Fianna Fail’s policies were procyclical and encouraged the bubble when they should have been trying to restrain it. Worse still, by greatly expanding public spending from 2002-2007 they based a permanent expenditure on a temporary source of revenue.

FF held close ties to those who profited most from the property bubble. Perhaps it was because they had so bought into it that they found it difficult to react when the bubble finally burst; That they believed the bubble was a source of wealth that should be rescued.

FF, including Brian Cowen and his predecessors do deserve blame for the property bubble. But they were not alone in deserving criticism.

The banks for loaning so much money to developers and purchasers, the Irish central bank and Financial Regulator for not moderating bank lending, the developers, and even the home buyers themselves for believing the hype all share some responsibility for Ireland’s current situation.

All money being debt, I don’t generally distinguish between cash and credit. But in this case it is appropriate to do so as the monetary expansion referred to was primarily through credit.

Thanks for your suggestion, I have updated my post.

I wonder whether you should say “unrestricted issuing of CREDIT” rather than money?

Or don’t you distinguish between interest-free Cash and interest-bearing Credit in the money supply?

I just found you thanks to Technorati, for I’m keen on spreading awareness and information that all related to that famous Rothschild quote you mention…

Happy blogging!
Sabine
http://tinyurl.com/666rwd
http://moneyasdebt.wordpress.com