Quietly, Ireland's banks are being bled white as everybody and his dog have been retiring their money. (Not Koko, she never trusted the Irish with her money). Some 75 billion dollars have emigrated from Ireland. The country is insolvent. Broke. All the reserves of the financial institutions have been used up. The entire Irish banking system is on the verge of abrupt collapse.
Well, what do you expect from a Taoiseach born in an Irish pub?
Yet payments are still being made, but only because the Germans have taken over the country's finances and lent 130 billion euros. Germans are making a mistake by artificially maintaining the solvency of Greece, Ireland and who knows which others. The euro is under severe attack by cosmopolitan currency speculators and the question is if the Bundesbank (I heard someone call it "Buba" - doll in Hebrew) has the resources to fight off a run on Spain and Italy. I dont think it has.
The euro is in trouble. Europe was always expensive for Israelis, but now the euro is so weak and/or the shekel so strong that Europe is cheaper than Israel. I think shorting the euro would be profitable but immoral. It is against my concience. I am not doing it. I need more time to ruminate on this issue.
Addenda: Germany was able to refloat Greece and Ireland and will have no difficulty with the coming crisis - Portugal. If the dominoes keep falling and there is a run on Spain and/or Italy, the game will turn ugly and the euro may collapse, meaning that Germany will not see a cent of the hundreds of billions it invested and keeps investing in saving the euro. The natural dynamics of financial panics is a progressive acceleration, and the Europeans lost the opportunity to stop the process like Bernanke did in the USA with a monstruous overkill at its very start, immediately after the run on Lehmann and hours before it developed into mass hystery. The Europeans insisted for too long that there was no crisis, ridiculed the Americans, it cant happen here they said and allowed the uncertainty develope into full fledged panic. Now it may be too late to reverse the momentum, the herd is increasingly nervous and wishing to stampede far away from the danger.