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Ireland economy hitting the Buffers !!

Spotted this coming out of Tesco this evening, Ive heard a few times how the Celtic Tiger was expanding so rapidly that something was going to go seriously wrong at some point !! :eek:

http://www.independent.ie/national-news/cabinet-goes-on-holidays-as-crisis-worsens-1441810.html
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Comments

  • WTF?_2
    WTF?_2 Posts: 4,592 Forumite
    ultra10 wrote: »
    Spotted this coming out of Tesco this evening, Ive heard a few times how the Celtic Tiger was expanding so rapidly that something was going to go seriously wrong at some point !! :eek:

    http://www.independent.ie/national-news/cabinet-goes-on-holidays-as-crisis-worsens-1441810.html

    Yes - the Irish housing market was like the British one on steroids - and that's saying something.

    Compounding matters there was massive oversupply as a result of lots of new builds springing up everywhere seemingly against all planning laws. Nothing to do with the fact that senior figures in the ruling party were cosy with wealthy builders I'm sure :D

    In any case, like the British economy the Irish economy came to be largely dependent on people building and selling houses to each other and of course borrowing money against those houses to consume. Now the wheels are coming off it rapidly.

    Since it started to decline about 9 months to a year before the British one, expect similar tales of woe soon in GB. The only thing that might make it any better is that general oversupply isn't as bad - though of course there's massive oversupply in purpose-built BTL 'luxury apartments' which will likely have a knock-on effect.
    --
    Every pound less borrowed (to buy a house) is more than two pounds less to repay and more than three pounds less to earn, over the course of a typical mortgage.
  • Jonbvn
    Jonbvn Posts: 5,562 Forumite
    Part of the Furniture 1,000 Posts
    I expect Ireland will be in a far worse position than the UK, since in the UK we have control over interest rates, whereas Ireland does not. IMHO, the situations in both Spain & Ireland are almost identical, but does not bear good correlation to the situation in the UK. That is not to say that there will not be some similarities.
    In case you hadn't already worked it out - the entire global financial system is predicated on the assumption that you're an idiot:cool:
  • leftieM
    leftieM Posts: 2,181 Forumite
    Part of the Furniture Combo Breaker
    I have two relatives working in the public sector there. The one who works in the dole office says they are inundated with people from the construction industry. The one in the Department of Finance says the tax take is way down and they are concerned about funding. It's getting nasty.
    Stercus accidit
  • Pobby
    Pobby Posts: 5,438 Forumite
    Came back a while ago from Ireland. If anything it is madder than the UK for housing.
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    leftieM wrote: »
    I have two relatives working in the public sector there. The one who works in the dole office says they are inundated with people from the construction industry. The one in the Department of Finance says the tax take is way down and they are concerned about funding. It's getting nasty.

    Ireland is in an extra bind due to membership of the Euro. They couldn't set interest rates to rein in an overheating economy on the way up and they can't set them to stimulate on the way down. Also, they're not meant to run a budget deficit of > 3% of GDP which may mean some pretty tough choices in the months to come.
  • Guy_Montag
    Guy_Montag Posts: 2,291 Forumite
    1,000 Posts Combo Breaker
    Generali wrote: »
    Ireland is in an extra bind due to membership of the Euro. They couldn't set interest rates to rein in an overheating economy on the way up and they can't set them to stimulate on the way down. Also, they're not meant to run a budget deficit of > 3% of GDP which may mean some pretty tough choices in the months to come.

    What's our budget deficit?

    & err what is a budget deficit? I presume HM Govt. spending more than it receives.
    "Mrs. Pench, you've won the car contest, would you like a triumph spitfire or 3000 in cash?" He smiled.
    Mrs. Pench took the money. "What will you do with it all? Not that it's any of my business," he giggled.
    "I think I'll become an alcoholic," said Betty.
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    Guy_Montag wrote: »
    What's our budget deficit?

    & err what is a budget deficit? I presume HM Govt. spending more than it receives.

    Our budget deficit is 2.8% I think. That doesn't include off balance sheet items such as PFI and unfunded pension liabilities accruing.

    A budget deficit is the difference between government income and expenditure and is normally measured as a %age of GDP.
  • ultra10
    ultra10 Posts: 379 Forumite
    Pobby wrote: »
    Came back a while ago from Ireland. If anything it is madder than the UK for housing.
    I think ireland had an even Greater obsession with real estate than the u.k !!... The highest number of home owners per capita of any western nation as i recall ....
  • m00m00
    m00m00 Posts: 1,755 Forumite
    plenty of irish people invested in the UK BTL madness too ....

    so a double edged sword of damacles hanging over many
    It's a health benefit ...
  • poppy10_2
    poppy10_2 Posts: 6,588 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    Does Ireland even have an economy? Other than receiving EU handouts, I mean.
    poppy10
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