April 6, 2011

Economists with Foresight Versus Economists with Hindsight

Posted in Irish Economy · 69 comments ·
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There has been a lot of silly chatter this week about “celebrity” economists. This term is meant to be demeaning. But everyone knows – post crash – that the main distinction between economists in Ireland is not the “serious versus the celebrity” but it is between those economists with “foresight” and those with “hindsight”. If having foresight means that I am a celebrity – well, I am all for celebrity.

Here is a 2003 Prime Time clip taken from last night’s Freefall programme.

Can I humbly ask, where were Ireland’s so-called “serious” economists back then – the ones who are so vocal now armed with the worthless artillery of hindsight?


  1. Deco

    Where is Desperate Dan ?

    Just wondering, you know the way that Dan was always opposed to the fact that there were people in the public sector who getting paid regardless of their performance.

    Well Dan is now a public sector employee in a (useless) semi-state called BoI.

    Dan’s performance in regard to economic forecasting has been abysmal.

    Does this mean that Dan’s job will be on the line as a result of any public sector rationalization program ?

    He does not have to worry about being involved in a “sale of state assets”. Neither he nor BoI would constitute an asset these days. And neither have a buyer in the free market.

  2. junoroland

    Beware of the dangerous old windbags.
    Maybe Garrett should explain his piece to his good chum Mr. Sutherland
    from Goldman Sachs. Garrett has a direct ear to one of the senior
    bondholders of Irish debt who may have difficulty differentiating
    between fact and “celebrity” economist opinion. Maybe someone could give
    Charlie Mc Crevy a call in Bank Of New York Mellon another holder of
    senior Irish debt to explain how great things are here. Seems theres
    plenty of celebrity Irish politicians and movers and shakers in direct
    positions of power to “explain” the situation. Or maybe the markets have
    done their due diligence and know that you cant talk yourself into or
    out of a recession believing in this is only for the musings of the Old Irish political
    elite.

  3. FSinnott

    People believe what they want to believe. Charlatans like Dan Austin and Jim Power were telling everyone what they wanted to hear and of course peddling their employers spin. While David was giving an independent analysis nobody wanted to listen. I watched that program again. It was cringe-worthy listening to all the former boom cheerleaders trying to rewrite history. Shame on them.

    • Gege Le Beau

      Terrible damage was done with the ‘get on the ladder before it is too late’ mantra and talk ‘of a cooling in the property sector’ ‘a soft economic landing’. And still the talking heads rattle on.

      If people had any common sense all they had to do was look at who these people worked for and the rest gets put in context.

      Interesting article from the Irish Independent (2006)

      Property boom to last another year before ‘soft landing’

      “THE property market will boom for another year, with prices set to escalate by at least a further 10 per cent, before the market begins to cool. There is no certainty that the so-called ‘soft landing’ will then kick in, though most experts seem to think it will.

      Taoiseach Bertie Ahern, however, said earlier that there “was no great problem” about the level of money being borrowed for property. “If you had taken the advice on the property market given a year ago, you would have lost a lost of money,” Mr Ahern said after an Irish Management Institute conference.

      Economist Jim Power advises that only those who have a few investment properties should think about cashing in. “It would be a very risky thing to do, if it were your home and the market kept on rising you might not be able to afford to get back in,” he said. ”
      http://www.independent.ie/national-news/property-boom-to-last-another-year-before-soft-landing-129114.html

      Jim Power – Thursday January 15 2009

      TOWARDS the end of last year, I stated a belief that the Irish residential housing market was moving into a period of orderly correction or, in other words, a so-called ‘soft landing’, against a background of gradually rising interest rates.

      But I was wrong.
      http://www.independent.ie/national-news/nothing-is-certain-but-uncertainty-1602060.html

      TCD professor admits being wrong about housing bubble

      PROMINENT TCD academic and financial commentator Brian Lucey has accepted he wrongly forecast three years ago the Irish housing market would continue to grow at a “modest but still significant pace”.

