# Bertie gives "hard times ahead" warning



## Jaid79 (7 Jun 2007)

On the radio today, I heard a brief broadcast regarding Bertie Ahern give a hard times a head warning. 

Can anybody shed some light on this, as I dont know the full details?

Jaid


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## room305 (7 Jun 2007)

*Re: Bertie gives warning*



Jaid79 said:


> On the radio today, I heard a brief broadcast regarding Bertie Ahern give a hard times a head warning.
> 
> Can anybody shed some light on this, as I dont know the full details?
> 
> Jaid



What's a "head warning"? Northside slang? 

"Watch it there buds, I'm giving you a head warning ..."

The hard times won't know what hit them.


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## DrMoriarty (7 Jun 2007)

*Re: Bertie gives warning*

Are you sure it wasn't a hard hats warning?

[broken link removed]


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## rock3r (8 Jun 2007)

*Re: Bertie gives warning*



Jaid79 said:


> On the radio today, I heard a brief broadcast regarding Bertie Ahern give a hard times a head warning.
> 
> Can anybody shed some light on this, as I dont know the full details?
> 
> Jaid


 
All sarcasm aside, there has recently been a considerable drop in a *cough* particular class of asset into which the Irish, in general, are unusually heavily invested. They have typically borrowed high six digit sums to buy this particular class of asset, and the recent upwards bias of the ECB means that repayments on those loans are going to increase by about €250 per household per month. That's what's going to be pulled out of the Irish economy.

Taking a very modest guess on what this'll mean, it'll cause at least €50 million per month to be withdrawn from non-essential consumer spending.


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## Jaid79 (8 Jun 2007)

*Re: Bertie gives warning*

Lads,

No northsider here I`m from Louth "Hey" 

Your a funny bunch in here, but a clever bunch I`d assume.

The consumer spending power will reduce greatly and that in its self will have an impact on the cashflow of the country, but if people (Excluding AAM members) where a bit better with managing there money they could of set this cost very easliy. Do you agree? 

How much of an effect will Berties Warning have on the economy? We are a fickle lot.


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## ClubMan (8 Jun 2007)

*Re: Bertie gives warning*



room305 said:


> What's a "head warning"?


Why would one need a warning for something so pleasurable?


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## Jaid79 (8 Jun 2007)

*Re: Bertie gives warning*



> Why would one need a warning for something so pleasurable?


 
The `head warning` was form Bertie, maybe if it was from his daugher you might not need one :->


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## rob30 (8 Jun 2007)

*Re: Bertie gives warning*



Jaid79 said:


> Lads,
> 
> No northsider here I`m from Louth "Hey"
> 
> ...


What on earth makes you think AAM members are good with their money.
I'm more like a latin american country in the mid eighties myself!


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## TDON (8 Jun 2007)

*Re: Bertie gives warning*



ClubMan said:


> Why would one need a warning for something so pleasurable?


 
Your a nutter !!!


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## Carpenter (8 Jun 2007)

*Re: Bertie gives warning*

This humourous little thread brings me back to the "heady" days of the "jazzy plates" episode!


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## rmelly (10 Jun 2007)

*Re: Bertie gives warning*



Jaid79 said:


> The `head warning` was form Bertie, maybe if it was from his daugher you might not need one :->


 
preferably not the rough one though...


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## DrMoriarty (10 Jun 2007)

*Re: Bertie gives warning*



ClubMan said:


> Why would one need a warning for something so pleasurable?


Maybe it wasn't so much a warning as an election promise.

[broken link removed]


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## GeneralZod (10 Jun 2007)

*Re: Bertie gives warning*



rock3r said:


> They have typically borrowed high six digit sums to buy this particular class of asset, and the recent upwards bias of the ECB means that repayments on those loans are going to increase by about €250 per household per month.



Assuming a loan of €300,000 and an interest rate increase of 0.25% it's an additional €62.50 per month, not allowing for interest relief.

If rates go up to the previous peak of 4.75% from the low of 2% it will be a cumulative per month increase over the cycle of €687. That's about €100k worth of spending power or quarter of the value of a house.


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## z108 (10 Jun 2007)

*Re: Bertie gives warning*



ClubMan said:


> Why would one need a warning for something so pleasurable?



 All election promises are not good


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## therave (10 Jun 2007)

*Re: Bertie gives warning*

he'll be gone in 6 weeks once he sets up the new government..and Mr Cowen(biffo) as the new boss


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## Firefly (11 Jun 2007)

*Re: Bertie gives warning*

Given that most people were putting 250 a month into the SSIA for the past 5 years, won't the increases in interest rates be covered by this available money?


