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Compared to countries that have not destroyed their finances the IMF would have a pooor record; compare the performance of NINJA mortgages with those of more normal behavioural types and the record would not be good.

I agree on corporation tax; if it goes then the loans will not be paid back and they may as well let Ireland fail and burn the bailout money to generate a few watts of power.

Desmond snaps up a dark portrait of troubled nation‘Sword of Justice’ is one in a series of controversial paintings called ‘Boomtown’

By Ken Sweeney

Wednesday November 17 2010

A PAINTER whose recession-themed canvases have provoked controversy has attracted the patronage of millionaire businessman Dermot Desmond.

Artist Brian McCarthy’s ‘Boomtown’ series captures Ireland in 2010 in which the country is portrayed as a vast shanty town, or the Irish nation as boat people in a small craft on treacherous seas.

But it is the night-time scene. ‘Sword Of Justice’, in which an angry populace prepares for revolution, which has caught the attention of one of the country’s most successful entrepreneurs, Dermot Desmond, who purchased the work recently for €4,500.

“Dermot is a genuine patron of the arts,” Mr McCarthy said.

“I met him last year at an exhibition in London and he explained to me that, rather than collecting old masters, he preferred to buy work that caught his eye.

“This painting seems to have done that. It’s one of the biggest sales I’ve ever had.”

The 50-year-old said the inspiration for his ‘Boomtown’ work came from listening to RTE programmes like ‘Liveline’ each day.

“It’s the anger of the callers. I never planned to do a series of paintings on this subject but when the first piece ‘Boomtown’ got such a great reaction, I decided to turn it into a series. I’ve never known such a response. People seem to identify and understand perfectly what I’m feeling because they feel the same,” Mr McCarthy told the Irish Independent.

Another picture in the series, ‘Exodus’, depicts the Irish nation in a small boat making a desperate attempt to flee.

“The idea came from the Vietnamese boat people who were forced to set sail for a better life.

“This is true for so many young people leaving Ireland now. I choose the backdrop of pointed peaks because it’s as far away from an Irish landscape as you can get.”

The exhibition ‘Boomtown’ can be seen at the Keeling Gallery, 41 Clarendon Street, Dublin 2.

– Ken Sweeney

Irish Independent

Are you really saying Metro North will go ahead?

On a technical question; which are more resistant to stone chippings, vehicle tyres or bicycle tyres? Add the weight of cargo to the bicycle tyres and they would shred if the Luas lines ever get linked. You need pristine surfaces for them to work; but back to the substantive point how can the council justify a subsidy for an unproven mode when funds are non-existant?

The Taoiseach said what was needed was ‘calm heads and cool consideration’ of all the complex issues involved

The complex issue is the psychology of those that provide the funding; lets look at it from their point of view on the positive they hold an asset that is likely to provide a much higher yield than core EU economy bonds such as German, French or Dutch bonds, take inflation at 2% and French 10 year bonds provide a return above inflation of 1% p.a. In the case of Irish bonds that premium is likely to be 2% – 3% above French rates and 3% – 4% above inflation; if you think Ireland is a good prospect then Irish yields are a real opportunity at the current time.

Then look at what might make the people who fund the country scared, a number of final solutions have been issued to great fanfare and assurances given which have proven misplaced; the Government parties are at 11% and 3% respectively in the polls so have literally no support. The banking system excluding IL & P and BoI has credit markets closed to them and have swamped the exchequer with an extraordinary amount of debt. Unemployment is well in excess of 10% and real earnings are falling. An austerity package due in a month will probably take 3% off GDP for the next 5 years.

The EU are prepared to extend finance at a 3.1% discount to the market, the calming of the bond market would calm down not just in Ireland but across all of peripheral Europe making growth across the entire region more likely i.e. the country’s key market. Those holders of Irish debt who have remained loyal will see their losses cut and those that bet against the country will take a beating where it hurts in the pocket.

When you look at it once you get an assurance on corporation tax its actualy quite simple and you get to tell Jackie Healy Rae and his ilk which rock to climb under because it is out of your hands.

If pride stops an orderly bailout history will judge Cowen much more savagely than the poor scmuck who Bertie handed the sick baby to.

+1 plus they did their homework; plenty of 1980-‘s emmigrants did support Bushmills and a little Noraid; these days though you’d have a bit more faith in the UCD grads funding start up Bio-tech and IT companies from the MIT campus culture with their spare change rather than tossing dollars into a bucket to Noraid; sure wouldn’t they would gain valuable exposure to in their graduate employment and even get to know the winners from the losers to give the IDA leads into who to target down the timeline; remember that concept grads getting jobs? As a people we have moved on so far in the last 20 years just a pity the economy was wrecked by the most indecisive government in Irish History.

