Oooopps!

Merrill Lynch & Co. told the Irish government in 2008 it would cost 16.4 billion euros ($22.8 billion) at most to rescue its banks, a quarter of the eventual bill for bailing out its financial system.

Umm, from 11 % or so of GDP to 44% or so.

That’s a large mistake there…..

11 thoughts on “Oooopps!”

  1. Maybe they’ll sue ML for it.
    Just like all the companies whose job it was to certify America’s Home Loans as A1 got sued when it turned out their friends’ assets were junk.

    Not.

  2. Wasn’t there some sort of brouhaha over there over a leaked recording of senior bankers discussing how they’d reeled the Irish govt into a bailout by lying about the scale of their liabilities on the premise that once they’d started the bailout they’d have no option but to keep going, even if the bill went through the roof?

  3. Was this before or after Merrill Lynch was facing bankruptcy of its own and had to be taken over by the Bank of America in order to survive?

    It’s a bit like George Best taking advice from Oliver Reed on how much booze he should drink per day.

  4. Well no, not really.

    “It’s a bit like George Best taking advice from Oliver Reed on how much booze he should drink per day.”

    You’re not going to get a gross underestimate there, are you?

  5. Yep. A self-inflicted injury which simply saved the German and Dutch pension funds that had loaded up on Irish bank debt.

    My understanding is that the EU was initially against this but then would not let Ireland get out of it once they realised the above. Does anyone know if this is true ?

  6. The mistake would just about pay for HS2 – a project that will be funded by a much bigger economy over the course of about 20 years, not all at once.

    Whatever your view of HS2, imagine paying for it all at once in a country one-twelfth the size of the UK – ie 240 times the annual cost in relation to the economy.

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