January 1, 2018

The Price of a Pint of Guinness: A Boozy Guide to Currencies

Posted in Irish Times · 77 comments ·
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Every Christmas, our family heads to Belfast to see the in-laws and eat gluttonously, drink copiously, argue endlessly, and fill the boot dementedly before we head down South again. The difference in prices between the Republic and Northern Ireland is remarkable, particularly at Christmas when everyone is buying more of everything.

 

Choosing to shop in the North makes you richer.

 

Brexit will not change this. In fact, Brexit may make the price differences yet more clear-cut.

 

If sterling were to weaken against the euro next year because of a nasty shock during negotiations, a political change in London, or simply because European rates move up quicker than expected, Southerners would be mad not to think of the North as a giant discount store.

 

It is a “constitutional Lidl” that’s just up the road.

 

But before focusing on the bargains that are available up North, it’s worth considering just how expensive Ireland is relative to countries around the world.

 

To compare prices between Ireland and the rest of Europe, I’m going to construct an Irish version of the famous Big Mac Index. The Pint of Guinness Index is just a boozy version. It compares prices of Guinness in Irish pubs all over the world from Tokyo to Bucharest, Lisbon to Lima.

 

In a world dominated by financial markets where exchange rates can move up and down for no apparent reason, the Big Mac Index was conceived by the Economist magazine to try to assess whether exchange rates between countries were at their “correct” level.

 

The economic theory behind this is called “purchasing-power parity”. This means that, over the long term, the exchange rate between two countries should move toward equalising the prices of identical goods in two countries.

 

For the Economist, the Big Mac was a perfect identical product sold all over the world at McDonald’s franchises – a proxy for the real prices in each country.

 

So, if the price of a Big Mac in America was $6 and was $3 in France, the Big Mac Index would imply that the euro was 50% undervalued against the dollar. As a result, in the long term, the euro should rise against the dollar to eliminate this real underlying price difference.

 

Now let’s put Ireland into the frame.

 

If the Big Mac is America’s most conspicuous cultural export, bringing a version of America to the farthest parts of the globe, the ubiquitous Irish pub must be our equivalent.

 

It projects an ersatz “Irish-ness” to the most remote places. Some people might get sniffy about the replica, made-to-order Irish pubs, but it is the product Ireland exports everywhere.

 

Therefore, for an Irish view of the world of economics, the same logic should apply for pints of Guinness as for Big Macs. If the pint of Guinness is way out of whack between two countries with differing exchange rates, then there must be something wrong.

 

What happens to the price of a pint of Guinness, brewed in Dublin, when it leaves Dublin? Remember, economic theory states that because of transport costs, the price of goods should increase the farther away from the home country it travels.

 

But in almost all cases, the price of a pint of Guinness gets cheaper when it leaves Ireland. In some cases, the difference is enormous. In Spain and Greece, Guinness is 34% cheaper than it is here. In Germany, a pint of stout is 15% cheaper and in Austria 25% cheaper.

 

That’s only within the EU. Compare prices between Ireland and Singapore, Peru, Japan, and Russia, and you can see where Ireland stands on the global league of expensiveness or cheapness. It’s not a pretty sight.

 

However, all these places are too far away to avail of the arbitrage between the prices. We can’t go shopping in Peru. But we can go up North.

 

Taking the political rhetoric about the “all-island economy” at face-value, we can treat the island of Ireland as two economic zones within the one economy. We have the euro zone here and the sterling zone up North.

If we apply the Pint of Guinness index to the two exchange rates operating on the island, we can see that the sterling zone in this island economy is hugely undervalued vis a vis the euro zone. This is an opportunity for the Republic.

 

Pint of Guinness Index

 

The average price of a pint in Dublin is €5.50; up the road, in central Belfast, the same pint will cost you £3.40 or €3.84. Therefore, the implied exchange rate from the Guinness Index is €1 = £0.62. Consequently, there is a gap of 30% between the financial market exchange rate and the Guinness exchange rate.

 

This means that, in Northern Ireland, sterling is massively undervalued against the Euro.

 

Over time, the theory says that sterling would rise against the euro if its path were determined only by economic conditions in Ireland.

