Ireland in recession

asdasd · 25-09-2008 1:32pm #1

so says the guardian:

http://www.guardian.co.uk/business/2008/sep/25/recession.ireland

two quarters of negative growth ( of course) and fairly large too - a 0.3% drop followed by a 0.5% drop. Assuming no more acceleration thats 2% for the year. To put it into perpective the much maligned Eighties had one official recessionary year.

gurramok · 25-09-2008 2:16pm

Some of us posters predicted this less than a year ago but were ridiculed

This recession is mostly domestic related(good ole construction, retailing, financial, tourism and now the looming public sector cutbacks)) with international factors pulling us down further.
http://www.rte.ie/business/2008/0925/economy.html

Time to invest in export related industry rather than to try to prop up the construction sector.

betonit · 25-09-2008 4:09pm

cost of doing business is killing this country. One or two multi-nationals pull out we're headed for worse times than the 80s. In the 80s people were broke, now people wil be broke with massive personal debt

mike65 · 25-09-2008 4:24pm

Some on this forum( or politics) were busy suggesting nothing of the sort could happen - a year ago I would have been one of them but the penny dropped from me in the late spring. Oh well, anyone fancy predicting the upturn?

Mike

asdasd · 25-09-2008 6:54pm

of course if the David McWilliams had kept his gob shut none of this woulda happened. Fact.

gurramok · 25-09-2008 7:28pm

Yeh, those doom and gloomers!

Futureshock, Richard Curran, Morgan Kelly, Alan Ahearne and especially George Lee. Its all their fault

Back to reality, the ESRI themselves are saying this recession could last well into 2009, i concur and say it could be even 2010 before its over. (http://www.breakingnews.ie/ireland/mhqlsnkfcwmh/rss2/ )

mike65 · 25-09-2008 7:33pm

Cheers (goes to find the malt and a revolver)

Mike

leninbenjamin · 25-09-2008 8:26pm

asdasd wrote: »

of course if the David McWilliams had kept his gob shut none of this woulda happened. Fact.

plus one squillion.

seriously thought it was people like David McWilliams who caused the govt. to dwiddle over the stamp duty thing, which is what kick started the decline in this country in the first place.

gurramok · 25-09-2008 10:23pm

leninbenjamin wrote: »

plus one squillion.

seriously thought it was people like David McWilliams who caused the govt. to dwiddle over the stamp duty thing, which is what kick started the decline in this country in the first place.

Your blaming the mod?

Amazing how an economy so based on 'fundamentals' can go to serious difficulty on the basis on what a single person says

Time Magazine · 25-09-2008 10:49pm

asdasd wrote: »

of course if the David McWilliams had kept his gob shut none of this woulda happened. Fact.

That's not true at all!

Look, guys, all I was doing was analysing the situation based on my sound Antoin Murphy-taught creds. I've been predicting this for, like, ten years. I can't be blamed.

Time Magazine · 25-09-2008 10:51pm

leninbenjamin wrote: »

plus one squillion.

seriously thought it was people like David McWilliams who caused the govt. to dwiddle over the stamp duty thing, which is what kick started the decline in this country in the first place.

If the government's policy agenda is altered by journalists, then that is the government's fault and responsibility.

And this recession was caused by a very simple problem: an over-reliance on selling houses to each other. They were over-valued. People bought thinking they could sell in a year at a profit. In fairness to David McWilliams, he has been saying for over a decade that that's simply not sustainable.

futura123 · 25-09-2008 11:05pm

im guessing that is goin to be a protracted and long recession, i think 2009 recovery is bein overly optimistic. much worse than 80s due to massive personal debt etc. alot of my friends in galway have been let go or anticipating losin jobs soon, quite scary really!!!!

Gekko · 26-09-2008 2:17am

news reports today saying that there is a brain drain, meaning this country will be increasingly deprived of the people with the vision and skills to help get the country's economy moving in the right direction again.

Not a good sign.

Not sure if we'll see one of the big multinationals pull out but I guess the threat is always looming on the horizon.

I think that we're in for a much longer and much worse downturn than anyone is anticipating.

asdasd · 26-09-2008 10:03am

Possibly. That said I think it looks like it will be very severe - given the fall in construction, consumption, and exports (even) - and that will mean real declining living standards for everyone in the private sector for the next few years which is the only way ( sadly) to regain competitiveness. I bet however, that the benchmarking process will not reflect this decline in private sector pay.

Mark200 · 26-09-2008 10:26am

I think if the whole credit crunch business was never reported on the news then we'd all be fine.

By mentioning it over and over again it creates a fear in everyone, and even those who are not in financial trouble or near it are going easier on the spending which is what is ruining businesses.

asdasd · 26-09-2008 10:39am

think if the whole credit crunch business was never reported on the news then we'd all be fine.

