After Friday's Panic, Will Ireland Go the Way of Greece??????

Discussion in 'Wall St. News' started by S2007S, Sep 20, 2010.

  1. S2007S

    S2007S

    Why the fuck are we going to worry about Ireland being the next greece?? The greece crisis came and went without a problem, they were bailed out just like the rest of the world and happy days were back once again. There is no such thing as panic anymore, even the credit crisis here in the US was an easy fix, just keep printing money and running up a deficit and everything will be A-OK.

    Are we going to see more fake bank stress tests in the next month or 2 as the world continues to sell worthless bonds, most likely yes.



    After Friday's Panic, Will Ireland Go the Way of Greece?
    Published: Monday, 20 Sep 2010 | 6:22 AM ET
    Text Size
    By: Antonia Oprita
    Web Producer, CNBC.com



    A planned auction for Irish government bonds is likely to go ahead despite jitters concerning the country's banks and debt that roiled markets Friday, analysts said Monday.

    Some are already saying that the Irish situation seems to repeat that of Greece, where market panic exacerbated an already-bad debt problem. Others, though, say problems at the country formerly known as the Celtic Tiger are nowhere near those of Greece.

    Ireland plans to reopen two bond issues, maturing in 2014 and 2018, to add between 1 billion euros ($1.3 billion) and 1.5 billion euros at the auction, according to the debt agency's NTMA's Web site.

    "I think it will be a decent auction," Brian Devine, in charge of economic research at independent securities firm NCB, told CNBC.com from Dublin.

    Irish stocks fell and the cost of insuring Irish debt hit a record high Friday, following a report by investment bank Barclays Capital that suggested the government should ask bond holders in failed banks to foot part of the bill for bailing them out.

    The report also suggested that, if growth did not return, the country might be forced to ask for the aid of the European Union and the International Monetary Fund, but it acknowledged that Ireland's funding needs were met for this year.

    "I think a lot of it is just a matter of perception," Devine said.

    A PR Situation

    Irish officials denied market speculation that they plan to request aid, but the European Central Bank had to intervene in Irish bonds to calm investors, according to some reports.

    The Financial Times wrote that the ECB's intervention was relatively small, in the range of tens of millions of euros.

    "It's clear that Ireland has got quite a lot on its hands so it needs to regain some trust," Guillaume Salomon, a fixed income strategist at TD Securities, said. "It's very similar to Greece, it's some sort of a PR situation here."

    But there is a "big difference" between Greece and Ireland, according to Devine. Greece needed to roll over about 30 billion euros of debt, whereas Ireland's funding needs are covered until the second half of next year, he said.

    Greece's debt burden was already high when the crisis hit, whereas Ireland entered the crisis with just 25 percent of gross domestic product government debt, and the country does not have Greece's credibility problems, Devine added.

    Noises pointing to the need for more austerity measures for Ireland are increasing. On Sunday, Finance Minister Brian Lenihan told Irish paper Tribune that low-income earners will have to pay tax, as a system that excludes them is no longer sustainable.

    And on Monday, central bank governor Patrick Honohan conceded that the country may not reach its target to cut its budget deficit to 3 percent of gross domestic product by 2014 as agreed with the European Union because the economy is likely to be weaker than expected.