Why is this Country in Such a Mess?

Gareth37 · 19-09-2008 10:49am #1

Can someone explain why they think this country is in such a mess?

I can understand that the banks borrowed way too much and gave too much credit to Irish fools to bid against each other in property with money owed to European Banks. Now the time has come to pay it back, jobs are going and the cycle is on a very steep downhill ride. Basically the money was not ours to spend and a lot of it has left the country with foreigners, Irish people spending abroad, drug dealers, pimps etc.

I think a lot of organisations are to blame including greedy bank shareholders but most of all greedy politicans at all levels for promoting their own property interests and estate agent businesses.

What I can't understand is the severity of the credit crunch - where has all the money gone? Surely it is in circulation somewhere?

Ireland seem to be far the most worse off as our economy was mismanaged.

3 things the Government can do to reverse the problems:

1. Get back our natural resources such as the Corrib gas fields which would be worth €1 Trillion to our economy (the Norwegian governemnt think its hilarious that we gave away our natural resources for free).

2. Develop renewable energy such as wind power, I hear that ireland have the best wind speeds in Europe. This can allow us to export energy, provide the nation with very cheap heat and power and attract major industry to the country by offering them free power eg server farms. The current empasis on unsustainable grants for stupid pet projects such as solar panels needs to be scarped - its a joke. the current plans to introduce smart meters is also a joke. Its quite sad really. get renewable energy and use as much a syou want as cheaply as possible.

3. Withdraw from the EU and bring back our farming and fishing industries - make Ireland self sustaining.

seamus · 19-09-2008 11:08am

Gareth37 wrote: »

Now the time has come to pay it back, jobs are going and the cycle is on a very steep downhill ride. Basically the money was not ours to spend and a lot of it has left the country with foreigners, Irish people spending abroad, drug dealers, pimps etc.

Some big leaps in there. There money hasn't "gone" anywhere. Jobs are really only being shed in one area - construction.

What I can't understand is the severity of the credit crunch - where has all the money gone? Surely it is in circulation somewhere?

Ireland seem to be far the most worse off as our economy was mismanaged.

I don't know what gives you the impression that Ireland is in a particularly bad position. People seem to have this impression that Ireland has much further to fall than everyone else, that when it's all over, it'll be 1982 again. Ireland was proportionally way behind the rest of Europe. We caught up, then overtook them. We don't have very far to fall back because our baseline, the number of sustainable jobs and industries in the country, has been raised significantly.

The credit crunch occured primarily because of ridiculous practices by primarily American banks.
The money doesn't have to exist anywhere. Once you get higher up the chain to massive amounts of money, much of it only exists within a computer system, it's effectively just an intangible number. For every dollar in existence, there isn't a dollar bill to back it up.

For example, let's say I lend €3 to Joe to buy a car (sticking with simple figures here

). Joe agrees that he'll pay me back €5 in a week. Peter also wants to buy a car. It'll cost him €5. I don't have €5 on me, but after talking to the car vendor and explaining that Joe owes me €5, he's happy to release the car to Peter on my word that when he needs the €5, I can give it to him.

Now on paper it appears that I have €10. But I don't. I only have €5. If Joe defaults on his loan, I'm in trouble. Not only do I not have €5 to give to the car vendor, I might even have trouble getting back my €3.

19-09-2008 12:22pm

Gareth37 wrote: »

1. Get back our natural resources such as the Corrib gas fields which would be worth €1 Trillion to our economy (the Norwegian governemnt think its hilarious that we gave away our natural resources for free).

it saved us billions because we didnt have to spend money drilling empty wells.
Now when a company finds something you want to push them over and take over. Going back on a deal will deter future foreign investment.

You also want us to leave the EU after all the money they pumped into the country

Mink · 19-09-2008 12:43pm

I have to say, I agree with Gareth37 on a lot of what he says. Inflation is caused by world banks pumping fictional money (that no one produced for) into countries & then putting them into debt & getting them to pay it back with interest. Then a recession is created and eventually the whole cycle starts again. It's a way of controlling populaces & is far more sinister then anyone really realises. Wow, I do sound like a conspiracy theorist don't I!

jmayo · 19-09-2008 1:08pm

Gareth37 wrote: »

Can someone explain why they think this country is in such a mess?

