets which can disappear in the blink of eye?

Of course, money is only paper and metal if the whole financial system does come crashing down.
dead_pan is offline  
Old 8th Dec 2010, 20:30
  #214 (permalink)  
bnt
 
Join Date: Feb 2007
Location: Dublin, Ireland. (No, I just live here.)
Posts: 714
Like Greece, there's no way that Ireland could safely exit the Euro at this point. It would have to be a planned event, with an exit date and exchange rate announced in advance, but investors with money in Ireland (including locals) would not wait for that date: all the money would leave Ireland well before then, because that exchange rate would not hold for more than a second after the markets opened.

Or, to put it another way: any conditions for a safe exit would be much like the conditions that were in force at the time of entry. The economy would need to be stable, and you certainly can't say that at the moment. Someone in the UK might laugh the problem away - "we're quite safe, we're not even in the Euro zone" - but if the Irish economy truly collapsed, most major UK banks would go bankrupt due to the debt defaults, just as half the population of Dublin turned up in Holyhead, looking for work. You don't want that.
bnt is offline  
Old 11th Dec 2010, 04:39
  #215 (permalink)  
Registered User **
 
Join Date: May 2010
Location: Canberra, Australia
Posts: 38
Now it begins to make sense

An Irishman Telling It Like It Is ...

Bluey Snuttzov is offline  
Old 11th Dec 2010, 06:30
  #216 (permalink)  
 
Join Date: Apr 2002
Location: Hong Kong
Age: 52
Posts: 1,356
Love it! Brilliant.
Load Toad is offline  
Old 11th Dec 2010, 06:40
  #217 (permalink)  
 
Join Date: Jan 2008
Location: The Land of Beer and Chocolate
Age: 51
Posts: 794
"I'm senseing a wee bit of discontent".............

Class
hellsbrink is offline  
Old 11th Dec 2010, 08:17
  #218 (permalink)  
 
Join Date: Mar 2009
Location: SW England
Age: 72
Posts: 3,698
And right at the end, as if the poor guy wasn't depressed enough already

"Michael Flatley is coming to Chicago"

"F**k off!"

Priceless
Tankertrashnav is offline  
Old 11th Dec 2010, 08:47
  #219 (permalink)  
Ecce Homo! Loquitur...
Thread Starter
 
Join Date: Jul 2000
Location: Peripatetic
Posts: 9,916
No, he said "Michael Flatley is from Chicago"

Wiki: Flatley is a native of the South Side of Chicago, born to Irish parents. He began dancing lessons at 11 and, in 1975, became the first non-European resident to win the All-Ireland World Championship for Irish dance. He is a trained amateur boxer as well as a proficient flute player, having twice won the All-Ireland Competition. In dance, Flatley was taught by Dennis Dennehy at the Dennehy School of Irish Dance in Chicago, then went on to producing his own show. After graduating from Brother Rice High School, on Chicago's Southwest Side, he opened a dance school.

Personally, I'd be grateful......
ORAC is offline  
Old 11th Dec 2010, 10:07
  #220 (permalink)  
 
Join Date: Mar 2009
Location: SW England
Age: 72
Posts: 3,698
Cheers ORAC - obviously time to get the old lugholes syringed again! Still liked his incredulous "F**k Off" though"
Tankertrashnav is offline  

Thread Tools
Search this Thread

Contact Us Archive Advertising Cookie Policy Privacy Statement Terms of Service

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.