      However, he said his basic position seemed reasonable, based on the available data.
      http://www.irishtimes.com/newspaper/ireland/2009/0630/1224249782454.html

  4. emerosiochru

    Should We Listen to Economists Anymore Then?

    Yes, if they are Modern Money Theorists. MMT will inform a number of economic policies to be presented and debated in a conference entitled “Lessons from the Crisis: Money, Taxes and Saving in a Changing World” co-hosted by Smart Taxes, (Fiscal Policy for Sustainability Network) and TASC (Think Tank for Action on Social Change) on the 9th May 2011 at Croke Park, Dublin.

    The conference is free and open to anyone whose mind is also open. Email Alex at Tasc to book your place : aklemm@tascnet.ie

  5. Not a bad effort to attribute blame for the scam, but incomplete…. Not just the ‘old landlords’ or the ‘mortgage agencies’ but very significantly untouched there by DmcW, bank shareholders, the financial industry, government tax take, crony developers, FF.

    Nevertheless, bet he bores the hell out of the wife and kids playing that to them every evening:)

    Interesting discussion here

    http://bit.ly/eDND4o

  6. adamabyss

    subscribe.

  7. DN

    The biggest joke in the last week was Blackrock – forget Garret

    Blackrock – the most aggressive bidder on US real estate in the mid 2000 era! They lost $500B in one deal in NYC. They lost their national CalPERS multi family account as their returns were so poor.

    Blackrock is giving the Govt advice? April Fools day continues….

    • Deco

      Where do they find each other ?

      Dumb and Dumber. Drumm and Drummer.

      • Then we take Blackrock’s optimistic figures and make them even more optimistic by ignoring about 30% of future debts, leaving the potential for zombification of banks even if they were recapitalised according to the Central Banks figures. The motto of the central bank seems to be “hope springs eternal”

  8. stiofanc02

    God, Miriam O has really dis-improved in the last 8 years! She even knew how to dress then! Who puts the stuff that hangs on her like a cheap suit now? That Austin fella is a looser. Anyhooo,.. as a nation were fu€ked! These dumb asses didnt know sh1t! And this is just more of it. Good man David M.

  9. dogsharkey

    one day soon an irish winston smith will be deleting and re-editing all that footage and we and we will all be encouraged to stop worrying and love big brother / peter sutherland / denis o’brien / the green jersey {delete where applicable}
    good on you david to hell with the flat earthers!

  10. dwalsh

    I dont watch TV but I came to despise the bleating gombeen voice of Austin Hughes and his pathetic ilk on radio in the years running up to the crash. I think I hate poor the poor auld fecker.

  11. Deco

    To think that that gombeen Hughes, would write an article every Friday, in the Irish Times Business Supplement, every week of the year almost. For years on end.

    Maybe he still does.

    Austin, was on Page 3 of the IT-BS. (Hilarious initials). Austin was there to encourage people to take seriously the culture of property porn. (Which incidentally was, the main hard sell of the IT PS – is there an O missing there ?)

    You might have Seanie Fitz, Fingers, Eugene Sheehy, or Fintan Drury on the back page of IT BS. Complete with a set of golf clubs. And Desperate Dan was on P2. facing Austin – Dan was telling us that he was bullishly optimistic.

    There was something absurd about the whole era, when so many so blindly, and so boldy followed the advice given by so useless a collection of wasters. Stupidity and living way beyond your means were fashionable. And TSB had lots to lend. All you had to do was get down to your local BoI representative. And your local Ford dealer was also feeling flathulach. (before he went bankrupt also).

  12. Praetorian

    Think you said it best David, the closer to the target (the truth) the more flak you take.

    No doubt to my mind you and others represent something of a threat to the status quo, the money makers and their servant politicians, you spoke straight as an arrow on Prime Time and if people had heeded your message they would not now be in difficulty. It is a terrible thought that good Irish people have been swindled by their own people. It really is shameful.

    Well done on the comments above, if only we had a few legions of such people.

  13. AIDEN

    David, Great newsletter i am an avid follower of yours but i do think it was a bit much to expect a balanced critique from the Nations only TV Broadcaster?

