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People in Iceland are not happy about being stuck with the bill for bank liabilities and in particular for Internet bank Icesave whose depositors were reimbursed by the UK and Netherlands governments, who now want Iceland to reimburse them.  It’s an ongoing saga, though one without the heroics of sagas past –

The bill, covering repayment of a $5.3 billion loan, which would saddle each citizen with $16,400 in debt equivalent to 45 percent of 2009 economic output, sought to cover U.K. and Dutch depositor claims after the 2008 failure of Landsbanki Islands hf, which set up the Icesave accounts, and unfreeze the international bailout.

But now look at the most egregious aspects of what the Irish government announced today (and we’ll generously leave AIB, the bank whose name kept coming up in the Tribunals, out of the picture).

Another 18 billion for Anglo on top of the 4 billion they have already, and nearly 3 billion for Irish Nationwide.  And that’s not counting the NAMA loan purchases, since at least in that case there are some actual assets apparently receiving diligent valuation.

So that’s 25 billion euro going into insolvent financial institutions, institutions whose business model is gone with the wind.   Expressed in other ways, 15 percent of GDP, or €5680 for every man, woman, and child in the country — not to buy anything, not to loan to anybody, but to keep up past commitments made by these two institutions.

Incidentally, in the USA, the AIG bailout became the most politically damaging for the government when it was revealed that a key part of the bailout involved keeping whole the returns of the counterparties to whom AIG had offered insurance on debt obligations.  The public eventually was told the identities of these counterparty beneficiaries, and that type of bailout wouldn’t happen any more.

In Ireland, we still don’t know who is being protected by the Anglo and Irish Nationwide cash infusions, and there is still no special windup regime for such institutions.  Maybe we’re not like Iceland and so we won’t put this latest commitment to a referendum.  But could we at least get the names of the people on whose behalf each of us just took on nearly €6000 in debt?

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9 Responses to “Iresave”

  1. # Comment by Eoin Mar 31st, 2010 12:03

    “we still don’t know who is being protected by the Anglo and Irish Nationwide cash infusions…”

    This struck me very forcefully this morning when people began talking about lines being drawn in the sand and using the words transparency and visibility like they mean nothing.

  2. # Comment by Betty Mar 31st, 2010 20:03

    The big, big question is why is the govt so determined to keep Anglo afloat. What were they told on the night of the guarantee???Who are they covering for The only reason to protect Anglo (and Fingleton)is to protect someone or something else.

  3. # Comment by des groome Apr 2nd, 2010 20:04


  4. # Comment by Betty Apr 5th, 2010 22:04

    I wonder?????Is he -Was he big enough????or was it going to bring the whole ins business down????

  5. # Comment by EddieL Apr 7th, 2010 10:04

    Now we are getting some of an idea of what “the only game in town” entails. And NAMA is not the only game in town. The Lisbon treaty (dare I say it) was the only game in town. The latest “only game in town” is the deal with the public service unions (looking at the union heads promoting the government line was was really pathetic).
    Has anyone noticed that all these “only games in town” mean taking the wealth from ordinary people and giving it to the super-wealthy creating a new elite through privatisation, low taxes for the wealthy, stealth taxes for the ordinary person, lower wages, worse working hours and conditions, control of the main-strem media, pitting workers againg one another etc.
    I think the time is long overdue when the ordinary people decided to play a different game.

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