Ireland Goes Bust

[Jan Klimkowski]

Ordinary Europeans (incl Brits) are on the hook for Ireland's banker slush fund:

Ireland bailout: UK taxpayers could face £7bn bill

Scale of eurozone crisis underlined as emergency bailout of Ireland appears increasingly likely and EU statistics body says Greek budget deficit was even larger than thought

Comments (331) Julia Kollewe guardian.co.uk, Monday 15 November 2010 15.31 GMT

An emergency bailout of Ireland, which is looking increasingly likely today, could cost Britain billions of pounds.

Although Ireland continues to deny that it has asked for help, many analysts believe the country will have to tap a €60bn (£50bn) rescue fund set up by the European Union in May.

Under the terms of a deal agreed by Alistair Darling, the UK is liable for 13.6% of this fund. This means taxpayers could contribute as much as €8bn, depending on how the rescue package was structured.

The UK government declined to say how much an Irish rescue package could cost British taxpayers. "There has been no application [from the Irish government for emergency funding] and we won't speculate on it," said a spokesman for the Treasury this morning.

Miguel Ángel Fernández Ordóñez, the governor of the Bank of Spain, piled fresh pressure on Dublin today. "The situation in the markets in recent weeks has been very negative due in some way to the lack of a final decision by Ireland," said Ordóñez, who is also a member of the European Central Bank governing council.

"It's not me who should take a decision about Ireland, it's Ireland that should take the right decision at the right moment," he added.

A spokesman for Fine Gael, the opposition party, claimed today that the European Union had already intervened in the crisis. He predicted that a bailout will be hammered out during meetings between EU finance ministers this week.

Amid the uncertainty, the euro traded close to a seven-week low of 84.5p struck on Friday and the yield on Irish 10-year government bonds remained at crisis levels, trading at about 8.1%.

Fears that the financial crisis is entering a new phase also hit UK government debt, with British gilt futures tumbling against German bunds. The December gilt future was 26 basis points down at 122.11 – about 10 points ahead of the equivalent bund.

The scale of the eurozone debt crisis was underlined today when the EU statistics body Eurostat warned that Greece's budget deficit was even larger than thought. Eurostat reported that the Greek deficit in 2009 was 15.4% of its GDP, up from a previous estimate of 13.6%.

Having revised several years of data, Eurostat also said that Greece's deficit for the current year would be equal to 9.4% of GDP, missing the government's target of 7.8% of GDP.

http://www.guardian.co.uk/business/2010/...to-britain

The Icelandic people revolted against banker rape (and Gordon Brown's shameful use of anti-terror legislation).

It's surely time for some fighting Irish spirit.