They shouldn’t have been allowed to fail, no. But it should not have been left to the Irish tax payer to bale them out, it was a European problem not an Irish one.

It’s worth remembering that, even with the blanket guarantee, “savers and despositors” were protected under legislation up to 100k.

*without

Alan better anarchy for a while than generations of poverty snd emigration.We have managed to put the country in a worse position than it was under British Rule.

The savers and depositors were only part of the problem though. The banking system is also how we move value around. If retail banks collapse, people’s wages can’t be paid, and businesses can’t pay each other. The entire economy stops functioning. Eventually people will come up with an alternative, but at what price?

A different solution might be legislation which allows the government to take over the current account system and limit withdrawals in an emergency – i.e. separate movement from funding.

Yep, I don’t know enough to say what should’ve been done, but I just wanted to point out that the image of every depositor getting wiped out if the banks had been let go is a bit misleading.

Total nonsense Gus. If you want to know why go read a book on social history in Ireland in the late 19th and early 20th centuries.

The amount of over the top, narcissistic, poor me nonsense on this site is absolutely staggering. Have any of you any pride at all.

You forget about the bank strike if the 70′s? I know today we rely more heavily on the fluidity of the modern banking system but people do cope without it. For a time but of course it is systemically important.

What Mr. Carney doesn’t call out though is that a sovereign currency issuing government never has to impose the losses of the commercial banking system on to its citizens/taxpayers. If such a state (e.g U.K.) does choose this path, then it is entirely a political choice and not an economic necessity.

Modern fiat currency money is not a finite resource. It is created at will on the computer keyboards of the world’s central banks. The central bank can therefore shore up any insolvency in the balance sheets of the commercial banks under their remit if they choose to do so. Alternatively they could if they wished impose losses on creditors such as bondholders (instead of transferring them to the citizen) while guaranteeing deposits.

Ireland as part of the Eurozone is not longer has a sovereign currency but the second option was open to the FF/Green government in 2008. Instead they instinctively protected the interests of the capitalist elite and issued the blanket bank guarantee to load the banks’ private illegitimate and odious debts onto the national finances.

Over the next 2 years it became obvious the scale of bank losses would bankrupt the nation and so as blanket bank guarantee was close to expiring during the summer of 2010, the government belatedly attempted to impose some losses on the bondholders. Soon after the ECB, ably assisted by U.S Treasury secretary Geithner stepped in and forced the Irish government into the Troika ‘bailout’ (read stitch up). This ensured full repayment of all bank bondholders from senior secured right down to junior unsecured under threat of withdrawal of all liquidity funding from the Irish banks as per the Trichet letters.

In 2011, the people elected a new government with a mandate to burn the bondholders but instead FG & Labour continue colluding with the Troika to implement the neo liberal agenda of Austerity whereby the systemic failure of speculative capitalism will be paid for by 4 million ordinary Irish people.

In this way the EU & IMF gets to have the Eurozone commercial banking system stabilized largely at the expense of the Irish people and we get to pay for the privilege through Water charges, Home tax, USC, Health & Education cutbacks, Pension levy and the extra 3 years added to our working lives etc etc etc…

No should never have had to in the first place. In fact the next time whether by law or not we should let them crash ,the upheaval would be the fastest redistribution of wealth in history, although it may also trigger an apocolypse of sorts that would tear civilisation apart.

There’s no danger of an apocalypse DH. In the case of the systemic failure as seen here in 2008, the state just needs to step in, assume ownership of the banks under its remit and instruct them maintain the payments system etc.

Alan O’Connor

You are talking pure drivel.

All of Ireland’s banks could have been allowed to go bankrupt without any issues whatever in Ireland itself.

Simply close one day, draw a line under their accounts and restart the next day under new ownership (likely the State, until any further decision). Simple as that.