If the last year has taught us anything it is that the best way to take down a country is to bury ones head in the sand. The only question now is will Lenihan Bros take down Portugal as well?

Pride the biggest hurdle to Irish bailout
By Carmel Crimmins, REUTERS

REUTERS/Cathal McNaughton

Is Ireland on the brink of collapse?

DUBLIN – National pride and fear of having to accept tough policy conditions are at the heart of Irish resistance to being bailed out by the European Union. But these considerations are likely to be swept aside if Brussels insists on a financial rescue.

Prime Minister Brian Cowen has repeatedly said he does not want external assistance. Deeply unpopular, he is resisting going cap in hand to Europe partly out of concern for the electoral fallout, and because as a condition of emergency loans, Brussels might demand he raise the low rate of corporate tax, a key part of the government’s economic strategy.

Cowen still appears to be hoping the publication of a four- year austerity plan later this month, and the planned passage of the 2011 budget in early December, will convince investors Ireland can solve its fiscal and banking crises by itself.

But last week’s surge of Irish borrowing costs, which dragged up bond yields of other weak countries such as Portugal and Spain, means Cowen may already have lost the argument — Brussels may be so concerned that Ireland’s crisis could destabilize the euro zone that it may effectively force Dublin into a bailout.

In the last two days, official euro zone sources have told Reuters talks on the possibility of a rescue are underway and it is “very likely””Ireland will receive help. One source said that although Dublin was not keen to apply for aid, it might not have a choice, depending on market movements.

“We have already surrendered our political sovereignty and anyone who doesn’t recognize that is naive in the extreme,” said Jim Power, chief economist with investment firm Friends First.

“Ireland is now being run out of Europe; the ECB is keeping our banking system solvent and indeed is keeping the whole economy solvent. I think that is the reality.”

While the Irish government is fully funded until the middle of 2011, and thus does not face any immediate solvency crisis, Ireland’s banks have been frozen out of term funding markets and are dependent on support from the European Central Bank.

HUGE SHAME

A bailout, with fiscal conditions attached in negotiations with the EU, would be humbling for a country once feted for its rags-to-riches transformation and proud of its struggle for independence from Britain.

“I remember the 1980s when you’d be working over in London hiding your Irish accent,” said one Dublin-based financier, who declined to give his name.

“A bailout would damage our reputation for years. We’ve achieved so much, it would be a huge shame to see it undone.”

Ireland’s central bank governor said last week that if external assistance were required, it would not force a shift in fiscal austerity measures already planned by Cowen, which total 15 billion euros over the next four years.

But the government has yet to outline exactly how it will achieve its budget adjustments and there is a real fear in Dublin that Europe would demand unpalatable measures in exchange for aid, most controversial of all a possible increase in Ireland’s 12.5% rate of corporate tax.

“It comes down to the corporation tax,” said Brian Devine, economist with NCB Stockbrokers. “If it wasn’t for that issue I would say we should call for it (external aid) straight away.”

Ireland’s corporate tax rate is a magnet for multinationals such as Google and Pfizer and a source of irritation in some other European capitals, which view it as unfair competition.

Greece had to raise its sales tax to 23% from 19% in a few months as part of a 30 billion euro package of steps it promised the EU and the International Monetary Fund in May in exchange for its 110 billion euro, three-year bailout.

OBSTACLES

In fact, because Ireland has already taken difficult budget steps, it might find it easier to agree on an aid deal than Greece did during its ten days of tense bailout talks with the EU and the IMF in late April and early May.

Athens eventually promised to cut its budget deficit to 2.6% of gross domestic product in 2014 from 13.6% in 2009. Ireland is already targeting a shortfall of 2.75-3% of GDP in 2014 against an underlying 12% this year.

If the Irish do apply for aid, “there can be no question that they’ll get it without much trouble; i.e. no need for long negotiations on conditionality,” Erik Nielsen, chief European economist for Goldman Sachs, said in a research note.

He said the issue of the corporate tax might be resolved with some sort of “gentlemen’s agreement” to move in the direction of a higher tax over the medium term.

Another contrast between Greece and Ireland is that the Greek bailout was pushed through by a strong leader, Prime Minister George Papandreou, at the head of a solid government which had recently taken power.

