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Thread: Ireland "basket case economy": Finch

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    Default Ireland "basket case economy": Finch

    The rating agency Fitch said it now has five countries on watch for "macro-prudential stress", up from two last year, using a set of indicators ... Azerbaijan, South Africa, Russia and, surprisingly, Ireland, where the ratio of private credit to GDP has reached 190pc, the world's highest."
    The only people who think that Ireland's economy is sustainable along with its house prices are .. us Irish.

    The rest of the world are laughing at us.

    Still, I stand proudly alongside my Azerbaijan comrades.

    http://www.telegraph.co.uk/money/mai.../cctrade12.xml
    Do you support the 32CSM? All of Ireland think you are murdering scum, worse than paedophile priests.
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    The thing is, our economy has been nothing but an unsustainable bubble pyramid-scheme since the summer of 2001. And in those 5 years, huge chunks of the real productive economy have withered away or become completely uncompetitive as the mania took hold.

    We have nothing substantial holding it all up. Nothing at all. Just sentiment and a blind belief that somehow the Irish are magically entitled to all get rich by, ummm, not actually doing any work or making any products that other countries want to buy. Nope, we'll be the first country in history to all become millionaires and retire without having to do a days work, all on the back of magic property values which "never fall". Get on the ladder, quick!

    I'm only 33, and this is the 3rd bubble I've witnessed first-hand - and studied a few others back when I was doing my degree in Commerce (for my sins, and a lifetime ago it seems now, but I digress). The third time I've sat and watched friends and family financially shoot themselves in the head by getting carried away by the hype and spin in what is clearly a wildly over-valued market.

    People are stupid. Every bloody time, the same old manic magic-beans nonsense. And doubtless within a decade we'll see another "guaranteed profit" frenzy. Next time though, I think I've now learned and observed enough about how these bubbles work to maybe skim some modest profit off the herd on the upswing, and get out in plenty of time before the bust
    Je suis un loo-lah

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    Quote Originally Posted by Sidewinder
    The thing is, our economy has been nothing but an unsustainable bubble pyramid-scheme since the summer of 2001. And in those 5 years, huge chunks of the real productive economy have withered away or become completely uncompetitive as the mania took hold.

    We have nothing substantial holding it all up. Nothing at all. Just sentiment and a blind belief that somehow the Irish are magically entitled to all get rich by, ummm, not actually doing any work or making any products that other countries want to buy. Nope, we'll be the first country in history to all become millionaires and retire without having to do a days work, all on the back of magic property values which "never fall". Get on the ladder, quick!

    I'm only 33, and this is the 3rd bubble I've witnessed first-hand - and studied a few others back when I was doing my degree in Commerce (for my sins, and a lifetime ago it seems now, but I digress). The third time I've sat and watched friends and family financially shoot themselves in the head by getting carried away by the hype and spin in what is clearly a wildly over-valued market.

    People are stupid. Every y time, the same old manic magic-beans nonsense. And doubtless within a decade we'll see another "guaranteed profit" frenzy. Next time though, I think I've now learned and observed enough about how these bubbles work to maybe skim some modest profit off the herd on the upswing, and get out in plenty of time before the bust

    The asset price bubble in Ireland will likely end when the US property bubble bursts later this year or the first half of next year. The outfall will be traumatic as much of Irish lifestyle is built upon the accessing of inflated capital values. It is only a matter of timing.

    I note from the weekends property supplements that whereas they refer to the number of properties left unsold over the summer season they are still talking up prices for the Autumn selling season. If you can get now, as I have already, then you should (investment properties only I am not suggesting that you sell your main residence).

    Supply this year is thought to be 85000 units or circa 2/3rds of the entire UK? Plus the census shows that 1/6th of dwellings are unoccupied!

    Just like the tech bubble it is those with a vested interest that are talking up the market whereas those with a shread of intelligence know what is coming. And of course it is those with the vested interest that have access to airwaves and the print media (who of course could not be comprimised by their reliance on advertsing from the property and construction sector, the thought of it!) such as financial p.rostitutes masqureading as economists and the like.

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    Good point about supply. Given the demographics, we probably need about 50-60000 units per annum now at the peak of the Pope's Children demographic bulge, declining to about 40,000 over the next 5 years. That's what rational output would be.

    Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units. Or at least six years supply.

    Six years supply. We could shut down the entire construction industry tonight for 6 years, and there'd still be enough houses for everyone to live in.

    Utter madness. This is going to make the Japanese bubble look like a minor hiccup.
    Je suis un loo-lah

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    Quote Originally Posted by Sidewinder
    Good point about supply. Given the demographics, we probably need about 50-60000 units per annum now at the peak of the Pope's Children demographic bulge, declining to about 40,000 over the next 5 years. That's what rational output would be.

    Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units. Or at least six years supply.

    Six years supply. We could shut down the entire construction industry tonight for 6 years, and there'd still be enough houses for everyone to live in.

    Utter madness. This is going to make the Japanese bubble look like a minor hiccup.
    In fairness the Japanese bubble took the biscuit with intergenerational 100+ year mortages and the Royal Palace in Tokyo had a higher valuation than the entire land mass of Canada!

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    Quote Originally Posted by Sidewinder
    Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units.
    That's a shocking figure. Is that from the census???

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    how much was the entire land mass of canada valued at.

    i'm sure treasury holdings will put in a bid!
    Not being able to govern events, I govern myself. -Michel de Montaigne, essayist (1533-1592)

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    Ireland will be a different country in five years from now; economically and politically. Scapegoats will be required.

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    Quote Originally Posted by Johnny
    Quote Originally Posted by Sidewinder
    Right now, we have 275,000 units lying empty and an estimated 85,000 units to be built this year. Total empty supply: approx 360,000 units.
    That's a shocking figure. Is that from the census???

    The Irish Independent (19.6.06) regarding empty properties uncovered by Census enumerators.

    ‘Following inquiries among neighbours, postmen and women and apartment block management companies, the vast majority of those dwellings - some 275,000 - were identified as being vacant.’

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