Merkel tells collapsing Ireland to accept German hegemony.

M

MohdSalleh

http://www.montrealgazette.com/busi...Portugal+hits+panic+button/3831814/story.html

Ireland has resisted growing international pressure to accept EU financial assistance amid concerns that this would lead to a surrender of political and economic sovereignty.

However, the German government is expected to signal that Ireland may have to accept a pounds 77?billion bail-out, along with a loss of economic and political independence, as the price of preserving the euro.

Mrs Merkel said that the single currency was "the glue that holds Europe together".
 
Expect more and more of this to come in the future - government stealing from citizens in order to fund their inefficiency, waste, and needless spending of the past. From the article:




George Papandreou, the Greek Prime Minister, said new European-wide taxes may now be needed to fund bail-outs.

"We need a mechanism which can be funded through different forms and different ways," he said. "My proposal is that taxes such as a financial tax or carbon dioxide taxes could be important revenues and resources for funding such a mechanism."



How would you feel if you were a citizen from a financially sound/responsible country and would now be subjected to so-called "European-wide" taxes?! Yikes. No wonder they are rioting.
 
So what if Ireland or Greece defaults on their bonds? Why would that destroy the euro? When Orange County defaulted did it destroy the dollar?

Europe has created this problem for itself by trying to create the illusion that all euro-sovereign debt is the same. It isn't. Investors will learn that, and the bond market will impose discipline on these countries with far more efficiency than the EC or Germany can.
 
Ireland just needs to hit the reset button on their debt. They should cancel all gov't contracts at all levels of gov't, pass a strict exception free balanced budget law for all levels of gov't, default on all gov't debt, and then renegotiate only the gov't contracts that are absolutely needed in a way that the cost is sustainable. There would of course be some pain in the early years. But, with the yoke of debt and interest payments removed, Ireland would be much stronger in the long run.
 
Quote from endsongs:

Ireland just needs to hit the reset button on their debt. They should cancel all gov't contracts at all levels of gov't, pass a strict exception free balanced budget law for all levels of gov't, default on all gov't debt, and then renegotiate only the gov't contracts that are absolutely needed in a way that the cost is sustainable. There would of course be some pain in the early years. But, with the yoke of debt and interest payments removed, Ireland would be much stronger in the long run.
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Ireland will obey IMF or Eurozone policy or condemn themselves to the status of pariah on the international level.

This could change in years to come but for now this is the score.
 
Quote from Scataphagos:

When you go overboard on debt, you need to be prepared to accept some distasteful things others force upon you.
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it depends. if you owe the bank enough you own the bank. that is what that scoundrel bernanke is hoping the Chinese will believe,
china and the rest of asia are calling his bluff.
 
Ireland should tell Merkel to go eff herself. Ireland was able to service its debt before she opened her obese pie hole and claimed that bondholders would have to take a haircut on the losses, even after the Emergency facility was set up to prevent just that.

She then waited a full 10 days to back away from that statement, but the damage was already done.

So yields on the debt go through the roof, now making it unsustainable to service that debt. Germany does not like the fact that Ireland has a low business tax regime and that many German re-insurers have domiciled there.

If Ireland has to take a bailout, then they will be forced to change that tax haven benefit, thereby making them almost irrelevant overnight.

Without the dregs of the EMU keeping the Euro low, Germany would never be able to compete with china and experience the kind of export led growth they've had.

Germany should be on the Dooshmark, with it trading around 1DM= 2 USD.
 
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