When Irish Eyes Are Crying
vanityfair.com
When Irish Eyes Are Crying
1–10 of 80 posts
Re: When Irish Eyes Are Crying
#2"Which way entire nations jumped when the money was made freely available to them obviously told you a lot about them: their desires, their constraints, their secret sense of themselves. How they reacted when the money was taken away was equally revealing."
So true, for countries and people.
Re: When Irish Eyes Are Crying
#3Banking seems a lot like a gambling except that it's heads you win and tails they lose.
Lend big into a property bubble and you'll be rewarded with colossal bonuses.
The bubble bursts, loans go bad and the share price collapses.
However the main banks banks are considered too big to fail and the taxpayer has to bail them out.
Bonuses (smaller ones) for exceptional performance continue to be the norm, rolling heads the exception.
Why don't the shareholders get rid of their employees, the bankers who have overseen the collapse of their asset?
The shareholders are Pension funds who, while they ostensibly have the little peoples'interests to preserve, are actually run by people from the same gene pool as the bankers themselves.
These people sit on one anothers remuneration committees.
Dog does not eat dog.
Re: When Irish Eyes Are Crying
#4Here's the previous article in what seems to be a series: http://www.vanityfair.com/business/features/2010/10/greeks-b...
Re: When Irish Eyes Are Crying
#5As someone currently living in Ireland, I found the subtitle of this article particularly appropriate: "Where's the rage?". The Irish government bankrupted the country many times over by putting the debts of the banks on the backs of the people. But, unlike France, for example, where people have taken to the streets and brought the country to a halt to be heard, in Ireland there is nothing like the level of activism that one would expect given the depth of the economic quagmire.
I find it quite sad to see how a country that was once such a hotbed of political unrest has become so passified by the recent wealth that it experienced. My guess is it has to do with people having the feeling that they are stakeholders in the system now, with mortgages and fungible assets, and so they are less willing to want to subvert the system itself rather than muddle along even with unsatisfactory political solutions.
Re: When Irish Eyes Are Crying
#6some previous discussion on this: http://news.ycombinator.com/item?id=2171381
Re: When Irish Eyes Are Crying
#7Pardon if I deviate a bit from the main topic.
I live in Ireland, and it was quite disheartening when the last budget cuts appeared. Taxes were increased across the board. If you were earning 25,000 Euros a year, you would pay an extra 1000 Euros in tax (and surprisingly enough, this low earner class was the worst beaten income group by hike in tax in percentage terms - 4+% more tax!).
Since its general consensus that banks, govt. etc are at fault (to which I agree), I want to say something which generally is ignored, just a theory. The Celtic Tiger years, due to low Corporation Tax rates, have had the similar impact on the economy as Resource Curse (http://en.wikipedia.org/wiki/Resource_curse). Ireland got rich so fast with all the incoming money that lots of careless spending by government as well as people was ignored. The property prices went up crazy, things became awful expensive etc etc. When nobody cared about how much govt spent or how much banks are landing real estate developers, this was bound to happen IMHO. If Ireland had gotten rich slowly and on its own (by increasing exports, productivity etc), such rackless spending bubble economy would probably never have manifested itself.
Re: When Irish Eyes Are Crying
#8Anger is certainly an appropriate reaction in circumstances like this, but I find articles like this really gloss over the nature of the shared responsibility for what happened.
Yes, banks and governments (including the US! - we just haven't felt the full brunt of it yet) engaged in many unsustainable and downright fraudulent practices. Asset bubbles are breeding grounds for such things. On the other hand, no one forced homebuyers to take on loans they knew they could not afford, or spend borrowed money at unpayable rates.
Now, everyone wants a bailout. Neither banks nor consumers should get them. Iceland actually did the right thing by taking its banks into receivership and breaking them up. The banks screamed bloody murder and threatened national chaos, and the Icelandic economy did grind to a halt for almost a year. Now, they seem to be on a road to sustainable recovery. This is not true in either the rest of Europe or the US, where the bailouts came fast and generous. Look at today's job report. Is that the sign of economic growth?
While the decisions were justifiable at the time, TARP, TALF, and the like need to be admitted as mistakes and corrected. If this means recognizing all of our largest institutions as insolvent, so be it! The nation requires a banking system, but not any individual bank. It will hurt badly, just as it hurt in Iceland, but the alternative is Ireland and Greece.
Re: When Irish Eyes Are Crying
#9One of the few positive things to have come out of the financial crisis of 2008 is that it has probably killed any prospect of Scotland becoming independent - we used to be promised that we could share in the same kinds of success as Ireland and Iceland if only we had the courage to go it alone!
I doubt if many people have the appetite for being stuck in a small country with a financial monster like RBS or HBOS.
[NB I am a reformed Scottish Nationalist]
Re: When Irish Eyes Are Crying
#10Australia also has had a long, rolling property boom, with bank lending behind it all.
It didn't pop when expected because our economy was propped up by mineral/metal prices, due to China's demand and surprisingly little supply from other countries. Both may change.