  14. dwalsh

    David was right that it was a scam; but his diagnosis of the scam was incorrect.
    It was never a scam by the old on the young as he portrays it. That dynamic was merely part of the way the scam played out locally. The scam is a global scam by the global elite; those who own and control the money supply system; the debt system. They are the ultimate Senior Senior Bond Holders.
    They will eventually agree to negotiate. There will eventually be debt relief. But not before they have bankrupted the Western nations and forced fire-sales of assets which their subsidiaries will cherry-pick.
    Debt relief when it comes will involve the establishment of a new global central banking system with oversight of continental and national (think provinces) budgets. In fact the first wave has already arrived here in the person of Mr Chopra.

    • Winter

      Well done dwalsh. You’re spot on and I can’t for the life of me see why people can’t see that.
      Don’t know what we’ll ever do about it though. If there is anything we can do!

      • grougho

        you can join us in protest this sunday -11.15 from the church car park to the town park – protest and picnic. or better still – start your own!
        fermoy says no

        • Julia

          groucho, best of luck on Sunday. Hopefully you’ll have a big turnout.
          The whole thing is a protection racket isn’t it? The banks owe billions, we the ordinary citizens are to pay. If we don’t pay the ECB will come and break our legs. Well, the only way to deal with bullies is to stand up to them.

  15. Gege Le Beau

    People need to develop their own counsel and certainly not rely on so called ‘experts’ and politicians even less so. This clip should be played to every single secondary school student, we have to learn from the mistakes, hurbis and vested interests which skew ‘common sense’.

    This clip blew me away as I was out of the country when this stuff was unfolding, how that man from BOI can ever speak on a topic again is beyond me. Thanks for posting.

  16. BnB

    Some predictions take years to be proven right after being constantly dismissed by the powers that be. The latest prediction by many other economists and commentators – that Portugal would ask for EU funding – has turned into reality today after just a few months. It’s an almost exact re-run of what happened with Ireland at the end of 2010.

    Also today, we saw optimistic headlines like “Spain has no need of financial aid: IMF’s Strauss-Kahn” and “Deposits outflow steadies, says Noonan”. How can anyone take these reassurances seriously any more?

    • dwalsh

      Sometimes policy makers use denials to introduce an idea they intend to implement. FF used that tactic throughout their bungling of the crisis…or maybe they just lied… pathologically; you never can tell with that lot. The only thing you can be sure of is you can’t believe a word out of their mouths.

    • BnB

      There were certainly some bare faced lies being told by people at the very top in the days before Ireland’s deal with the EU and IMF. These people denied that there was going to be any deal, and at the same time EU and IMF officials were in town negotiating the final details with the Department of Finance.

    • BnB

      More good news today: Both Richard Bruton and Eamon Gilmore tell us that the Portugal bailout is good for Ireland. I don’t think it’s really worth the effort trying to figure out the logic of that argument.

      • Deco

        Yeah, hilarious.

        This reminds me of Cowen telling us that the bailout of Greece, would improve liquidity in the Eurozone, and that this would benefit the Irish banks in their efforts to get access to funds.

        Cowen then tells us that we will be bailing out Greece. We were to borrow money, and loan it to the Greeks, and were running out of ability to borrow. As Wills tells us, “Ponzi scheme”. Solve the problem with more borrowing.

        Cowen told us that he had confidence in the Greek PM, who happens to be his drinking buddy at the EU junkets. (However do these clowns find each other ?).

      • dwalsh

        Ha! That gave me a laugh.
        The logic is that’s the kind of bullshit they have to talk for as long as they’re in the ‘G-Buildings’.

  17. DavidIreland

    Hi David,
    Can’t help feeling Garrett is a bit jealous of you popping up on Channel 4 etc. and nobody wants to talk to him – not because he’s not a nice man, he is; not because he’s stupid, he’s not; BUT because he either didn’t have the vision to see what was happening OR because for some other reason HE DIDN’T SPEAK UP. I could come up with a couple of reasons why he didn’t speak up.

    Please Garrett, I respect you but you didn’t speak up, now don’t compound it by making a fool of yourself.

