What happens to our deposits if IMF step in?

Just doing a bit of thinking out loud.
4 billion a year cut for 4years to get the deficit under control.
Thats 4,000 million cuts a year for our population of 4 million.
Thats 1000e cut for every man woman and child in the country.
The fourth year will see an average cut of 4000e for every person in the country.Thats a 16,000e yearly average cut for a family of 4 or a 80e per week cut for the average person.This would bring us close to only spending what we take in in taxes.
Unemployment will rise as there is less spending power in the economy and of course the dole will be much reduced.The extra "mortgage" for servicing the bank bailouts is not included in the above figures.Also we must pay back the debt that we already owe + interest.
It is clearly going to be really tough times ahead but as Garret Fitzgerald once said..."being poor doesn`t mean you can`t enjoy yourself"....He obviously was never in a pub or even a brothel with no money.
Property and buisnesses prices will plummet in value and will be bought up cheaply by foreigners. Also the government will sell off everything they can...I mean they own a lot of forestry and colleges and so on.
Ther will be a certain amount of inflation which will ease the pain.
 
To sum it up the way I see it. The administrator analogy isn't a bad one but lets keep in mind what the IMF would be here to do - Get us to a position of long-terms sustainable financing. So while on one hand they might slash and burn our expenditure (public pay & social welfare) and equally set about raising more money through higher taxes what would be the long term benefit of defaulting on deposits in our banks. You'd end up with even more of a zombie banking system with people forever remembering "the day the IMF stole our deposits".

I know that the psotion between government and banks has been blurred but the focus of the IMF would be day to day expenditure of the governemnt not really the bank bail out. besides the IMF would still have to respect the laws of the landand the right I have to access my money.

cremeegg said:
As I understand it during Argentinas default, accounts were temporarily blocked. The currency was devalued before they were unblocked. .
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Accounts weren't blocked rather a bank holiday was extended to allow the markets to open and adjust to the new FX rate. The reason why the bank holiday was extended was to stop a bank run. Use the same logic here and the IMF would want to preserve the deposit base.
 
Originally Posted by cremeegg http://www.askaboutmoney.com/showthread.php?p=1092644#post1092644
As I understand it during Argentinas default, accounts were temporarily blocked. The currency was devalued before they were unblocked. .

And if I remember correctly, the Argentinian government then capped the amount the public could withdraw from their own accounts - I think the figure was $200/day.

The following book is a good account of what happened when the IMF entered Argentina: 'And the money kept rolling in and out' - Paul Blustein
 
Interesting! I'm wondering if the same will happen if all the countries belonging to the PIIGS acronym will have to pull off from the Euro! :(
 
sunrock said:
This would bring us close to only spending what we take in in taxes.
Unemployment will rise as there is less spending power in the economy and ...
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This isn't correct. The government has to take money out of the economy in order to spend it. Cutting government spending will have a positive effect on the economy, but increased taxation will have a negative one. Unfortunately Ireland is so broke that tax increases will be inevitable, even though they will make things worse.
 
Why don't depositors move savings to Rabo which is covered by the Dutch Guarantee. It might not keep it away from the prying fingers of the IMF but a Dutch guarantee is worth more than an Irish one.
 
Does Rabo come under the Irish Gov guarantee?

My question really is:
In the event of IMF coming in and withdrawal limits placed by the Gov through not being able to honour the Guarantee in Full and Immediately,
would the withdrawal limits apply to Rabo and/or Ulster Bank Republic and/or Ulster Bank NI?

I am afraid that we will get our guaranteed deposits back EVENTUALLY but only allowed to withdraw over say 10/12 years, getting 1% interest (less DIRT, levies and new prsi tax) and inflation running at 4 or 5% p/a
 
what about pensions taken out with the banks, in the event of a default and banks (BOI/AIB) failing? Would the pension be worthless as the investments are not guaranteed in any shape or form? Or are the banks in this case just the agent for the pension and the investment continues?
 
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