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APlanforEconomicRecovery.

DraftCopy(d)Feb11

Minister.for.savings@gmail.com

TheIMF/ECB/EUhaveloanedmoneytoustocoverthecostsofourspending.My proposalwouldbethattheIrishGovernmentwouldagreetoSWAPEuro()notes*1 fromthepeopleofIrelandandgivethemIrishpounds(IR)ona1:1ratiowithaNO commissionfees.ThesthatarecollectedaregivenbacktotheIMF/ECB/EUandany otherpartiestopaythebillsowed(includingbankbailoutsthiscouldendupbeingin therangeof200bn250bn).TheseSTANDINnoteswouldbeexclusivetoIreland andtheIRscanthenbeusedtobuyproductsorservicesasnormalandshopsand businesseswillacceptbothcurrencies.ItwouldleaveIrelandwithazero internationaldebtcleanslatewhichpresumablywouldbeafirstforanycountry, andwithcarefulmanagementwouldpullthecountryoutoftherecessionatitsown speed. So,brieflyHOWWOULDITWORK? EVERYDAYPURCHASING Ifyouboughtanitemworth10andpaidforitby20thechangeyouwouldgetwould beIR10.Youseeaniteminanothershopfor5,youpayforitwithyourIR10and yougetIR5change.Allpricingwouldremainins EUTOURISTS TouristsfromtheEUcancometoIrelandandspendtheirs.Whentheyaregoingback totheircountrytheywouldsimplyconvertanychangethattheyhaveaccumulated,on aNOcommissionbasis(e.g.IR5wouldbecome5) TOURISTSOUTSIDEtheEU TouriststravellingfromoutsidetheEUtoIrelandwouldsimplyusethenormalBureau deChangeinthewaytheypresentlydotoconverttheirmoneyintos.Thiscouldthen bespentasabovewithasimpleNOcommissiontransactiontoconverttheirIRstos priortodeparture. HOLIDAYINGABROAD IRwouldbeexchangedtoonaNOcommission1:1ratioatdeparturepointsorat yournearestbank. IMPORTS AnybodypurchasingitemsfromoutsideIrelandwouldsimplyconverttheirIRtofree ofchargeandeitherconductbusinessasnormalortransferittoanothercurrency throughtheregularBureaudeChange. EXPORTS Peoplewhoareinvolvedwithexportingthatarepaidinswouldeitherspendthes andgetIRchangeorifpaymentmadeintoaBankAccountthiswouldremainasIRs. MoneycomingintotheStatefromanotherCountrywouldbeconvertedtosasperthe currentBureaudeChangeregulations.

BUSINESSES Allcommercialbusinesswillacceptbothcurrencies,andbecauseitisona1:1ratio therewillbenoproblemwithconversionrates.Allpriceswillremainincurrenteuro andcentformat. BANKING Bankswouldtakethesoutofthesystem.Thiswouldbeusedforpayinganyfurther moneyowedtotheEU/IMForanyotherdebtorsofthestate.Ifthedebtisstillclear, thentheswouldbecomelockedintothesystemasbefore.Ifanybodywasconducting acrossbordertransactiontheBankwouldautomaticallyexchangeIRintowithNO fee.Bankswouldstillkeeptheircurrentcommissionratestransferringfromtoother currencies.

ANDSOMEQUESTIONSYOUMIGHTNEEDANSWERSFOR... Isitpermanent? No.OncetheeconomystartstogrowtheIRcanbephasedoutatanytimeand inanyquantityonthebasisthatforevery5receivedthatIR5istakenoutof thesystem. Howmuchwoulditsave? Assoonasimplementeditwouldclear*1anycurrentdebt,wouldceaseany futureECB/IMF/EUtranchesandtheinterestrateonthatmoney.Thesavings areimmense,asitisestimatedthatINTERESTaloneonthecurrentEU/IMF bailoutfundwillbe~10bnin2013thatwewillallHAVEtopaytosave payingthisamountwouldbeofgreatbenefittotheState. WhatiftheEUsaysyoureprintingmoney? 1. TheyareOURnotes,andcannotbeusedinanyothercountry(unliketheUKs STG) 2. WhenwegaveuptheIEP(punts)thesewereallconvertedoverto;thes werenotgivenoutfree,thereforeiftheIrishStateSWAPPEDtheseona1:1 basisitisnotprintingmoney.(5isworth5etc.) 3. ThereisaMAJORdifferencebetweenSWAPPING(replacinglikewithlike)and PRINTING(adding) WhatisthedifferencebetweenthepreeuroIrishpunts(IEP)andIrishpounds(IR)? TheIrishpunt(IEP)wasouroldcurrencywhichwastradedagainstthefora rateofIEP0.79p Irishpounds(IR)remainequaltothevalueofthebutcanonlybeusedin Ireland.Theycannotbetakenoutofthecountrybutcanbeconvertedintofor nofee. Wherewouldwegetthesfromtoswap? ItwouldbedonebydrawingdownStateseizedmoneyfirst(C.A.Betc.),then fromtheeverydayretailside,anddependingonthebalanceofa%oftotal savingsperpersonacrosstheboard(e.g.atotalof2%ofeveryonessavings). ThetotalsumswappedwillbeEQUALtotheoutstandingdebt.Thiswillachieve afairerresultforthoselesswelloff.Nomoneywouldbetakenoutofthe pensionpotasthiswouldbeusedforitsoriginalpurposeorinaworstcase scenarioasarainydayfund. Almosteverybodyhassavings.BecausethesewouldbeTEMPORARILY SWAPPED1:1youwillstillhavethesameamountofsavings.Ifyouleavethem aloneinanaccountwhichmostpeopledoitwontmaketheslightest difference(youwontevennotice).Howeverwhenyoutakeanysavingsoutof youraccountandgetIRsyoucanusethesetopurchaseanythinginIreland,or transferthesetosfor1:1foranythingoutsideIreland.

