Irish debt yields in new record despite better job data

Spiv_2

The cost of servicing Irish debt has hit a new record, despite data showing the first fall in unemployment since February.
The interest rate on Irish government debt has reached a high of 6.791%.
The rise comes as concerns about the country's economic health continue to nag at investors.

But many problems remain, not least the final bill for winding down the nationalised Anglo Irish Bank.
Estimates for this are as high as 35bn euros (£30bn; $47.4bn) - more than 20% of Ireland's gross domestic product - and the details are expected to be given by the government on Thursday.

http://www.bbc.co.uk/news/business-11433817

Thrugelmir

Irish debt yields in new record despite better job data

What's the connection?

Spiv_2

Anglo Irish, Allied Irish May Need EU14.4 Billion



http://noir.bloomberg.com/apps/news?pid=20601087&sid=aWdk4a.O_auk&pos=1

Generali

It's because Lenihan announced that 'headline deficit' will be 32% of GDP for the year!!!

Thrugelmir

Spiv wrote: »

Anglo Irish, Allied Irish May Need EU14.4 Billion



http://noir.bloomberg.com/apps/news?pid=20601087&sid=aWdk4a.O_auk&pos=1

The Irish domestic jobs market isn't going to affect the rate that the Government needs to borrow at.

They've taken the full hit of recapitalising the banks on the chin (in accountancy terms ) but its going to take a further 10 years to resolve the issue, as they'll need to tap the market for further funds.

Spiv_2

Generali wrote: »

It's because Lenihan announced that 'headline deficit' will be 32% of GDP for the year!!!

Flipping unbelievable!

Thrugelmir

Spiv wrote: »

Flipping unbelievable!

As I said in my post.

"They've taken the full hit of recapitalising the banks on the chin"

Blacklight

I was listening to this story on R4's Today. The long and short of it was, as ever, the banks lent irresponsibly funding a property bubble based on toxic debt/sub prime mortgages and now they need to be handed 35bn.

My question is, where has their own 35bn gone that they lent out?

Thrugelmir

Blacklight wrote: »

My question is, where has their own 35bn gone that they lent out?

Last heard of sailing their luxury yachts around the Virgin Islands.

Mr_Mumble

Irish citizens should be rebelling, pitchforks and the rest, demanding these banks are put into a form of receivership where high street operations remain - they could be sold to another bank over a weekend (as happened with many recent failures from Dunfermline to Wachovia) - while creditors are made to take the losses rather than the taxpayer. It's another crazy case of corporatism. The really astonishing aspect to me is how the politicians can get away with blaming the banks when it is they who are keeping the banks afloat with other peoples money.

Blacklight wrote: »

My question is, where has their own 35bn gone that they lent out?

Bank lends $1m to company A to buy a warehouse, company A goes bust and the bank, as secured creditor, gets the warehouse. Bank tries to sell warehouse and the highest offer is from company B who'll only pay $300,000. This simple example is no exaggeration. The Irish Central Bank's estimate for peak-to-trough fall in commercial property prices is 70%!

Generali

If the solvent take on the debts of the insolvent they risk insolvency themselves.