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Talk of new bailout is not ludicrous

The Government may be unwilling to admit it but such speculation is consistent with the facts, writes Colm McCarthy

AND then there were four. Only Germany, the Netherlands, Finland and Luxembourg of the 17 eurozone countries retain AAA ratings after Friday's unsurprising downgrade from Standard and Poor's. The borrowing of the EFSF stability fund, which lends to Ireland, is guaranteed by the solvent eurozone members including France and Austria, both downgraded on Friday. The interest rate the EFSF has to pay gets passed on to the borrowing countries. With lower credit-worthiness for the guarantors, the EFSF will have to pay more, which is bad news for Ireland.

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