The reason that Ireland was threatened by the ECB (and EU Commission) to keep those banks open, or in the case of Anglo, guarantee bondholders, was because they did not want any knock on effects in the wider European and global financial system. And there was some good reason for this & why Tim Geithner flew over the pond to issue instruction to the US’s vassals of the EU… The US banks (Wall St) had flooded the world’s financial system with $trillions of fraudulent and worthless mortgage backed securities, and they didn’t want any of this unravelling…

Of course… the ECB could easily have guaranteed and bailed out whatever bondholders it wished, at zero cost, as issuer of the currency.

But instead, it was preferred, rather than open that can of worms publicly, by the EU’s elites, notably those in Germany, to simply dump a collective punishment on Irish citizens because the country had reckless self-serving, even criminally fraudulent bankers and property developers. Ireland’s political establishment (in all main parties) were intimately associated with these crooks, so preferred to accept the ECB/EU punishment… just not themselves personally, naturally.. rather, on behalf of the country.

It would not do to publicly admit that the Euro is fiat currency & that any amount as necessary can be conjured from thin air on the ECB’s computers… except purely as ‘monetary’ operations for their mates in banking. That in fact, the ECB has the financial capacity to provide ‘stimulus’ funding to recover our economies at zero cost to anyone…. but then where would that leave those privileged & hallowed ranks of Capital owners skimming off their profits off our backs?

Hence the politicians’ favourite meme on all this that ‘we all partied’…. a monumental lie… but they knew most citizens, on the mushroom principle, don’t do sums that well… and certainly don’t know sweet f.. about economics (aided and abetted by our sick joke ‘academics’).

Recall, no bad loan of less than €20 million went into NAMA. Hands up who ‘partied’ with €20 million? Ya… not a lot of us, right?

The truth is that it was +commercial+ lending in vast sums, for land and property deals all over Europe and beyond… in many cases with Ireland as ‘conduit’ for what amounts to a pyramid scheme for impossibly high yields…where the real incentive was finance fees for ‘pump and dump’.

Long story short….

If we had any politicians in the Dail, or public servants, who actually desired to represent the interests of the majority of citizens… we could have had a very different outcome indeed…

Ergo… one might then also conclude that the biggest ‘deficit’ of all… an actual flat broke bankruptcy… existed in the notion that we live in a ‘democracy’. We clearly don’t… and I’ve not seen anything in the last six years to persuade me otherwise… the opposite in fact…. as the Water Tax again demonstrates.

I wasnt serious about the apocolypse part coddler

Fair enough DH.

“Have any of you any pride at all”?

My pride was restored when I walked with water protesters on the 11th of October. You could experience a million St Patrick’s days and still not come close to how proud I felt to be Irish that day. To see a sea of people the full stretch of O’Connell street finally protesting for something they believe in is a sight to behold and brings a tear to the eye when I think of it.

They could have guaranteed deposits up to 100000euro this would have protected the majority of ordinary ppl with accounts in aib and boi..anglo was an investment bank so fcuk it

No anarchy in Iceland .. Only growth and prosperity

They were bailed out because our elected, self-serving servants had their stash squirrelled away in said bond-market.
They betrayed the Irish people to avoid any personal losses.

@fin what’s a piggy promise ?

Pinky promise:
A non-negotiable binding agreement made by Spongebob and Patrick using their little fingers (or pinkies) to close the deal.

Sadly this would not be enough we need much broader safeguards than this…it’s actually incredibly frustrating how naive some in politics are about this stuff

It’s a joke Ryan. Nothing other than a licence to carry on milking the ‘real’ economy for next to nothing whatever useful in return.

A vastly bloated entire ‘Financialised’ economy serving no other purpose but extraction from the real economy.

Supported, aided and abetted by the bought or otherwise captured political classes. Coup d’Etat… job done… legal copper fastening of Plutocratic rule by Banks and Corporations on the way with Orwellian termed ‘trade’ agreements like TTIP.

Thanks sean…means alot!