“Our adventures with Your Money”: Irish banks get 10% on Irish sovereign bonds, give Irish depositors 1%


From BloombergIrish Notes, Portuguese Bonds Drop as Debt Crisis Deepens Ahead of Summit:

Irish two-year notes slumped, leading the bonds of the region’s most-indebted nations lower, on concern a permanent solution to the fiscal crisis will elude European Union leaders meeting at a summit starting tomorrow.

The declines drove the yield on the security to more than 10 percent for the second consecutive day, while the spread investors demand to hold Irish 10-year bonds instead of German bunds climbed to a record.

What this means:

  • You and I and every other Irish sucker deposits our money with an Irish Bank;
  • The Irish Banks buy Irish Sovereign bonds (debt that our government(s) have taken on – rightly or wrongly – as your debt);
  • This pays the Bank over 10% interest
  • It is over 10% because of the discount – the risk – associated with the Irish State, as a direct result of it taking on the Banks’ debts;
  • The Irish Bank then pays you – the sap who is not only giving it your money, but bailing out all its friends – only ~1%!
  • The Irish banks then pocket the difference – around 9%!
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This entry was posted in Accountability, Bankers' Bailout, Budget, Debt Default/Restructuring, ECB/IMF, Economy, EU, Euro / Sovereign Money, Housing Bubble, ireland. Bookmark the permalink.

One Response to “Our adventures with Your Money”: Irish banks get 10% on Irish sovereign bonds, give Irish depositors 1%

  1. Pingback: Update: The Panic of 2011 (2) | rebel-alliance.org

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