Madam, – Please be patient with my query as I do not have the financial education of Brian Lenihan, Brian Cowen or even the Keynesian brain of a Jim Power. I am just a simple, uneducated, working-class soul. Can you please explain the following?
Our banks borrowed huge sums of money from gamblers and investors on the money markets. The banks then loaned this money to Irish gamblers and investors. When it turned out that the Irish gamblers and investors couldn’t pay back the money they got from the banks, and therefore the banks couldn’t repay the gamblers and investors on the money markets, the Irish Government decided that the taxpayer needed to pay this money back to avoid upsetting the international gamblers and investors.
Now Ireland is deeply in debt thanks to the Government’s generosity. So, now the Irish Government needs to go back to the international market’s gamblers and investors to borrow more money to shore up our financial ability to run the country. These same gamblers and investors now see Ireland as a lending risk, so they charge us almost twice as much to borrow back the money that we just returned to them.
The market’s gamblers and investors, happy with their unexpected windfall, will sell on Irish debt as default products, therefore betting that Ireland will be unable to pay back this money. The gambler and the investor get paid twice, while the public services of the Irish taxpayer are decimated to keep Mr Gambler in jet fuel.
I am quite willing to be made a fool of. I would just like to know if this is the complicated truth.
– Yours, etc,