I can understand that the banks borrowed way too much and gave too much credit to Irish fools to bid against each other in property with money owed to European Banks. Now the time has come to pay it back, jobs are going and the cycle is on a very steep downhill ride. Basically the money was not ours to spend and a lot of it has left the country with foreigners, Irish people spending abroad, drug dealers, pimps etc.

I think a lot of organisations are to blame including greedy bank shareholders but most of all greedy politicans at all levels for promoting their own property interests and estate agent businesses.

What I can't understand is the severity of the credit crunch - where has all the money gone? Surely it is in circulation somewhere?

Ireland seem to be far the most worse off as our economy was mismanaged.

3 things the Government can do to reverse the problems:

1. Get back our natural resources such as the Corrib gas fields which would be worth €1 Trillion to our economy (the Norwegian governemnt think its hilarious that we gave away our natural resources for free).

2. Develop renewable energy such as wind power, I hear that ireland have the best wind speeds in Europe. This can allow us to export energy, provide the nation with very cheap heat and power and attract major industry to the country by offering them free power eg server farms. The current empasis on unsustainable grants for stupid pet projects such as solar panels needs to be scarped - its a joke. the current plans to introduce smart meters is also a joke. Its quite sad really. get renewable energy and use as much a syou want as cheaply as possible.

3. Withdraw from the EU and bring back our farming and fishing industries - make Ireland self sustaining.

Where do I start ?
We are screwed as an economy becuase we let housing construction become too great a portion of the economy, i.e. the country became too dependent on it.
As for blaming foreigners for taking "our" money out of the country, that just stinks of a xenophobic attitude that "they came here and took our jobs and took our money".
They came here to work, some of them to do jobs that we Irish were "too good for" or we Irish were too lazy to do (note we still had eejits drawing dole during the boom times).

Foreign workers came here to work and contributed to the countries coffers so don't start blaming them for sending or tkaing money home.
We did it in UK, US and throughout the world, it's how lots of people in Ireland survived down through the years.
As for drug delaers and pimps!
Again nobody ever forces people to go to either of them.

I agree we should not have sold off our gas and oil rights so cheaply.
But we have not discovered trillions of dollars of deposits as of yet.
But there maybe be huge undiscovered deposits out there ?
Either way the Irish consumer gets shag all out of it.

As for wind energy allowing us to be sustainable or energy exporters, that is a complete joke. Wind energy is all well and good, but have you ever noticed that wind doesn't blow all the bloody time no matter where you are.
We may have best winds in Europe, although parts of Scotland may disagree, but it is not reliable form of energy production.
Wave would be more reliable but neither could be totally relied upon on their own.
What is wrong with solar panel grants? The sun doesn't have to be shining Sahara style for you still benefit from them. Why not get people to cut down on some of their enegy costs by getting some benefit from daylight.
You sing the praises of one form of alternative energy, yet you belittle others and energy saving incentives.
If you want ot alk seriously about energy sustainablitiy then lets talk nuclear.

As for withdrawing form EU, yeah right that would be a great idea...

Blindjustice,
are you telling me that Shell or all the other companies together spent billions drilling wells and if they found something that should almost get it for free with no benefit to the people of the country ?

The oil companies did drill useless wells but it is surprising how the wells came back with something once their drilling and exploration costs were covered by Irish Taxpayer post 1987. The irish consumer will still have to pay market rates for gas and there are very good taxinceives for oilcompanies even though they are using up the countries natural resources and making a handsome profit out of it.

SimpleSam06 · 19-09-2008 1:30pm

jmayo wrote: »

As for wind energy allowing us to be sustainable or energy exporters, that is a complete joke. Wind energy is all well and good, but have you ever noticed that wind doesn't blow all the bloody time no matter where you are.

That is incorrect. Deep water offshore winds are both strong and constant, using proven technology, and there are several groups actively developing these wind platforms. No planning and no objections since no one will see them fifty miles off the coast. Not only could we export energy, we could export components and technology as well, I mean in Denmark the wind power industry employs over 30,000 people.