 

But the euro vs. sterling exchange rate is not simply determined by events in Ireland. It is affected by world events. Therefore, sterling won’t rise against the euro materially.

 

As a result, there is a massive opportunity between the two zones of the all-island economy.

 

At these prices, it is an act of economic self-harm not to shop in the North. If you could do all your shopping in the North you could raise your disposable income by 30%.

 

The benefits to the whole country of using the North as a “constitutional Lidl” – a bargain basement a few miles up the road – would be huge.

 

Some retailers in the Republic, however, would almost certainly say that deserting the expensive South for the cheap North would destroy retail in the South. Granted, there would be some casualties, but it’s more likely that retail in the Republic would simply evolve.

 

Irish retail has never been destroyed by a 30% increase in the disposable income of the Irish consumer.

 

This is the sobering conclusion from the Pint of Guinness Index.

 


    • Mike Lucey

      David, by any chance, did you consume a large quantity of the ‘dementedly boot filled content’ before putting pen to paper on this occasion?

      • Deco

        I think the term “Product Placement” is relevant.

        A legal drug dealer, built on death, underperformance and bad health.

        Diabetes. Chronic Heart disease. Accidents. Wife beatings. Malnourishment and deprivation. Fighting. Agression. Poverty.

        • Truthist

          Revolting Flatulance ; Sorry, … it must be said.
          Ulcer Condition
          Liver damage
          Filthy Homesteading ; Not always
          Snide Remarks ; In the main
          Theft ; Sometimes
          Adultery ; Increasingly so
          Rape ; Seldom, but increasingly so as society is increasingly libertine
          Incest ; Seldom, but still much more than folks realise

          “HOMELY” + “SCHMALTZY” + “ACCEPTABLY CUTE-IN-IRISH-TERMS” EXCUSE FOR :
          otherwise Ineptitude
          otherwise Graft
          otherwise Extortion
          otherwise Following the Orders of the Freemasons of Ireland & EU that Irish State give Sovereign Guarantee — as appallingly advised by David McWilliams to Min. for Finance — on the Loans of the Banks
          inter alia
          otherwise Laziness
          otherwise

    • LKSteve

      I’m a bit late to this thread, but feel I should make a contribution given my love of both stout & economics.
      I drink a lot of stout and enjoy variety, so I drink different types as often as I can.
      Here in Australia, which for some reason has been left out of the Guinness Index, Guinness is available in two varieties, imported and locally brewed. I occasionally drink both, though am never sure which I’m drinking & don’t care. Guinness is brewed locally by Lion, which is owned by Kirin, which in turn is owned by an arm of Mitsubishi group. It’s actually quite shit here as everyone knows Guinness doesn’t travel well and the nips have no clue about stout.
      Therefore I drink Coopers, a locally brewed stout, brewed by an Australian company and a good one at that.
      I diverge from stout momentarily to focus on the economics of buying in volume. Young Irish men & women planning on visiting these shores should pay attention.
      In Australia, buying your beer in cases is good for your bank balance.
      On a recent trip to the mecca of volume beer discounting ‘Dan Murphy’s', in a moment of intense consideration, I pulled out my iPhone for some quick calculations.
      I was buying beer, not stout and although Coopers pale ale is a favourite of mine I was seeking something a little more refreshing on the palate, it’s been bloody hot here recently and drinking cold beer in volume is a fact of life.
      Anyway, James Boag’s Premium was on the menu. It’s a pretty good beer, brewed by Boag’s of Tasmania. In recent times Boag’s has fallen into the Kirin’s hands so in reality the stuff could be coming from anywhere however I digress.
      I thought the price for a 6 pack was slightly expensive given Dan the man Murphy’s reputation for cheap drink, it was about $21.
      I noted there was a special on cases, being 4 X 6 packs @ around $50 – $12.50 per 6 pack.
      Isn’t that spread quite extraordinary? It’s 68% dearer to buy a single 6 pack than to buy 4 at a time.
      Let this be a warning to young (and old) Irish coming to Australia for the first time. Preserve your capital, buy drink in bulk. Happy new year everyone.

  1. Patchkk

    Surely there is problem with this analogy in that there is vastly different duty and VAT added onto alcohol in these different jurisdictions… Ireland having one of the highest alcohol duties in the Europe, not sure about the rest of the world.

