I am convinced that Ireland is in Serious trouble

El_Duderino 09

KomradeBishop wrote: »

We've got one of the highest emigration rates in Europe, are doing worse than most of the rest of Europe on unemployment rates and for job vacancies per unemployed person - but don't worry everybody, we've got 'the fastest growing economy' in Europe, so the crisis is over (who gives a toss about the emigrants or unemployed anyway?).

We're only at the start of an uphill battle, for getting our economy back to full employment - and when QE fails, and deflation returns, all of Europe (Ireland included) will become stagnant economically, and we'll see our current conditions become set-in-place (or worsen) permanently.

That's presuming the Euro doesn't come apart before then.

The bit in bold is really indicative of the inability to grasp the nuance of the situation. It isn't either/or.

These are 2 true statements:

1. We are in a bad place.
2. Our situation is improving.

Re-read those 2 statements until you can understand that 350,000 unemployed is really bad but 300,000 is also bad but is improving. 290,000 will be bad and will be a further improvement. Get it?

KomradeBishop

RecordStraight wrote: »

Of course, this also doesn't factor in the trend for young Irish people to spend a few years in Aus or Canada or Lonon or whatever before coming home.

That link backs my statement that we have very high emigration - we're still well in the negative there, by a long way.

keithclancy

6541 wrote: »

I am of the opinion that Ireland is in serious trouble now.
I drove across the country at the weekend and it is shocking the state of some of the towns, street after street are lying derelict.
A whole generation have left.
There are zero jobs.
Where I live the soul has been ripped out of the town, go for a drink to be greeted with nobody in the pubs / clubs.
7 years of this and no sign of it ending !
The country is a basket case.

To be fair that's also because of the Motorways.
Many towns are now bypassed so the business is gone.

A whole generation haven't left, a large percentage of the people I know have stayed.

There are plenty of jobs if you train for a sector there are jobs in, if you train to become a teacher with the knowledge there are too many teacher and too few children then you have nobody to blame but yourself.

I'm gone since before the financial 'crisis', now all the bars have fancy craft ales, everyone is into gourmet and organic food and there's a motorway all the way from Cork to Dublin.

It's not half as bad as you think it is, your just reading too much shíte in the Daily Star.

KomradeBishop

El_Duderino 09 wrote: »

The bit in bold is really indicative of the inability to grasp the nuance of the situation. It isn't either/or.

These are 2 true statements:

1. We are in a bad place.
2. Our situation is improving.

Re-read those 2 statements until you can understand that 350,000 unemployed is really bad but 300,000 is also bad but is improving. 290,000 will be bad and will be a further improvement. Get it?

If you want to extrapolate our current 'improving' situation, to eventual full employment and full recovery, then you are missing the nuance:
When QE fails, all of Europe is going to hit deflation again, and then you can forget having any recovery - permanently (as in: multiple Lost Decades like Japan) - until either the Euro falls apart, or (extremely unlikely) Europe engages in proper recovery policies.

We're not even close to turning the corner, towards true recovery. We're potentially decades away, still.

El_Duderino 09

KomradeBishop wrote: »

If you want to extrapolate our current 'improving' situation, to eventual full employment and full recovery, then you are missing the nuance:
When QE fails, all of Europe is going to hit deflation again, and then you can forget having any recovery - permanently (as in: multiple Lost Decades like Japan) - until either the Euro falls apart, or (extremely unlikely) Europe engages in proper recovery policies.

We're not even close to turning the corner, towards true recovery. We're potentially decades away, still.

LOL. You sound like one of those right wing nuts in the States who is waiting for the rapture or the rise of the Devil. Surrounded by tins of beans and pretending they aren't praying for exactly that to happen.


Anybody would agree that we are a long way off true recovery but I am curious about what "true recovery" would look like exactly? Would "true recovery" be like the early 2000s in your mind?

keithclancy

El_Duderino 09 wrote: »

Anybody would agree that we are a long way off true recovery but I am curious about what "true recovery" would look like exactly? Would "true recovery" be like the early 2000s in your mind?

Probably everyone with cars less than 2 years old, 120% Home Ownership and a high speed bullet train from Sligo to Dingle

Eugene Norman

andrew wrote: »

Fair enough that having more debt is bad, but there's not much evidence there's another housing boom going on. Prices are rising, but the other particularly destructive features of a boom - high LTV and LTI ratios, massive expansion of credit, constructioin constituting a massive percentage of GNP, people (especially 'neophytes') buying investment properties - aren't there.



Increasing the duration of Irish debt doesn't 'kick the can' down the road. It makes the debt more sustainable, because all that matters is that Irish GDP grow at a higher rate than the interest on our debt. So long as that's true then we're fine. By increasing the duration, you decrease the interest rate you're paying, even if by the end you've ultimately paid more in interest.



