Wise Up Journal
by Gabriel O’Hara
When the banks cash in the €400 billion promise the Irish government has guaranteed them, which bankers from around the world have praised, the 4.2 million people of Ireland, all the men, women, and even all the children will owe €94,343 each. €377,372 for a family of four. The Daily Mail is the only paper I know of to have published this, “the £315billion [€400 billion] cost leaves each Irish resident liable to the tune of £75,000. It is nine times the country’s national debt.” If the U.S. was to adopt the same reckless measures as Irish politicians, and also pledged €94,343 ($128,098) to the bankers for it’s population of 305 million people it would add €28.8 trillion ($39 trillion) to it’s national debt, the international community would be discussing it’s complete and utter bankruptcy despite the U.S. military might propping up the Dollar.
Last week international investors placed large bets that Ireland will go completely bust after Irish politicians unwisely guaranteed banks a titanic €400 billion. Such bets on bankruptcy are placed on the international level through Credit Default Swaps (CDS) and they went through the roof to the highest level in recorded Irish history of CDS at 63.5. “The decision lead to the CDS swaps on Irish sovereign debt blowing out in the last two days,” Hugh Hendry, chief investment officer and Partner at Eclectica Fund, told CNBC last Thursday. He said, “That is the market’s best estimate, best hunch, as to the probability of defaulting on debt. And we have similar probabilities for corporations, we do it everyday. And the reality now is the market believes that McDonalds, the burger chain, is of greater integrity, greater solvency, greater robustness than Ireland.”
The Daily Mail reported the following:
How can Ireland afford it?
The reality is that it can’t. The total liabilities of the six institutions involved are more than three times Ireland’s total economic output. And the move has led to an increase in the cost of borrowing for the Dublin government.
In the past every time a very large company engaged in criminal management that put it on the brink of bankruptcy the same excuse currently being used has always been used: “[Insert Company Name] is so large that to let if fail would do more damage to the economy, jobs, and the [nationality] people.” However these bailouts cause every citizen to pay for the bad debts and keep failed but favoured businesses going. When bankers changed the leading and leveraging rules 10 years ago they knew from past experiences the more reckless they are the safer the guarantee, paid by the citizens. Hugh Hendry also told CNBC, “we have seen in the last ten years something unprecedented. It was never the case, your loans were never twice your deposits, never until the last ten years. And that was a massive, massive gaming of the system. What I contend is leverage ratios of 30 or 50 to 1. That is bank of America today, that is Barclays bank today, that is HBOS today. Politicians stand up with bailout plans[…] there is no such thing, we end up paying for it.”
Government aided large scale monopolies have been the status quo (especially in the U.S.) for decades. How can capitalist countries allow this one might ask? On the large scale the West has not been capitalist for over 100 years, this is not the fall of “capitalism”, what is happening is the rise of something else.
Last year Ireland was listed as the fifth richest country in the world based on GDP, not based on hospital quality or anything like that, but in 1987 Ireland’s national debt to GDP stood at a whopping 117%. When the banks cash in on the Irish government’s non-existent kitty, the titanic €400 billion guarantee (the number thought needed and signed into law) will have to be borrowed and it will bring the people of Ireland’s debt to over 240% to the current GDP. The hard times of the 80’s are going to be a picnic compared to the new Ireland and new Western world that will emerge from this astronomical debt. Are you ready for that?
The high gross national product (GDP) over the last few years allowed Ireland to payout approximately €1.8 billion per year in interest on our relatively small national debt. If Ireland borrows the €400 billion at 0%, which certainly won’t happen, and Ireland pays money directly off this massive debt it would take over 220 years to clear. 220 years at the same Celtic Tiger economy level. That is the best case scenario when the current politicians in control of Ireland’s government sellouts the nation by borrowing billions from international bankers to keep others bankers in business who’s criminal management guaranteed the people’s savings would be wiped out. Instead of only bailing out the country’s savings and arresting bankers responsible, the Irish finance minister Brian Lenihan spoke with central bankers and decided to bailout the bank’s bad loans, a much larger sum than the savings. The bailout was then voted for by the majority of politicians. The individuals in control of the Irish government are the same ones who agreed to 0% commission on Ireland’s natural gas it gave away to Shell. Do you still have faith they serve your best interests?