Mark, firstly you are hardly demanding that a free press limits it's enquiries are you? If anything there is a very unhealthy relationship between the property sections of newspapers and supposed journalism on those sections, really just continued unpaid for advertising. Also nobody besides out ginger friend and a few others, claimed we would be in recession ( in fact at the start of the year the consensus prediction was for growth of 2.5% ish, and the much vaunted "soft-landing" which was impossible).

Even with your stalinist control of the media, without any reporting of credit crunches ( which would take an amazing control - given how important the financial crises in America is, and how related to property it is) people would notice that prices were falling, and construction was declining, and people losing jobs. And they would curtail spending, which - frankly - might have been more advisable during the boom.

damnyanks · 26-09-2008 10:54am

Mark200 wrote: »

I think if the whole credit crunch business was never reported on the news then we'd all be fine.

By mentioning it over and over again it creates a fear in everyone, and even those who are not in financial trouble or near it are going easier on the spending which is what is ruining businesses.

It doesnt really matter what the press say or do. The credit crunch does and will impact everyone. These investment banks are what pump the blood (Money) in our economies. They make it possible for large companies to access large sums of cash to continue to grow. Once thats gone it hits everyone.

26-09-2008 10:55am

Mark200 wrote: »

I think if the whole credit crunch business was never reported on the news then we'd all be fine.

By mentioning it over and over again it creates a fear in everyone, and even those who are not in financial trouble or near it are going easier on the spending which is what is ruining businesses.

Amazing, people actually do believe that you can talk down an economy :eek:

gurramok · 26-09-2008 11:38am

And Bertie did say at the time that these 'doom-mongers' should top themselves.

Anyway, there was a piece in the media a few weeks back about lots of doctors and nurses starting new lives in Aussieland and NZ.
Their basic complaints were not lack of pay but long hours(internal industry issue) and the country had become too expensive for them to have a decent standard of living.

Mark200 · 26-09-2008 12:19pm

asdasd wrote: »

Mark, firstly you are hardly demanding that a free press limits it's enquiries are you? If anything there is a very unhealthy relationship between the property sections of newspapers and supposed journalism on those sections, really just continued unpaid for advertising. Also nobody besides out ginger friend and a few others, claimed we would be in recession ( in fact at the start of the year the consensus prediction was for growth of 2.5% ish, and the much vaunted "soft-landing" which was impossible).

Even with your stalinist control of the media, without any reporting of credit crunches ( which would take an amazing control - given how important the financial crises in America is, and how related to property it is) people would notice that prices were falling, and construction was declining, and people losing jobs. And they would curtail spending, which - frankly - might have been more advisable during the boom.

I'm not demanding or suggesting anything. I believe in free press and all, and I wouldn't want anything else. I'm just plainly saying that if the media hadn't of kept it in the news every single day, when it wasn't that bad then I don't think it'd be as bad as it is now. I'm not saying we wouldn't be in economic trouble, I'm just saying we mightn't be faced with a recession if three quarters of the population are still buying and spending as normal. Shops would not have to reduce prices if people are still buying.

Économiste Monétaire · 26-09-2008 12:25pm

Mark200 wrote:

I'm just saying we mightn't be faced with a recession if three quarters of the population are still buying and spending as normal. Shops would not have to reduce prices if people are still buying.

I don't know where you get the idea that because a news-outlet displays the woes of a financial crises then ergo people have less money to spend. Domestic demand is down due to lack of available credit, an increase in commodity prices (inflation), and, of course, unemployment has increased.

Mark200 · 26-09-2008 12:32pm

UCD_Econ wrote: »

I don't know where you get the idea that because a news-outlet displays the woes of a financial crises then ergo people have less money to spend. Domestic demand is down due to lack of available credit, an increase in commodity prices (inflation), and, of course, unemployment has increased.

Well my point is that because it's in the news all the time, that even people with money to spend are no longer spending it.

eamonnm79 · 26-09-2008 1:00pm

People have to stop trying to dig their heads in the sand. The housing crisis in America is largely down to an "unprecidented housing bubble" that happened over the last 9 years.

I took this next quote from an article in the Irish indo Sept 17 by David McWilliams "Check out the chart. It reveals that residential mortgages in Ireland have risen by 522pc in nine years. In the US, the figure is only a 102pc increase,"

We have been living on cheap credit for the last 9 years.
Charles Haughy's "we are living beyond our means" speech would be a lot more apt if it were given by Brian Cowan Today.

I honestly think these bailouts in America will not work. Congress is correct in questioning Hank and Ben. Less than 2 months ago Congress approved a 800 billion bail out (barely reported) which Hank and Ben used to, among other things, Bail out fanny and freddie, AIG and JP Morgan (barely reported) among others.
Now they want another 700 billion. How long till they are back again?
Another important question is why congress didnt kick up the same fuss 2 months ago?
Something has happened!
Congress started getting inundated with requests from concerned citizens telling them not to pass the bill.

