A big-bang budget would be painful but might just pay off
Making a once-and for all cut of €6 billion in the 2011 budget would bring a significant reduction in bond yields and debt interest, writes Eunan King
Now that there is greater clarity about the cost of the bank bailout we may be able to concentrate on the most pressing risk to Ireland’s solvency - the high level of bond yields. Bond yields need to come down soon because of the risk that the country could begin an upward debt spiral.
National debt is about equal to annual GDP.
With the interest rate on debt close to 7 per cent,...
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