There are more Porsche Cayennes in Greece than people declaring income of 50K or more for tax purposes. If those fucking Greeks paid taxes to their own government they wouldn’t be in such big shit. Let em off at this stage.
Amount of cuts was put at 3.6 billion aswell. Bit coincidental.
Greek Government on the brink of collapse.
TDs (or the greek equivalent) are revolting against Padandreou and his majority is down to two seats. There is a confidence motion scheduled for Friday, which could signal the end of the current government.
You would be surprised how often they occur
Any chance it’s a cunning diversion tactic to make paying off the €1bn Anglo bond that’s due tomorrow more palatable?
I was thinking that about the arrest.
Ah sure look haven’t we €2.6bn left over, and one of the anglo lads locked up.
What a great day for Ireland.
Huzzah 
We’ll beat this fucking recession yet :guns:
Posted on broadsheet.ie. Makes for disturbing reading:
Tom Lyons, of The Sunday Times and co-author of The Fitzpatrick Tapes, went on Lunchtime on Newstalk (with Jonathan Healy) to discuss the arrest this morning of former Anglo director Willie McAteer (above) and the payment tomorrow of €750 million to the bank’s unsecured bondhoders.
This will tend to make you very upset. It’s turned Chompsky right off his food.
Jonathan Healy: “Tom, what do we know about the arrest this morning of William McAteer?”
Tom Lyons: Well we know that this is the second time that Willie McAteer has been arrested. The first time was in March 2010. The big issues facing Willie is his role as Finance Director and Chief Risk Officer of the bank, which meant he was somebody at the heart of the bank at the time when some big decisions were being made. The big, likely focus is going to be on the whole issue of Irish Life and Permanent and how €7 billion was used, was taken from Irish Life and Permanent and used to boost Anglo Irish Bank’s balance sheet at a crucial time as Finance Director and Chief Risk Officer. It’s obviously of great interest to the gardai what he might have known about this. And the second issue he’s gonna face is a personal issue, which relates to €8 million he borrowed from the bank.
Healy: ”€8 million?”
Lyons: ”€8 million. Which wouldn’t have been that much at the time. The issue is around how the loans were initially given. They were given with only…they were only secured on his Anglo shares, which promptly went to zero, so that was a big issue for him. He then changed this to full, personal recourse but I think the gardai are going to be asking questions about the circumstances of that and should have he been granted the loan in the first place.”
Healy: ”This is the second time he has been arrested. When was the last time he was detained? Do you have that…it was a couple of months ago if I remember?”
Lyons: “It was March 2010, so it’s a long…”
Healy: ”It’s over a year.”
Lyons: “It’s over a year ago, so you can see the very, very slow pace that this investigation is going at, that we’re only getting around to the questioning of the Finance Director of Anglo Irish Bank, for a second time, at this, at this very late stage.”
Healy: ”Ok, well he has been detained, as I said, under Section 4 of the Criminal Justice Act and that allows for him to be questioned for up to 24 hours, we’ll watch that space, Tom. But we’ll park that particular issue there for now because Anglo is in the news for a very different reason aswell. This payout to the senior bondholders, the unsecured bondholders, is it one of more than one? Do we know who is going to benefit to the tune of €750 million tomorrow?”
Lyons: “No, we don’t know which is one of the most outrageous things about it. We’ve got $1billion being paid out to various bondholders and we’ve no idea who they are or how much money they are going to make. We know that we’re paying them 100 cents in the Euro, they’re being paid, everything is being repaid to them.”
Healy: ”This is the full deal, even though they were unsecured so, effectively to use layman’s terms, they were taking a gamble by putting money into this bank, the bank is now closed, it’s gone and it is being wound up. Yet, they’re still getting the payout?”
Healy: This is the full deal, even though they were unsecured so, effectively to use layman’s terms, they were taking a gamble by putting money into this bank. The bank is now closed, it’s gone and it is being wound up. Yet, they’re still getting the payout?”
Lyons: Worse than that, the original people who would have put this bond up, most of them have sold out to hedge funds at say 20/30cents in the Dollar and they sold out because they figured ‘Ireland isn’t going to be foolish enough to repay us’/
Healy: ”Oh, how naive of them.”
Lyons: “So it’s the hedge funds that took the gamble that Ireland was going to repay 100 cents in the dollar who are going to clean up here. And I’m guessing there’s going to be a lot of people, very happy people in London and New York.”
Healy: ”And this is, as you said, effectively taxpayers’ money.”