Istheremoreriskinvolvedwiththiscomparedtoexchangingfromeurotostg/dollar etc? Somepeoplearecurrentlytransferringsavingsfromtostgandotherforeign currencies.Therearetworeasonswhythisshouldntbedone.1)TheIRwill remainona1:1ratiowiththe.2)Shouldthecollapse,itwoulddestabilise otherlistedcurrenciesandhavingtheIRalreadyincirculationcouldmeanthat anybodywiththesewouldhaveacurrencywhichwouldbereadytogetavalue putonitstraightaway.Becausewewouldnowhaveacountrythatis internationaldebtfreethemarkets/tradersshouldlookonusinavery favourablelight. WoulditaffecttheEuropeanUnion? Becausetherateofthenoteswouldbefixedat1:1inrelationtotheeurothere shouldbenodamagingeffect.ThenotescouldnotbeusedoutsideIrelandand thereforewouldnotaffectothercountries.Therewouldbemorebenefitstoit becausetheswegivebackwillbeCASHthatcanbeusedtohelpother countriesintheEU. WoulditdestabilisetheEU? No,becauseanysthatwepaybackarecurrentlyowedandanymoneythatis currentlyneededthroughtheECB/IMF/EUbailoutwillhavetobeprintedbythe ECB.ThiswouldbeADDITIONALmoneytotheEUMonitorysystemwhichis alreadyunderseverepressure. WoulditmeanIrelandgettingoutoftheEU? No.Everythingwouldremainasis.ItisNOTIrelandgivingtheEUthefinger,itis IrelandhelpingtheEUintherecoveryofthedebtthathaslandedonour shoulders,whichispartiallythefaultoftheECB. Howmuchwillitcost? Itwillcostthepriceofpaper,inkandlabour.Whiletheinitialcostwillbeinto thems,whenwerepayourdebt(currentlyheadingto126bnandpossiblyup to250bn)totheECB/IMF/EUandanyotherstherewillbesavingsofbillions fromyearoneonthecurrentintendedinterestratealone. ArewebreakinganyEUrules? Thenewnoteswouldremain1:1withthe,andournearestEuropean neighboursinEnglandhavetheirowncurrency,whichislegaltenderandwhich theEUhavenoproblemswiththemusing. DuringtheIcelandiccrisis,whichwassimilartoours(theirbankswereclosed forafewdayswhiletheywereinreceivership),theyusedfoodvouchersto enablethepopulationtobuyfood.

