Generation Game- David McWilliam's take on Irish economy

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busman said:
Hobbs, McWilliams, Ahern getting rich by using the 'fear' tactic. If they were genuine and actually knew something they would have made lots of cash on their knowledge


....these so called experts (only interested in personal gain)...
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I think there may be a contradiction here?
 
Surely businesses owners have just as much of a vested interest in maintaining an "all is well" stance as McWilliams et. al. have in claiming we're doomed?
 
room305 said:
Surely businesses owners have just as much of a vested interest in maintaining an "all is well" stance as McWilliams et. al. have in claiming we're doomed?
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The point is the statistics are positive. I know statistics can be manipulated but the phrase "you can't polish a turd" comes to mind. If we were in for it there'd be no hiding it.
 
So if the dogs on the street know (1) that the residential construction sector accounts for a large element of our economy, and (2) that this sector is decreasing its production; should we collectively act on this information as soon as we learn of it, or should we bury our heads in the sand for a year or two until the statistics are published?
 
I'd be very curious to know if david mcwillliams has any residential property still in ireland?
 
ubiquitous said:
So if the dogs on the street know (1) that the residential construction sector accounts for a large element of our economy,
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An economy is based on imports and exports, considering the Irish construction industry is all imports how is this going to affect the balance of the economy? Mcwilliams is great at looking at past examples, so lets take an Irish example. In the late 90's and early 2000's our economy was largely based on IT. That got whacked and to top it all off along came India and increased competition. Now I know alot of people got burnt but the industry survived and competition from India has been a very healthy thing. Things are now "Normal".

ubiquitous said:
and (2) that this sector is decreasing its production; should we collectively act on this information as soon as we learn of it, or should we bury our heads in the sand for a year or two until the statistics are published?
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Not bury your head in the sand but unless you are involved in the construction industry you should continue as normal. A decrease in production does not mean a crash. Things go up and down, thats life.
 
Moggy said:
If we were in for it there'd be no hiding it.
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Statistics are a lagging indicator and as such they will only tell people that we're in a recession when we're already in the thick of it. On a micro scale that's about as useful as deciding to ignore the prospect of being made redundant until a year or so after you're let go.
 
room305 said:
Statistics are a lagging indicator and as such they will only tell people that we're in a recession when we're already in the thick of it.
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Lagging back to 1999 when McWilliams was still spouting the same rubbish? Open your eyes. People need to get on with work. The dream of sitting on your ass waiting for your house to make you a millionaire are over, that is all...nothing more.
 
Moggy said:
An economy is based on imports and exports, considering the Irish construction industry is all imports how is this going to affect the balance of the economy?
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Moggy said:
Not bury your head in the sand but unless you are involved in the construction industry you should continue as normal. A decrease in production does not mean a crash. Things go up and down, thats life.
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Moggy said:
If we were in for it there'd be no hiding it.
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Moggy said:
Open your eyes. People need to get on with work. The dream of sitting on your ass waiting for your house to make you a millionaire are over, that is all...nothing more.
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So you're saying that the construction sector will experience a downturn but the economy will prosper regardless?
 
room305 said:
So you're saying that the construction sector will experience a downturn but the economy will prosper regardless?
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What I'm saying is the construction industry in Ireland is no more than a redistribution of wealth and credit. It is not bringing money into the country and I do not think a normalisation will have a major negative effect on people outside of the industry or on the economy as a whole. In fact I think it will be healthy, see my forest fire analogy. People will now have to work for a living and those with money to spare will have to invest in something which is of benefit to the country.
 
Moggy said:
I do not think a normalisation will have a major negative effect on people outside of the industry
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But isn't the whole point, that so many people are in that particular industry (and its offshoots), and when it turns down many will be impacted.
 
diarmuidc said:
But isn't the whole point, that so many people are in that particular industry (and its offshoots), and when it turns down many will be impacted.
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But there are people in the industry that should not be there. They are riding the gravy train. For them it will be a case of back to the day job. Anyway, the smart ones have already cashed in and gone back to the day job.

As for the construction firms, they will simply have to pull up their socks. Gone are the days of shabby jobs and a take it or leave it attitude, and why should we have any sympathy for them?
 
I noticed McWilliams new book costs 25 euro. I hope he includes this in his assessment of a high cost economy !
 
Moggy said:
But there are people in the industry that should not be there. They are riding the gravy train. For them it will be a case of back to the day job. Anyway, the smart ones have already cashed in and gone back to the day job.
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Do you mean emigration? Or back to school? A good percentage of the building contractors and subcontractors in my own neck of the woods were either working abroad, or were in school or college 10 years ago. I actually don't know of any of them who "have already cashed in and gone back to the day job" in recent times.
 
I noticed McWilliams new book costs 25 euro. I hope he includes this in his assessment of a high cost economy !€25 is not particularly expensive for a hardback book. It's the standard price for an Irish published book of that length and quite cheap compared to a UK published one.
 

I agree recession is good for getting rid of the rot but how long do you anticipate a downturn? Has the economy become too expensive, as like what happened to Germany and Japan. Both countries had an over reliance on property and had a to strong "a feel good factor" among its citizens. It took 12 years plus to regain stability - if it can be fully called yet.

My view is, if the government had the bottle, it should have stuck to its property agenda in circa 2001 and penalised second homes through higher tax. Therefore this quagmire we are in, would not have reared its ugly head. We may have retained a "Nordic style" stable economy. Credit booms always burst and cause a headache. But for now we should learn possibly from Germany and Japan who've had to fight their way out of deep holes. Both have been imaginative in creating the right conditions for stability through output/productivity & FDI, whilst restricting consumer speculation (especially Japan).
 
MichaelDes said:
My view is, if the government had the bottle, it should have stuck to its property agenda in circa 2001 and penalised second homes through higher tax. .
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It tried to do this in 1998 after the 1st Bacon report, when it removed mortgage interest relief on rental income for investors. The aim of this was to reduce competition from investors in the first-time-buyers market. The result was an exodus from the private rental market, followed by a shortage of rental acommodation and higher rents. The government was forced into a u-turn on this measure.

Experience shows attempts by government to control the price of housing through the tax system either don't work or have drastic unforeseen consequences.
 
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