Business and Financial Education: A Canadian Perspective.
Sunday, November 21, 2010
Irish Forced to Accept Bailout as Banks get Worse and a New Irish Diaspora Begins.
Stocks around the world should begin on a healthy note tomorrow morning as the Irish government announced that it is willing to bite the bullet and accept a 100 billion Euro aid package.
Once again it will be primarily the German taxpayer and some other members of the IMF and the European Union that will have to fund the propping up of Ireland's decaying financial system. Once referred to as the "Celtic Tiger" because of its soaring domestic economy and thriving housing markets, Ireland is returning to a have-not position within the European community. To be sure, studies indicate that a new Irish diaspora is beginning to develop as young inhabitants of the Emerald Isle leave to seek employment elsewhere.
To be sure, there are going to be a lot of strings attached to the bailout of Ireland's economy, and the Irish people are going to have some tough years ahead of them, especially as their tax base begins to leave to seek employment abroad, taking their skills and money with them. But it was a smart move by the Irish government, as they had to get help before things got worse. People were quickly pulling money out of Irish banks and in order to restore confidence in them the country had to send a message that it had enough money to keep the banks afloat should the need arise.
The winners from this bailout are undoubtedly going to be the European financial stocks who hold a lot of Irish and other European debt, such as the debt held by Portuguese and Spanish banks as well (two other nations in big trouble). Allied Irish Bank (AIB in New York), the Bank of Ireland (IRE in New York), and even a large Spanish name like Banco Santander (STD) should be winners for the week ahead.