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Generational Dynamics Web Log for 28-Nov-2010
28-Nov-10 News -- North Korea fires missiles as war games begin

Web Log - November, 2010

28-Nov-10 News -- North Korea fires missiles as war games begin

Europe rushes to bail out Ireland by Sunday evening

North Korea fires missiles into Yellow Sea

At this writing on Saturday evening, there are reports that North Korea is firing missiles into the Yellow Sea, near Yeonpyeong Island, where civilians were killed by North Korean missiles on Tuesday.

The new missile firings come just hours before joint military exercises between the US and South Korea are to begin in the Yellow Sea.

At the same time, Tuesday's attack is generating a desire for revenge by the South Koreans, according to the NY Times. South Koreans have been deeply shocked by the North's ferocious attacks on civilians, and are demanding some kind of revenge. However, most are not demanding a full scale military response, since that would trigger all out war.

Europe rushes to bail out Ireland by Sunday evening

Tempers are flaring as European Union officials rush to put together a bailout plan for Ireland before the Asian markets open on Monday morning, which is Sunday evening in New York and London.

Under the bailout plan, Ireland is expected to receive a loan of 85 billion euros, and will be forced to nationalize the Bank of Ireland, according to the Telegraph.

Something that's particularly infuriating to the Irish is that Ireland will be forced to pay 6% interest on the loan, much higher than the 5.2% interest that Greece will have to pay. The reason for the higher rate is that the loan to Ireland will be for 6 years, while the loan to Greece is nominally just 3 years.

On Saturday, some 50,000 people marched in Dublin to protest the bailout plan and the budget cuts.

Ireland's top labor leader, David Begg, speaking to the crowd, said that Ireland should not have to borrow any money because they're still owed money in German reparations that were imposed by the Treaty of Versailles after World War I, according to the Irish Times:

"Does anybody in this country or in Dáil Éireann think that we can as a people afford to pay 6.7 per cent on money that we did not ask for in the first place and that is being forced upon us to bail out the banking system in Europe which is in hock to this country for €509 billion. We can’t pay that money and we won’t pay that money. ... Well our gallant allies in Europe have arrived 95 years too late and uninvited and instead of guns to help the revolution they have brought economic weapons of mass destruction."

The bailout plan comes just two weeks after Ireland insisted that no bailout is needed. But as we reported yesterday, since the beginning of the year, investors appear increasingly to be panic-selling bonds issued by Ireland, Greece, Spain and Portugal. The Europeans are hoping and praying that a quick bailout of Ireland will cause investors to say, "Whew! That was close! But now the crisis is over!" Fat chance.

Last spring, Greece was insisting it didn't need a bailout -- until it did. Then Ireland said, "We're different from Greece, and we don't need a bailout." But now they do. And now we're hearing that Portugal and Spain are "different," and don't need a bailout. We'll see.

How secure is depositors' money in Irish banks?

People who have deposited money in Irish banks should consider withdrawing it as quickly as possible, according to an article in the Daily Mail.

It now appears that Bank of Ireland and Allied Irish Bank will be nationalized, while Anglo-Irish bank was already nationalized in September. This means that deposits are guaranteed by the Irish government, but will be at risk if Ireland defaults.

British advert

British advert

The nearly 2.3 million British people who have invested billions of pounds in Irish deposits and bonds. Britain has already supplied some bailout money to Ireland's banks, and is also guaranteeing the safety of some depositors' money in Irish banks, as described in the adjoining ad.

If you have money in Irish banks, you should consider your options.

Additional links

Thanks to the bailouts of Greece and Ireland, the International Monetary Fund (IMF) is gaining new authority and prominence. NY Times

Many Boomers will have no retirement money, as pension plans are vastly underfunded, and 401k plans are not doing very well. Newsweek

(Comments: For reader comments, questions and discussion, see the 28-Nov-10 News -- North Korea fires missiles as war games begin thread of the Generational Dynamics forum. Comments may be posted anonymously.) (28-Nov-2010) Permanent Link
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Generational Dynamics Web Log for 28-Nov-2010 28-Nov-10 News -- North Korea fires missiles as war games begin

North Korea fires missiles into Yellow Sea

Europe rushes to bail out Ireland by Sunday evening

How secure is depositors' money in Irish banks?

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Generational Dynamics Web Log for 28-Nov-2010
28-Nov-10 News -- North Korea fires missiles as war games begin