    • Absolutely my first thought.
      What about dues, fees and taxes. Does the Canadian price include VAT which in Canada is added after the advertised sale price.
      That is usually about another 12% added at the till.

  2. goldbug

    @DAVID

    TRANSLATION -> THE EXCHANGE RATE WILL CRIPPLE IRELAND?

    “Irish retail has never been destroyed by a 30% increase in the disposable income of the Irish consumer.”

    -> HAS IRISH RETAIL EVER BEEN DESTROYED

    => BY A 70% DROP IN SALES?

  3. zohan

    The reason we pay too much for everything is very simple. Out taxes including indirect are unbelievably high to pay for the high wages and pensions for the public service. Somebody should do the math.
    Go north to save……

    • Metropolitan Hillbilly

      The reason we pay too much for everything is laziness, inertia and an education system that diverts resources on ridiculous languages (Irish/Polish) that deliver little in return but won’t teach kids basic negotiating skills in a market economy. People won’t shop around and won’t hardball the sales people when they purchase a product. This applies to insurance, cars and virtually every key consumer product. When you make contact with a human they have to eat/pay rent/pay a mortgage and that’s all the leverage you need for a discount. The Guinness analogy is bogus in this discussion given the domination of the two major players in the local market. If they had the same market share in an EU wide context they could be prosecuted for abuse of a dominant position. But don’t get me started. It was the Californians who exposed Volkswagen not the Germans and certainly not any EU regulator.

      • Deco

        Fair point MBH.

        James Dyson had some interesting comments concerning the EU’s institutional bias against him, and in favour of his continental (mainly German, and Italian) competitors.

        None of that in the Irish media though.

        We are going to be shafted by our own establishment, again.

  4. HoChi

    The Irish are lazy/stupid about finances, they go to the UK to buy a s/h car ‘cheaper’, then get whacked by Revenue but won’t admit that in the long run they actually paid more than they could have bought it here for. Nobody believes me when I tell them how much my latest s/h car cost me, original Irish reg car bought here, for 60% less than I’d have paid going to the UK – that’s because I checked ALL the factors before purchase. A car importer told me that the manufacturers price the pre-tax base cost on where they want to position the car in the market. Looked at the Land Cruiser 100 (Amazon) years ago in different markets – in Japan it cost say $30k (positioning-large workhorse jeep), in Australia it was say $40k (positioning-farmers ute/family car), in the UK it was $60k (positioning – luxury jeep for suburban mummys), and in Ireland it was $90k (positioning – only for rich horse breeders!).
    Likewise with Guinness, in Dublin it’s a workingmans drink but go overseas and it’s ‘IRELAND’ in a glass in the better areas of every city – but everyone says it doesn’t taste the same as in Ireland . Inferior taste so cheaper price overseas ?? Me? I would just buy the local pint where ever I am and compare that to Irish prices for Guinness/Heineken in Dublin

    • Metropolitan Hillbilly

      Lazy yes. Stupid no. People are just usually ignorant because it’s a skill that they haven’t been taught. It’s just not in the culture to negotiate and is usually seen as a bit pushy. It’s only when you move into business or overseas that you learn. It therefore suits local business interests to keep this facet of our culture. But the laziness factor staggers me. A bottle of 12 year old Redbreast costs €35 in Sainsbury in Belfast. The same product is €64 in Tesco in Dublin and stupid prices at the loop in Dublin Airport. The only explanation for that level of differential is consumer inertia.

    • Had some Guiness in Florence a couple of weeks ago and I thought it was very good having not had any after a few months in the Caribbean.

      Got back to Lucan for Christmas and had some and I have to say it was WAY bettery, even in a pub that was done a few years ago for watering down drinks (Courtney’s Pub in Lucan village).

      Going to have some tomorrow night in Philadelphia on my first visit to that city so I’ll be interested to see how that compares.

      Cancelled trip to Niagara Falls / Toronto as the weather here in Maryland is freezing and way worse north – driving conditions too bad. They’re lucky they don’t get much rain here otherwise the roads would be like a skating rink at -7 degrees.

