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Ecb-Forced 'run On Our Banks' Led To Bailout

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http://www.independent.ie/national-news/ecbforced-run-on-our-banks-led-to-bailout-2628449.html

Economist Colm McCarthy has said that there are "widespread suspicions" that the European Central Bank fostered a run on Irish banks to force the last Government to seek a bailout from the EU-IMF.

In the Sunday Independent today (below and page 23), Mr McCarthy says that the ECB behaved in a "bullying fashion" towards Ireland by threatening to withdraw liquidity support and "fostering" a run on the banks.

Mr McCarthy also said that any further inquiry into the banking crisis in Ireland should explore the "murky role" of the ECB in events leading up to the exit of Ireland from financial markets and resort to EU-IMF financing in November 2010.

His comments follow the publication of a quite sensational account by former Finance Minister Brian Lenihan in which he claims that the ECB forced Ireland into the bailout.

In an interview to be broadcast on BBC Radio 4 today, Mr Lenihan has also accused members of the ECB executive of "betrayal". He criticises some ECB governing board members for the "damaging" manner in which they briefed some media about Ireland.

Although to be fair the status of Irish banks didn't exactly help matters, the bubble had burst and the Irish had run out of money.

So why would the Germans want to force a bank run?

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http://www.irishtimes.com/newspaper/frontpage/2011/0423/1224295312306.html

BRIAN LENIHAN has claimed the European Central Bank forced Ireland into taking a bailout and rejected claims by a senior ECB figure that the bank warned Ireland in mid-2010 of the dangers it faced.

He has also accused members of the ECB executives of briefing against Ireland and of “betrayal”.

In a wide-ranging interview on the events surrounding last November’s bailout, Mr Lenihan criticised some of the 17 governing board members of the bank for the “damaging” manner in which they had briefed some media about Ireland.

“On the betrayal issue, I did feel that some bank governors should not be speaking out of turn and that only the president should speak for the bank.”

He describes as “at variance with the facts” a statement made in an interview in this newspaper in January by Lorenzo Bini-Smaghi, one of six executive board members of the ECB.

In the interview Mr Bini-Smaghi claimed ECB president Jean-Claude Trichet had pressured the Government from mid-2010 to bring forward the 2011 budget. Mr Lenihan denies any such representations were ever made.

Yet another politician in denial about reality and if the sums don't add up your bankrupt.

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http://www.todayszaman.com/newsDetail_getNewsById.action;jsessionid=209E0252B41C02E8EB5796FF710F401C?newsId=241016

In an opinion piece in the Financial Times, ECB Executive Board member Lorenzo Bini Smaghi said Ireland’s taxpayers should foot the bill as they are the ones that benefitted during the pre-crisis boom years and elected the governments that regulated the banks as the problems built. “The principle of ‘no taxation without representation’ should work both ways. If taxpayers have the right to share in decision-making, they must also accept the consequences,” Bini Smaghi wrote. “As long as the accountability of supervisors to taxpayers is primarily a national affair ... then there is a high risk that taxpayers will foot most of the bill. They should not complain when it actually happens.”

The problem is though that those in power will manipulate and lie to the public to ensure they stay in power, you can only be effectively represented if you know the truth.

And I think it's rather a board generalisation to say that all Irish taxpayers will have benefited, but perversely if you take this view those lending the money to the Irish also have to accept they lost and take the haircut. They bought into the boom, why should the Irish taxpayer foot the bill for their losses?

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Sounds like the Irish politicians are in back covering mode as they can see how grim things are going to get for Ireland in the future decades.

Blaming the ECB sounds very like the Irish version of "it started in the US" used as an excuse by UK politicians for their incompetence.

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The Irish have been milking Europe for every cent for a generation.

They've received billions.

Are they really so naive as to think that street ran only one way?

I'm starting to understand why the jokes about the "Irishman" had such traction.

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The Irish have been milking Europe for every cent for a generation.

They've received billions.

Are they really so naive as to think that street ran only one way?

I'm starting to understand why the jokes about the "Irishman" had such traction.

For "European" read UK taxpayer.

The sooner we quit the EU the better.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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