  18. lff12

    There is a German word often used in systems practie (basically a method of thought based on looking at interconnections, relationships and the “bigger picture”). Its called “Weltanschaung” which translates as “world view.”

    The world view didn’t happen overnight, it occured as a result of 30-40 years of carefully thought out policies which favoured home ownership and basically shut down the supply of cheap homes to low income families and singles in particular. FF have been in power for all but 7 of the last 32 years – plenty of time to establish a locked down commitment to pushing interests that restrict the supply of low cost housing, while shutting down social housing to all but a token minority of extreme poor and making it virtually impossible for anybody to build “one off homes” at a lower cost.

    • Deco

      Well, actually, I would say that if really started digging, you would find that most of the fiddling with the market started in the FF representation on Dublin Corporation in the 1980s. I am talking about councillors under Rambo, Lord Lucan, Squire Haughey, Ditherer, etc… A combination of a ludicrous housing density model (Los Angeles style) and a few builders controlling access to rezoning via the brown envelope.

      Many years ago, while travelling in the city of Dresden in Eastern Germany, I took a “stadtrundfahrt” tourist bus.

      And one of the statues that we passed was the statue “of the good moral councillor”. This was on the top of a building associated with the City government. It was to inspire the councillors to behave morally, and the people to only elect representatives who behaved in a responsible manner. It even survived various regimes in the twentieth century.

      I took a picture. To bring home, so as to introduce the concept back in Ireland. Sitting there looking at this monument, I was dumbstruck. My mind flooding with thoughts about Rambo, CJ, Bertie and the boyz all working the system. What an original idea. Back home about the same time Ireland was discussing the “Binge Syringe” in O’Connell Street. No monunment back home to the “good public representative”. Instead a monument to self importance.

      • chthonic

        if12. My feeling is that it is China, really that is at the back of it all. Well, not so much China but the fear of China and its potential output industriially. Our industial might has vanished and there’s barely anything left and that is still diminishing. All the sallaries and wages, emoluments and tranches are under pressure, diminishing. Little people always pay the piper and have to dance to his tune and why should this be? Because his payment is the only VARIABLE that can be easilly got at and made less. When the thing al;l gets gouing again we will be working for food alone. Frightening, that, isn’t it?

  19. lff12

    Whoops, forgot to add one thing.

    We have not had a true housing “market” since the early 1970s, we have had a cartel involving government, builders, developers and financiers, who all colluded to ensure that selling prices remained high.

    NAMA is a new part to that cartel, as it attempts to keep prices high (under the excuse that they are being kept high for the taxpayer – a flat and blatant lie), by keeping them empty and forcing up prices otherwise, by protecting market failure laws such as “upward only rent reviews”, and by creating an illusion that the market ticks over nicely.

    Economists played a vital part because they came from this society, and the models which they learned, especially from undertaker businessmen like John Teeling in UCD, served to reinforce that view.

    • chthonic

      Now, IffI2, You’ve really caught on to something. How is the new goverment or any goverment going to find the bottle to push down the price of the funeral cartels – The undertakiners’ prices. Scandalous in Ireland. These are amongst the biggest gangsters of all. This is really holding the people to ransome. The cost of burying a loved one amid all that hefty
      preyer and guilt with the trusty purveyors’ feet fixed firmly against retrenchment…. it was tryed in England but it didn’t last long as the bodies built up in vast collections as the undertakerrs went on strike..

  20. Peter Atkinson

    Haven’t commented for a while but it’s great when you get it glaringly right and fair play David Mac.Bang on the money and on national TV too.Pity nobody outside this jurisdiction watches it.Maybe if they had the benefit of RTE Player at the time who knows what may have happened.Yeah right.From Blackrock to Ballymun to Bulgaria they all got it horribly wrong.We all know the assholes who bought a pile or three in the hope of screwing some Eastern European gobshite with the promise of a killing.And thats not a Bulgarian Mafia type hit either.Look guys take your medicine and remember don’t believe everything you are told by the establishment particularly when one of their daughters makes a mint from writing fiction while the father spouts it.After all, remember,caveat emptor.Its all legal and written into law.You can’t say you weren’t warned.