Storage can be achieved by reservoirs or many other systems, and the only problem with feeding it into the grid is that you need to shut off the other power generators, which would have been the whole point anyway.

In fact its such a juicy prospect that between you, me and the thousands of people who read boards, and anyone they mention it to, I'm looking at putting together a proposal to show some investors and officials to exploit this resource.

dan_d · 19-09-2008 1:41pm

When you say "only construction jobs are being laid off" I presume you realise that includes the following...plumbers,electricians,carpenters,architects,architectural technicians,design engineers (mechanical,electrical,civil ,structural),CAD technicians,project managagement staff,health and safety officers,quantity surveyors, site engineers,foremen,people working in concrete plants,people in specialist steel companies...it's quite a big list, and it's not just your average "builder" stereotype that most people have.
Things aren't a total disaster, but we're not doing a huge amount to help ourselves, plus we were completely reliant on the construction sector. We haven't fallen as badly as we could have, but we certainly need to rely more on more sustainable areas of the economy, and get rid of this ieda that our property market, and by extension, our construction sector, can be considered to be the basis of an economy, and the benchmark by which our economic success can be measured.

astrofool · 19-09-2008 1:50pm

I still think you're launching into offshore wind farms a bit too early SimpleSam, and that it will, hopefully, be our next +1 solution to power, but it's not quite there today.

What has been the largest installation of these wind farms so far? How long have they been operating for? (genuine questions btw).

SimpleSam06 · 19-09-2008 1:58pm

astrofool wrote: »

I still think you're launching into offshore wind farms a bit too early SimpleSam, and that it will, hopefully, be our next +1 solution to power, but it's not quite there today.

I have a habit of launching into things early, and it hasn't done me too wrong so far. I'm not especially concerned about talking about it, I mean anyone that would try to lever the government and investors into putting millions into something like this, in the current environment, would want to be nucking futs.

astrofool wrote: »

What has been the largest installation of these wind farms so far? How long have they been operating for? (genuine questions btw).

There are no existing deep water wind farms at this time. I have schematics for possible configurations though (based on existing tech, anchored oil platforms and near shore marine wind turbines of which there are enormous fields in Denmark), and several groups (both petroleum industry research groups and commerical investment groups) have begun construction on the first models in Europe.

The initial cost estimates are wildly uneconomical, but thats before you apply mass production to the equation, and remember that prototypes and research always cost loads.

The technology is at most a decade away from realisation, not a question of if but when, and considerably sooner with a bit of luck.

latenia · 19-09-2008 3:08pm

To go back to the OP's original question:

Taoiseach Brian Cowen inherited his seat from his father.
Misister for Finance Brian Lenihan inherited his seat from his father.
Leader of the opposition Enda Kenny inherited his seat from his father.

This is just the tip of the iceberg as far as the the rest of the Dail goes.

This is why the country is so poorly run.

AARRRGH · 19-09-2008 3:22pm

The country isn't a mess.

Maybe if you work in construction, but me, an average IT worker, I am benefiting from the lower rents, lower prices and reducing house prices.

Our Government are a load of ****e though.

jmayo · 19-09-2008 5:08pm

SimpleSam06 wrote: »

That is incorrect. Deep water offshore winds are both strong and constant, using proven technology, and there are several groups actively developing these wind platforms. No planning and no objections since no one will see them fifty miles off the coast. Not only could we export energy, we could export components and technology as well, I mean in Denmark the wind power industry employs over 30,000 people.

Storage can be achieved by reservoirs or many other systems, and the only problem with feeding it into the grid is that you need to shut off the other power generators, which would have been the whole point anyway.

In fact its such a juicy prospect that between you, me and the thousands of people who read boards, and anyone they mention it to, I'm looking at putting together a proposal to show some investors and officials to exploit this resource.