      • Just arrived in Philadelphia after a hell of a 4 hour drive in snow from Southern Maryland. Enjoying a beer in McGillens Irish pub (noisy and packed at just before 7pm) after 7 days of my 10 year old daughter running me ragged (in an enjoyable way!). They don’t even serve Guinness here though and the O’Hara’s stout is rancid. Cheap though at $6 a pint. Miserable staff too – where’s the VIP section?!

        NB. The pint in Florence was €8 as I recall – not bad and tasted good. Pint in Lucan was almost a fiver (or maybe just over) as we know. Excellent but overpriced – should be cheaper in the city it’s brewed in. Carlsberg was dirt cheap in Copenhagen when I was there.

  5. CorkPlasticPaddy

    @ HoChi, I’d like to know how you saved 60% on the price of a s/h car here in Ireland and the UK?? The last time I bought a s/h car back in February 2009 I went up north to purchase and I can tell you that I saved myself a packet. Even after paying the vehicle registration tax when I brought it back down south I saved over €2000 on the price of the same make and model of car down here in Cork. So, can you please tell me and everybody else how you would go about saving 60% on the price of a car in the Republic???

    • You’d have to factor in the opportunity cost too, of buying your car this way.

      How many extra hours of your time did it take to arrange this purchase in the north, to go there and get it, and to deal with the re-registration when you got back etc.?

      Please let us know, thanks.

      • Grzegorz Kolodziej

        Sticking to the NI/ROI comparison, I think you should know that always since I remember (back to socialism days and then after the transition) Czechoslovakia and then Slovakia was to us what NI is to you in terms of prices and shopping (at some stage, a special bus would go from my town and drive 100k, crossing the border). Then after Slovakia introduced the euro currency, Poland is to them what NI is to us in terms of shopping/prices – they come down with coaches to shop (in Slovakia, the supermarkets started gradually bringing up the prices from a year before they joined the euro currency – to avoid the shock and massage the inflation figures – they were around 50% after the switch).

  6. In 1968 a glass of beer was 25 cents. The going labour rate was $2.50 / hour. Thus an hour of labour in BC was worth 10 beers or glasses of beer at about a 1/3rd of a pint.
    Today the cost of a glass of beer is about 4.75. The labour rate is lucky to be above 20 dollars. to be charitable we will say 25/ hour.

    25/4.75 = 5.2.
    So as a beer gauge on the economy an hours labour buys a half what it used too. That is, since we went totally off the gold standard in 1971 our standard of living is less than half what it used to be.

    Another measure is that is now takes over two wages to buy your average home. Reported recently to be 2.5 wages.

    The Guinness measure has too much froth.

  7. Deco

    I have heard of the Big Mac index. Some people would state the Big Mac might not even pass for nutrition. I can say that Guinness is definitely NOT an essential.

    So, both indexes are of questionable worth.

    Perhaps a simple litre of milk might be a better comparison. Given that it is a commodity without anything added. And it is of higher nutritional value than either mashed meat in a bun, or rotten barley in a bottle.

    McDonald’s have a core objective – to have an outlet within a ten minute drive of 95% US consumers. In fact a lot of fast food outlets have this objective.

    And from where did they get this objective ?

    Well, they got it from the way in which Guinness pushed their drug into Ireland in the 1800s, whilst quietly monopolizing the market.

    If you are an obese American, you have a choice. You can try outlets where McDonalds is not there – but instead Burgerking, Carl Jr.s, Chick-fil-A, etc..

    However, if you are an obese Irish person, every pub outside a handful, and Counties Cork and Kerry – you will find Ireland’s officially promoted substance abuse preference, on tap.

    And why is this of relevance ?

    Well, it is contributing to lost productivity, social problems, wife beatings, assaults, and HSE lock down.

    Which costs money. Which contributes to the high cost of business / inefficiency in the economy. Now the same problem exists in the North.

    But….not a word about that…..instead the media has a message

    SUPPORT OUR ADVERTISING SPONSORS [ and nudge...nudge...wink....wink....the news never needs to tell the truth if it contradicted the advertising spend pushed through the same media organs ].

    I have an even better suggestion with regard to saving money…..dump the booze altogether.

    WISHING YOU ALL A HAPPY, HEALTHY 2018.

