The latest idiotic outburst from David McWilliams

Baird

Help Ireland or it will exit euro, economist warns

A leading Irish economist has called on Dublin to threaten withdrawal from the euro unless Europe's big powers do more to rescue Ireland's economy.

By Ambrose Evans-Pritchard

Last Updated: 9:12AM GMT 19 Jan 2009


David McWilliams, a former official at the Irish central bank, has said that Ireland could withdraw from the euro if they are not given more help Photo: Rex Features

"This is war: countries have to defend themselves," said David McWilliams, a former official at the Irish central bank.

"It is essential that we go to Europe and say we have a serious problem. We say, either we default or we pull out of Europe," he told RTE radio.

"If Ireland continues hurtling down this road, which is close to default, the whole of Europe will be badly affected. The credibility of the euro will be badly affected. Then Spain might default, Italy and Greece," he said.



Mr McWilliams, a former UBS director and now prominent broadcaster, has broken the ultimate taboo by evoking threats to precipitate an EMU crisis, which would risk a chain reaction across the eurozone's southern belt, where yield spreads on state bonds are already flashing warning signals. The comments reflect growing bitterness in Dublin over the way the country has been treated after voting against the EU's Lisbon Treaty.



"If we have a single currency there are obligations and responsibilities on both sides. The idea that Germany and France can just hang us out to dry, as has been the talk in the last couple of days should not be taken lying down," he said.



Mr McWilliams cited the example of New York's threat to default in 1975. President Gerald Ford "blinked" at the 11th hour and backed a bail-out to prevent broader damage.



As yet, there is no public support for withdrawal from the euro. A Quantum poll published by the Irish Independent yesterday found that 97pc reject such a radical move. Three-quarters are in favour of a national government, an idea floated by Unilever's ex-chief Niall Fitzgerald.



"The economic disaster we are facing is unlike anything which has happened in my lifetime. It is a national crisis and needs a government of national unity," Mr Fitzgerald said.



Mr McWilliams said EMU was preventing Irish recovery. "The only way we can win this war is by becoming, once again, an export country. We can do what we are doing now, which is to reduce our wages, throw more people on the dole and suffer a long contraction. The other model is what the British are doing. Britain is letting sterling fall so that the problem becomes someone else's. But we, of course, have ruled this out by our euro membership.



"We are paying twice for the euro: once on the exchange rate and once more on the interest rate," he said.



"By keeping with the current policy, the state is ensuring that Ireland turns itself into a large debt-repayment machine. Is this the sort of strategy to win wars? " he said.

Times like these makes you want to harp back to the good old days when you could be shot for treason.
Irish financials are being dessimated on the back of these insightful comments.

Kintarō Hattori

Baird wrote: »

Times like these makes you want to harp back to the good old days when you could be shot for treason.
Irish financials are being dessimated on the back of these insightful comments.

But but....... the euro is the best thing..... ever!

P. Breathnach

Baird wrote: »

Times like these makes you want to harp back to the good old days when you could be shot for treason.

It is not treason to express an opinion on public affairs, even a daft one.

Irish financials are being dessimated on the back of these insightful comments.

Not so. The banks did the damage to themselves.

Frankie Lee

He's absolutly right, if only our government listened.

321654

The man is a mouthpiece.
He makes his money being a media whore.

He is the Jade Goody of Economics.

Nothing wrong with it as long as people are aware thats what you are.

Baird

Frankie Lee wrote: »

He's absolutly right, if only our government listened.

What the hell is he right about can i ask?
He is basically telling us to sacrifice our country for the sake of the Euro.
A sacrifice that more than likely will end up being futile.

luckat

Dessimated? The Jade Goody of economics? My brain is reeling from this good stuff!

Have to say our Dave has a point; he says it's the only leverage we have, and basically Europe is hanging us out to dry.

mike65

Not something worth discussing as it can't/won't happen. If Ireland needs an effective devaluation it'll have to be "internal" - a cut across the board of 15-20% to be sustained for maybe 5 years. Quite how we could achive that is another matter.

Raiser

Baird wrote: »

Times like these makes you want to harp back to the good old days when you could be shot for treason.
Irish financials are being dessimated on the back of these insightful comments.

Decimated? They were behaving like a complete pack of fcuking Bankers!!!!

- Haven't heard someone stick up for them until now - I honestly didn't know ye existed?

P.S. This isn't Seanie Fitzpatrick is it???

asdasd

What the hell is he right about can i ask?
He is basically telling us to sacrifice our country for the sake of the Euro.
A sacrifice that more than likely will end up being futile.

He is saying the opposite. i am pretty sure the Euro has no future anyway. Might as well leave it now.

The man is a mouthpiece.
He makes his money being a media whore.