The way Obama almost immediately encouraged congress to pass the bill is a serious black mark against him. Why didnt he question bailing out wall street to the cost of the american people. Mccain also implored congress to pass the bill. They have both changed their positions to "lets find a bailout that works for the american taxpayer"

These bail outs are throwing good money after bad. The bubble has to be let burst. Will there be a lot of pain? Yes. But the pain is inevitable. The bail outs are delaying the pain and making the eventual fallout worse and worse.

If we(Irish, Americans, everyone) miss this chance to level with ourselves then we will have lost an enormous oppertunity.

drunkmonkey · 26-09-2008 1:05pm

Mark200 wrote: »

if the media hadn't of kept it in the news every single day, when it wasn't that bad then I don't think it'd be as bad as it is now

I think the media were very slow in coming out with the facts, the propety pages of the indo are testament to that...they still are...did you see todays, loads of houses, great investments;)

I don't think it's that bad right now in Ireland, I have a fear it will get a lot worse for people who bought into the property bubble...

I grew up in the 80's and by some twisted turn of faith I missed out on making millions on the irish property market, I had the option to buy a place in 2002 and thought the price was redicuolus and I just couldn't justify the cost (even though it was well within what I could afford to borrow on paper), it made no sense to spend the next 30 years trying to pay a mortage for a 3 bedroom apartment, I don't believe you should have to work your whole life just to have a palce to put your head at night.....this is where the Irish Politicans have let alot of people down and forced the rest into life long slavery, for this reason alone I detest them.

Hopfully the recession will bring property back down to reality, I feel sorry for the people who got hood winked by the banks, developers and politicans but anyone with half a brain could see it was unsutainable...
David Mc Williams was predicting it for the last 10 years, so how long has the bubble being growing?

I personally hope the bottom completly falls out of the residentail propery market as It will give people like me a chance to put a roof over our heads without felling like a slave to than banks..

This recession will be a good thing in 10 years time and hopefully it'll be my turn to cash in and make a few easy bob...

What's life going to be like in this recession?

asdasd · 26-09-2008 2:06pm

What's life going to be like in this recession?

Bad for the people who losed their jobs, obviously. For everyone else, not so bad. Civil servants will be ok. I think that IT will be ok, since it has been is a recession, and wages have remained static for years, so no competitiveness has been lost.

it all depends on the world market. We would have been ok if we had our bust when the rest of the world was ok, we could recover relatively quickly by regaining competiveness ( i.e. real wage falls) quick enough and having decent export led growth. Like the 90's. Now we cant really export out of trouble.

djpbarry · 26-09-2008 2:06pm

drunkmonkey wrote: »

...I had the option to buy a place in 2002 and thought the price was redicuolus and I just couldn't justify the cost (even though it was well within what I could afford to borrow on paper), it made no sense to spend the next 30 years trying to pay a mortage for a 3 bedroom apartment, I don't believe you should have to work your whole life just to have a palce to put your head at night.....this is where the Irish Politicans have let alot of people down and forced the rest into life long slavery, for this reason alone I detest them.

Nobody was "forced" into anything. You weren't forced into buying that 3-bed apartment, were you?

topper75 · 26-09-2008 2:19pm

As Mr. Big said in I'm Gonna Git You Sucka:

"There is only one economy - my economy"

Too true. I was out of work (and savings) circa 98-99, the supposed boom years. No use to me, not being in construction etc.

It's recession now and things have never been steadier for me.

OK, if things get to the point where govt raise income tax rates, then it affects me. But until then, I'm alright Jack.

Économiste Monétaire · 26-09-2008 4:02pm

eamonnm79 wrote:

We have been living on cheap credit for the last 9 years.
Charles Haughy's "we are living beyond our means" speech would be a lot more apt if it were given by Brian Cowan Today.

What were the origins of that speech? What happened for a decade that resulted in that speech?

asdasd · 26-09-2008 4:08pm

He made that speech, whilse wearing £200 shirts, in the early Eighties. Living beyond our means then meant the country was over-borrowed - the State, not the people. We were paying half, or more, of our taxation into interest repayments alone.

Mark200 · 26-09-2008 4:09pm

asdasd wrote: »

He made that speech, whilse wearing £200 shirts, in the early Eighties. Living beyond our means then meant the country was over-borrowed - the State, not the people. We were paying half, or more, of our taxation into interest repayments alone.

He was wearing more than one shirt? Why?

But if he can afford it, then why not?

Économiste Monétaire · 26-09-2008 4:13pm

You're not seeing my point, asdasd. The origins of that was the poor use of early Keynesian Economic thought, not a property asset bubble. Not-the-same-thing.

Ireland in recession

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