  8. michaelcoughlan

    Hi David,

    Inflation in the US measured in big mac terms;

    http://inflation.us/bigmac/

    The average inflation rate PER YEAR from the graph for the last 12 years is 5.5%!

    In other words the us dollar is worth an eye watering 65% less now than it was only 12 years ago measured in capacity ti purchase a big mac.

    Still no mainstream economist will take about inflation in prices, increase in the money supply or increase in the national debt.

    Most People I know david have had their salaries at the same level for the last 10 years. Which means they are 50% easily worse off than they were 10 years ago BEFORE increases VAT, property taxes etc etc etc.

  9. Truthist

    Hedonists in Irish State have moved from Guinness to Hard Drugs
    Cocaine
    Heroin
    &
    worse

    How about a Smack Guide to Currencies ?

    ///////////////////////////////////

    Interestingly, … ;

    Heroin went rampant outside of Dublin just after the visit by Queen Elizabeth 2 of England & her entourage ;
    I think that the British Royal Navy were exchanging jokes with the Garda Special Branch.
    Never be complacent about Brit. Royal Family

    Mshd / Google.com results for string ;

    mountabatten AND airey neave AND assassination AND heroin

    https://www.google.com/search?dcr=0&source=hp&ei=9GxLWuixKMWh0gTrv5XoDA&q=mountabatten+AND+airey+neave+AND+assassination+AND+heroin&oq=mountabatten+AND+airey+neave+AND+assassination+AND+heroin&gs_l=psy-ab.3…524.15234.0.16385.42.42.0.0.0.0.327.5800.0j18j9j1.28.0….0…1c.1.64.psy-ab..14.17.3286…33i160k1j33i21k1.0.HhJ2t2m8v7A

    e.g.

    http://www.hallettreport.com/No3.html

    //////////////////////////////////////////////////

    THE 1st CREATIVE PRIORITY IS “HOUSING” FOR THE POPULACE

    THE 1st DESTRUCTIVE PRIORITY IS “SMASH THE NARCOTICS SCENE” FOR THE POPULACE
    THERE NEVER WAS A WAR ON DRUGS
    FIGHT FIRE WITH FIRE
    FIGHT DRUGS WITH THE MOST POWERFUL DRUG EVER !
    THE MOST POWERFUL DRUG EVER IS … “THE TRUTH” !
    FIGHT THE NARCOTICS SCENE WITH “THE TRUTH”

    ////////////////////////////////////////

    Good Slogan ;

    “Drink Guinness ;
    It gives u the Scutters.”

    8-)

    Alcohol is a V-E-R-Y OVER-RATED experience.

    • Truthist

      Mshd / Google.com are censoring access to the bauld Chris Spivey website ;
      Here is his excellent version on Earl Lord Mountbatten & Airey Neave & Prince Philip & Heroin & Irish State shenanigans ;
      But, seemingly bereft of photos ;
      And, most of Spivey’s photos had very telling speech bubbles & captions.
      .
      .
      http://theflowofperceptions.blogspot.com/2013/04/who-murdered-mountbatten-by-chris-spivey.html
      .
      .
      //////////////////////////////////////////////////////
      .
      ALL OF IRELAND IS AWASH WITH HEROIN

      THE IRISH STATE IS KNOWINGLY UNDER-SCORING THE NUMBER OF ADDICTS IN EACH METROPOLITAN AREA & COUNTY.

      De Facto LEGALISING OF MALE HOMOSEXUALIZM HAS PROPELLED THIS CRISIS TOO.
      FOLKS BOTH SUPPLYING + DEMANDING.

  10. Truthist

    EWES MAY WELL NEED A GUINNESS AFTER READING ABOUT HOW UR TAXES ARE SPENT ON AUL TRINNERS
    .
    8-)
    .
    .
    .
    Ref.
    31st December 2017, 10:21 PM

    #1

    General Urko

    Our Professors Paid More Than Those At The World’s Top Universities

    With our university rankings in freefall, it hasn’t stopped these lads (and they are very much mostly lads) pigging at the trough to the last!

    https://www.independent.ie/irish-new…-29298324.html

    Full professor salaries at Trinity College Dublin – ranked 110th in the world – and University College Dublin (187th) average €138,350 and €134,150 respectively.

