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Ireland "basket case economy": Finch


DublinDaze

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May 7, 2006
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10
The rating agency Fitch said it now has five countries on watch for "macro-prudential stress", up from two last year, using a set of indicators ... Azerbaijan, South Africa, Russia and, surprisingly, Ireland, where the ratio of private credit to GDP has reached 190pc, the world's highest."
The only people who think that Ireland's economy is sustainable along with its house prices are .. us Irish.

The rest of the world are laughing at us.

Still, I stand proudly alongside my Azerbaijan comrades.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/09/12/cctrade12.xml
 

Sidewinder

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Oct 23, 2004
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442
The thing is, our economy has been nothing but an unsustainable bubble pyramid-scheme since the summer of 2001. And in those 5 years, huge chunks of the real productive economy have withered away or become completely uncompetitive as the mania took hold.

We have nothing substantial holding it all up. Nothing at all. Just sentiment and a blind belief that somehow the Irish are magically entitled to all get rich by, ummm, not actually doing any work or making any products that other countries want to buy. Nope, we'll be the first country in history to all become millionaires and retire without having to do a days work, all on the back of magic property values which "never fall". Get on the ladder, quick!

I'm only 33, and this is the 3rd bubble I've witnessed first-hand - and studied a few others back when I was doing my degree in Commerce (for my sins, and a lifetime ago it seems now, but I digress). The third time I've sat and watched friends and family financially shoot themselves in the head by getting carried away by the hype and spin in what is clearly a wildly over-valued market.

People are stupid. Every bloody time, the same old manic magic-beans nonsense. And doubtless within a decade we'll see another "guaranteed profit" frenzy. Next time though, I think I've now learned and observed enough about how these bubbles work to maybe skim some modest profit off the herd on the upswing, and get out in plenty of time before the bust :lol:
 

kerrynorth

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Oct 5, 2005
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1,525
Sidewinder said:
The thing is, our economy has been nothing but an unsustainable bubble pyramid-scheme since the summer of 2001. And in those 5 years, huge chunks of the real productive economy have withered away or become completely uncompetitive as the mania took hold.

We have nothing substantial holding it all up. Nothing at all. Just sentiment and a blind belief that somehow the Irish are magically entitled to all get rich by, ummm, not actually doing any work or making any products that other countries want to buy. Nope, we'll be the first country in history to all become millionaires and retire without having to do a days work, all on the back of magic property values which "never fall". Get on the ladder, quick!

I'm only 33, and this is the 3rd bubble I've witnessed first-hand - and studied a few others back when I was doing my degree in Commerce (for my sins, and a lifetime ago it seems now, but I digress). The third time I've sat and watched friends and family financially shoot themselves in the head by getting carried away by the hype and spin in what is clearly a wildly over-valued market.

People are stupid. Every y time, the same old manic magic-beans nonsense. And doubtless within a decade we'll see another "guaranteed profit" frenzy. Next time though, I think I've now learned and observed enough about how these bubbles work to maybe skim some modest profit off the herd on the upswing, and get out in plenty of time before the bust :lol:

The asset price bubble in Ireland will likely end when the US property bubble bursts later this year or the first half of next year. The outfall will be traumatic as much of Irish lifestyle is built upon the accessing of inflated capital values. It is only a matter of timing.

I note from the weekends property supplements that whereas they refer to the number of properties left unsold over the summer season they are still talking up prices for the Autumn selling season. If you can get now, as I have already, then you should (investment properties only I am not suggesting that you sell your main residence).

Supply this year is thought to be 85000 units or circa 2/3rds of the entire UK? Plus the census shows that 1/6th of dwellings are unoccupied!

Just like the tech bubble it is those with a vested interest that are talking up the market whereas those with a shread of intelligence know what is coming. And of course it is those with the vested interest that have access to airwaves and the print media (who of course could not be comprimised by their reliance on advertsing from the property and construction sector, the thought of it!) such as financial p.rostitutes masqureading as economists and the like.
 

Sidewinder

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442
Good point about supply. Given the demographics, we probably need about 50-60000 units per annum now at the peak of the Pope's Children demographic bulge, declining to about 40,000 over the next 5 years. That's what rational output would be.

Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units. Or at least six years supply.

Six years supply. We could shut down the entire construction industry tonight for 6 years, and there'd still be enough houses for everyone to live in.

Utter madness. This is going to make the Japanese bubble look like a minor hiccup.
 

kerrynorth

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Oct 5, 2005
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Sidewinder said:
Good point about supply. Given the demographics, we probably need about 50-60000 units per annum now at the peak of the Pope's Children demographic bulge, declining to about 40,000 over the next 5 years. That's what rational output would be.

Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units. Or at least six years supply.

Six years supply. We could shut down the entire construction industry tonight for 6 years, and there'd still be enough houses for everyone to live in.

Utter madness. This is going to make the Japanese bubble look like a minor hiccup.
In fairness the Japanese bubble took the biscuit with intergenerational 100+ year mortages and the Royal Palace in Tokyo had a higher valuation than the entire land mass of Canada!
 

Johnny

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Apr 29, 2004
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1,223
Sidewinder said:
Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units.
That's a shocking figure. Is that from the census???
 

zakalwe

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Oct 20, 2005
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171
how much was the entire land mass of canada valued at.

i'm sure treasury holdings will put in a bid!
 

Ponzi

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Apr 15, 2006
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Ireland will be a different country in five years from now; economically and politically. Scapegoats will be required.
 

Ponzi

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Johnny said:
Sidewinder said:
Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units.
That's a shocking figure. Is that from the census???

The Irish Independent (19.6.06) regarding empty properties uncovered by Census enumerators.

‘Following inquiries among neighbours, postmen and women and apartment block management companies, the vast majority of those dwellings - some 275,000 - were identified as being vacant.’
 