    • Deco

      {
      don’t believe everything you are told by the establishment particularly when one of their daughters makes a mint from writing fiction while the father spouts it…caveat emptor….
      }

      Summed it up perfectly.

  21. At the end of my post I have included a link to Yesterday’s Keiser Report where they talk laughingly about NAMA and then have Alex Jones giving an interview about the financial dictatorship. This is alternative media at it’s best and makes RTE look laughable by comparison. This type of reporting scares the old establishments and makes them feel threatened

    David. The Irish establishment is looking desperate and outgunned on economic matters and they know it. For example Shredded Wheat Head (SWH) was giving Vinnie Browne and Boyd Barret a hard time the show the other night trying to defend the establishment line. Does anyone listen to such fish eyed propaganda machines any more?

    There are far better news sources like those Hillary Clinton was referring to when she pointed out that west is losing the media (propaganda) wars to foreign English speaking broadcasters. By paying normal wages these stations can employ lots of savvy journalists for the price of one Pat Kenny. I would also suggest that our biggest problem in Ireland might not the banks but RTE

    Surely the only reason someone would have for defending the Irish establishment now is that they are either being paid to or have a very narrow worldivew? People everywhere are wakening up and overthrowing dictatorships and in Ireland they will too once the full implications of the 9/08 attacks sink in. The coup is complete but the Irish seem to be currently suffering from Stockholm Syndrome

    They need someone to blame. You put yourself in their crosshairs in 2003 and you will need to get used to being singled out for sniper practice from time to time. You have friends out there who know the truth and they are not easily fooled with the views of our advertising sponsors

    Keep up the good work and let them have it. Good luck.

    —————————————————

    Max Keiser and co-host Stacy Herbert report on the black hole of bankers’ debts in Ireland, virtual pigs in Australia and free workers in America

    http://rt.com/programs/keiser-report/bankers-debt-ireland-finance-terror/

    • lff12

      I don’t quite agree on RTE. After all it was RTE who screened the extremely controversial “Aftershock” programme which had government ministers accusing RTE of “talking down the economy.”

      The problem wasn’t the media at all, it was the informal communications and rumour mill happening locally, the one where bricklayer boy gets wind of the best prices for the houses he is building so he is “in” at the beginning and can play what he believes to be a game of brinkmanship with those coming after.

      The extent to which the “market” was actually artifically manufactured and controlled was astonishing and the banks willing compliance with it even more so. The recommendations of the Bacon report were pooh poohed far more in the kitchens of the new property owners than RTE, and one friend, a lecturer in UCD, complained of the vulgarity of Dublin home owners bragging about how much their homes were worth.

      There was most definitely a particular complaince in the property pages of the broadsheets and still is, there are at least 100 cry baby articles about the plight of owner occupiers and speculators while this lone article in the Examiner tells the true story of how this is impacting those who are at the very bottom of the ladder – irishexaminer.com/ireland/ tenants-face-eviction-over-repossessions-147762.html

      While there is a lot of talk about o how awful it is for those crippled by high mortgages, they are limited to the terms of their mortgage. Those who are caught in the renting trap are as badly off as ever, contrary to the myth that renting is now “cheap”, if the “average” of 800 a month is a mere drop in the ocean in comparison to the incomes of those renting. It is far from it.

  22. “Can I humbly ask, where were Ireland’s so-called “serious” economists back then — the ones who are so vocal now armed with the worthless artillery of hindsight?”

    They need to be seen to be right. They have no notion of Uriah Heep’s belief of the need for men to be ‘umble

  23. uchrisn

    I think David is one of the most positive people in Ireland on the Economy.
    Probably most people who comment here have been called ‘negative’ by their family or friends at some stage. However they are actually positive because they have seen the better way forward.
    If you say to someone ‘hey don’t jump into the fire, you’ll get burnt’ you are not ‘being negative’.
    Some in Ireland would tell you ‘Jump into the fire, if you are positive and have confidence you won’t get burnt’.
    Then you get burnt – they’ll say ‘that was because the negative guy made you think the fire was hot, its all his fault.’
    Those people are simply not good at accepting their own faults – Mr. Fitzgerald is blaming David because he clearly cannot accept his own mistakes for example.
    I know a guy who said to me ‘I’m cutting all of the negative people/news out of my life’
    But they misunderstand the meaning of negative. If someone gives you a warning thats positive, you avoid the problem and end up in a better situation.