So what if he makes money by saying things in the media, as long as he is right,

P. Breathnach

asdasd wrote: »

i am pretty sure the Euro has no future anyway. Might as well leave it now.

What would a punt be worth today?

Membership of the eurozone is about the only thing keeping us from total economic collapse.

20goto10

Who wants to go back to the days of being Britains poodle? We don't need to go backwards we need to go forwards. We're only in trouble because of our over dependence on trade with Britain. Its old school business operating in the new modern Euro model and it doesn't work. The answer is not to ditch the Euro its to ditch our reliance on Britain. We're in a transition phase now and thast transition needs to be a quick one. The weakening of Sterling is a long overdue wake up call.

asdasd

Membership of the eurozone is about the only thing keeping us from total economic collapse.

membershp of the eurozone is the main reason we are in this mess. And devaluation would be a good option.

silverharp

asdasd wrote: »

membershp of the eurozone is the main reason we are in this mess. And devaluation would be a good option.

I dont think that stands up to logic. This is a global problem and in particular its a AngloSaxon problem, one way or another ireland would have got caught up in this problem. And has been said before just give a bit of notice when said devaluation is coming so that I can get my savings into a real currency or even gold.

The_Minister

I personally believe the Euro is the only reason that we are still here, and not like Iceland.


And the Award for Most Idiotic Outburst Relating to the Economic Crisis still goes to Gay Michell for suggesting that we borrow all the money from China.

Frankie Lee

Also how is this the latest idiotic outburst from McWilliams, granted the stupid names he uses for stuff can be annoying but he is probably our top economist and I cannnot find any subject where he has been far off the mark.

Top Irish Economists

http://www.esr.ie/Vol38_3/02%20Vol%2038%20Tol%20Ruane.pdf

RedPlanet

What an idiotic title for a thread.

On the Marianne Finucane radio show he promoted Devaluing with historical precendence.
Unfortunately for us we cannot devalue.
The solutions for Germany and France may not be the solutions for our own economy.
He said they will hang us out to dry.
He's probably right, again.

P. Breathnach

Deleted User wrote: »

Top Irish Economists

http://www.esr.ie/Vol38_3/02%20Vol%2038%20Tol%20Ruane.pdf

Confined to those in academia or research. Poor David is necessarily excluded on those criteria.

asdasd

Top Irish Economists

The ESRI. What was their prediction for growth this year, in say, 2007.

Confined to those who publish work in peer reviewed journals. Not just spouting crap in a newspaper.

You will find as well that many of those 'academics' have been heralding the current economic state, they just don't run to some broadsheet to big themselves up.

asdasd

Fantastic. Here is the ESRI from two years ago. We are doing fine.

Fat_Fingers

"Top Economists" is the same as "Top meteorologist" All guess work and no accountability.

20goto10

Fat_Fingers wrote: »

"Top Economists" is the same as "Top meteorologist" All guess work and no accountability.

Exactly and if a meteorologist was to predict rain every sinlge day eventually he's going to be spot on. It doesn't make him a good meteorologist.

Flamed Diving

Sorry guys. It was me who pushed for moving this forum into 'Soc'.

I apologise unreservedly.

asdasd

Exactly and if a meteorologist was to predict rain every sinlge day eventually he's going to be spot on. It doesn't make him a good meteorologist.

Better than the guy who predicted sun and heat in winter. Actually DW didnt just predict the recession based on the "recessions happen" argument - he explained the property component or the bust, and the cause - Irish indebtedness.

David from 2007 - the ESRI was predicting 3.5% growth in 2008.

mike65

That ESRI report flagged up plenty of potential problems and yet still came up with a growth number of nearly 4% pa, oddly they presumed the government would be compentent.

asdasd

That ESRI report flagged up plenty of potential problems and yet still came up with a growth number of nearly 4% pa, oddly they presumed the government would be compentent.

By 2007 the government had done most of the damage - a pro-cyclical budget, public service pay rises mapped to a frothy GDP. DW pointed this out, not the ESRI.

P. Breathnach

It is a great relief to me that members of the David McWilliams fan-club get only one vote each in elections.

I am tempted by the idea that anybody who thinks that David is the cure should have their votes withheld, but I am so wedded to the idea of democracy that I think even fools should be allowed vote.

It would be interesting to know if David McWilliams himself believes he would be a good Minister for Finance.

Flamed Diving

The ESRI do seem to get it wrong quite consistently, I must say.

asdasd

It is a great relief to me that members of the David McWilliams fan-club get only one vote each in elections.

I'd take the vote from Public servants who can't read.

The piece I linked to, from 2 years ago, explained the situation as it now is. Try and keep up.

nesf

Deleted User wrote: »

Top Irish Economists

http://www.esr.ie/Vol38_3/02%20Vol%2038%20Tol%20Ruane.pdf

Meh, ranking institutions/people based on number of papers published is a bit pointless tbh, the raw numbers don't say much about the quality of the person's output or their input in the discipline.