Ballinran

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Aug 22, 2006
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70
Johnny said:
Sidewinder said:
Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units.
That's a shocking figure. Is that from the census???
The question is, where are all these empty houses?
 

KeithM

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Aug 18, 2006
Messages
93
kerrynorth said:
Sidewinder said:
Good point about supply. Given the demographics, we probably need about 50-60000 units per annum now at the peak of the Pope's Children demographic bulge, declining to about 40,000 over the next 5 years. That's what rational output would be.

Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units. Or at least six years supply.

Six years supply. We could shut down the entire construction industry tonight for 6 years, and there'd still be enough houses for everyone to live in.

Utter madness. This is going to make the Japanese bubble look like a minor hiccup.
In fairness the Japanese bubble took the biscuit with intergenerational 100+ year mortages and the Royal Palace in Tokyo had a higher valuation than the entire land mass of Canada!
Yes, but Canada, surely that's quite understandable! :twisted:

I actually think what we have now is similar to the nonsense that went on in Holland centuries ago when tulips were completly overvalued and no one could see it. You'd certainly want to be a tulip to pay over a million for a three bed semi, as I've seen on myhome.ie.
 

commentator

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Aug 3, 2005
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One major pull out by a north American multi - national would be the catalyst.

I stand to be corrected but I believe we are now per capita the most indebted society in history anywhere anytime in the history of developed european economies. Is that correct?

Given that it probably is it is a shameful indictment of the govt. whose friends in the construction industry have made billions on the back of the unsustainable boom.

Am I alone in sensing the straws in the wind, Inflation rising, oil price instabiliity, terror, the sheer weight of debt and rising interest rates. There is increasingly a general sense that the hangover is only months away.

Scapegoats? Poles and Latvians. Unfair but that is what will happen given our failure to run a reasonable immigration policy. yet another of Bertie's inexcusable failings.
 

Pax

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Feb 12, 2004
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Sidewinder said:
Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units.
Hmm empty supply, ah sure we'll be alright, no need to worry, FF'll sort it out.....I mean what if a housing OPEC was set up? For some reason/mcguffin we can't build anymore houses, therefore, there's a coming House Peak. This would prop up the price of houses and benefit the construction sector as the oil industry benefits from a pertually coming oil peak wrt oil prices (there really is an oil peak, albeit on the far horizon, but they've been one a'comin for every 20 years since the 50s...). The resultant house fund taxes would then be redistributed to unemployed construction employees and companies with the new house buyer continually screwed well into the future. It'll be the all new public private partnership!

There would be untoward repercussions under our new Organization of the House Building Counties (OHBC) future, Dublin would in effect be the new Saudia Arabia, so I fear that'd make Rebel Cork (which naturally would buck the trend and start jerking around the price by building more one month and nothing the next - a la Saddam)..... the new Iraq!
 

sackville

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May 4, 2005
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commentator said:
One major pull out by a north American multi - national would be the catalyst.

I stand to be corrected but I believe we are now per capita the most indebted society in history anywhere anytime in the history of developed european economies. Is that correct?

we're breaking one record

The rating agency Fitch said it now has five countries on watch for "macro-prudential stress", up from two last year, using a set of indicators. A mixed bag, they comprise Iceland, Azerbaijan, South Africa, Russia and, surprisingly, Ireland, where the ratio of private credit to GDP has reached 190pc, the world's highest. The denouement for Ireland may not be pretty, since it gave up control of monetary policy when it joined the euro
:shock:

commentator said:
Given that it probably is it is a shameful indictment of the govt. whose friends in the construction industry have made billions on the back of the unsustainable boom.
they'll be sipping on cocktails in Bermuda or te like when it happens!

:roll:
 

DSCH

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Feb 6, 2006
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246
Sidewinder said:
I'm only 33, and this is the 3rd bubble I've witnessed first-hand - and studied a few others back when I was doing my degree in Commerce (for my sins, and a lifetime ago it seems now, but I digress). The third time I've sat and watched friends and family financially shoot themselves in the head by getting carried away by the hype and spin in what is clearly a wildly over-valued market.
But the world didn't end, and won't.
 

Eddiepops

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Aug 4, 2006
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106
DSCH said:
Sidewinder said:
I'm only 33, and this is the 3rd bubble I've witnessed first-hand - and studied a few others back when I was doing my degree in Commerce (for my sins, and a lifetime ago it seems now, but I digress). The third time I've sat and watched friends and family financially shoot themselves in the head by getting carried away by the hype and spin in what is clearly a wildly over-valued market.
But the world didn't end, and won't.
Actually, a lot of people's would, should the worst predictions prove true. Previous bursts of the bubble occurred when private indebtedness was radically lower than before. Now people have invested literally millions in their homes and other purchases which they think will never devalue. i think we're in for a seriously rough ride, one so bad that it's going to have serious social and political consequences. I think that commentator might be right and that it will be non-Irish members of society that wil bear the brunt.
 

ruserious

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Ireland will be a different country in five years from now; economically and politically. Scapegoats will be required.
5 years into the future and you were most correct. Take a bow son.
 

Doodah

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Ireland will be a different country in five years from now; economically and politically. Scapegoats will be required.
5 years into the future and you were most correct. Take a bow son.
"Ponzi's" last activity on P.ie was on Friday 27th September 2008. the weekend of the Irish government's guarantee.

Reports from the RTE news archive that weekend, Monday 30/09/08 and the Tuesday, are interesting.

eg. Crisis will hit non-banking sector - McCreevy - RT News

ISEQ suffers record one-day fall - RT News

US 'crisis' after bail-out plan rejected - RT News

Govt 'guarantee' debated in Dil - RT News
 
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ruserious

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