    • uchrisn

      I had an excellent boss once who banned words like can’t, difficult, and problem from the workplace.
      It was actually better not to use these words which immediatly get peoples backs up. Instead we used words like challenging and issue. However noboby was moved from the project for using negative language.
      However if a consultant lied/exageratted about what they could do and then couldn’t deliver they were off the project immediatly. Or if an issue wasn’t properly communicated by a consultant – again off the project.
      The point I would make to this ‘negativity’ issue in Ireland is this -
      First you have to be realistic about your abilities. Second you need to communicate any issues that arise. Third you have to act and communicate and speak in a positive way.
      In this order.
      If you fail on the first 2 don’t start preaching about the dangers of being negative.

      • uchrisn

        I should mention this project was in the U.S.
        In Irish business culture I have found that people saying they can do something when they clearly know they can’t, or failing to communicate a potential problem seems to be tolerated. Rarely are people punished for these mistakes. They actually seem surprised if you get annoyed about that. This is the Irish idea of ‘being positive’, which really is ‘ignoring the laws of nature’.
        A Harvard Law graduate once told me ‘you are too comfortable and convenient to ever be successfull’. I think I need to send her to the Department of Finance.

        • uchrisn

          I should say that depite this wekaness Irish people have many other general good qualities like well-educated, forming good relationships, taking initiative, innovating, problem solving etc and actually I was quite surprised by the poor performance of some of the U.S. consultants.
          So that is why their is a positive future for Ireland, only if we would give our young graduates and workers a fair chance in Ireland.

          • coldblow

            I haven’t direct experience of much of what you are saying but, from start to finish, your comment is ringing a lot of bells.

        • Deco

          uchrisn.

          “rarely are people punished for their mistakes”.

          I agree. The only thing that gets punishment is speaking up, or breaking ranks from the consensus.

          • coldblow

            I think it’s MH-Finfacts who describe it as the country where the buck stops nowhere.

            Some like him oppose unilateral default (whether on bank or sov. debt) as it would remove the pressure for root and branch reform and leave vested intresest intact.

            As for the consensus, I think that’s very true. (I’ll spare you all this again, but it’s definitely an extravert trait: what is is – accept reality and join in or be a crank.) It’s probably something we have in common other postcolonial nations in the Third World (I think I saw something about Jamaican society being gradated on your precise level of whiteness – the black brotherhood stuff is presumably for the lower orders, a kind of local colour). Interesting that David in his last article said we are worse than Uruguay. I think Crotty would recognize the connection.

            I have a feeling that in the face of hard facts a new consensus will emerge. No argument there I’m sure. However, my guess is that when it happens it will appear in the twinkling of an eye. Suddently it’s there (whatever it is) and everyone will know it and it will be just as total as the last one was. It will be the acknowledged reality but its originators (Urheber and Ban-Urheberinnen) in its unique and particular manifestation will be unclear. The new Celtic Ideal will arrive fully formed.

            When will the hour come and how will we know it? Ha ha!

            While I’m in this vein, here’s another one that occurred to me. Did anyone else think it too? Taking Fennell’s Nice People and Rednecks theme: FG Tutsi vs FF Hutu! God forbid.

      • Praetorian

        Better to go down fighting on your feet than begging on your knees for someone else to solve the problem/issue/challenge.

        It is a question of maturity and taking responsibility for issues.

        But the essential issue is that we have amateur politicians with poorly educated civil cervants pandering to those who can afford to write cheques for political campaigns. It is a defensive system which would perfer to make a complete balls of it rather than take on constructive criticism, which is almost instinctly reacts negatively to because they think they are modern day Oracles, with positions, money, status and ‘who are you to challenge me?’, you are nothing but an opportunist, celebrity economist making hay while the sun-shines.

