Thursday, 4 November 2010

The Irish are broke

Have a look at this chart...

Would you say it's tending towards infinity?

Do you wonder what it's a chart of?

Well, wonder no more. It's the interest rate the Irish government has to pay to borrow money. (Technically, it's the yield on a ten-year bond.) They pay nearly 8% while the Germans pay little more than 2% for the same thing.

It doesn't look good, does it?

Taoiseach Brian Cowen would be well advised to have the IMF on speed dial!

That said, they are probably OK until the middle of next year due to having sold all the bonds they need to sell for the next few months.

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