Morgan Kelly's latest article

[Howitzer]

If he is so convinced he's right, thenlet him defend his position and argue it out, or get off the stage and let people who actually want to engage in a democratic debate, take the role on. As Sunny points out he's no Messiah.

In so far as the running of the country is concerned there is no such thing as democratic debate. The people in certain positions make decisions and that's that.

 

[serotoninsid]

But everyone seems to want to buy it just because it was written by Morgan Kelly and no one is allowed to ask him where he got his facts or why he has chosen to commit himself to writing this as the ultimate likely scenario.

I couldn't give a fiddlers who wrote it - but is it not what a lot of us wanted in the first place( ie. go tell the ECB to go fish - its not a sovereign issue - it's a private banking issue)?
Isn't it what the Icelanders did?
Isn't it what WE would do if we were given the opportunity to vote on it (which won't happen of course).
I worked a paye job all through the past ten years. I didn't benefit from the boom - nor had I any involvement in what irish Private institutions were doing - and they certainly weren't acting on my behalf - and of course that is the case for 95% of the rest of the population.

 

[horusd]

In so far as the running of the country is concerned there is no such thing as democratic debate. The people in certain positions make decisions and that's that.

Those in positions are elected. Kelly feels he has something to say of such massive import that every few months he writes something significant. He obviously cares about the issues involved. He feels the need to speak out, nobody is presumably holding a gun to his head. He clearly wants a change of policy and is warning damnation if not. The logical step is to engage and prove his points so that the changes he wants can ever see the light of day.


The man is no fool. He hardly expects that an opinion piece is going to do it, he surely knows that to effect change he will need to defend his ideas, so it begs the question, what is he at? Causing a debate ? Well, that's happened as it did before. so what's new? Another few months will pass and the Oracle of Delphi will speak again. To what end?

 

[Teatime]

The logical step is to engage and prove his points so that the changes he wants can ever see the light of day.

But which points do you think he needs to prove?

 

[LittlePiggy]

The main thing I took from the article was that we should be reducing our spend so that we can finance public expenditure without borrowing. Thats a simple point that nobody can argue with. I disagree that we should go and give the EU finger and then start cutting expenditure, that sounds like a disaster in waiting. I would rather do the cutting first and then see what options we have.

 

[Smart_Saver]

But which points do you think he needs to prove?

There are a whole load of claims made in that article.
Here's some.

"Ireland’s Last Stand began less shambolically than you might expect. The IMF, which believes that lenders should pay for their stupidity before it has to reach into its pocket, presented the Irish with a plan to haircut €30 billion of unguaranteed bonds by two-thirds on average. Lenihan was overjoyed, according to a source who was there, telling the IMF team: “You are Ireland’s salvation.”

2 questions straight away. Who is this source and why has Brian Lenihan never spoke of this ?

"The deal was torpedoed from an unexpected direction. At a conference call with the G7 finance ministers, the haircut was vetoed by US treasury secretary Timothy Geithner who, as his payment of $13 billion from government-owned AIG to Goldman Sachs showed, believes that bankers take priority over taxpayers. The only one to speak up for the Irish was UK chancellor George Osborne, but Geithner, as always, got his way."

Another pretty big claim. Where is the information source for this ? From reading it you get the impression that Morgan Kelly was aware of everything that was happening at the exact centre.

"The IMF found itself outmanoeuvred by ECB negotiators, their low opinion of whom they are not at pains to conceal. More importantly, the IMF was forced by the obduracy of Geithner and the spinelessness, or worse, of the Irish to lend their imprimatur, and €30 billion of their capital, to a deal that its negotiators privately admit will end in Irish bankruptcy."

Another big statement slamming the IMF. Where is all this information coming from ?
In the end Horusd is correct - if Professor Kelly wants to encourage a change in direction he needs to come forward and be prepared to stand by his opinions and not just close the office door once more.

 

[michaelm]

The man is no fool. He hardly expects that an opinion piece is going to do it, he surely knows that to effect change he will need to defend his ideas, so it begs the question, what is he at? Causing a debate ? Well, that's happened as it did before. so what's new? Another few months will pass and the Oracle of Delphi will speak again. To what end?

I like the above quote. Just he right amount of disdain. I agree, Kelly should defend his ideas, if he cares about such.

 

[horusd]

But which points do you think he needs to prove?