Lyons: “This is effectively taxpayers’ money and this is an absolutely ginormous scandal and it just seems extraordinary that, you know, we have Willie McAteer, who’s been knocking around for three years now, being arrested on the very day before we make this outrageous payment.”
Healy: “On the payment, on the issue of the payment, the Government is saying: ’this is part of the deal that was done by the last coalition’. Now that excuse is wearing pretty thin at this point. But the real situation is that the European Central Bank, even if Michael Noonan wanted to burn these guys, which he’s suggested in the past, that he might have considered, they can’t because the European Central Bank is saying ‘I know you’d like to do this but you’d do untold damage to yourselves and you wouldn’t re-enter the market next year’.”
Lyons: ”Well I think the real thing with the European Central Bank is that it has hundreds of billions, it has pumped hundreds of billions into the Irish economy and, as a result of that, it’s keeping the banks open, it doesn’t want to see a default in anyway, in terms of Ireland at this time. It’s trying to limit the disaster to Greece and keep it down there…”
Healy: Which is difficult…
Lyons: ”Which is difficult and it’s going to be the Irish who are going to have to pay the price for that. So we’ve been very, very good and we’re paying bondholders, who most people would expect, with a bank crash, you would expect those people wouldn’t be paid in full.”
Healy: ”But the point that’s being made, and it was made on Newstalk Breakfast this morning, was that if we decide ‘hang on a second, the Greeks are getting a 50% haircut, we’re going to sting the bondholders here aswell, that is, in the short term, you’ll obviously get the benefit of the $1billion or the 700 and odd million euro but, in the long term, you’d be doing reputational damage. And the one thing that the Irish have been very good at so far is trying to restore our battered reputation internationally. Is there any argument for that, because that’s what the Government is saying is probably the main reason why we are, painful and all as it is, paying out this money tomorrow?”
Lyons: Well that’s the argument being put forward by the Government and if that’s the case you’d wonder why they won’t disclose the names of the bondholders/
Healy: ”And why won’t they?”
Lyons: “If we could see that they were big pension funds from Germany, who are going to back us in the future, if we could see that they were blue-chip banks, who are going to back us in the future, I could, you could certainly see their argument. If it’s a case that it’s not blue-chip people that are going to support us in the future, but instead it’s speculators, I think that would be a very different argument that we would be having but unfortunately those names are being kept secret.”
Healy: ”Will we ever find out who these guys are, because is this going to go into infamy as a group of people who will be popping the champagne corks tomorrow, the Irish people will have to suck up €3.6 billion cuts in the budget and we’ll never know who these guys were?”
Lyons: It’ll take an extraordinary leak for it to happen because it’s, certainly, these types of things, they aren’t accessible under the Freedom of Information Act We can’t do an FOI to the NTMA and I also think that in terms of doing an FOI to the Department of Finance, it also wouldn’t work. I think it’s something that we’re just going to have to suck it up and hope that the Government is correct in its position and that eventually we will be able to return to the markets. But it is worth recalling that this is, this $1billion, there will be other billion dollars next year, which will have to be repaid, who are similar, who are similarily in a weak position and you wonder are they going to be paid in full too?”
Healy: “But those guys are probably laughing now because they’re saying ‘ah look the Irish, much and all as we expected them to default, in some shape of form, sure they’re happily towing the ECB line, we’re gonna get our money next year’.”
Lyons: “Well absolutely, I mean they’ve been rewarded for taking a risk in buying…or the people who bought these bonds at less than 100 cents in the Euro at say 20 or 30 cents in the Euro, they are being rewarded magnificently to the tune of hundreds of millions.”
That’s pretty sickening indeed. Having read Anglo Republic recently, it seems to me that there’s grounds for dozens of arrests and convictions rather than this tokenism ahead of the pay-out tomorrow.
Its retarded that we are paying back the bonds on a dead bank, but in the interest of fairness it should be pointed out that the bond never traded below 55c and even then was only at those levels for a day or two.
The size of that accounting error is gas. It’s 2.3% of GDP, that’s massive in terms of the amount we are looking to close the deficit by.
The timing is suspect, but it’s still great news in fairness. Not that it will make a blind bit of difference to proposed cuts. But if you took that money, and told the Anglo bond holders to fuck off we’d be up to €5bn savings without cutting anything.
I think the world is fucked.
All this needs is one of the French Banks to go and we are goosed
On the plus side the EU are going to end up having to print money and give us some.
Can everyone just call everything quits and move on?