Sorry Simplesam when I was speaking of wind farms I was thinking of the land based ones or the onshore ones. Actually the only sea based ones I can think of are the ones off Arklow. I din't know about offshore developmetns you speak of.
I know the wind power industry is huge in Denmark, but do you think we could turn the country into one big wind farm until the technology is readily available to go so far offshore, out into the Atlantic I presume ?
Are you talking about basing standard type wing generators ontop of oil platforms ?
When you say storage by reservoirs, are talking about Turlough Hill type infrastructure? That would involve huge infrastructural developmetns and not sure about planning.
I always thought that wave technology maybe a better way to go, but I also think that sooner or later we are going to have to go nuclear or else buy energy from UK which will be nuclear generated anyway, but I defer to your greater knowledge in the area.
Anyway off topic I guess ... basically I believe we blew the good times and not we got to knuckle down once again or else sod off as before.
As someone decalred before berties rain will be seen as one big lost opportunity.

Calina · 19-09-2008 5:50pm

Gareth37 wrote: »

Can someone explain why they think this country is in such a mess?

I think this country is in a mess because a significant number of people have an over simplistic way of looking at complicated things and an overly complicated way of looking at simple things. Our media is not deep on analysis either and the biggest selling paper of the week is the Sunday Independent. None of this augurs well for mess avoidance. After all, someone thinks that Brendan O'Connor is competent to mouth off about economics and finance which is somewhat worrying.

Gareth37 wrote: »

I can understand that the banks borrowed way too much and gave too much credit to Irish fools to bid against each other in property with money owed to European Banks. Now the time has come to pay it back, jobs are going and the cycle is on a very steep downhill ride. Basically the money was not ours to spend and a lot of it has left the country with foreigners, Irish people spending abroad, drug dealers, pimps etc.

I think you don't understand the problem in too much detail at all. From about 2002 and onwards, we had historically low interest rates and a lot of people, banks included, behaved as though they were given Daddy's credit card. Obviously when you do this, in all films, there is payback at some stage. The people who did the borrowing did so because in the short term they would be rewarded and in the long term, they didn't expect to be aroun to clean up the mess.

The dilution of lending criteria was crazy, I never agreed with it, but it could have been stopped by the Central Bank. We are in this mess in part because of a lack of clear regulation of financial services company. A lot of people who borrowed that money were not fools; and it is extremely superficial to call them that. Ireland has a particular problem - compared to most of Europe (although not the UK) regarding its rental market being less than mature. As such, despite the cost, if you could fund your mortgage, the pay off in security was worth it to a lot of people, particularly families. The encouragement of a buy-to-let market without decent tenancy regulation was careless and more evidence of laissez-faire. Not a good idea.

Ireland is in a particular mess, however, because we didn't just create a bubble market locally, we also exported a lot of it. We provided a significant number of buyers for property speculation in other countries on borrowed money, disproportionate to our population per se. Provided the loans can be paid back, the issue is not with the banks, more with the borrowers.

People were looking for a quick buck. Like pyramids, however, only a few can manage it.

This does not lead to people spending abroad - when I spend money abroad, I do it with my own earned money. The country had a heroin problem 20 years ago; now it has a heroin and cocaine problem; borrowed money is not the issue here, peer pressure more likely, and we have always had a prostitution issue. Now of course, much of it is imported because like many other jobs, locals are above doing it. Note: I don't agree with prostitution; but it is not caused by the amount of money in the country over teh past few years; it was always here. The profile of service suppliers has changed.

I have no issue with immigration; I think that Ireland, and Irish society in general, could benefit from having its rather closed mind forced open like an oyster shell. Having lived abroad, one of the big issues I find about Ireland is that if you suggest something could be improved by reference to how things are done else where you very frequently get told to f off back there then. This is hardly constructive. A more cosmopolitan society might be no bad thing; we might actually get decent public services then. In about 20 years maybe.

Gareth37 wrote: »

I think a lot of organisations are to blame including greedy bank shareholders but most of all greedy politicans at all levels for promoting their own property interests and estate agent businesses.

Lack of regulation is an issue. While I don't particularly appreciate the estate agency business, it has to be recognised that there are several players in the transaction; namely buyers and sellers. In past years, you could say that there was an issue with gazumping - so the issue there is with both buyers who gazump and sellers who renege on previous agreements. I do think, however, that the real estate industry in Ireland is ludicrously underregulated.

