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Irish Recession

http://news.sky.com/home/business/article/16131657

Surely puts more pressure on them to withdraw from the Euro ! Their Ecomony is hardly going to improve next year, in fact i would say probably get worse & the bulk of its trading partners are also entering a downturn ..

Comments

  • pqrdef
    pqrdef Posts: 4,552 Forumite
    Not sure I see the point of withdrawing from the euro. If they invent a basket-case currency, nobody will want to hold it or buy it or trade in it.
    "It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    it would be sensible for them to default on their banking debts; leave the euro and allow their effective exchange rate to decline and so become more competitive
  • Mr_Mumble
    Mr_Mumble Posts: 1,758 Forumite
    pqrdef wrote: »
    Not sure I see the point of withdrawing from the euro. If they invent a basket-case currency, nobody will want to hold it or buy it or trade in it.
    They're in a basket-case currency, creating a new currency would allow the Irish economy to find its feet - if that means the value of Irish money goes down versus the Euro then good! Ireland can sell more goods and services with a cheaper currency but more importantly there would be far less pressure on nominal wages - the currency devaluation would make real wages lower - and so increase jobs.

    Of course Ireland is a rather specialised case with it being a tax-haven for many US and international companies trading with the EU. Being outside of the Eurozone may hinder the trade.
    "The state is the great fiction by which everybody seeks to live at the expense of everybody else." -- Frederic Bastiat, 1848.
  • nollag2006
    nollag2006 Posts: 2,638 Forumite
    Love the sub-headline here from the main Irish broadcaster that the Irish economy "sharnk":
    http://www.rte.ie/news/2011/1216/economy-business.html

    It's the sort of qualadee spelling and analysis we've grown to love from the likes of brit1234 and Graham_Devon - more basket case economists.
  • They should join the pound sterling area - 'tis a serious suggestion, not a frivolous comment
  • atush
    atush Posts: 18,731 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    No thanks. Remember when Germany took in The East? Took them a long to time to recover.
  • wellused
    wellused Posts: 1,678 Forumite
    The whole of euroland will enter a recession if they don't actually do something positive about their problems instead of just talking about doing something, probably dragging us down with them. The best thing that could happen is for France to lose the triple A rating which might just kick them out of their lethargy.
  • atush
    atush Posts: 18,731 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    No, it just gives them an excuse to kick us lol.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    At least the Irish have taken major steps in addressing their budgetry imbalance. Along with reducing the balance sheets of their nationalised banks. So hardly surprising that economy is contracting.
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