House prices....

saverbuyer

A.L.D.A wrote: »

The South is not going down the Japan route.

Their fortunes are tied up with the Euro. Assuming sense prevails in the Eurozone and eventually they get their act in order, I would see fairly steady growth in RoI. The government is about 30% of GDP (from memory so welcome correction). The country is in a position similar to the mid 80s and demographics and many tax structures are favourable. As it recovers people here have more employment opportunities on the other side of the border. As for investing here heaven only knows, the memory of people is only as long as the next 'investment opportunity'. Improvements there will help the economy here.

If sense does not return in Euroland, it will lead to a weaker Euro or breakup. Either way may make the Irish economy a lot more competitive as the currency (whatever currency) will initially be a lot weaker.

IRELAND
GDP: €0.2 tn
Foreign debt: €1.7 tn
€390,969
Foreign debt per person
1,093%
Foreign debt to GDP
109%
Govt debt to GDP
Risk Status: HIGH

vs.

UK
GDP: €1.7 tn
Foreign debt: €7.3 tn
€117,580
Foreign debt per person
436%
Foreign debt to GDP
81%
Govt debt to GDP
Risk Status: LOW

qwert_yuiop

saverbuyer wrote: »

QE actually causes inflation resulting in a greater chance of interest rate rises.

Eventually, yes, once the whole thing goes out of control (You mean someone is in control?), but QE is an attempt to stimulate the economy after interest rates of zero have failed to. Remember when dropping rates used to cause a mini boom? Not any more.

saverbuyer

qwert_yuiop wrote: »

Eventually, yes, once the whole thing goes out of control (You mean someone is in control?), but QE is an attempt to stimulate the economy after interest rates of zero have failed to. Remember when dropping rates used to cause a mini boom? Not any more.

Eventually?

Inflation have been over double target for a number of years.

wanchai_2

If the euro collapses, I don't think any European country is going to do well out of it, initially at least!!! :eek:

qwert_yuiop

saverbuyer wrote: »

IRELAND
GDP: €0.2 tn
Foreign debt: €1.7 tn
€390,969
Foreign debt per person
1,093%
Foreign debt to GDP
109%
Govt debt to GDP
Risk Status: HIGH

vs.

UK
GDP: €1.7 tn
Foreign debt: €7.3 tn
€117,580
Foreign debt per person
436%
Foreign debt to GDP
81%
Govt debt to GDP
Risk Status: LOW

Chances of going back on sterling? As I said above, anything's plausible these days. When the Queen visited, Messers (sic) Cameron and Hague came too, which never happens. I thought something big, such as above, was about to be announced.

saverbuyer

wanchai wrote: »

If the euro collapses, I don't think any European country is going to do well out of it, initially at least!!! :eek:

I think the Euro (at least as we know it) is toast.

A collapse is inevitable. Using debt to pay debt hasn’t worked surprisingly.

qwert_yuiop

saverbuyer wrote: »

Eventually?

Inflation have been over double target for a number of years.

You're right, so what next? Further QE seems to be more likely than an interest rate hike. Happily debasing the currency.
Have you wondered why you still have to pay 86 pence for the permanently crisis hit euro? The pound's doing worse, that's why.

wanchai_2

A.L.D.A wrote: »

Say someone is thinking of buying a house for £150,000 do you think the £1,500 stamp duty is going to make that much difference?

Much more important if you are buying one at £260,000 as the difference in tax between that and £249,999 is about £5,300.

It would make a difference if they were looking at houses between £125,001 and £135,000, say.

People don't like having to pay a big chunk of money upfront, that's all there is to it. Especially cash-strapped FTBs who are scraping all their money together for a deposit/furniture etc. If they could add it onto the mortgage, most of them would!!

saverbuyer

qwert_yuiop wrote: »

You're right, so what next? Further QE seems to be more likely than an interest rate hike. Happily debasing the currency.
Have you wondered why you still have to pay 86 pence for the permanently crisis hit euro? The pound's doing worse, that's why.

The government will QE until the cows come home or rather until (like Italy, Spain, Greece and Ireland) the bond markets say stop. Then you get forced interest rate hikes. Devaluation and QE is simply default through the back door.

86p to the euro does say a lot about Stirling and also a lot about Germany. Don't get me wrong the pound is screwed but as you say we can devalue and QE. The Euro zone (or rather Germany) wont.

The Euro it toast. The pound is toast.

qwert_yuiop

A.L.D.A wrote: »

If sense does not return in Euroland, it will lead to a weaker Euro or breakup. Either way may make the Irish economy a lot more competitive as the currency (whatever currency) will initially be a lot weaker.

I cannot see how a country can exit the euro just like that. When the euro was launched, we had several years' warning. It would have to be flagged weeks if not months in advance, causing a total clear out of all local banks. As soon as word gets out, it's mayhem. Argentina was tied to the dollar, but they had their own notes and coins, so they just declared the tie was cut.

We're straying off topic here, but I'd be glad to hear everyone's ideas on how Dublin could break with the euro.

Prepared to eat my hat of course.