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Ireland bail-out: British banks hit as Irish rescue falters
The Telegraph ^ | 11/23/2010 | By Robert Winnett, Bruno Waterfield and James Kirkup

Posted on 11/22/2010 11:00:01 PM PST by bruinbirdman

British banks lost billions of pounds in value yesterday after the Irish bail-out was thrown into jeopardy over concerns that the country's government might collapse before a rescue deal can be agreed.

The share prices of Royal Bank of Scotland and Lloyds fell sharply as stock markets took fright at the political chaos engulfing Dublin.

It had been hoped that the £70 billion bail-out agreed between Ireland, the European Union and International Monetary Fund would ease investors' fears over the eurozone economies.

But within hours of the Irish government admitting it needed help, the Green party – on whom Prime Minister Brian Cowen relies for support – called for a general election by the end of January.The suggestion prompted a fall in the value of the London stock exchange and the euro and a rise in the cost of borrowing for both the Irish and Spanish governments. The head of the eurozone warned that "crazy" market speculators could turn on Portugal and Spain next.

British banks have more than £140 billion in outstanding loans to Ireland. RBS has forecast it will have about £10 billion in "impaired" Irish loans next year. Lloyds is expected to write off more than £1.6 billion.

If the bail-out fails, further outstanding loans could be in doubt. Yesterday, shares in RBS fell by almost five per cent and Lloyds fell by more than four per cent.

Last night, Mr Cowen insisted he would negotiate the rescue deal before dissolving the Irish parliament and calling an election in January.

In an emergency statement to Parliament, George Osborne announced that the British Government would play a leading role in the international bail-out with a direct loan worth several billion pounds to Ireland. The loan will add to this country's record government debts.

British taxpayers will also

(Excerpt) Read more at telegraph.co.uk ...


TOPICS: Business/Economy; Crime/Corruption; Foreign Affairs; News/Current Events
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1 posted on 11/22/2010 11:00:07 PM PST by bruinbirdman
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To: bruinbirdman

It is hard to believe that Irish bankers could create that much bad paper...


2 posted on 11/22/2010 11:05:12 PM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: April Lexington

They lent to Italy and Greece.


3 posted on 11/22/2010 11:12:51 PM PST by rahbert
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To: rahbert
Did they lend to Irish people who bought houses in Italy and Greece or did they lend to Italian and Greek home buyers?
4 posted on 11/22/2010 11:17:16 PM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: bruinbirdman

This nothing more than another central bankers scam!


5 posted on 11/22/2010 11:18:21 PM PST by taxtruth
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To: April Lexington
"It is hard to believe that Irish bankers could create that much bad paper..."

An up front commission with every loan every step of the way.

What's that, real estate agent and company, bank, secondary market, securitization, security sales, security/loan insurance. On a $250,000+ house X millions of them.

That is just the finance/real estate industry.

Countries all deficit spend. Every year they must sell trillions of debt. What happens when the bond market dries up, not just banks, countries?

Forced austerity? Only for countries that can't print money. Heck, the USA already needs to buy bonds from itself/The Fed.

In Ireland, they will have forced decreases in their SS/medicare equivalent. Forced reductions in their dole/welfare, etc.

The big picture goes way beyond fraudulent bankers going to jail or bankrupt banks.

yitbos

6 posted on 11/22/2010 11:19:30 PM PST by bruinbirdman ("Those who control language control minds." -- Ayn Rand)
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To: April Lexington

“British banks have more than £140 billion in outstanding loans to Ireland.”

This has been and will continue to be, about bailing out banks that encouraged housing bubbles all over the world.

In this case, it is the BRITISH banks that need the bailout, and the Irish people who will be forced to pay to repair those banks insolvent balance sheets. Like this country is bailing out Goldman and JPM, and the rest of the country can go to, well, you know, hell.

The whole world will before this is over.


7 posted on 11/22/2010 11:20:54 PM PST by TruthConquers (Delendae sunt publicae scholae)
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To: taxtruth

Next year we get to see who is swimming naked in State and local bonds and loans in the US.
Sounds like Sen. Dodd maybe has lost money on his Irish house.


8 posted on 11/22/2010 11:21:41 PM PST by Oldexpat
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To: taxtruth

Yup. And for that reason, we should hope that this attempt to prop up the Irish banks fails. The only way we get to the end of this is that bankers start taking losses - big losses - and central bankers start learning some humility.


9 posted on 11/22/2010 11:21:53 PM PST by NVDave
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To: bruinbirdman

Tick, tick, tick....


10 posted on 11/22/2010 11:24:15 PM PST by Humidston (For the first time in my adult life I FEAR my government.)
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To: NVDave
"Yup. And for that reason, we should hope that this attempt to prop up the Irish banks fails. "

The Irish Green Party, a big part of Irish socialist deficit spending, has withdrawn support for the governing coalition (which nationalized the biggest and worst banks) and is forcing elections in January.

yitbos

11 posted on 11/22/2010 11:30:06 PM PST by bruinbirdman ("Those who control language control minds." -- Ayn Rand)
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To: TruthConquers

Wow! So much for Irish independence and freedom. Barely 100 years and... poof! Owned by the Germans!


12 posted on 11/22/2010 11:33:40 PM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: bruinbirdman

I saw that. I don’t know if their political gambit will be enough to finally stop this charade of propping up stupidity at the banks.

Sooner or later, the Germans have to say “nicht mehr” and leave the French and Brits on the hook for their own cupidity.


13 posted on 11/22/2010 11:35:50 PM PST by NVDave
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To: TruthConquers
Why in heck would the Irish or Swiss or US government care if banks collapsed? Wouldn't Japanese banks and Chinese banks just step in on Monday morning to clean up the mess? Why burden the tax payers?
14 posted on 11/22/2010 11:36:10 PM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: NVDave

Ja, oder kein mehr!


15 posted on 11/22/2010 11:37:00 PM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: bruinbirdman
These governments don't have the kugels to cut spending to match tax revenues. They set the tax rates and then spend whatever they want to spend by borrowing the balance. The average tax payer is clueless as to how much the debt service costs. Thus, the tax payer gets the public benefit without realizing the cost. Unfortunately, the national credit cards are about maxed out!
16 posted on 11/22/2010 11:40:08 PM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: bruinbirdman

perhaps Ireland
can be profitably
converted into an amusement park.


17 posted on 11/22/2010 11:43:55 PM PST by Talf
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To: April Lexington
"They set the tax rates and then spend whatever they want to spend by borrowing the balance."

Well, we are going to see Brussels/Deutschland run Ireland's budget. In any case, during the upcoming depression, Ireland won't have the revenues and won't be able to print/borrow money to cover their deficit.

I hear Grease is selling islands to hit wealth distribution targets.

yitbos

18 posted on 11/22/2010 11:51:55 PM PST by bruinbirdman ("Those who control language control minds." -- Ayn Rand)
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To: bruinbirdman
If you do the math, you see that the Irish are now serfs of the Germans. They will spend generations paying off this loan... So much for the freedom thing...
19 posted on 11/23/2010 12:00:58 AM PST by April Lexington (Study the Constitution so you know what they are taking away!)
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To: bruinbirdman
I don't know how they hope to repay this loan. My research shows that this is their only export.


20 posted on 11/23/2010 12:09:25 AM PST by Lazlo in PA (Now living in a newly minted Red State.)
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