As I said, while high levels of debt are definitely bad, what particularly matters is that GDP/GNP growth is greater than the interest rate on our debt, which makes the siutation a bit less bad than it seems. (but obviously, the less debt the better).



If ECB rates are at 3% again, it's because the European economy is doing well. At that point, those with tracker mortgages will, in general, be employed and have better job prospects. As such, they could possibly weather an increase in repayments. Even if they can't, as you've already noted, house prices are increasing. Their 600K house in Ballsbridge might end up being worth close to that again, in which case they can just sell it if the repayments are getting too onerous.

Wrong on nearly all counts.

Firstly the level of debt is still onerous and increased in all years from 2008 to 2013, falling slightly last year. We need to have continuous primary budget surpluses to have overall deficits lower than the GDP growth rate. In times when the inflation rate is low, reducing debt is harder.

Restructuring to pay more interest later is a short term solution. You need to assume fairly rapid economic growth, or the later interest payments become very hard to manage. It might work, but be aware of the danger.

I call a housing bubble when prices are too expensive for most workers, every bubble will have it's own characteristic. In this case there is a huge cash element to the market, spooking that cash market will collapse the house prices again.

If you are relying - as you seem to be - on prices going back to 600K for a 2 bed roomed apartment in Balls bridge you are looking for the people to be able to buy that to put down 120K and have an income of 480/3.5 = 137,000 euro. God knows what you are expecting 3 bedroomed houses to be, a cool million no doubt. No prices won't go back to where they were, and people will be screwed when interest costs rise. All of these restructured loans are a minefield too. I mean interest only loans which are barely affordable at 1%? Whats going to happen at 3-5%?

This market increase isn't going to happen again. I think that what you are articulating is what the banks and government want to happen, but there are far too many problems still in the system to iron out so readily.

I honestly can see Ireland defaulting in a few years. One year of 4.5% growth, proves nothing given the structural imbalances.

yipeeeee

It's ok lads, all the economists, statistics, growth figures in Europe are wrong.

The experts of boards know a lot more.

Eugene Norman

El_Duderino 09 wrote: »

LOL. You sound like one of those right wing nuts in the States who is waiting for the rapture or the rise of the Devil. Surrounded by tins of beans and pretending they aren't praying for exactly that to happen.


Anybody would agree that we are a long way off true recovery but I am curious about what "true recovery" would look like exactly? Would "true recovery" be like the early 2000s in your mind?

the 1990s were a good recovery from the 1980s, which were a lost decade because of profligate spending in the 1970's. What goes around.

Its that recovery I can't see happening again, as we engaged in "catching up" with the rest of the first world, now we are pretty much there in terms of GDP per capita.

DarkJager

People still bang the drum about there being no jobs but there actually are some available if you go and look. I know a guy who was unemployed for a couple of years after losing a job in construction who only last week, started a new job in a call centre on 19k a year with no previous experience.

Do people who say there are no jobs just not know where to look, or are they seeing positions available and feeling that such work is below them?

Eugene Norman

yipeeeee wrote: »

It's ok lads, all the economists, statistics, growth figures in Europe are wrong.

The experts of boards know a lot more.

Thats not much of a contribution, either way. If you want to trust the ESRI etc go ahead, much use that would have done you in 2007. Did you read the transcipts of the banking enquiry? The economists said they got it wrong.

I bet if we were to drag up threads from 2007 though, we would find people on here making reasonable points about a housing collapse.

And plenty of economists believe that the EURO is doomed, and stagnation will resume post QE. Mostly the guys who got it right in 2008.

yipeeeee

DarkJager wrote: »

People still bang the drum about there being no jobs but there actually are some available if you go and look. I know a guy who was unemployed for a couple of years after losing a job in construction who only last week, started a new job in a call centre on 19k a year with no previous experience.

Do people who say there are no jobs just not know where to look, or are they seeing positions available and feeling that such work is below them?

A simple search of Irishjobs.ie will confirm the above.

keithclancy

yipeeeee wrote: »

A simple search of Irishjobs.ie will confirm the above.

Ya, 10613 Job ads there at the moment.

micosoft

RecordStraight wrote: »

What is the alternative? Economic dunces like Sinn Fein who want to turn Ireland into a socialist paradise? Or outright lunatics like the Anti-Austerity Alliance who want to turn Ireland into East Germany in 1978?

