"Boom will end in 2008, broker warns"

[Johnny]

And so, after countless vague predictions that the end is nigh, someone finally puts a date on it. Anyone agree?

Lead story in yesterday's Sunday Business Post.

[JCSkinner]

This means that the government finances will remain flush with money moving into next year, but that the government in power following the general election - expected next May - will face a much tighter position in 2008, as the boom finally starts to fade.

This is the interesting bit. I expect the current government to slink off into opposition for a term, safe in the knowledge that they can erroneously blame FG and Labour for the inevitable downturn, and then position themselves as the Government of Boom for the election following.

[emmet100]

Well personaly I think the construction boom will continue for another decade at least as we catch up with Europe in terms of our roads, schools and hospitals. Also, a tightening of the belts in 2008 might be a blessing in disguise and end the current view by government and the man on the street that the good times will never end. I think if cut backs have to be made in, for example, healthcare, this could lead to getting rid of wasteful practices and the current situation where four adminstrators to the job that one did ten years ago.

[farnaby]

Makes sense - a foreseeable decline in consumer spending and construction. (3% growth per year is no disaster though.)

These economic forecasts always look at us coming to the end of a cycle waiting for the bad times rather than looking beyond the slowdown. I would love to see something positive in the pipeline for the Irish economy - home-grown successes, major new competencies developed here etc. to bring us to a new stage of development, away from the EU subsidy/US FDI causes of the good years. I can't at the moment (unless the billions put into R&D bear fruit and we actually capitalise on these) - anyone see any possibilities?

[JCSkinner]

Not really. We had it briefly, and we blew it on Bulgarian holiday homes. Game over really.

[emmet100]

anyone see any possibilities?

As I've said before on this site, massive port facilities will have to be built in the Shannon Estuary by 2040 to cater for supermax tankers that will be unable to reach the maninland European ports. This would be a major employer and source of revenue for government, but its a good 30-40 years away.
Until then, we're a country surviving by selling houses to each other.

[farnaby]

Not really. We had it briefly, and we blew it on Bulgarian holiday homes. Game over really.

The brief spark of happiness, the inevitability of failure, the absurdity (of Bulgarian holiday homes), the sparse meaningful language - have you been at the Beckett again?! There is no 'game over' in economics! There will be a slump, maybe it's inevitable, maybe it's too late to avoid even if we could, but it's not the end of the world, we can succeed again, and we don't have to wait for godot.

emmet100's got the idea, hope that gets consideration by government.

[JCSkinner]

I give it ten years max before we're a net emigrating country again. Basically within six months of US IT multinationals pulling out to go elsewhere, we'll be utterly banjaxed.

[Skin]

I'm predicting Sept '06 - Jan '07 as the first signals of the end of the boom.

1. Interest rate increases
2. 90,000 houses set to be built this year overreaching demand. (Immigrant population is largely mobile, rents have begun to decrease in parts of Dublin)
3. (a)SSIA's - too much read into them. Avr payout is according to BoI id €13800 which implies that despite all our wealth the avr person couldnt afford to save the max.
(b) also (mainly from my own experience) half of my SSIA is already tied up in a car loan. I'm guessing many others will find themselves i the same position.

I dont think it will be a crash but certainly a sharp correction in houses prices + increased unemployment starting somewhere from Sept '06 - Jan '01.

[emmet100]

I give it ten years max before we're a net emigrating country again. Basically within six months of US IT multinationals pulling out to go elsewhere, we'll be utterly banjaxed.

I don't think Ireland will go back to the Eighties unless there is a massive economic disaster (e.g. collapse of the dollar). Companies will always need highly-educated English-speaking people and that is our speciality. Who knows, maybe Chinese and Indian firms will be employing Irish people in their thousands come 2030. Compared to the rest of Europe, we're simply the best in terms of tax, worker education, and we're catching up on infrastructure.
Encouraging major Irish employers to grow through massive once-off grants (I'm talking hundreds of millions per company) could be a way of creating Nokia-style success stories for our companies. Pahramcueticals and chemicals seem to be the way forward though, but construction and consumer demand will see us through the next ten years or so.