Ireland set to go BUST

Once upon a time, Ireland was a pleasant little land,
even if it wasn't the wealthiest of countries.

Then one day it decided it didn't want to be left out
of the club. So it joined the EU and became part of
the international banking system. Whereupon it began
to receive all the blessings that are bestowed by this
glorious global octopus. . . .

Sad smile emoticon


http://www.independent.co.uk/news/world/europe/ireland-set-to-go-bust-claims-economic-historian-1692673.html

May 29, 2009

Ireland set to go bust, claims economic historian

"The idea that countries don't go bust is a joke," said Niall Ferguson, Harvard professor
and author of The Ascent of Money.

"The debt trap may be about to spring" he said, "for countries that have created large
stimulus packages in order to stimulate their economies."

His chosen prime candidate to go bust is "Ireland, followed by Italy and Belgium,
and UK is not too far behind".

Argentina is top of his list of shaky countries but "the argument that it can't happen
in major western economies is nonsense".

Professor Ferguson believes the economists are ill qualified to analyse the current
economic situation since they lack the overview of historians such as himself.

"There are economic professors in American universities who think they are masters
of the universe, but they don't have any historical knowledge. I have never believed
that markets are self correcting. No historian could."

The historian does not subscribe to the theory of the "Great Depression" repeating
and says this scenario is unlikely because the Federal Reserve has "massively
expanded the monetary base which is the opposite of what happened in the 1930s".

The problem now is what happens when current monetary policy collides with a policy
of "vast government borrowing" on a scale unknown since the 1940s.

"We have the fiscal policy of a world war without a war."

Referring to the clash between inflation and deflation he added: "I don't know who
is going to win but we know that while the struggle goes on ordinary people will get
trampled. There will be more economic volatility and ordinary people will pay."

He has also warned that in Britain he expects "more riots in major cities this year"
because of the economic situation and says the recent "drip feed" of the peccadilloes
of British MPs and their expenses is "just the beginning of a crisis of political legitimacy
that will be played out over the next 18 months".

Ferguson, a native of Glasgow, specialises in financial and economic history as well
as the history of the British empire.

* This article is from The Belfast Telegraph.