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## Bronte (11 Jun 2007)

*Re: Bertie gives warning*

Also lots of people have fixed interest rate mortgages and it won't affect them.


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## annR (11 Jun 2007)

*Re: Bertie gives warning*

Many peoples' fixed rate will be ending this year and they will be going on to a variable rate.  I also read in the Sunday BPost yesterday that many people were stress tested to 4% back when the rates were 2%.  Looks like the rates will exceed this!


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## Jaid79 (11 Jun 2007)

*Re: Bertie gives warning*



Carpenter said:


> This humourous little thread brings me back to the "heady" days of the "jazzy plates" episode!


 
Why what did you get up to back then?


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## Afuera (11 Jun 2007)

*Re: Bertie gives warning*



Firefly said:


> Given that most people were putting 250 a month into the SSIA for the past 5 years, won't the increases in interest rates be covered by this available money?



Less than half of the 1.1 million people that joined up for the SSIA were putting the maximum amount of 254 EUR p/m into it. There's little to no wiggle room for the majority of people that were not in the SSIA or were only able to save small amounts in their SSIA accounts.


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## ClubMan (11 Jun 2007)

*Re: Bertie gives warning*



annR said:


> Many peoples' fixed rate will be ending this year


Can you substantiate this claim please?


> I also read in the Sunday BPost yesterday that many people were stress tested to 4% back when the rates were 2%.  Looks like the rates will exceed this!


 ECB rate was 2% in mid 2003. Mortgage holders at the time have had 4 years to reduce the capital outstanding on their loans so presumably the interest portion of their repayments has reduced in the meantime which might offset any rate increase?


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## Afuera (11 Jun 2007)

*Re: Bertie gives warning*



annR said:


> Many peoples' fixed rate will be ending this year and they will be going on to a variable rate.  I also read in the Sunday BPost yesterday that many people were stress tested to 4% back when the rates were 2%.  Looks like the rates will exceed this!


Good point. Also remember that EBS got caught by the financial regulator for only stressing by 1% above the current rate. I'm not too sure how long ago they were doing this but all those people they approved on those terms will be dangerously close to the threshold, if they haven't passed it already.


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## Afuera (11 Jun 2007)

*Re: Bertie gives warning*



ClubMan said:


> Can you substantiate this claim please?
> ECB rate was 2% in mid 2003. Mortgage holders at the time have had 4 years to reduce the capital outstanding on their loans so presumably the interest portion of their repayments has reduced in the meantime which might offset any rate increase?


It was at 2% until the end of 2005 though so it's possible that many borrowers have only had 1.5 years to readust if they took out a mortgage at the end of that cycle.


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## ClubMan (11 Jun 2007)

*Re: Bertie gives warning*



Afuera said:


> It was at 2% until the end of 2005 though so it's possible that many borrowers have only had 1.5 years to readust if they took out a mortgage at the end of that cycle.


OK - I stand corrected on that so.


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## ClubMan (11 Jun 2007)

*Re: Bertie gives warning*



Aileen2 said:


> Also lots of people have fixed interest rate mortgages and it won't affect them.


There are always options - e.g.
Trade down
Extend the mortgage term
Avail of the rent a room scheme
Make expenditure cutbacks
Etc.
Also - mortgage interest relief as of Budget 2007 is much more generous than it used to be.


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## Glenbhoy (11 Jun 2007)

*Re: Bertie gives warning*

There are also the little matters of wage inflation, additional disposable income thanks to giveaway (and ridiculously inflationary budgets) and additional mortgage interest relief to remember, so whilst stress testing was carried out at 2% and whilst repayments have undoubtedly increased dramatically, funds to meet those repayments have increased substantially too - not to the same extent, but it will certainly alleviate the hit for many people.


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## Jaid79 (12 Jun 2007)

*Re: Bertie gives warning*

So in a nutshell what should we be expecting of the warning? Some tough love from Bertie & Co. prehaps?


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## Glenbhoy (12 Jun 2007)

*Re: Bertie gives warning*



> So in a nutshell what should we be expecting of the warning? Some tough love from Bertie & Co. prehaps?