        Takes balls to challenge the power elite, an elite which uses every mechanism in the book to stall, muddy the waters, pour cold water on critics etc whle enriching themselves at the expense of others.

        Pity a few of them never took up golf or knitting would spare us their clap-trap.

  24. Harper66

    Watched Lucinda Creighton on Vincent Browne last night. utterly dismayed at the level of her incompetence however impressed with Stephen Donnelly.

    I believe the tide of anger is coming, rising interest rates, FG/Labour continuing FF disasterous policy, another hair shirt budget looming,majority of small businesses struggling and a government that does not act in the interests of the people.

    David, I know the last election took the group you were attempting to organise by surprise but start planning now an election can only be 18 months away.

  25. HAC

    Legal Question:

    It a given that Mr. Austin Hughes in his capacity as acting Chief Economist with IIB Bank was more than willing to state his expert opinion in a live televised debate.

    He must have know without question that his argument would be vital and critical information necessary for IIB customer making serious decisions on mortgages at that point in time.

    Were his comments irresponsible and could IIB mortgage holders use this video of Mr Hughes in their defence should negotiations or legal issues arise due to difficulties with their mortgage repayments?

  26. Thnaks for the comments as always. The interesting thing is that the “serious” economists weren’t just wrong about the housing/banking cartel, but we see them lagging again on the debt crisis. Remember these were, in the main, the “Ireland doesn’t need a bailout” crew. Anyone who suggested that the Euro hid a deep financial faultline was dismissed as a crank or a celebrity. Now with Portugal this morning, we know that this is a proper debt crisis and the outcome is clear – mass debt restructuring in Europe

    Best David

    • Praetorian

      Do you market insiders expect the Spanish domino fall? Something that seems increasingly likely.

      If the German domestic audience was upset about ‘bailouts’ before wait until the get the bill from Spain.(‘bailouts’ which are in fact loans at high interest rates, something not explained by the German elite because when you trace the steps to their natural conclusion the buck stops at German and French banks and hence heat on German and French politicians in election years).

    • lff12

      David

      Would love to see you write a piece on market failure.

      Lets start with the following:
      1. Telecoms
      2. Private health insurance
      3. Housing
      and now banking.

      Michael Porter talks in his update of his 80s article on the “5 forces” of competitiveness that some strategists can expand a market rather than create a zero sum scenario. I’d love to hear what Porter thinks of Ireland’s negative sum scenario!!

      regards

      Laura

  27. SLICKMICK

    GF , like the rest of the insiders is in love with everything european.They can’t stand the simple fact that they have shown to be clueless.The experience of the UK inside the ERM , rock bottom interest rates @ the wrong time was disastrous, some people couln’t extend that to Ireland.
    http://www.uti.is
    An Icelandic view on things.

  28. coldblow

    I looked at the clip. It lasts 10 mins. Did I miss something? One of the people featured is called Kate Fennell. She said that you have to go with the flow, live life now, etc. I’d say she must be a daughter of Desmond Fennell. I’d be interested to know what he makes/ made of all this. I think a brother, Cillian, is or was a producer of the Late Late, and that he appeared on it himself once, discussing the Irish language. His views (if I remember correctly) were derivative and mainstream. (Although from another angle they were just sound common sense -depends on your pov.) Must be a reaction to the dad.

    The only knowledge I have of economists comes from when I read the irisheconomy blog and there it’s not always easy to distinguish between economists (of various specializations), financial experts and ordinary punters. I appreciate the insights but reserve judgment of the bigger picture.

    On one level I seem them as, from background, social milieu, connections, etc, supporting whatever the status quo is, perhaps not consciously. I do believer that many of our motivations are not consciously recognized or acknowledged. Wills?