There are three things that are relevant to Kelly's argument:

1. Objective numerical facts. Monetary amounts, interest rates,and other objective numerical data.

2. Objective historical facts. Who said what to who when, who decided what, who did what,when, how etc . Again, objectively true data noting a sequence of actual events.

3. Opinions of the meanings, priorities,"mistakes", "correct decisions", relative values and interpretations etc of 1 & 2.

All of these are in dispute. Kelly speaks to the court of public opinion as the prosecuter, judge and expert witness. But refuses to be questioned, refuses to back-up 1 & 2 and thus he cannot establish 3. Any judge worth his salt would chuck this argument out. Kelly may be right, but as long as he cannot be tested on his argument, his rightness or otherwise cannot be a given. If I said the time was 6.15 pm and you said no it was not, it was 7.20pm, but you refused to let me look at the clock, or explain how you know, or why you think it's 7.20pm would you believe me or would you think now that's all very odd?

 

[JoeB]

Well, what aspects of the article does Honohan claim are false?

Does he deny a conflict of interest by being legally bound to carry out the ECB decisions.. versus his position as economic advisor to a country that sits on the opposite side of the negotiation table to the ECB? Which side does he sit on, both sides? Is that possible?
(I know he doesn't sit, but if he did it'd be on the ECB side)


What about cutting off Lenihan at the ankles? What authority does Honohan have to annouce that Ireland needs a bailout? Does he speak for Ireland?, or Gov.ie? Does he deny that he was the first to announce a bailout? How is that different from me announcing a bailout need?, other than he can use his position to appear credible. Perhaps we did need a bailpout, but I think our finance minister should annouce these things, or at least a member of government.
edited to add.. is Honohan governor of the Irish central bank?.. if so I suppose that is a suitable position to comment on Irish finances. If not (i.e only ex Governor) then what was he doing?


Does he think we can afford to pay back 200 to 250 billion?


We're left in an impossible situation where we don't know who to believe.

 

[Smart_Saver]

This post will be deleted if not edited immediately, you wouldn't ask a journalist to name his sources if it was just another run of the mill report. Why should Kelly start naming names? Because it suits you not to believe him?

This is the third time Morgan Kelly has taken this route. Each time after his opinion is published he retires back to his office without doing any post interview or offer of justification for the likely outcomes or predictions he claims.

But the national swell of day to day opinion is rocked after each report and the confidence of the nation takes another battering.

I fail to see the point of it anymore. What is he trying to prove or achieve?

 

[UFC]

What is he trying to prove or achieve?

Give his honest assessment of the scale of our problems?

You don't really believe the people in power are doing what's best for Ireland? Surely you're not that naive...

 

[Sunny]

Give his honest assessment of the scale of our problems?

You don't really believe the people in power are doing what's best for Ireland? Surely you're not that naive...

No it's a big conspiracy involving the FF/Greens/FG/Labour in co-operation with the Central Bank and the Judiciary to protect wealthy developers, bankers and bondholders.

To accuse Honohan who is not a career civil servant or banker and who is one of Ireland's most internationally respected economic experts of what amounts to treason is ridiculous. Kelly could have disagreed with the policies without the personal attack on Honohan. Maybe Kelly thinks he should have been made head of the Central Bank and he would have gone to the ECB and said 'it is Kelly's way or no way'. Writing opinion pieces is like being in opposition in the Dail. Easy to criticise and have great populist ideas. Things change when it comes to putting these wonderful ideas into practice. Writing that we should tell the ECB and the IMF where to go might make him feel better but I can guarantee you that make Kelly Minister of Finance tomorrow and he would change his tune.

I should point out that there are large parts of the article that are well written and it is a very interesting piece. I would also believe him when he talks about the negotiations with the IMF/EU and the intervention of the US and the rest of the G7. It was always suspected that this was the case.

 

[Bronte]

No it's a big conspiracy involving the FF/Greens/FG/Labour in co-operation with the Central Bank/IMF/EU/G7 and the Judiciary to protect wealthy developers, bankers and bondholders and to protect the status quo of those at the top at the expense of those at the bottom.

Who cares what the economist Morgan Kelly says, he could be right, he could be wrong, Honohan could be right, he could be wrong. Was Lenihan right or was he wrong. Does the IMF know what to do, does the EU, do the G7 countries. At some stage one of them will be right and the others wrong. Because if you call it one way for a sufficient amount of time at some stage you will call it correctly. Basically a type of gambling. Just in this case they are gambling with Irish, Portuguese and Greek livelihoods.

