Is Ireland the new Greece?
A woman walks past an Anglo Irish Bank in Dublin, Ireland on November 11, 2010. European Commission president Jose Manuel Barroso said Thursday that the EU stood ready to support Ireland 'in case of need', after Irish bond yields soared to record levels on public debt fears.
TEXT OF INTERVIEW
JEREMY HOBSON: Now to Chris Low, he's chief economist at FTN Financial here in New York. He joins us live. Good morning.
CHRIS LOW: Good morning.
HOBSON: So,Chris, first to the G-20 meeting that just wrapped up in South Korea. It seemed to end with a whimper -- no requirement for countries to limit their trade imbalances, which U.S. officials had wanted -- did we get anything out of that meeting?
LOW: You know, I think we did, actually. We didn't come out with a document certainly, which would've been nice, but considering the level of animosity towards the U.S. going into the meeting, the fact that the President was able to shift the conversation and they are now talking about at least focusing on those trade imbalances. I think it's a step in the right direction we can build on in the future.
HOBSON: A step in the right direction. And now here about a step in the wrong direction, all those world leaders in South Korea ended up focusing on Ireland and its debt problems. Do you think that this situation has the potential to become another Greece and really wreak havoc on the global economy?
LOW: Well, if what you mean is a country in need of a bailout to save it sovereign bond system, then yes we're already there. I'm afraid the EU is very likely going to announce a deal in the next day or two. But at least we differ from Greece in the sense that the people have accepted the deal, they've adopted a more frugal budget for example, and they're already making good progress in reducing spending. All that means that it's likely to work in Ireland, where as in Greece it's still questionable whether even with the bailout they can prevent bankruptcy.
HOBSON: Chris Low, chief economist at FTN Financial. Thanks so much.
LOW: You're welcome, thank you.