Whatever happened to Michael Noonan’s “burden sharing”?
Whatever happened to Leo Varadkar’s “not a cent more”?
They would never have deliberately lied to win a general election would they?
It looks as if the Greek government is going to collapse anyway and there won’t be any referendum at all. Can’t be letting people have a say in this kind of thing.
Michael Noonans speech to the Dail in December 2010:
Bailout deal a ‘downright obscenity’
This deal is a very bad deal and in one respect it is a downright obscenity.
Ireland’s sovereign debt is manageable, but once the banking liabilities incurred by the Government were added to the sovereign debt the situation could no longer be sustained.
This is why Ireland could no longer borrow in the markets. This is why the IMF and the EU are bailing us out. The direct cause of the banking crisis is the Government’s banking policy which has led directly to the IMF/EU bailout which we are now discussing.
It’s worth recalling the liabilities of the Irish Banks which the Government decided to cover since September 2008:
• €440 billion of eligible institutions guaranteed under the CIFS and ELG schemes;
• €80 billion of property and associated impaired loans from the banks to be purchased by NAMA in exchange for Government guaranteed bonds;
• €31 billion upfront capital support in the form of promissory notes and SIS which has brought the general Government deficit to 32% of GDP in 2010 (11.9% initially expected). The bailout plan has increased the debt burden for the Government and has lead to sovereign downgrades. The terms of the bailout insist that a further €17 billion of loans be transferred to NAMA by the year end. NAMA are signalling additional discounts on this tranche of loans so a considerable additional cost to the Irish Treasury will be added to the €33 billion.
There are increasing market tensions which may add further to Ireland’s debt burden, with increasing concerns that the position will become unsustainable.
Despite all this the Government failed to negotiate a burden sharing arrangement for non-guaranteed bank debt as part of the bailout arrangement.
Ireland’s commitments on sovereign debt must be honoured in full. Ireland’s commitments on debt under guarantee must be honoured in full.
What legal or moral compulsion is on Ireland, however, to honour in full debt incurred by Irish banks when there was no State involvement in the arrangements? These loans were entered into freely by willing lenders to willing borrowers. The interest rate charged represented the risk at the time and there never was a State liability. It is obscene that liability for these loans is now being transferred to the taxpayer.
There is €10 billion of subordinated debt in the Irish banks. There is €15 billion of non-guaranteed senior debt. The Irish Government and the Irish taxpayer has no liability whatsoever for these debts, but the bailout deal is now forcing them to accept liability because the it puts this imposition on them.
So the Minister in his Budget reduces social welfare payments, he punishes the blind, the disabled, widows and carers and the unemployed, he taxes the poorest at work and for what?
So that the taxpayer can take on liability for debts that the country never incurred, and that arose from private arrangements between private institutions.
What a disaster!
What an obscenity!
How can the Government stand over it?
How can our European colleagues stand over it?
When the deal was agreed there was an attempt to justify it because any re-negotiation of bank debt in Ireland could have a major adverse effect on those banks in Germany, France and the UK that have lent to Irish banks. This consideration may have been valid sometime ago, but it is no longer valid. The latest available data shows that a major portion of Irish guaranteed bank debt has been sold on at a discount to hedge funds in the USA, the UK and Luxembourg as well as to smaller speculative investors. This data is available through Clearstream and Euroclear.
If, for example, a hedge fund buys Irish unguaranteed bank debt at 80 cents in the euro, it stands to make 25% on its investment if Ireland continues to guarantee to redeem the debt at par. The position has now become indefensible – that the Irish taxpayer, even the very poorest taxpayers, should be required to underpin the speculation of hedge fund investors.
There must be burden sharing of bank debt, transparent, open, negotiated burden sharing. It must deal with both subordinate debt and non-guaranteed senior debt.
If the EU find this approach unacceptable for fear of a knock on effect in Europe, and if the Irish taxpayer is expected to underpin the banking system in other member states, then where is the quid pro quo?
The Icelandic Government has negotiated 15 year money at 3.2% from the UK and Dutch Governments. Ireland is being charged 5.8% and at least one tranche of EU funding has a built in profit margin of 2.9%. This is not solidarity, this is not in accordance with the spirit of Article 122 of the Treaty.
The Government’s negotiations have led to a very bad deal. The deal needs to be re-negotiated and Fine Gael will look for a mandate to do so.
Might only be a matter of time before another military dictatorship is put in place. The Yanks might have to do it again as the French and Germans have lost their touch for that kind of thing.