I was chatting to a psychologist who used to be at Cambridge before he retired a few weeks ago, he mentioned they had moved to a system where rankings were based on a persons 5 best papers in the past 5 years. Seems like a far more sensible option in my opinion.

/digression

boardswalker

If we left the euro our currency would have an interest rate several percentage points above the euro. My guess is 3-4% minimum. Not many want that.

If we devalued our currency most of our borrowings which are currently denominated in euro would be instantly increased corresponding to the devaluation.

One of the problems right now is the level of debt and peoples inability to service/repay that debt. Leaving the euro and devaluing would only make the situation much worse. It's not going to happen.

meglome

I can never understand why this man gets so much ****e. He actually tried to talk some sense into this economy when very very few others did, and has (unfortunately) been proved right. I personally applaud the man, not that I always think he's right.

nesf

meglome wrote: »

I can never understand why this man gets so much ****e. He actually tried to talk some sense into this economy when very very few others did, and has (unfortunately) been proved right. I personally applaud the man, not that I always think he's right.

He comes across as a smug git. I'd say that's half the cause tbh.

gurramok

Deleted User wrote: »

Confined to those who publish work in peer reviewed journals. Not just spouting crap in a newspaper.

You will find as well that many of those 'academics' have been heralding the current economic state, they just don't run to some broadsheet to big themselves up.

Its obvious you're alluding to MK. at least he has called it right on how damaging the bubble has been without been laughed at by the ESRI and bank paid economists who all predicted a rosy 2008.

ranger4

gurramok wrote: »

Its obvious you're alluding to MK. at least he has called it right on how damaging the bubble has been without been laughed at by the ESRI and bank paid economists who all predicted a rosy 2008.

agree,and a possible soft landing, experts my arse.

Clytus

Baird wrote: »

Times like these makes you want to harp back to the good old days when you could be shot for treason.
Irish financials are being dessimated on the back of these insightful comments.

I heard him make that statement on Marion Finucane on Saturday. Strangely enough the man made his comment in relation to the level effort and guts the goverment will need to demonstrate to get this Country through what started out as the Economic Slowdown that become the Credit Crunch ( which incidently was loosly related to the sub-prime issue) that swan dived into a Recession that has now morphed into an Economic Crisis/ National Emergency.

I used to think David was a Eddie Hobbs style psudeo-starlet who just liked the sound of his own voice on the national Airwaves. But I was wrong!!

Having listened to him explain how he witnessed similar bubbles appear in Russia/Israel/Argentina that mirrored the irish property bubble and the common facets of human nature that plagued all, I came to a realisation that this man knew what he was talking about.....that and the fact he was spot on re; the Nationalisation of Anglo.

nesf

Clytus wrote: »

I heard him make that statement on Marion Finucane on Saturday. Strangely enough the man made his comment in relation to the level effort and guts the goverment will need to demonstrate to get this Country through what started out as the Economic Slowdown that become the Credit Crunch ( which incidently was loosly related to the sub-prime issue) that swan dived into a Recession that has now morphed into an Economic Crisis/ National Emergency.

I used to think David was a Eddie Hobbs style psudeo-starlet who just liked the sound of his own voice on the national Airwaves. But I was wrong!!

Having listened to him explain how he witnessed similar bubbles appear in Russia/Israel/Argentina that mirrored the irish property bubble and the common facets of human nature that plagued all, I came to a realisation that this man knew what he was talking about.....that and the fact he was spot on re; the Nationalisation of Anglo.

Well, in fairness to him he used to work in the Central Bank (he took George Lee's position after he left for RTE iirc). So it's not surprising that he can talk with some authority on these matters.

It doesn't mean he's always right though only that you shouldn't dismiss him out of hand. That said, I know a lot of professional economists who hold his popular books in very low regard which says a lot about them.

professore

There are so many people that should be ranted about here before David Mc.
He talks sense FFS. End of.

leninbenjamin

professore wrote: »

He talks sense FFS.

in a world where 2+2=5 maybe...

asdasd

in a world where 2+2=5 maybe...

No, that was the mathematics of the property bubble.

The dislike of DW, even now, is extraordinary. he called it right ( not in a stopped clock fashion, he gave the reasons).

Deal with it.

Fat_Fingers

leninbenjamin wrote: »

in a world where 2+2=5 maybe...

