A global recession is on the horizon - please read OP for mod warning

You may want to check your history books for the chapters on the early history of this state when we went all in on “self sufficiency” leading to impoverishment, emigration and misery

this is not what im advocating for at all, we have to stop thinking dichotomously, yes we have done the largely self, or limited external supports, and yes, it was an absolute disaster, but you can clearly see, the other extreme, is also not working, we struggle to see that it could be possible to have a mix of both. since opening our economy, we ve advanced extremely quickly, creating an astonishing level of wealth, in a relatively short space of time, but its obvious now, something is seriously failing with this approach now, and yes, many other countries are also experiencing the same, or similar issues such as housing etc, but our political and policy making institutions dont actually know what to do next, and are stuck, defaulting to what has been done before, and its clearly obvious, its not gonna work, its just not!

we re now in a completely different world from when we were a more closed economy, far more advanced, educated etc etc etc, these eras are unrelatable and incomparable, we have to start believing in ourselves, our people, and our own businesses, as we ve become overly exposed to external sources, fdi etc, we have to start taking more internal risks, both from a state point of view, and irish businesses etc.

so not the same as the past!

thank god we dont export much of our plastic waste, further polluting foreign lands and of course our oceans!

Agree on this that our policy makers have had it too easy for too long off the back of FDI. A good example is our banking system. David McWilliams did a piece on this last month stating our Central Bank is one of the worst in the world when it comes to supporting the Irish economy.

They are so obsessed with repeating the over-lending excesses of the Celtic Tiger, they completely ignore the fact the banks are effectively under-lending, constraining credit to productive enterprises in the economy. Thanks to a the savings of the Irish and a lack of competition, our Irish banks are only lending out 40c for every €1 on deposit.

While banks are making easy money hand over fist, they are not interested in doing anything that risks these profits. They must be forced to lend.

Credit, along with energy is the lifeblood of the economy. Banks have a social responsibility to society given their privileged position afforded by way of regulation. Yet our Politicians are blinded by the FDI revenue which is masking the serious impact this is having for Irish business.

I read the McWilliams piece and it did make me wonder where is the credit demand gone?

I remember twenty years ago in 2006 him explaining how it was German savers that were lending to Irish banks which was funding the massive credit spree and housing bubble here. They were lending to Irish banks because they were being promised better returns than German bank deposits.

I think part of the problem and we see it in so many threads is that as this society of mostly aging homeowners (I think it's currently around 70% owner occupier) we're probably not spending like we once were. Nearly half our population in 1992 was under 25 years of age and as incomes rose that went into a lot of small businesses funded by bank lending.

In the 1990/2000s we experienced the credit multiplier effect of a demographic dividend, the maximum amount of working age in paid employment being able to service borrowing, which in turn had banks competing with eachother to write loans until they ran out of new entrants to keep that dynamic going.

It could well be that some of that unused Irish saving now seeking a return elsewhere could be pumping up some asset bubble some where in the world. Maybe some investments are already imploding if they were stuck in Dubai property.

state created money differs from bank created credit, mmt advocates for state created money, via deficit spending, noting, all money is magically created, i.e. both deficit and credit created money are magically created, but in different ways, by different means

What ever about McWilliams (lets not derail the thread about him), the point was our Banks have so much cash on deposit combined with no competition, therefore have no incentive to lend to anything other than the safest prospects.

If we want to pivot away from our reliance on FDI, we need home grown small businesses to be able to access credit. This is the productive part of the economy. The demand is there, but banks will insist you put up all of your assests and then some.

As @Wanderer78 put it we need a mindshift in policy from our Govt and Civil service. But with a country run by Teachers, Lawyers & Landlords, I just dont see it happening anytime soon.

Otherwise if this continues, and we face a prolonged energy crisis, its going to get ugly very quickly.

The State has very considerable lending power of its own through Enterprise Ireland and its local subsidiaries, with no equity taken or assets marked.

However its a very high bar to earn the loans or indeed the grants, and really it should be, because all over the world the majority of small business enterprises fail.

I definitely don't think we need to overreact and flood an already humming domestic economy with funding that only adds to inflation.

Trump hasn't got the stomach for a long engagement here, because he is most susceptible to his numbers falling and prices rising. And currently support for the war is 73/27 and prices are stubbornly high due to tariffs being passed on.

So we in Ireland have a very considerable buffer of economic growth. We can afford to steady the tiller and do nothing drastic. At worst it will probably need a temporary reduction in excise for 3 to 6 months to ease the potential spike in consumer prices in energy and groceries.

And just like that oil prices tumble and Trump declares the war almost over. Let’s get on with our lives and look forward to the revised commentary in the media tomorrow that inflation won’t take hold after all. I’ve seen a lot of opinion pieces about how a prolonged war in Iran could lead to higher inflation but if the war is the cause and it is now effectively over, we should also see the narrative now flip back that inflation is not expected anymore.

There's no "narrative". War is on in the M.E. therefore prices increasing. If that war is ending then prices will naturally start to decrease. When the war actually ends, they should revert back to a certain level.

There's a whole bunch of complex stuff going on, risk premiums, etc, but that's the basics of it.

Nice one 5% growth without the MNCs

“The Republic of Ireland's domestic economy grew by almost 5% in 2025, official figures suggest.

Irish domestic output is estimated using a measurement called modified domestic demand (MDD).

The economic performance of most countries is measured using gross domestic product (GDP), but Irish GDP is heavily distorted by the activities of multinational companies.

The figures suggest that Irish GDP grew by more than 12% in 2025.”

Again - a lack of forward thinking policy by our political masters will ensure "steady as she goes" even if the impetus may be there.

Look at the last big opportunity during covid. There was a brief once in a generation window when the Govt could have tapped bond markets for next to nothing to fund a massive renewable infrastructure binge and set this country up for generations to come. But that was beyond Pashcal's realm of possibility.

Instead we gave helicopter money to the great unwashed to help assist the struggling shareholders of Amazon & Netflix….

Fence sitters who are bad at math?

At 10-12K per install after grant as being discussed in solar thread elsewhere here that’s an expectation that this war in Middle East would drag out for 10 years and nothing changes to justify the 1000euro per year cost due to these rises (oil already fallen sharply)

https://www.irishtimes.com/ireland/2026/03/09/fuel-prices-top-2-a-litre-as-annual-extra-cost-to-households-could-hit-1000/

A 10k install would repay itself between 5 and 10 years depending on aspect and energy usage patterns.

That is a brilliant ROI, because it also adds even more value to your home.

Sure, a reminder but the facts are that this was a very short lived oil crisis which has subsided significantly and therefore inflation is not going to happen in the manner it has been “predicted” in the media the last few weeks.

There is so much doom mongering about it that it almost seems like a narrative.

https://www.rte.ie/news/business/2026/0307/1562024-5-ways-trumps-war-will-make-you-poorer/

https://www.independent.ie/opinion/analysis/petrol-pensions-mortgages-and-food-all-the-ways-the-middle-east-conflict-will-hit-you-in-the-pocket/a1629407190.html

https://www.irishtimes.com/business/2026/03/10/commercial-property-recovering-but-mideast-violence-threatens-new-inflation-spike/

It’s all bread and circus but there is no reason to see inflation based on the last couple of days. The posts directly above show how strong our economy is and this is the reality.