There is a cost to creating more money, there is a cost to creating more money, there is a cost to creating more money, otherwise we’d have an unlimited funded utopia. The cost is higher costs, when more money is created, eventually prices rise to catch up. All the money created to pay these non-capitalism global bailouts to save bank profits will devalue your savings, your savings will buy less as prices rise. Banking profits from ignorance, Banking is built on deception that would be called financial fraud in any other type of business, so if you have misunderstood this before that is they way you were supposed to “understand” it. Can you see wealthy bankers sitting back laughing when politicians and the main stream media tell the public these bank bailouts are to protect your savings knowing it will cause prices to rise? Excessively wealthy private bank owners in the western world have put almost every nation in the same situation. In addition to bailout money the private ECB, as declared in the Maastricht treaty, is creating billions of Euro everyday to keep European banks from sinking. Meanwhile the U.S. is continuing to add billions to the trillion it created a few weeks ago. Hyper inflation will occur as these trillions of Euros and Dollars are manifested on computer screens. Who will be laughing when almost all the citizen’s of the west will be plunged into debt, debt that will take generations of labour to pay off? We are going in to a new world system. On CNBC the chief investment officer and Partner at Eclectica Fund brought up the point, “if that is allowed to stand it will bring down the Euro, the Euro is not a tenable currency if you have member states making such decisions. There is no such thing as a free lunch, politicians have got to understand it. The reality is there is no such thing as a free lunch.”
TWO FOREIGN-OWNED Irish banks have been requested to forward detailed submissions to the Department of Finance progressing their applications to join the Government’s guarantee scheme
Including Ulster Bank and Halifax-Bank of Scotland (Ireland) would increase the liabilities covered in the guarantee from €400 billion to about €490 billion, with Ulster Bank accounting for roughly €60 billion and Halifax-Bank of Scotland (Ireland) about €30 billion.
Do you support the bailout in its current form? There is still time to demand the government throw out the legislation that covers bad debt.
The Crisis Tool
International elites tend to gain a number of plunders from crisis they create; one involves “solutions” that give greater centralized control.
New York Times reports, “benefit from the current turmoil is that it often takes a crisis to propel European integration forward. ‘Progress in Europe is usually the result of a crisis,’ Mr. Eijffinger [adviser to the European parliament] said. ‘This could be one of those rare moments in E.U. history.’”
Before last Saturday’s “mini-summit” of European leaders the International Monetary Fund chief, Dominique Strauss-Kahn said, “the banks’ losses are the worst we’ve ever seen,” and “the IMF thinks it’s a global problem that needs a global response.”
Was the desired result of the solutions thought of first and the right crisis to bring it about second? Do elites think like this?
May 1990, West Magazine Canada publishes an article from journalist Daniel Wood on his Maurice Strong interviews. Elitist Maurice Strong was co-chairman of the World Economic Forum, Secretary-General of the UN Environment Program, president of the World Federation of United Nations and held many other high positions. The article describes Maurice Strong boasting about a novel idea, “each year, he explains as background to the telling of the novel’s plot[…] he then says: ‘What if a small group of these world leaders were to conclude that the principal risk to the earth comes from the actions of the rich countries[…] They won’t change. So, in order to save the planet, the group decides: Isn’t the only hope for the planet that the industrialized civilizations collapse? Isn’t it our responsibility to bring that about? This group of world leaders, bring about an economic collapse. These aren’t terrorists. They’re world leaders. They have positioned themselves in the world’s commodity and stock markets. They’ve engineered, using their access to stock exchanges and computers and gold supplies, a panic.’ I sit there spellbound. This is not any storyteller talking, this is Maurice Strong. He knows these world leaders. He is, in fact, co-chairman of the Council of the World Economic Forum. He sits at the fulcrum of power. He is in a position to do it. ‘I probably shouldn’t be saying things like this,’ he says.”