Maybe it'll go something like this:




> I wish to talk to you this evening about the state of the nation's affairs and the picture I have to paint is not, unfortunately, a very cheerful one. The figures which are just now becoming available to us show one thing very clearly. As a community we are living away beyond our means. I don't mean that everyone in the community is living too well, clearly many are not and have barely enough to get by, but taking us all together we have been living at a rate which is simply not justified by the amount of goods and services we are producing. To make up the difference we have been borrowing enormous amounts of money, borrowing at a rate which just cannot continue. A few simple figures will make this very clear...we will just have to reorganise government spending so that we can only undertake those things we can afford.—Charles J. Haughey, January 9, 1980​
> 
> 
> Bartholomew P Ahern, July 1, 2007​


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## annR (12 Jun 2007)

*Re: Bertie gives warning*



> Quote:
> Originally Posted by *annR* http://www.askaboutmoney.com/showthread.php?p=429724#post429724
> _Many peoples' fixed rate will be ending this year_
> 
> Can you substantiate this claim please?


 
Do I have to? Isn't it true that lots of people in, say, 2004 would have fixed for 3 years and that that fixed rate term will be coming to an end now?


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## room305 (12 Jun 2007)

*Re: Bertie gives warning*



annR said:


> Do I have to? Isn't it true that lots of people in, say, 2004 would have fixed for 3 years and that that fixed rate term will be coming to an end now?



According to the CSO 83% of outstanding mortgage debt is variable rate (2005 figures). In 2000, only 69% of outstanding mortgage debt was on variable rates. This implies that the bulk of mortgages drawn down in this period were variable rate mortgages.


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## tiger (13 Jun 2007)

*Re: Bertie gives warning*

From [broken link removed] 





> Almost 40,000 homeowners will pay 20 per cent more on their monthly mortgage repayments over the coming year as their discount mortgage deals end.


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## room305 (13 Jun 2007)

*Re: Bertie gives warning*



tiger said:


> From [broken link removed]



Those discount deals were usually variable just sold at a reduced rate above ECB base rates (e.g. ECB+0.2%) and probably rolling to ECB+1% when the discount period ended.


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## Jaid79 (13 Jun 2007)

*Re: Bertie gives warning*



> I wish to talk to you this evening about the state of the nation's affairs and the picture I have to paint is not, unfortunately, a very cheerful one. The figures which are just now becoming available to us show one thing very clearly. As a community we are living away beyond our means. I don't mean that everyone in the community is living too well, clearly many are not and have barely enough to get by, but taking us all together we have been living at a rate which is simply not justified by the amount of goods and services we are producing. To make up the difference we have been borrowing enormous amounts of money, borrowing at a rate which just cannot continue. A few simple figures will make this very clear...we will just have to reorganise government spending so that we can only undertake those things we can afford.
> 
> —Charles J. Haughey, January 9, 1980​


 
If thats the sign of things to come Bertie really will be doling out love of a tough nature.

Bertie is such a nice lad surely he wouldnt talk like Charlie?


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## noilh (28 Jun 2007)

*Re: Bertie gives warning*

"Bertie Ahern give a hard times a head warning"

I always knew Bertie was a "header"


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## MichaelDes (2 Nov 2007)

*Re: Bertie gives warning*

Interesting to note according to David Sharrock in The Times that our Taoiseach, Bertie Ahern, has been awarded a 14% pay rise, bringing his annual salary to €310,000 or £217,000 [he's been encouraging business on wage restraint]. He is now the highest paid leader in the 30 member OECD - well done, you deserve it thoroughly.

George Bush and Gordon Brown get £195,000 and £187,000 and are the second and third highest paid respectively. Commensurate to population with calculation against Bushs, he should be on about €3500.00. 

Is this better value for money? Especially for a leader under investigation of corruption?


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## queenlex (2 Nov 2007)

*Re: Bertie gives warning*



ClubMan said:


> Mortgage holders at the time have had *4 years to reduce the capital outstanding on their loans *so presumably the interest portion of their repayments has reduced in the meantime which might offset any rate increase?


 
Unless they chose interest only right?


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## ajapale (4 Nov 2007)

This recently resurrected thread has been moved from The Great Financial Debates to Letting Off Steam.


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## rabbit (4 Nov 2007)

*Re: Bertie gives warning*



MichaelDes said:


> Interesting to note according to David Sharrock in The Times that our Taoiseach, Bertie Ahern, has been awarded a 14% pay rise, bringing his annual salary to €310,000 or £217,000 [he's been encouraging business on wage restraint]. He is now the highest paid leader in the 30 member OECD - well done, you deserve it thoroughly.
> 
> George Bush and Gordon Brown get £195,000 and £187,000 and are the second and third highest paid respectively. Commensurate to population with calculation against Bushs, he should be on about €3500.00.
> 
> Is this better value for money? Especially for a leader under investigation of corruption?


 
Brilliant post


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