I don't swing one way or the other on this topic but would be interested to hear valid explanation why is he wrong.
This "2+2=5" does nothing to show what is he so wrong about. Please less of the flame wars and more of the facts.
No offence to anyone.

leninbenjamin

Fat_Fingers wrote: »

I don't swing one way or the other on this topic but would be interested to hear valid explanation why is he wrong.
This "2+2=5" does nothing to show what is he so wrong about. Please less of the flame wars and more of the facts.
No offence to anyone.

fair enough, but his opinions seem to violate some of the fundamentals of economics. If you believe that the EU, and the whole common market is a good thing for us, then by default you should believe that a common currency is a good thing. it facilititates trade, breaks down boundaries between the different markets, reduces transaction costs... all that. If what McWilliam's says is true, then by the same logic we should leave the EU. But this makes no sense because the EU has been so facilitating of our growth over the past 20 years or so.

mind you what i've just written is still very much an over simplification...

Frankie Lee

leninbenjamin wrote: »

fair enough, but his opinions seem to violate some of the fundamentals of economics. If you believe that the EU, and the whole common market is a good thing for us, then by default you should believe that a common currency is a good thing. it facilititates trade, breaks down boundaries between the different markets, reduces transaction costs... all that. If what McWilliam's says is true, then by the same logic we should leave the EU. But this makes no sense because the EU has been so facilitating of our growth over the past 20 years or so.

mind you what i've just written is still very much an over simplification...

My understanding of what he is saying in the article is that we should use the threat of pulling out of the EMU which would lead to a disaster for the EU, to bribe France and Germany into bailing out our public finances.

I think he mentioned a couple of weeks back that the Lisbon treaty should be used as leverage for an Irish bail out from the EU also.

I gather that he thinks our public finances are completely ****ed so a bail out seems necessary.

dresden8

What if it all goes @rse over t1t and the IMF come calling or whatever other disaster might befall us eventually happens?

What effect will this have on the eurozone? Is it Germany's/France's interests to bail us out?

Back to McWilliams. Gotta love the hatred of the man. Even though he called it right, there's people who still insist he was wrong.

P. Breathnach

dresden8 wrote: »

Back to McWilliams. Gotta love the hatred of the man. Even though he called it right, there's people who still insist he was wrong.

I see no sign that anybody hates the man. I don't think anybody has suggested that he is wrong about everything.

What I do see is that he has fans, and some of those fans seem to believe that he is right about everything.

Frankie Lee

I don't think there are many instances where he has been wrong yet as opposed to the large amount of corrupt economists that have led us into this mess we are in, so therefore he is an economist whose opinion should be highly regarded.
George Lee is another but he does not really show any ideas rather just gives excellent expert commentary.

Abraham

The powers-that-be will always try to counter the David McWilliams's of this world and you can include George Lee as their target as well. They do it by adopting the role of hecklers and sometimes score a hit by a neat point against the run of play.....a tactic for which we Irish are suckers in our admiration therefor. But one swallow does not make a summer and those who don't know that are shallow thinkers indeed.

David Mc and George L were true to their profession and did try to warn us about the precariousness of the House of Cards we were building and the absolute illogicality of it all but they were ridiculed and lampooned for their warnings. O.K., they didn't call it bang on every single time but the principle message in what they were offering was "...this is madness."

Now, those who try to ridicule them sift through the warnings given in good faith and when they find a phrase or comment that somehow does not fit neatly or jars when teased out, shout this from the rooftops as if they have discovered some major flaw in the warning.

Listen, nitpickers.....Davey Boy and Georgie were right and right again and the devastation now surrounding us is proof positive of that but then ye are not interested in that, now are ye, ...Oh no...shoot the messenger...let the world know his mother was unmarried or he has had a poor unbringing......anything but admit plain and simple TRUTH.

Time Magazine

Abraham wrote: »

David Mc and George L were true to their profession

Not that I disagree with your point, but I'd like to point out that neither David McWilliams nor George Lee are real economists. McWilliams is a journalist/commentator and George Lee is a journalist. People don't watch the news and think David Davin Power is TD, but they do think George Lee is a "real" economist. This isn't the full truth.

The people who have been consistently ignored are those in the ESRI/universities, and they've been far more correct in their analyses than either of McWilliams or Lee.

Frankie Lee

The Economist wrote: »

Not that I disagree with your point, but I'd like to point out that neither David McWilliams nor George Lee are real economists. McWilliams is a journalist/commentator and George Lee is a journalist. People don't watch the news and think David Davin Power is TD, but they do think George Lee is a "real" economist. This isn't the full truth.

The people who have been consistently ignored are those in the ESRI/universities, and they've been far more correct in their analyses than either of McWilliams or Lee.

From Wikipedia:

David McWilliams (born 1966[2]) is an Irish economist and journalist.[3] McWilliams has worked with the Central Bank of Ireland, UBS bank, and the Banque Nationale de Paris. More recently, he has become a popular broadcaster and documentary-maker with TV3 and RTÉ, as well as publishing two books, The Pope's Children, and The Generation Game.

I can't find info on George Lee but I would consider both real economists.

I imagine there is a difference between academic economists and real world economists, I would consider the above in the latter.