Detailed market commentary at The Market Ticker and Ticker Classics
(The Year 2012 In Review)
Donations accepted; we offer GOLD ACCESS for enhanced privileges. T-Shirts, caps, coffee mugs? Click here.
BlogTalkRadio - Mondays at 3:30 Central - Yes, TickerGuy has a radio show (kinda)
RSS available You are not signed on; if you are a visitor please register for a free account!
|MarketTicker Forums Single Post Display (Show in context)||
User: Not logged on
|User Info||Letter to UK MP's re Ireland Bailout; entered at 2010-11-17 15:48:54|
Registered: 2007-07-26 UK
You can contact your MP via http://www.theyworkforyou.com/ and http://www.writetothem.com.|
I have read with some alarm today in the Financial Times that the UK is weighing up billions in Tax payer loans to Ireland.
One of the reasonís I have read for extending these loans is that the UK needs to advance them as Ireland is a major trading partner creating a surplus for the UK, and that we donít want to see a decline in this as it would affect UK GDP.
The problem for Ireland is that they now have too much debt at the State level after bailing out their own banks, and they canít service this debt at the current interest rates demanded by the market.
How do you think lending them more money is going to solve the problem? This sounds exactly like vendor financing where you lend your customer funds to buy your goods, however the customer never payís you back, this is the exact process that bankrupted major telecom equipment companies during the dot com crash.
While Ireland is too indebted they have been implementing austerity measures to try to pay back said debt, this is likely to diminish their ability to trade with the UK. So the additional loans will not help UK trade.
Donít you think it would be better to trade with a country which has restructured their debt to a significantly more manageable level rather than extend more loans which could lead to losses for the lenders when the country eventually has to restructure their debts?
I look forward to your response