Finally got around to grabbing some quotes from the Brian Lenihan interview on Monday’s Breakfast with Newstalk. Some of the nonsense is terrifying. Will be throwing bits of this into the Quotes from Brian Lenihan collection.
“The bank [of Ireland] has been put on a sound commercial footing, it’s clearly able to operate on world markets, it’s clearly going to be able to liberate itself from state support and attract funds into this country and lend to the wider economy.” – Breakfast with Newstalk Monday
Followed by a bit of banker hero-worshipping…
“Mr Richie Boucher left this country last Monday morning on a boat to England because of the volcanic ash and saved the taxpayer €1.5bn by getting these people to invest in Bank of Ireland, that’s what happen last week. During the week there was a controversy about his pension and he decided – in the national interest to support the Croke Park agreement, and also to ensure the banks plans to insure pensions in their own bank could be adavanced – that he would forego rights which he had and which flowed from a reduced salary which was sanctioned for him. That’s the situation in Bank of Ireland”.
Then this load of dross which Ivan Yates does a good job trying to cut through in an brilliant exchange…
Ivan Yates: “Do you not see that Anglo has capsized our public finances?”
BL: No, no…
IY: You’re in denial minister.
BL: No, no… You’re in denial! Because, because when Mr Boucher went to London all he heard was how well we’re managing our finances here
IY: Because you’ve spun it that way, but it’s actually not true!
BL: No it’s not a matter of spinning it, they’re able to read figures! They know about the Anglo figures, they’re all factored in already.
IY: They’re not, that’s the whole point of the EU Commission [decision].
BL: Sorry [hold on], this money was borrowed already this year, that’s the position. The world markets were perfectly well aware of that. This [decision] was purely an accountancy-classification issue.
IY: Minister you’re in total denial…
BL Can I finish? Can I finish? Ivan, can I finish?… because this point was made by Richard Bruton last week and was put to John Fitzgerald of the ERSI who said Richard Bruton was just wrong on this as well. And you’re just wrong on this as well. The position is that that money has already been borrowed, so that’s the past position.
IY: That’s for 2009 but for 2010 you got up in the Dail and said…
BL Hold on! Hold on!
IY: … €1.3 billion is to be put in… that has to be added to our deficiit!
BL: … can you please… can you please, discuss this rationally. Can you? First of all, that’s the position in 2009, Eurostat hasn’t decided it yet, that’s our assesment of how they will decide it, we’ll still argue the toss with them. We have to deal with 2010 yet, but let’s assume that you’re right for a minute and that all the €8bn has to be added on in 2010. Let’s assume that. We won’t be borrowing the money, we’ll be borrowing the money over a period of ten or fifteen years. We’ll actually be upfronting – in accountancy terms – the figure, but we will not in fact be borrowing…
IY: Anglo’s bankrupting the public finances…
BL: No, no, listen, listen. This not good for the country and it’s inaccurate. If next year we’re obliged to include the €8bn, the €8bn will not actually be borrowed next year the device of the promissory note means we borrow…
IY: No, I know the promissory note is over ten years. You’re missing the point…
BL No you’re missing the point! This is an accounting device! This is not real borrowing! What the markets look at is real borrowing. Not accountancy devices…
IY: That’s total nonsense, with respect…
BL Well I’m sorry but…
IY It’s real money! It’s €22.3bn in real money!
BL This information has been in the public domain since last Thursday and the Bank of Ireland issue is three times oversubscribed this morning, the world markets do not see Ireland as being in the same place as Greece and we’re not in the same place as Greece! And we really have to stop talking ourselves down as a country and misrepresenting facts, misrepresenting facts which the rest of the world is not even interested in seeing misrepresented. This is domestic political battle, Ivan, it has nothing to do with the realities!
What international markets and investors look at is the real sums you’re borrowing, and the real sums we’re borrowing are substantial, are difficult, but are manageable. And we have been commended by the European Central Bank, by Angela Merkel and by the rest of Europe for what we’re doing, because we’re doing the right thing and we’re restoring our economy to growth and confidence. That’s the position.
And yes the position with Anglo is very difficult, I agree with you, and it will have to be worked out over time because I can tell if we were to pay all the sums that would be required to wind it up tomorrow morning, we would be in the same position as Greece. But we’re not in that position, we have to time to resolve this problem. And just as we resolved the problems of Bank of Ireland, we will resolve the problems of the other banks, and in all cases, at maximum protection and minimum exposure to the taxpayer.
Odd how the attitude on Anglo seems to have changed since Monday. Also, last quote, for the record…
Now that I’m the shareholder in Irish Nationwide I will clearly ensure that whatever money is owed by Mr Fingleton is paid by Mr Fingleton.
Surely by now our higher-ranking journalist are beginning to realise Lenihan is not an economic godsend sent to save our sorry souls? Surely they realise he is simply good at sounding confident?
Is the perception of The Saviour Lenihan changing, like it has done over the last 12 months of the formerly, “presidential”, “statesman-like” Brian Cowen?
Full interview below.
Oh and while we’re on quotes, here’s one from Constantin Grudgiev’s classy fisking of Minister Lenihan’s recent Dail speech on Nama.
… [The] sentence [quoted prior to this one] is an example of the Minister’s habitual abuse of financial terminology, in so far as it makes absolutely no rational sense to anyone even vaguely familiar with finance.
And here’s another…
This statement clearly shows that Minister Lenihan does not understand the basics of interest rate/yield curve relationships.
The Saviour, Brian Lenihan, lads.
Great post, very revealing of what this man realy is.
This sentence neatly sums up what Ireland is.
“This is domestic political battle, Ivan, it has nothing to do with the realities!”