Ireland Debt Crisis and Economic Austerity

Thursday, November 25, 2010
By Paul Martin

By: Kevin Geary
Market Oracle
Nov 25, 2010

As details of the worst austerity budget in memory emerged ahead of the budget debate on Dec. 7th, This was overheard at the Irish Stock Exchange:”We don’t know where the money went,” said the trader, half in jest, but half in earnest. “We’ve been debating it all morning. Cars, flat-screen TVs, Bulgarian properties? Everyone round here used to have a Mercedes. The whole country was a pyramid scheme.”

Well, not quite. The Irish government actually only had a deficit of 12% of GDP, the lowest in the EU, just a couple of years ago (compared to 40% for Germany and 60% for France!). The coffers of the Irish government were pretty full and the government wasn’t overspending. The truth of the matter is that the Irish banks went nuts, lending money to developers without a thought. The British, French and German banks bought up the debts like crazy, without a thought for the possible consequences of a downturn. Now, Ireland is having to borrow huge sums of money, and impose draconian measures on its people, essentially impoverishing them, all because the banks lied about the catastrophe repeatedly, and the British, French and German banks holding their crappy loans wanted to be paid at 100 cents of the euro, for now worthless shit.

Why, pray tell, don’t the Irish tell the banks to bugger off, declare them all bankrupt and reorganise them in bankruptcy. And why are the bankers in England, France and Germany going to be paid in full, for now worthless pieces of shit, whilst the government is planning to lower the minimum wage on the backs of the poorest Irish?

There is, and was, no need to bail out the Irish government, it’s the Irish banks (and all the foreign debt holders who are being bailed out), and the Irish are being told to just sit down and be kicked in the groin and have their pockets robbed for years to come to pay for worthless debt for which the bankers should be taking a shower.

The sooner there’s a real revolution, and an overthrow of these greedy, irresponsible bankers, who simply made bad business decisions, and who should accept the consequences (i.e. bankruptcy) and move on, the better.

We should remember that it was “reparations,” both to banks and foreign governments, in the 30s, that brought Germany and Italy to their knees economically, that led to the rise of Facism in Europe. Don’t think that can’t happen again.

One more thing. Hitler actually overcame the Great Depression in Germany by issuing government, instead of central bank, money. Indeed, had he not been a homicidal expansionist megalomaniac, and simply confined himself to his economic rescue of the money supply, he’d be thought of today as one of the greatest leaders in German history. He took the bankrupt German economy, which was the worst in Europe and, within four years, turned it into the richest economy in Europe and indeed the world at the time, by basically telling the bankers to bugger off, and printing his own (interest-free) money. Maybe it’s time for the Irish to consider doing the same, and let the banks go belly up, instead of the people.

By Kevin Geary

www.kevingearyart.com and www.kevingearyportraits.com

Kevin Geary is an artist who lives in Sedona, Arizona. He was the youngest political cartoonist on the Financial Times at the age of 19. He had his first one man show at 20, opened by the prime minister of Great Britain, Harold Wilson. He has had over 60 exhibitions of his work; has work in several major museums, including the National Portrait Gallery in London, and his work has sold at major auction houses, such as Christie’s, in London, Whyte’s in Dublin and Doyle in New York.

He has followed politics, history and economic history for many years, and has also written about it elsewhere online. He predicted this depression long before it happened, timed the collapse of the stock market in June last year, long before it happened, and his stock picks have often been very accurate. The four stocks he picked on January 1st, 2009 to do well (Amazon, Apple, Baidu and Google ), are all up from the beginning of the year. He does not offer specific public advice about stocks, but he has written from time to time about long and short term trends in the political and economic realm.

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