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Thursday Newspaper Review - Irish Business News and International Stories - - November 06, 2014
By Finfacts Team
Nov 6, 2014 - 10:55 AM
CAPPING mortgage loans at 80pc of the price of a house will lead borrowers to gamble on risky loans to make up the difference, the head of the country's biggest bank warned.
Bank of Ireland boss Richie Boucher warned of potential unintended consequences of the controversial lending cap, which the Central Bank is planning to introduce next year in a bid to cool the rising property market.
He said many house hunters would be unable to save the 20pc deposit they need and could turn to riskier and more expensive unsecured loans to make up the deficit.
"There is an obvious concern here we have as to whether customers take out unsecured debt to meet the loan-to-value rules," he said.
The unusually frank intervention came as Mr Boucher addressed TDs and senators at the Oireachtas Finance Committee.
Aer Lingus has unveiled new seasonal services to the United States as it posted its strongest third-quarter results since the economic crisis began.
Aer Lingus will launch a seasonal service between Dublin and Washington DC from next May. It will operate four times a week.
It will also boost its Dublin-San Francisco service to a daily frequency. That route was only relaunched by the airline this year.
The airline is also adding a seasonal third daily flight between Dublin and New York, departing the capital just before 8am. Aer Lingus will use a smaller Boeing 757 on the early service.
Chief executive Christoph Mueller said the early departure would enable passengers to visit New York for just a day if they needed to, departing early and leaving on the last flight from New York.
An Irish teacher was denied a job in South Korea for a very anti-Irish reason.
'Katie' applied for a teaching role through Craigslist but the response she got was not the one she was expecting and was more than a little racist.
The European Central Bank (ECB) explicitly threatened in late November 2010 to cut off emergency funding from the Irish banking system, unless Ireland immediately applied for a bailout and agreed a programme of austerity and bank recapitalisation.
The letter from then ECB president, Jean-Claude Trichet, to former finance minister Brian Lenihan – marked “secret” – was sent on November 19th, 2010. A copy has been obtained by The Irish Times. Its publication is due to be considered at a meeting of the ECB governing council today.
The letter states that the governing council of the ECB would only agree to provide further emergency liquidity assistance (ELA) to the banks if it received “in writing a commitment” from the government to apply immediately for a bailout.
Irish food multinational Glanbia has put more than €1 billion into companies in Luxembourg that have no employees but serve to reduce its tax bill here.
The companies are the subject of advanced tax agreements (ATAs) negotiated with the tax authorities in Luxembourg and feature in 28,000 pages of leaked documentation from PricewaterhouseCoopers (PwC) in Luxembourg detailing ATAs with multinational companies around the globe.
The leaked documents have been shared by the Washington DC-based International Consortium of Investigative Journalists (ICIJ) with more than 40 media groups around the world, including The Irish Times.
The High Court has granted orders to a company which establish a 20-metre exclusion zone around locations in Dublin city where workers are installing water meters.
GMC Sierra Ltd, which has a contract to install meters at various locations in Dublin, last month secured injunctions preventing a number of individuals or anyone with notice of the orders assaulting, intimidating or interfering with the installations.
Those orders were obtained after the company said its workers had been harassed and threatened while installing meters in the Dublin 5 and Dublin 13 areas. On Wednesday the company sought an additional order establishing the 20-metre zones around its work stations arising from what it described as an escalation of unlawful activity by protesters.
EU migrants to the UK paid more in tax than they received in benefits in the past decade, according to a report that threatens to stoke the political debate over immigration.
People who moved to the UK after 2000 contributed £20bn (€26bn) to the public finances between 2001 and 2011, the study by UCL Centre for Research and Analysis of Migration showed.
Migrants from the 10 mostly eastern European countries that joined the EU in 2004 accounted for £5bn. Immigration has become a key political battleground as Prime Minister David Cameron seeks re-election in May. With his Conservatives losing votes to the anti-EU Ukip, ministers are intensifying their rhetoric. Michael Fallon, the defence secretary, talked of towns and communities being “swamped” by migrant workers.
Euro Topics: The European Commission has considerably lowered its growth forecast for the Eurozone. A noticeable improvement is unlikely before 2016, the Commission announced on Tuesday. The economic outlook once more highlights how forced austerity is ruining Europe's economy, some commentators criticise. Others call on Europe's problem states to stop complaining about cuts and implement the necessary reforms.
Radical change of course needed: The EU is now badly in need of a new policy because austerity has all but ruined the European economy, the left-liberal daily Libération demands: "It's become clear to anyone with common sense that a twin austerity course - in budget and monetary policy - would prevent the hoped-for economic revival on the continent. ... It was clear that the simultaneous drop in incomes in most of the member states would lower overall demand and put a brake on growth. Today, those responsible for this warn of deflation, the vicious circle that lowers prices, demand and production and risks prolonging the crisis for years. ... There's only one way out of this cynical tragicomedy: a radical change of course in Europe's economic policy."
Don't just clean up your own back yard: Fiscal discipline is not a cure-all and European policy must not stop at national borders, the liberal business daily Il Sole 24 Ore writes commenting on the EU's growth prognosis: "The fact that stable democracies and solid economies like Germany and France are slowing down makes it clear that it's a fallacy to believe that if everyone does their homework everything will be all right. When economies are interdependent policies can't remain within the confines of national consensus. ... But unfortunately national borders have once again become the point of reference. This is above all due to the European crisis, which made it necessary for each state to get its own affairs in order first."
Internet surveillance must be allowed: In a commentary published in the Financial Times on Monday, Robert Hannigan, the new boss of the British intelligence service GCHQ, argued that Internet companies like Google and Facebook should give security agencies more access to private data. This is indispensable in the fight against terrorism, the conservative daily concurs: "Following Snowden, it is evident that procedures in the US and UK are insufficiently transparent. That said, US internet companies cannot ignore their responsibilities vis-à-vis national security. These firms do not inhabit some separate planet where they can operate independent of state obligations to defend the public against terrorism. No government can tolerate a situation in which citizens communicate with one another over data networks without any possibility of legitimate surveillance."
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