Bank shareholders are in it to make a profit. In any case, I think they are likely to be victims in this one too; reserve your ire for senior bank management. But in truth, they merely exploited the absence of effective regulation. Realistically, dilution of salary lending multiples and high LTVs could have been attacked in two ways by the Central Bank without having recourse to interest rate changes which they can't do any more anyway. Those options are increase the minimum deposits held by the banks at the Central Bank - they are required to have money on reserve there - and also they can just tell them not to do certain things. The much vaunted stress testing should have been upped considerably in the light of historically low interest rates.

Gareth37 wrote: »

What I can't understand is the severity of the credit crunch - where has all the money gone? Surely it is in circulation somewhere?

You need to read up on money supply in wikipedia - it's not indepth but it's a good start. Basically a lot of money is just notional; it's not backed by actual banknotes or whatever the base value is.

Gareth37 wrote: »

Ireland seem to be far the most worse off as our economy was mismanaged.

This is actually not necessarily true. I don't get this attitude with Irish people that they automatically assume that if something is wrong they have the worst of it. Our economy could have been better managed, this is true. a couple of German banks had far more exposure to nasty bank products from the US, and although our unemployment is rising, it's still far from being the highest in Europe. We will have a painful transition but with some creativity and vision, we could, in 10 or 20 years come out of it. We have some export industry and it's in our interest to hold on to it. Languishing and moaning about how we are worst off is stupid to be honest.

Gareth37 wrote: »

3 things the Government can do to reverse the problems:

1. Get back our natural resources such as the Corrib gas fields which would be worth €1 Trillion to our economy (the Norwegian governemnt think its hilarious that we gave away our natural resources for free).[/QUOTE]

The Corrib gas field will be worth nothing to our economy if we do not start exploiting it. There is a long thread somewere on the property pin on this subject but in general, if you want people to spend a lot of money on oil and gas exploration in an area with not huge amounts of potential - and comparatively we are very much bit part players on that front - you have either pay for it yourself which is a gamble and not what I want done with tax payers money up front; or make it attractive for other people. There is a 25% tax on profits from the Corrib gas fields as far as I am aware although I am not expert on the figures. Name me another natural resource apart from the gold in Croagh Patrick and Monaghan and come back to me with a wiser and more concrete proposal later.

Gareth37 wrote: »

2. Develop renewable energy such as wind power, I hear that ireland have the best wind speeds in Europe. This can allow us to export energy, provide the nation with very cheap heat and power and attract major industry to the country by offering them free power eg server farms. The current empasis on unsustainable grants for stupid pet projects such as solar panels needs to be scarped - its a joke. the current plans to introduce smart meters is also a joke. Its quite sad really. get renewable energy and use as much a syou want as cheaply as possible.

This is not a short term solution. Currently, the cost of getting out renewable energy both financially and environmentally is higher than what you get out of it. So what you're proposing is a long term solution. Unfortunately, the odds of making it happen are limited in the short term (a few years of economic stagnation might change this though) as any major infrastructure suffers from plannign headaches. I actually am of the opinion that all houses going forward should be equipped with solar panels regardless of other sources of energy.

Gareth37 wrote: »

3. Withdraw from the EU and bring back our farming and fishing industries - make Ireland self sustaining.

Ireland was not self-sustaining prior to access to the EU in 1973. Do you seriously think that this is goign to work now when it didn't 40 years back?

irish_bob · 19-09-2008 8:51pm

latenia wrote: »

To go back to the OP's original question:

Taoiseach Brian Cowen inherited his seat from his father.
Misister for Finance Brian Lenihan inherited his seat from his father.
Leader of the opposition Enda Kenny inherited his seat from his father.

This is just the tip of the iceberg as far as the the rest of the Dail goes.

This is why the country is so poorly run.

they didnt inherit the seat like a son inherritts his fathers house or perhaps land , they may have been groomed to take over the seat but the people in the constituency still had the final say in voting them in

SimpleSam06 · 20-09-2008 8:56am

jmayo wrote: »

I din't know about offshore developmetns you speak of.

