ECB Tells Irish To Go F**k Themselves
The story so far: a corrupt Irish political system bailed out a corrupt bank, on orders from the ECB, to avoid the implosion of mainland European banks. Also a corrupt Irish political system, on orders from the ECB, bailed out the financial gambling losses of well-heeled investors.And so comes an opportunity for the ECB to recognise that the Irish helped save Europe. An opportunity to ease the terms and timescale of Irish repayments of the newly-printed ECB money which was used to benefit banks and investors. (By the way, the Irish people never actually got the money - it was "exported" as quickly as it was printed by the Irish Central Bank under EU auspices.)
In recent weeks, Irish politicians have waxed lyrical about their ongoing negotiations with the ECB over the loan notes repayment schedule - especially one note for €3.1Billion, due for payment on 2 April 2012. Quiet confidence in the outcome of those informal talks was reinforced by finance minister, Michael Noonan who intimated the ECB would accept pushing back that note payment and similarly rescheduling all subsequent notes (totalling over €30Billion).
In the last few days a "mission accomplished" outcome was flagged by Irish government sources. Then on the eve of Noonan's Fine Gael party annual shindig, the Finance Minister rolled out to announce victory. Ireland would not be paying the loan note and so would not need to borrow to fund that payment. Furthermore this success augured well for rescheduling the balance of the outstanding notes.
It was a giant lie. It wasn't just gilding the Lilly, it was calling a dog turd a Lilly. Don't take my word for that, take the ECB's word. The ECB issued a statement welcoming the note payment and looking forward to further on schedule payments - while reminding Ireland that it had aided Irish banks greatly. So there.
In fact, Ireland will be making the note payment as scheduled. In fact, that ghastly reality augurs poorly for the remaining notes.
SMOKE AND WHEELBARROWS
So where did Ireland get the money to make the €3.1Billion note payment? They borrowed it from Bank of Ireland - using NAMA as an intermediary. And where did Bank of Ireland get the money - considering they are a totally bust bank who won't even loan €310 to small business, let alone €3.1Billion to the Irish government? Answer: they 'magicked' the €3.1Billion into existence using the rules of fractional reserve banking.
The Irish government created a bond. NAMA handed the bond to Bank of Ireland - who stashed the bond in the vault and... Hey Presto! €3.1Billion comes into existence as a loan against the bond. And the government hands the new cash to the Irish Central Bank - who are the local agent for the ECB.
What do the Irish Central Bank do with the €3.1Billion? They take it out the back yard and burn it in a wheelbarrow. Really. Remember, the money was first printed by the Irish Central Bank under EU auspices. Now it is to be destroyed to (ahem) 'balance' the books.
If you are starting to feel concerned about the ease with which money is "magicked" in and out of existence; and if you are getting a headache trying to follow this smoke and mirrors game, then let's cut to the chase.
The broke Irish government only now just borrowed the €3.1Billion which years ago was used to pay off well-connected Anglo Irish bondholders. The new loan fees and interest will reward well-connected bankers and financial engineers. The bill is yet more debt the public will be looted to pay.
There are now no ECB negotiations. The ECB wants €3.1Billion EVERY year to burn in the wheelbarrow. The ECB has told the Irish government that if they don't like it, then they can go f**k themselves.
Lacking any testicles, and acting as an intermediary while lying through their teeth, the Irish government has told the Irish people to destroy their country so that money can be burned in wheelbarrows. And if THEY don't like it, then THEY too can go f**k themselves.
Did I mention the upcoming Fiscal Treaty vote? How about the Irish send these political and financial bwankers a message? One like this: NO.
And if they don't like that they can go f**k..........