    On another, old human nature seems to be in play and the instinct to defend and justify one’s views and actions. On a couple of occasions in the past I have found myself on a weekend in the company of high-achieving professionals and administrators. While they were clever and interesting, and capable, I also noticed that some appeared at the mercy of a childish streak in personal relations that, I think, has given me an insight into what life in a boarding school must be like. There’s a willingness to personalize arguments and deride opposing views, eg the caricature of the wild bondholder burners, or the schadenfreude at the collapse of the independents’ alliance that was forming before the election. We’re all human.

  29. Praetorian

    Can somebody throw some light on the Ratings agencies and why the big accountancy firms have not been prosecuted for signing off on false accounts?

    A poster on another site wrote this which provoked me to repost it:

    “I want readers to remember that Moody’s is the very same company that rated the banks that ultimately required a Tax Payer BAIL OUT, as either Triple A (AAA) or Double A+ (AA+) right up till the point they went bust…

    And they are the same Moody’s that rated the completely worthless Junk debt swaps/bonds, as Triple A (AAA) or Double A+ (AA+). They knew they were worthless and were paid billions to rate them as AAA.

    The actions of Moody’s are one of the principal causes of the ‘Poo’ that the tax payer currently find ourselves in. The banking crisis was not an accident, it was not simply a cost of doing business, it was the biggest financial fraud EVER! See ‘Inside Job!’, an Oscar winning Documentary that everyone should see.”

  30. Adelaide

    Harper66 predicts “I believe the tide of anger is coming… ” Oh please, you missed the tide of anger. It culminated in the four poorly-attended outside-Dail protests at the end of last year. The tide is now ebbing as demonstrated by the 100 people who tuned up at the Dail yesterday evening 6pm for the referendum protest.

    We tried our ‘couldn’t-be-arsed’ best attempt at anger and it has served its purpose. Now we move on, back to our self-absorbed couch-potato lives, only to stir when the EU-sponsored soup-kitchen calls round to hand out our EU-charitable cheese+bread meals.

    We deserve better than this.

    At least an additional side plate of chips, or potatoes. We like potatoes. A “More Potatoes For Ireland!” protest will be held 6th April 2013 6pm outside the Dail, where presumably a 100 people will bother to turn up.

    God bless Ireland.

    • Colin

      You’re right Adelaide. I think the root cause of the ‘couldn’t be arsed’ attitude to protesting stems from two things;
      1. Those who didn’t go nuts with getting on the property ladder and furnishing their home with loans from Harvey Norman and Land of Leather, well they have the option of leaving this debt laden country.
      2. Those who did go nuts feel so guilty now about their own stupidity and therefore would feel awkward about marching on the streets followed by returning home to their 3 bed semi in the suburbs on which they are 6 months behind, then sit on their nice leather couch which they haven’t completely paid for, then into the cashandcarry kitchen to cook a meal on appliances that haven’t been paid for.

      • Praetorian

        As one poster commented, houses are being made so comfortable with leather couches, American style fridges, surround sound, decking for the barbcue, king size mattresses, faux Italian tiles, that people don’t want to leave them.

        Instead of your home as a castle, it is your house as an intellectual prison topped off by the knowledge of the mountain of debt which keeps the would be rebels well in place and don’t employers know it.

  31. gerry

    For an interesting conversation on the risk models of banks between Daniel Kahneman & Nassim Nicholas Taleb have a look at

    http://www.edge.org/3rd_culture/kahneman_taleb_DLD09/kahneman_taleb_DLD09_index.html

  32. Peter Atkinson

    Did anyone get a load of the article in the Indo and the IT yesterday about some Polish (I think) property scam where a load of quote ” high net worth individuals” (greedy twats) were invited to invest a total of €22 million between them in this scheme (scam).Well it was definitely a northside who’s who of greedy bastards and I noted one pharmacy owner (surprise surprise) was in to the tune of €1.5m.It ended up in court and you know what. My heart bleeds for them.Wish a few more of these Celtic Tiger high net worth individuals were named in open court so their ordinary joe neighbours could see the extent of the greed that this country was exposed to during the finance fest of the noughties.Guess what folks, these very people will head the queue pleading for moral hazzard and no doubt the insiders will hear them.

  33. Adelaide

    Potatoes, anyone?

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