That's really unfair on the East German Politburo of 1978. They did lots of good work. The Coffee Crisis of 77 led to the genius introduction of Mischkaffee in 78 which was 51% coffee and 49% filler (same stuff as pedigree chum use). Those were the days! But back to topic. Yes. Ireland is really awful. Terrible place indeed compared to the socialist paradise it could be!

Eugene Norman

El_Duderino 09 wrote: »

The bit in bold is really indicative of the inability to grasp the nuance of the situation. It isn't either/or.

These are 2 true statements:

1. We are in a bad place.
2. Our situation is improving.

Re-read those 2 statements until you can understand that 350,000 unemployed is really bad but 300,000 is also bad but is improving. 290,000 will be bad and will be a further improvement. Get it?

Thats, of course, presuming the conclusion. Sure 290,000 is better than 300,000. And 120,000 is better than 290,000.

Now back to the continuing overhang of debt and what happens when interest rates normalise.

AudreyHepburn

DarkJager wrote: »

People still bang the drum about there being no jobs but there actually are some available if you go and look. I know a guy who was unemployed for a couple of years after losing a job in construction who only last week, started a new job in a call centre on 19k a year with no previous experience.

Do people who say there are no jobs just not know where to look, or are they seeing positions available and feeling that such work is below them?

These are part of the problem but I also think people are equating 'no jobs in my sector' with 'no jobs at all' and either can't or won't try to look beyond what they know.

Just a little Samba

keithclancy wrote: »

Ya, 10613 Job ads there at the moment.

I'll inform the 290,000 odd people in the register that they have a real chance of getting that customer service job in topaz Rathkeel!

DarkJager

Just a little Samba wrote: »

I'll inform the 290,000 odd people in the register that they have a real chance of getting that customer service job in topaz Rathkeel!

Case in point. You will probably earn more in topaz than you get on the dole but sure it's Topaz so there's no jobs rabble rabble etc

keithclancy

Just a little Samba wrote: »

I'll inform the 290,000 odd people in the register that they have a real chance of getting that customer service job in topaz Rathkeel!

That's part of the problem really, nothing wrong with working in a service station.

KomradeBishop

El_Duderino 09 wrote: »

LOL. You sound like one of those right wing nuts in the States who is waiting for the rapture or the rise of the Devil. Surrounded by tins of beans and pretending they aren't praying for exactly that to happen.


Anybody would agree that we are a long way off true recovery but I am curious about what "true recovery" would look like exactly? Would "true recovery" be like the early 2000s in your mind?

keithclancy wrote: »

Probably everyone with cars less than 2 years old, 120% Home Ownership and a high speed bullet train from Sligo to Dingle

Yes well done ignoring the points made, to cheer on your imaginary 'recovery' - I'll repeat again:
When QE fails, all of Europe is going to hit deflation again, and then you can forget having any recovery.

People are fond of making simplistic extrapolations about our 'recovery', based on present growth rates, while being incapable of looking beyond the end of their own nose, to see the roadblock we'll be running into.

Just a little Samba

DarkJager wrote: »

Case in point. You will probably earn more in topaz than you get on the dole but sure it's Topaz so there's no jobs rabble rabble etc

My point is there are 10k odd jobs, many of which will be double postings, jobsbridge listings, "self employment opportunities" chugging jobs or just old listings which weren't taken down yet.

And there are 290,000 odd people on the register.

so even if they all applied for jobs in the morning, there'd still be a minimum 280,000 people on the register.

Loads of jobs sure, people are choosing to be on the dole, it's a disgrace joe!

andrew

Eugene Norman wrote: »

Wrong on nearly all counts.

Firstly the level of debt is still onerous and increased in all years from 2008 to 2013, falling slightly last year. We need to have continuous primary budget surpluses to have overall deficits lower than the GDP growth rate. In times when the inflation rate is low, reducing debt is harder.

Restructuring to pay more interest later is a short term solution. You need to assume fairly rapid economic growth, or the later interest payments become very hard to manage. It might work, but be aware of the danger.

I'm not sure what you mean by 'restructuring to pay more interest later.' We won't be paying 'more' interest later. The repayments on issued Government bonds don't suddenly go up or down, you lock in the repayments when you issue the debt (unless they're floating rate bonds, and we only have €28bn of those, spread out over the 16 years between 2038 and 2053). Also, debt repayments now are the same percentage of tax revenue as they were in 1995.

I call a housing bubble when prices are too expensive for most workers, every bubble will have it's own characteristic. In this case there is a huge cash element to the market, spooking that cash market will collapse the house prices again.

Is there a bubble in bespoke suits too? They're too expensive for most workers. You don't get to have a personal definition of a bubble, no more than you get to define any other word!