It is a bit offtopic but sure the whole thread seems to be an ill fit for property and accom, so what the hey. There are no deep water fields which exist at the moment, thats the beauty of it.

jmayo wrote: »

I know the wind power industry is huge in Denmark, but do you think we could turn the country into one big wind farm until the technology is readily available to go so far offshore, out into the Atlantic I presume ?

Absoloutely not, that would be an abomination. We'll just have to muddle through until the tech is ready, but even getting it ready would employ hundreds. Eventually it would employ tens of thousands.

jmayo wrote: »

Are you talking about basing standard type wing generators ontop of oil platforms ?

No, custom designed floating turbines anchored to the sea floor, along the lines of a fishing float, you know the ones dangling on a line.

jmayo wrote: »

When you say storage by reservoirs, are talking about Turlough Hill type infrastructure? That would involve huge infrastructural developmetns and not sure about planning.

Basically yes, but there are two advantages here, your distribution stations would be on the seashore (and not neccessarily near to anyone who would care), so you have access to major amounts of water from the get go, and the great thing about these yokes is you don't need to build them halfway into the Atlantic, you can build them onshore and tow them out to their positions, thus cutting out the need for those enormously costly crane ships and reducing maintenance. You could have several of them in dock on standby in case of damage.

The hits just keep coming with this!

jmayo wrote: »

I always thought that wave technology maybe a better way to go, but I also think that sooner or later we are going to have to go nuclear or else buy energy from UK which will be nuclear generated anyway,

Nah not a bit, we are one of the best placed, if not the single best placed country in the world to take advantage of deep water winds. There is no reason at all why we couldn't be generating a constant surplus of energy from wind plus serious high tech that other countries would be delighted to buy from us, if we're quick enough off the mark (and I really can't emphasise enough how vital timing is here, we need to get off our arses immediately). Lord knows we have the brains.

Not to mention it would put Ireland in an exceptionally sweet position for the eventual advent of the electric car once petroleum resources start to dwindle. The infrastructure for distribution is already in place!

Victor · 20-09-2008 11:25am

Gareth37 wrote: »

1. Get back our natural resources such as the Corrib gas fields which would be worth €1 Trillion to our economy (the Norwegian governemnt think its hilarious that we gave away our natural resources for free).

This is the Accommodation & Property board - lets stick to that.

Calibos · 23-09-2008 5:24am

Wow, I never knew simplesam06 was a marine electrical engineer or is it venture capitalist. Where did it all go wrong for Airtricity and what would you do differently sam?

DublinWriter · 23-09-2008 6:01am

Gareth37 wrote: »

Basically the money was not ours to spend and a lot of it has left the country with foreigners...

Yes, damn those foreigners and their hard working ways...

Gareth37 wrote: »

3. Withdraw from the EU and bring back our farming and fishing industries - make Ireland self sustaining.

4. Comely maidens dancing at the crossroads, etc.

SimpleSam06 · 23-09-2008 8:57am

Calibos wrote: »

Wow, I never knew simplesam06 was a marine electrical engineer or is it venture capitalist.

Neither, but thanks for asking.

Calibos wrote: »

Where did it all go wrong for Airtricity and what would you do differently sam?

I guess that would all depend on how well SSE holds up. I mean Airtricity only made £150,000 profit last year, and Scottish and Southern are seriously in over their eyebrows in debt, a very bad place to be in the present climate. In addition Airtricity is only servicing commercial customers, a crucial mistake in my opinion, athough no doubt that decision was made for good reasons.

Anyway if anyone wants to discuss this with me in private, feel free to PM, before Victor cranks up the infractometer for being in the wrong forum.

Boggle · 23-09-2008 9:15am

In addition Airtricity is only servicing commercial customers, a crucial mistake in my opinion, athough no doubt that decision was made for good reasons.

Feel free to correct me here but as far as I remember deregulatio of teh electricity market applied to commercial customers before private customers so they would have built up their comercial customer base first and probably just lay stagnant at that. Could be wrong though about the dregeulation cos its only a glint of a memory.

Why is this Country in Such a Mess?

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