were britain right to bail out ireland?

[victoria24]

non political please as per the rules. this is a purely monetary question.

[Kanga]

Is this a game of spot the errors or are you really wanting to discuss?

[victoria24]

erm.. sorry kanga, what do you mean?

[Duncan74]

But it's really not 'just monetary', it is as much about politics as tax and spending is what underpins policies.

[victoria24]

but we're not allowed to discuss that type of gubbins on here so its more of a "out of principle should countries bail each other out" type of question.
Could I run up a massive overdraft and then get my neighbour to pay it off?

[Mamee & Co]

The fear in the UK is the loss of a massive export market and the potential exposure of the banks if the Irish economy is to fail. Whether it will avert this remains to be seen.

[Duncan74]

Owe a bank and £1000 and it's your problem. Owe them £100,000,000 and it's their problem. The fact that several million americans (primerily, and leant by banks from all over the world) were sold loans that they could never repay has meant that there's a million more unemployed in the UK and round the world. Of course nations need to look out for each other as we're in a global economy. However, by the same score then there's going to be the need for a political shift in some of these nations. In the UK then we've been comparatively centre right in terms of policy, even with New Labour a the helm for the last decade. Tha austerity measures are going to need to be felt by all nations, and that is going to be a real shock for some more than others. And so there's a real tinder box and potential for a lot of civil unrest from those having to cut right back, and from those doing the bailing who are going to be suffering and see some of their taxes / jobs being 'given away' without seeing the long term need to restart the neighbours.

[GrumpyGoat]

the current system is not sustainable. Fiat money created out of thin air and loaned to govts at interest.
It's a ponzi scheme.

This is just the beginning. There will be an unraveling that will last many, many years.

Very bad times ahead.

[victoria24]

in the old days, cigs and booze were cheap to keep the working class happy in times of monetary strife.
lets hope 20 marlboros come down to $1 a pack!

[SueDonim]

It's a huge mistake for IE, UK, and EU.

For IE, they give up their sovereignty. Their whole economic system is going to be dictated by the EU. They will have to raise business taxes which will drastically hurt their competitive edge.

For UK and EU, it is a sure increase in moral hazard. When losses are bailed out, bankers and politicians have every incentive to increase the risk they take on. That hurts everyone, and is going to make the GFC even worse in the next iteration.

That's not even taking into consideration the non-sense going on with the Fed in the US.

The only positive is it may encourage the demise of the Euro and return sovereignty to the peoples of Europe.