If you are relying - as you seem to be - on prices going back to 600K for a 2 bed roomed apartment in Balls bridge you are looking for the people to be able to buy that to put down 120K and have an income of 480/3.5 = 137,000 euro. God knows what you are expecting 3 bedroomed houses to be, a cool million no doubt. No prices won't go back to where they were, and people will be screwed when interest costs rise. All of these restructured loans are a minefield too. I mean interest only loans which are barely affordable at 1%? Whats going to happen at 3-5%?

I'm not relying on anything to do with house prices in the point I just made. If interest rates go up, it's because the economy is doing well. If the economy is doing well, people will have more income. If people have more income, they can absorb increase interest expenditure. Even if prices don't go back to their pre-bubble levels (and nominally, they will), increased house prices will reduce levels of negative equity such that people can think about selling their house if the interst repayments become too much.

I honestly can see Ireland defaulting in a few years. One year of 4.5% growth, proves nothing given the structural imbalances.

The current Rating of Irish Sovereign debt, and the current risk premium attached to it, would indicate that you're wrong.

DarkJager

Just a little Samba wrote: »

My point is there are 10k odd jobs, many of which will be double postings, jobsbridge listings, "self employment opportunities" chugging jobs or just old listings which weren't taken down yet.

And there are 290,000 odd people on the register.

so even if they all applied for jobs in the morning, there'd still be a minimum 280,000 people on the register.

Loads of jobs sure, people are choosing to be on the dole, it's a disgrace joe!

I think there is an element of people who choose to remain on the dole because they are waiting for some magic job listing to come along that will require their previous skills or put them on a salary level they were on before. Don't pretend there isn't. If I had a choice between being on the dole or working in topaz, I'd work in topaz because

A) it's more money
you look better to prospective employers if you're in a job (even one which you class as being beneath you)
C) taking a job in topaz doesn't disable your access to job sites to find a better position.

Just a little Samba

andrew wrote: »

The current Rating of Irish Sovereign debt, and the current risk premium attached to it, would indicate that you're wrong.

And what were the ratings in summer 2007? How did that go? Sure everything was going grand then!

Just a little Samba

DarkJager wrote: »

I think there is an element of people who choose to remain on the dole because they are waiting for some magic job listing to come along that will require their previous skills or put them on a salary level they were on before. Don't pretend there isn't. If I had a choice between being on the dole or working in topaz, I'd work in topaz because

A) it's more money
you look better to prospective employers if you're in a job (even one which you class as being beneath you)
C) taking a job in topaz doesn't disable your access to job sites to find a better position.

You just carry on making an argument against a point I never made, I'm sure some sense will come of it eventually.
Pretend I said something else in this post and respond to that as well. It'll be great craic.

KomradeBishop

DarkJager wrote: »

People still bang the drum about there being no jobs but there actually are some available if you go and look. I know a guy who was unemployed for a couple of years after losing a job in construction who only last week, started a new job in a call centre on 19k a year with no previous experience.

Do people who say there are no jobs just not know where to look, or are they seeing positions available and feeling that such work is below them?

These same misleading anecdotes comes up regularly in threads that touch on unemployment - the key point is, there are not enough jobs.

There are 24 people for every job vacancy, so again, there are not nearly enough jobs:
http://www.nerinstitute.net/imglibrary/2014/09/201409021647131.jpg

andrew

Just a little Samba wrote: »

And what were the ratings in summer 2007? How did that go? Sure everything was going grand then!

I take it you don't trust doctors either then, seeing as they too sometimes fail to notice the symptoms of illnesses?

keithclancy

KomradeBishop wrote: »

These same misleading anecdotes comes up regularly in threads that touch on unemployment - the key point is, there are not enough jobs.

There are 24 people for every job vacancy, so again, there are not nearly enough jobs:
http://www.nerinstitute.net/imglibrary/2014/09/201409021647131.jpg

Misleading indeed, what is the * for in your Graphic and where is Greece ?

From the same website:
http://www.nerinstitute.net/blog/2015/02/03/work-welfare-taxes-and-unemployment-traps/

KomradeBishop

keithclancy wrote: »

Misleading indeed, what is the * for in your Graphic and where is Greece ?

From the same website:
http://www.nerinstitute.net/blog/2015/02/03/work-welfare-taxes-and-unemployment-traps/

If you claim the 24 people per job vacancy stat is misleading, it's up to you to prove it - you're just throwing out a claim there.

Just a little Samba

andrew wrote: »

I take it you don't trust doctors either then, seeing as they too sometimes fail to notice the symptoms of illnesses?

Comparing medical science to soft "science" like economics, that's a terrible metaphor.

It would be more accurate to say I trust economists about as much as I trust the lad down the road who says he can tell a storm is coming because his knee acts up.