WhileIrelandiscurrentlyandfortheforeseeablefutureexperiencingaNational crisisakintoacountryatwar,theGovernmentshoulddoitsutmosttoensure thatthecrisisisbroughttoaresolutioninanywayitcan,byitsownmeans,for thegoodoftheStateanditscitizensandassoonaspossible. Woulditaffectthestockexchange? Thecurrencywouldnotbelistedasacurrencyifyouwantedtofindoutwhatit isworthabroadyouwouldsimplygobythecurrentexchangerate. Willwerunoutofs? Solongasexportandtourismmarketsareincreasedandcurrentspendingis broughtundercontrolweshouldneverrunout.Thisplanwillonlywork properlywithproperspendingcuts(publicsectorpay&systemisreformed, numberstakenoutoftheupperechelonsofthecivilservice,pensionscutand perksaredropped,quangosabolished).Intimeandwithgrowthwecanstart takingtheIRsbackoutofthesystem,thesewouldbedestroyed. ThisplanwillNOTworkisifoutgoingsEXCEEDincomealthoughtheother possibilitiesofoutgoings&incomeremainingequalorwhereoutgoingsare lessthanincomewouldbothbringafavourableresult.Therewouldalsobea riskiftherewasmassexodusoffunds(s),whichisthesamescenarioweface atpresentandatthatstagedoesntmakeadifferenceifweareusingsorIRs. Wherewouldthedebtgo? Thedebtowedtootherswouldbewipedout;howeveritwouldmeanthat IrelandsdebtwouldthenbeconcentratedINIreland(ata0%interestfee),and itwouldbeuptothegovernmentoveraperiodoftimetoensurethatallthe IRsaretakenoutofthesystemandswappedfors.(asGraphic1to11above) Thiscomparestothecurrentsituationweareexperiencinginwhichthe DebttoothersWILLincrease,withotherCountriessettingtheirown interestrates. Whatotheradvantageswilltherebe? TheothermajoradvantageofthisplanwouldbethattheStatecouldkeepany assetsthatithasatpresent,ratherthansellingthemtoforeigninvestors;thus ensuringthatoursilverwareremainsours. Aworstcasescenario Ifthegovernment/financialinstitutionslostcontroloftheamountofs requiredforoutgoingsoutsidethestateitwouldmeanthatwewouldhavean unlistedeconomy.Thiswouldmeanthatdailytradecouldbecontinued,butno goods/servicescouldbeimported.Exportsnonreliantonimportedproducts wouldremainunaffected.Thisscenariowouldbeabitbetterthanoneof sovereigndefault.However,asthecurrencyislinkedtothevalueofthethe valueoftheIRwouldremainthesame.Ifitevergottotheunfortunatestage

thatwehavetoreturntotheEU/IMFBailout,ortakethekindofferfromthe IrishpeopleintheUnitedStatesofAmericaitwouldbeforasmalleramountto coveroutgoings. WhatiftheP.I.G.S.wereallonthissystem? ThiswouldbeexclusivetoIrelandbutitcouldworkforothercountriestoo.If Portugal,GreeceandSpainadoptedthissystemandapersonfromIreland wantedtogotovisit,theywouldsimplyconverttoatthepointofexitofthe countryandwhentheyreachtheirdestinationtheywouldspendtheirsinthe waylistedabove.Aslongastheeuroexchangerateneverexceeds1:1all Countriescouldparticipate.HoweverasacautionarymeasureIrelandshouldbe usedasatestcase. Howcanyouhelp? Ifyouwouldntmindspendingadifferenttypeofnoteanddontmindaccepting thenewstylenotethenthiswouldbethebesthelpyoucouldgive. CurrentlyeachOAP,adult,childandnewbornwouldhavetopay28,200toclear thenationaldebt[incNAMAdebt].(21,400withoutNAMAdebt) Inordertospeeduptheturnaroundtimebacktos,Iwouldsuggestthatwhen thedebthasbeenpaid,thegovernmentthenreadjustcurrenttaxandVAT rates,createsaNEW4yearbusinessplanandimplementsafairemergency budgetasamatterofurgencyinorderthatthecurrentriseinpeopleentering thepovertythresholdisreduced. Willitwork? UsedonitsownmeritsorinconjunctionwithaReferendumandbyusingArticle 24*2oftheConstitutiontherewouldbenoreasonwhythiscouldnotwork. WouldntitbebrillianttobeabletogoovertotheEU,askthemforourdebtbill,ask whattheywouldgiveusforaCASHdiscountandthenreverseaconvoyoftrucksinto thebankcomplex,unloadalltheirprecioussandbringtheremainingshometothe peopleofIreland?Savingscouldbeusedwiselybythegovernmentonestablishing businessforthecountryorbyloaningitthroughthecurrentECBschemeattheinterest ratechargedbyourfellowsintheEU. IvelaidouttheprosandconsthatIcanthinkof,howeverifyoucanfindANYTHING wrongwiththispleasesendmeabriefemailandIwillendeavourtocorrectflawsthat mayhavebeenoverlooked.Thefiguresinthisplanarebasedontheworstcasescenario inwhichthebondholdersareincludedata100%returnontheirinvestment. TheoverallfiguregiventotheBondHolderswouldbelowerbydecreasingtheirshare byaconsiderable%(possiblyuptothesameratiothattheaverageIrishpersonhaslost throughtheircontributionasshareholdersinthesamecompanies). Ifyoucantfindanythingwrongwiththeabovethenitisntadream!

Feelfreetodiscuss,comment,email,photocopy,redistribute,ormakepeopleawarethat theremaybeanalternateway. Thanksfortakingthetimetoreadthis.

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