$130 Billion!
That’s how much money Ireland will be getting in the bailout package they said they didn’t need as recently as Friday. I just want to make it perfectly clear that I also DO NOT need a bailout of tens of Billions of dollars so whatever you do – DON’T give me a bailout this weekend. Let’s hope that works! The U.K. and Sweden may contribute bilateral loans, the EU said in a statement. Irish Finance Minister Lenihan declined to say how big the package will be, saying that it will be less than 100 billion euros but Goldman Sachs said yesterday the government needs 65 billion euros to fund itself for the next three years and 30 billion euros for the banks.
Ireland’s annual deficit is the worst in Europe at 30% of GDP (that would be like the US having a $5Tn annual deficit) and the nation is expected to slash their budget by $20Bn next year just to keep it under that level. Prime Minister Cowen holds a very thin majority and now faces a “no confidence” vote that could lead to further turmoil with a special election coming on Thursday for a vacant parlimentary seat. “The likelihood of this government surviving long beyond the first month or two of next year is virtually gone now,” says David Farrell, professor of politics at the University College Dublin.
I already put out a special note to Members early this morning on the Dollar and the markets, so I won’t get back into it here but suffice to say we are VERY concerned about any instability that may drive people back into the dollar. I also have nothing to say on the US Economy that John Mauldin didn’t say in his great article this weekend “O Deflation, Where is Thy Sting?” so please read that and catch up on Market Tamer’s very nice chart series and then we can move ahead with current events. All caught up now? Great, let’s go!
Also featured at PSW this weekend was Ed Harrison’s note that perhaps some of the great Q3 performance in tech names was the result of good old-fashioned “channel stuffing,” where companies inflate sales figures by forcing more products through a distribution channel than the channel is actually capable of ultimately selling. …
