Irish Times: House prices in Ireland could drop by 80%

Conflict

tirano wrote: »

"To most, including those embedded in it, the effect of the Euro on such differing economic models is a very unknown quantity. It has had a terrible effect on Greece, Spain, Portugal and Ireland, but we can't know yet what the ultimate outcome will be."

These four countries are known as the PIGS , the problem they all have is that in a downturn their economy would be strengthened by a currency devaluation, however because they are in the Euro they cannot do this. The I used to stand for Italy, but because Ireland is in freefall it has taken Italys place.

Not exactly correct - its meant to be PIIGS including Italy and Ireland. Think it was first coined (or at least first printed) by a FT journalist back in Spring 2008.

macaque_2

GracieP wrote: »

Isn't that in Belfast?

All in all the Irish economy is in a much, much worse state than the UK. There are estimates that there are 300,000 (roughly 1 in 6) empty properties in a country where nearly 15% of the workforce worked in residential construction.

That alone would be enough to ruin the country, but we have an extremely heavy and expensive public service, which the country can no longer afford. Another 12% of the workforce worked in commercial and national development construction. Commercial property is as over-built and over-priced as residential and while some national development work will continue, the government can't afford many of their intended projects.

Much of the rest of the economy is service based, and we all know what happens to retail and other customer service based jobs in a recession. And in many areas there is an over-reliance on multi-nationals, many of which are leaving as Irish costs are too high. For example, Dell's recent announcement to end manufacturing in Ireland will directly and indirectly contribute to over 15% of the workforce of the city it was based in losing their jobs. (Including my brother).

The public services in Ireland, which should have been revolutionised during the boom weren't. So the country won't even be going into recession with decent schools, hospitals, public transport or roads in place. And personal debt is quite phenomenal. And our bankruptcy in Ireland is incredibly punative, taking 12 years to come out of and you can have your salary garnished for that time and lose your pension.

To make matters worse we have a government filled with crooks and shysters who make Brown look savvy. A media with almost no teeth who cheerlead the government. An unbelievable level of denial, headed by a former head of government, who two years ago, while in office, commented that those talking down the economy ought to go kill themselves. And a public who think the nasty, theiving, wife-beating crook was our saviour and things are only going to hell because he's gone.:mad:

To be honest, this description could equally fit the UK. The question is, which one is worse.

My fear is that the UK is in the bigger mess. So much of our wealth has derived from oil and financial services. Oil output is now falling and financial services have turned out to be a Cukoo in the nest. UK manufacturing is diabolically bad. We now have the lowest number of people employed in manufacturing since the industrial revolution and the rate of fall is accelerating.

UK industry stats now rely on electricity, gas, water, cars and chemicals. All our car companies however are foreign owned. Chemical and Pharmaceutical facilities are now closing every month. People still have no idea just how bad things really are.

When it comes to public services, the UK has problems of biblical proportions. Over the past 10 years, 3/4 million public servants have been recruited. All they have done is subcontract and outsource their work. We have millions of people milking the public purse like quangoes, PFI partners, private contractors and consultants. On top of this there are millions of retired public sector workers living like princes on final salary pensions.

I agree with another poster about the prospects for the Euro. I would not be surprised if it did dissapear within the next few years. Right now however, Ireland can borrow without resorting to 18% interest rates.

dopester

tirano wrote: »

"To most, including those embedded in it, the effect of the Euro on such differing economic models is a very unknown quantity. It has had a terrible effect on Greece, Spain, Portugal and Ireland, but we can't know yet what the ultimate outcome will be."

These four countries are known as the PIGS , the problem they all have is that in a downturn their economy would be strengthened by a currency devaluation, however because they are in the Euro they cannot do this. The I used to stand for Italy, but because Ireland is in freefall it has taken Italys place.

That is hilarious. First time I've heard of it.

macaque_2

StevieJ wrote: »

It will be gone within 2 years, how can applying German montary policy to the Irish economy be good

I share the view that the Euro will not survive (and I will certainly be pleased to see its demise). Right now however, the bottom line is that it is of great benefit to the Irish.

StevieJ

dopester wrote: »

That is hilarious. First time I've heard of it.

Substitute Italy for Ireland, the Pigs are all Med countries, Ireland is an honourary pig though

StevieJ

macaque wrote: »

I share the view that the Euro will not survive (and I will certainly be pleased to see its demise). Right now however, the bottom line is that it is of great benefit to the Irish.

No it isn't

StevieJ

mizzbiz wrote: »

I think you're being very unfair.

To most, including those embedded in it, the effect of the Euro on such differing economic models is a very unknown quantity. It has had a terrible effect on Greece, Spain, Portugal and Ireland, but we can't know yet what the ultimate outcome will be.

One thing seems certain, if the pound continues to be so devalued, the UK will start to look like an attractive investment proposition to Eurozone countries. But again, there are so many intrinsic factors that to speculate on Ireland or the UK in the next few years is a moot point entirely.

To accuse someone of being a monkey because their views differ, when actually the most qualified economists are sitting on their hands to see the outcome, is everything that is wrong with our society.

Do you know what a macaque is?
:rotfl:

epz_2

macaque wrote: »

I share the view that the Euro will not survive (and I will certainly be pleased to see its demise). Right now however, the bottom line is that it is of great benefit to the Irish.

The Euro will survive as its a political rather than financial decision, as far as i am aware there isnt any way to short the individual countries economies and force them out like the ERM.

I dont mean to say that staying in woulnt have dire consiquences like massive unemployment but these are longer term issues.

mizzbiz

StevieJ wrote: »

Do you know what a macaque is?
:rotfl:

I didn''t even notice the name of the poster. I just thought you were being nasty :embarasse:rotfl:

mizzbiz

epz wrote: »

The Euro will survive as its a political rather than financial decision, as far as i am aware there isnt any way to short the individual countries economies and force them out like the ERM.

I dont mean to say that staying in woulnt have dire consiquences like massive unemployment but these are longer term issues.

I think so. However much certain countries will want to pull out, it's not in their interests to. The ones that want out are the ones with biggest debt (in Euros). The reason to pull out would be for a devalued currency to counteract the harmful effects of a high value one on the economy, however, the effects of having a debt at least 2 times what they originally owed in the new (or even old!) currency would probably be more crippling in the long run.