The most unpopular leader in modern Irish history with a shaky parliamentary majority, Cowen does not have a strong mandate to negotiate with the EU or the IMF. Analysts expect an early parliamentary election in the first half of next year will end his Fianna Fail party’s 14-year grip on power and create a new ruling coalition of the centre-right Fine Gael and the centre-left Labour party.

But while opposition parties would make political capital out of Ireland’s loss of sovereignty in a bailout, they would probably not obstruct an aid package given the lack of alternatives and the bonus that Fianna Fail would be blamed for it.

It is conceivable that if the EU presses Ireland to take a bailout before the Irish election that is expected next year, the government will try to involve the opposition in the bailout talks in some way, to ensure there is a national consensus around the rescue agreement.

Despite rocketing unemployment, the worst recession in the industrialized world and two years of austerity measures, Irish people have reacted with resignation rather than riots, and are already expecting an even tougher wave of cutbacks regardless of whether Dublin or Brussels is calling the shots.

The damage on this was done by Anglo Irish Bank and INBS during 2006-2009; it is time to accept the inevitable and the polls and give the Country a new government with a new mandate and the authority to carry out the necessary adjustments. International Capital markets have heard the latest ‘line in the sand measure’ from this Government once to often; they don’t believe the current government; they have been codded more than once too often.

No but enter a new economic phrase ‘Regionalisation’

Good behaviour at corporate level sees stock market flotations and subsequent offerings to buy competitors.

Good behaviour at Government level sees lower bond yields, cheaper debt service costs and every bank going trying to lend you money you don’t need. The 1990’s!!!!

Bad behaviour at corporate level sees heavily discounted share offerings and in extreme cases nationalisation.

Bad behaviour at Government level sees rising debt service costs, bond markets shutting to much of the corporate sector and bailout by your regional partners; the term when this phase is reviewed will clearly be regionalisation. Dubai, Athens, Dublin, who is next Lisbon?

The PIIGs will become the LADDs

Its the economy stupid

I remember having a converation with a bicycle courier I knew who was offered a lease on the former Abrakebra at Merchants Arch in 1999; a nice guy but hardly a good covenant; you can be sure if A was offered this unit the landlords agents were having really problems getting a tenant. The issue with that unit is that the quayside elevation pre Port Tunnel was not a pleasant place to dwell and the Temple Bar side was easy to miss with the volume of people marching forward.

Architecturally very pleasant and no doubt with Abrakebra having wrecked the interior in the 1980s clearly a very adaptable space now. I really hope they have a strict door policy it could be noxious if it became a reincarnation of the Harp Bar given the impact the use would have on a pretty constrained passageway that has a vital role in the tourist infrastructure into Temple Bar from the budget hotels in the North Lotts area; that said I think granting permission for a pub subject to annual renewal of license being decided by the superintendent of Pearse St would be an ideal outcome; a decent bar there would be a great use but door policy would make or break its impact/contribution balance upon the City.

@KerryBog2 wrote:

Tragedy my arse……… PVC, that post of yours is like the ones Brian O’H. used to write extolling the virtues of Zoe. ;).

You will note from the Garathace love in thread I did not join in the we love the convayer belt of lego-brick apartments afflicting BAC albeit that the Dungloe House acquisition provided the operation with sharp cookies on the property side. However one suspects that the collapse of Zoe along with other large Nama held portfolios has created significant systemic contagion that spread from land speculation into the construction industry.

@KerryBog2 wrote:

Pierse has gone under with a deficit in excess of Euro200 million, of which more than 25% (>50 million) is due to ordinary trade creditors. That means that the knock-on effect will further add to the woes of those creditors – most already overstretched – and will hasten their demise. The size of the deficit would suggest to any financier ‘trading while insolvent,’ particularly when one looks at the amount of intercompany debt. I wonder where all that money went…… K.

One can only speculate that the lack of clarity in the how and when the development pipeline of half completed schemes was going to be handled created difficulty for construction firms in knowing which assurances from developers would be honoured and which wouldn’t.

I will rephrase my original point, if this happened in 2006 it would have been shocking and considered by most commentators to be a tragedy; events since that date have obviously numbed sentiment significantly; no doubt the true course of events will come out in the fullness of time but until they do I think it is fair to afford one of the big 4 construction firms the benefit of the doubt on their probably believing some of the assurances they were receiving which turned out not to have been honoured; I strongly hope that the contagion from this collapse is manageable and does not trigger another wave of defaults at subbie and professional levels.

A very slow motion trainwreck has hopefully now come to a halt

Hugh Ryan.