Sign in. It’s quick, free and it’s up to you.
An account is an optional way to support the work we do. Find out more.
EUROPEAN FINANCE MINISTERS have today agreed to change the EU’s plans for a permanent bailout fund – in a move that could provide new hope to Ireland in its quest to avoid a second bailout.
So, in short, how will it work?
Well, the current bailouts being given to Greece, Ireland and Portugal are being worked under a temporary agreement which creates two different bailout funds.
Those funds are the European Financial Stability Mechanism (EFSM), which is a fundraising vehicle backed by all 27 EU member states, and the European Financial Stability Fund (EFSF) which is paid into only by Eurozone members.
Because the EU’s member states have now come to realise that they’re not as invincible as they’d like to be, these two funds are being superceded in 2013 – replaced by a single, permanent European Stability Mechanism (ESM), which will take over the functions and loans of the other two.
This was agreed upon last December, but among the conditions created at the time was a clause about ‘preferred creditor’ status. This would mean that if a country was to default, the ESM would get first dibs on recouping its money.
This is best explained in an example. In Ireland’s current bailout, €45bn in loans is being provided by the EFSF and EFSM. Those loans, in 2013, will be taken over by the European Stability Mechanism.
If Ireland was to default, then the ESM would get first dibs on any cash we have left – meaning the IMF, or other bondhonders, would have to wait in line until the ESM had taken back whatever cash it needed.
This, naturally, is a prospect that would put many people off the idea of investing in Irish bonds in the future – why would anyone invest in Ireland if, should Ireland go under, they might not even get any of their cash back?
This would have proven a particular worry for Ireland, which hopes to get back to the international money markets – raising money through means outside of the package – by the end of next year.
Remember, Michael Noonan says the bailout might only get us through to the middle of 2013 – and more than one cabinet minister has discussed the possibility of Ireland needing a second package of EU-IMF loans if we can’t raise money through more everyday means by then.
If Ireland hopes to win back the confidence of international investors, it will need to get its potential interest rates down to a manageable level – and this wouldn’t be easy if investors were scared that, should Ireland go belly-up, the ESM would raid our coffers first.
It is this clause – of the ESM being a ‘preferred creditor’ – that has been removed by ministers in Luxembourg earlier today. Now, should a country default, every creditor will be treated equally.
The removal of this clause, therefore, could be crucial for Ireland’s hopes of getting itself back to a more normal financial situation – and comes as a nice boost as Michael Noonan continues his charge to reduce the interest rate being charged on the current Irish loans.
To embed this post, copy the code below on your site
This country really has turned into a Slum.
Why am I not surprised it’s beyond a joke at this stage
@Kenny Jones: sex always has been and always will be a currency……
I remember a Rathmines landlord having this kind of “arrangement” with a tenant as far back as 1992. He had a wife and kids in Navan at the time. Not a new phenomenon at all.
@Jane Gunnigan: The wife in Navan will now be checking on her husband’s property in Rathmines I992. Thing could get hot!
@Jane Gunnigan: Durable relationship
@Patrice Ahern: The marriage would be considered a durable relationship and exploitative relationship would not… really isn’t that difficult.
@Diarmuid Hunt: I wouldn’t bet on the marriage remaining a durable relationship either, and many, many are not.
@Thomas Sheridan: I would think that in the context of law that it would be especially in an scenario where it is in comparison to sex-for-rent arrangement.
Economists warned our political class that all the evidence internationally says that introducing rent caps, eviction bans etc etc in a market where the main issue is lack of supply will result in less supply, higher rents and they did not listen. SF are equally guilty as the main drum beaters for irresponsible policy. We need more politicians with engineering or science backgrounds, people who understand that words don’t create reality, and that cause leads to effect whether or not you wag your finger at it in the Dail. We need to build. Any policy to encourage building now is good. Any policy that discourages it is bad.
@Tom D: When it starts hurting FDI which must be close now they’ll start to do something. That’s all they understand.
@Tom D: We also need an electorate who will vote for such people – and telling the truth is not what people vote for. People vote to for money for nothing, basically. Daft policies come from daft politicians elected by said voters.
@Tom D: we also need less scammers and chancers claiming international protection
@Tom D: there is no lack of supply for houses in Ireland. The 2022 census listed 163,433 vacant properties in the country, most of them being in the Dublin region, with specialists saying this number could be over 180,000 in 2024. Saying there is a lack of supply is a bit of an oversimplification of the problem and doesn’t reflect the whole picture. While there is a shortage of available housing, there are a lot of reasons behind it, one of them being keeping the fallacy of housing crises to keep rent and property prices going up.
@Eduardo: One example of this is the apts by the ifsc at the Quays. The average occupancy level of some of those buildings is 60%. All apts are built to rent, but if landlords bring the rent down to increase occupancy, this will affect the prices of the other tenants, and bring down market evaluation in the area. So they keep a lower occupancy, and high rent. Nothing is as simple as the media portraits.
@Tom D: the Dail is full of Teachers (the only ones that have the time for canvassing) who have never ran anything but want to run the country!
A type of mania has set in. I got a notice for a 62% increase from what was previously a fair landlord. As young people work harder to satisfy this mania for a few blocks and a wooden roof, an unhealthy imbalance in society exists.
There is your survival of the fittest ( aggressive/greedy) with a younger generation playing along.
@Gerald Kelleher: The capitalist mania of taking advantage of anyone they can goes against what has, through the lens of evolution, made us a dominant species. You do yourself a disservice to equate the two.
No need to panic the government has the housing situation fully under control they have seen it worsen tremendously over the last 10 years and say if they are re-elected they will solve it this time. like they said the last time but this time they said they will,lessons learned by droves living in tents and inviting droves more in we will actually get to a stage that we may run out of tents as we have housing a great legacy by a government seeing the problems coming head on.
Will it also be illegal to offer sex in lieu of rent?
Vote no
Don’t make it an offence, make it a crime.
How do they get change back?
#your choice
How can they get away with advertising something like this? Bloody perverts.
If you have to sell your body so that you can study you would be better off forgetting college. No career is worth that.
@JP: But it is socially more acceptable with a sugar daddy, right?
Or for an EU passport or any desirable one?
This country has been in free-fall for years.. not surprised to read about this .There are plenty of schemers , scammers , strokers , shceisters , shady f#####s walking among us , that were born in this country .. yet still foreign nationals get demonised and scapegoated on a regular basis
have your say