Lots of people have asked, so here's the interview I did with Dick Roche today on East Coast Radio at 11 am this morning.
Lots of people have asked, so here's the interview I did with Dick Roche today on East Coast Radio at 11 am this morning.
An interesting interview Stephen and I see where you’re heading with the distinction between state and bank bail-outs but I don't see how the two can be separated whilst the state is still guaranteeing bank deposits. If investors in the banks, nervous that the state can't honour its guarantee, decide to withdraw funds en-mass, it’s the state that will need bailing out as much as the banks. For the state to ‘distance’ itself from the banks it needs to link any bank bail-out funding from the EU rescue fund to a withdrawal of its bank guarantee scheme... that might offer the government a chance to avoid the worst of any state bail-out conditions and lighten the psychological load born by the people of this state.
Steve,
(Liking the name),
Any debts racked up by our banks will fall on the taxpayer as long as the liabilities of the banks are guaranteed by the state, but that doesn't have to be forever--in fact there are strict time limits on the guarantee. The key to any recovery is the decoupling of private bank debt from state sovereign debt, and that won't be easy (or even possible) in the short term. When things stabilise, then perhaps a de-coupling is possible. But I've always insisted on the difference between the two, and here I'm no different--the banks' debts are ours only so long as that guarantee is there. If someone from a very large growing populous Asian country beginning in C decides to buy the banks from us, then perhaps the two can be separated again. Perhaps. At this stage I'm honestly not sure of anything. Cheers for the comment.