The Credit Crunch & Its Effects to the Irish Economy..!
As the “Irish Celtic Tiger” economy slowly strangles itself from the greed, waste, and folly of the financial boom in the 1990’s, the country now finds itself steering into an abyss of a financial (Red Hole), with no end in sight. Our present government has failed to act and preserve the surplus from our first boom years, since the declaration of the Irish State of 1922. I’m quite sure, if our leader’s of the past, saw what has happened to there country, and what they fought and laid down there lives, heads of our present government would roll… ”No questions asked“
So Let’s begin by not just waving the two fingers “V” in the air to our brainless ministerial bodies of the “Fianna-Fáil” party, who after 90 years of representation in the Free State, fell asleep, while doing absolutely nothing to prevent these crisis of the financial meltdown in Ireland.
These blundering over paid, so called ministers or “eegits” of the state, blew not only the quality of living in Ireland, but caused the crisis of unemployment, and put a strangle hold on the (ISME) irish small business entrepreneurs, by failing to put any pressure on the banking institutions, to free up the capital that was placed in the Irish banking institutions by the (ECB) since 2008. Why have the government not acted sooner to get the banks to loosen up on the credit for the small business…?
The European Central Bank pledged 30 billion Euros towards the (ISME) to stimulate the Irish economy, to ease the high unemployment where we now find ourselves in today mess. So what are the Irish banks doing with the pledged investment made by the (ECB) where’s the funding…?
Well it’s believed, the Irish banks are storing up there reserves, caused by the downturn in the construction industry, the fall in the property market, which was brought on by the over inflated valuations of land, & property developers and senior bank management alike. Not to forget, the property loan scams by the elite banking management, and the failure of the Irish regulators who supposedly were to regulate the banking system, at €300,000.00 a year, plus a fat pension taboo…
Our tax money at work…?
The Credit Denial by the Irish Banks has many implications here are just a few:
•Small Business unable to function to there full capacity.
•Start up businesses will find it hard to get started.
•Business closures.
•Growth in unemployment.
•Purchasing Power limited.
•Social life style challenges.
The Effects of Credit Denial:
Small Businesses depend on credit to keep the operations functioning. Credit helps pay the costs of doing business. It pays the employees, the operation overheads, i.e. rent to the property, energy to keep the equipment in operation, pay creditors, and helps businesses in growth and expansion. Credit also helps businesses in the exporting products to the global markets.
Start up business will be affected, as the credit crunch, can put strains on any new start up programs. This make’s it very difficulty for the new entrepreneur’s, who seek private investment from angel clubs, friends, or families, who can demand a higher interest rate or shares in the project. Opportunities could be missed out on, with new business ventures not been able to get of the ground, and possible a lost of tax revenue from the hiring of new employees, and revenues from new business.
Business closures will be a big contributor to the unemployment force, and this affects all area’s of the economy. Earning’s of tax revenue to the tax exchequer from employees and business will be down, and will put a burden to the economy. Other governments agencies will be affected, i.e. the welfare department, schools, hospital, policing the streets of Ireland, and many more area’s of the economy.
Growth unemployment, will be added to the already unemployed, also the possibility of loosing benefits to the unemployment benefits from the welfare department, as the growth to the unemployment welfare register, will be horrific. Here’s the latest figures on the live register 325,800 in February an annually increase of 165,000 a jump of 14% for the year 2009. Very, very, scary indeed…
Purchasing power will be effected, business will be unable to purchase or lease new equipment for there business, and unable to help increase employment force to our economy. Credit refusal to the Irish businesses from the banks, will have a serious outcome for the Irish economy to come. Standard & Poor, have downgrade the Irish government from a (treble AAA to a double AA +. I guess after all, they have no fate in the two “Brains” or should I say the two “Brians”
Social Implications:
As we can now see what the credit crunch can do to the businesses community and the economy. Today in Ireland were facing a recession of unknown fathoms, where and when the solutions to the financial crisis can contract…
Implications to our vital services which are critical to our social way of life, such as transportation, hospital care, social care, may be effected. As the government has less-funds in there budget to provide adequate services for the community, and to the economy. People from all sectors of the community, from the lower rung to the middle class, who have been laid off from the jobs, will be the most stresses out, and this will lead to physiological problems, many families will having difficulties, bills payments to creditors will not be met. Credit collections will amount on the unemployed who will have no way to make any payments, as the benefits from the department of welfare will just be enough to survive. If any?
The Way Through The Credit Crunch…?
•Begin with a change of government, a government with vision and with a comprehensive plan for at least ten years. A government who will take there ministerial duties serious, and who have the experience, with qualification that suit the department they manage. A minister, who head’s up the finance department, has the qualification to back up this position.
•Cap all minister saleries, and reduce expences, to a level thats fair...!
•Removed all junior ministers that sit in the senate, that do not act in any parliament or government decision making, this would save millions each year for the exchquer.
•Replace all the senior banking management,who have failed to keep the banking business honest. Restructuring the banking system, by insuring integrity from the new senior management. Cap all salaries, from senior to junior management staff, bonuses to be limited across the industry, and profits from the banking system to be reinvested into the economy, not in the bankers pockets or their pension funds.
•Issue goverment construction stock bonds, for the building of new construction, for roadways, railways, and other green energy projects, such as replacing and installing insulations through attics, walls, window replacment in older homes.
The way forward is to have a new goverment so, "Please" lets have a referendum for a new goverment with a plan for the country...(ASAP)?