 

[Teatime]

There are three things that are relevant to Kelly's argument:

1. Objective numerical facts. Monetary amounts, interest rates,and other objective numerical data.

2. Objective historical facts. Who said what to who when, who decided what, who did what,when, how etc . Again, objectively true data noting a sequence of actual events.

3. Opinions of the meanings, priorities,"mistakes", "correct decisions", relative values and interpretations etc of 1 & 2.

I agree that he does personalise the issue to add drama and I am unsure how he can be finding out who said what at vital meetings but I agree with the main thrust of his argument:

1) Private bank debt will make our soverign debt unmanageable
2) we need to default on private debt
3) we need to balance budget because nobody will loan to use post-default

 

[ccbkd]

This is the third time Morgan Kelly has taken this route. Each time after his opinion is published he retires back to his office without doing any post interview or offer of justification for the likely outcomes or predictions he claims.

But the national swell of day to day opinion is rocked after each report and the confidence of the nation takes another battering.

I fail to see the point of it anymore. What is he trying to prove or achieve?

He is an academic dissident who has examined the facts and is giving his subjective opinion, The Job of the Intellectual is to act with integrity and question authority..he has sparked a national debate about our current financial crisis across all media formats. We have been feed enough drivel from the dept of finance and previous finance minister to last a lifetime, Morgan Kelly's opinion whether you like it or not has caused alot discomfort to Honohan and his cohorts, at least now these people know they are accountable in the court of public opinion thanks largely to the prophetic articles by Kelly.

 

[monagt]

The question now is "Is he right AGAIN?"

He does not act as a celebrity economist like some (and this not a go at McWilliams or Lee who were also 'right on the money' and deserve a lot of respect) rather he is more serious on his pronouncements.

If we listened instead of attacking these guys we would not be in the mess we are in.

 

[Gekko]

I predict that United will lose to Blackburn and Blackpool and as a result Chelsea will win the Premier League title.

There's a tiny chance of the above happening, but if it does I'll suddenly be a sports betting guru whose view will be gospel to some people.

Doesn't make me any more qualified than the next chancer to call results.

Kelly's article is off the wall stuff in my view. His proposals aren't a runner, so why write about them?

 

[ccbkd]

I predict that United will lose to Blackburn and Blackpool and as a result Chelsea will win the Premier League title.

There's a tiny chance of the above happening, but if it does I'll suddenly be a sports betting guru whose view will be gospel to some people.

Doesn't make me any more qualified than the next chancer to call results.

Kelly's article is off the wall stuff in my view. His proposals aren't a runner, so why write about them?

Give a good logical argument why his arguments "off the wall". In my opinion the Irish Government and EU do not know what the next move is, they are stumbling from crisis to crisis..The current situation will inevitably led first to greek default, Irish default and then portugal and then perhaps Spain. Remember capitalism is like all things in life a constantly evolving process and the latest instalment generally referred to as "Neo-Liberalism" has failed, and failed abysmally. The process of a unified common currency in Europe is simply ludicrous and unworkable and in my opinion it is "off the wall" stuff and again this is self-evident in current crisis and needs no further argument, the economic and cultural characteristic of the the constituent parts are just too different for a common fiscal policy.

 

[Teatime]

Kelly's article is off the wall stuff in my view. His proposals aren't a runner, so why write about them?

You're entitled to your opinion but I would value Kelly's ecomonic credibility more than yours. I do think his proposals are our best play at this time.

Is the Kelly debate taking over from the Public v Private debate? Do public servants believe they have more to lose from Kelly's default and budget adjustment plan?

 

[JoeB]

The US is often held up as an example of disperate states coming together, with vastly different economies, and cultures too I suppose. Not having spent much time in the US I can't be certain, but i reckon down south is very different to up north, and Calafornia is very different to rural Alibama or whatever.

They do have a federal budget though.. does Europe?
States can raise their own taxes, as can European countries.

So how does it work there?,.. simply because they had a gold standard for most of their existence? (if so, the US may collaspe under their current huge debt burden, paid for by the printing press, which is legal for them). Apparently the US was close to becoming just another failed union at some points in it's history.


They also have different criminal laws, .. like Europe, with spamspamspam being semi-legal for example in some states, and subject to long prison sentences in others. (Of course they also have over-riding federal laws, which Europe doesn't seem to have)