    This compares with the €139,853 paid on average to professors at Caltech (The California Institute of Technology). Caltech has occupied the number one university in the world slot for the past few years.

    Trinity professors currently receive €32,158 more per annum than professors at the world number two ranking college, Oxford, and €26,905 more than their peers at Cambridge, the world number seven.

    They also make €14,348 more than professors at Berkeley in California and €33,119 more than those at Imperial College London, both of which are in the world top 10 rankings by the Times Higher Education (THE) barometer.

    And this largesse from us, is by no means confined to The Dublin Elite!

    I would have thought that a professor here would be on at a max €80K per annum, silly me!
    And please don’t give me the bull shyza that sure they are taxed much sooner here than in other countries!
    A genuinely hard working person on minimum wage has to pay €60 to bring a sick child (over 12)to see the doctor in this shytehole!

    It’s the absolute classic example of paying lads at League of Ireland level of ability (relative to their peers elsewhere and ordinary Irish Folk, off whose backs they are clearly leeching) being paid premiership wages and perks!
    Mind you the Lads in The Premiership don’t have the added bonus of obscene pensions paid for by everyone else also!

    It’s easy to understand now, why they want fees re-introduced – so they can suck more money into their arse pockets in wages!

    Also please spare me the complete bull shyza that we need to attract talent, hence the absurd salaries and perks!
    The vast majority of lads in these positions are local lads from privileged backgrounds who licked the right holes!

    There no chance this will be tackled until the next bailout is forced on us, of course the welfare state will be destroyed with it also!

    http://www.politics.ie/forum/education-science/261359-our-professors-paid-more-than-those-worlds-top-universities.html

    ////////////////////////////////////////

    And, Janus the so-called Irish Nationalist Republican himself says … :

    “Muppets, the lot of them … 8-)

    Mock, Mock, Mock, the fellow poster … 8-)

    Lick, Lick, Lick, … Lick some other … 8-)
    Of course, “LICKING” only where + when the banal crowd goes.

    “Don’t fret over the small stuff.” 8-)

    Bluff, Bluff, Bluff, … Bluff 8-)

    • Deco

      If you pay peanuts, you get monkeys.

      But…can somebody please explain how we pay a fortune, and end up with so many chimps ?

      • Grzegorz Kolodziej

        Based on my impressions of Trinity (though to be fair to be fair, science departments have very high level), I wouldn’t be surprised if someday, Derek Scally will be lecturing Polish constitutional law and “Dr” Kevin McCarthy will be teaching Polish history (to save cost, Mr Scally could also teach manipulation techniques, and “Dr” McCarthy psychiatry).
        P.S. I mean Dr Kevin McCarthy from Kinsale – there is another Dr Kevin McCarthy from UCC Cork but he is an engineer – that alone makes him more credible ;-)

        • RareAulDub

          Polish being taught in Trinity? WTF! How many of you did we let in? Either become as Irish as the Varadakars did or go back and teach your Polish shite in Poland. FFS.

          • Truthist

            What is so nobly Irish about Varadakar in wanting to legalise the murder of our, & foreigners too, Pre-born Babies, & Infant Babies ?
            .
            A real Dub is noble

            A real Jackeen is NOT noble
            Especially a RareAulJackeen.

          • Grzegorz Kolodziej

            RareMoronDub,
            First of all, you’re illiterate because I didn’t say that Polish is taught at Trinity. Secondly, no one here cares about you or your opinion. Thirdly, from the tone of your comment, I guess that there was too much incest in your retarded, cowardly family.

          • Grzegorz Kolodziej

            Just one more thing – David McWilliams should really do something about people like RareAulDub on his blog because he had said that my personal remarks to Pat Flannery were unnecessary (in response to Pat’s personal remarks) – yet he finds comments like those of RareAulDub’s acceptable.
            Personally, I’m in favour of absolutely zero censorship here on this blog (so that includes the retarded results of inbreeding like RareMoronDub) – then again, the downside of it is that if someone gets nasty on me, it will be visited on him tenfold – so I don’t want here in the future any of “I’m deleting these comments” or “these personal remarks are unnecessary” – if there are comments you want to delete, Mr McWilliams, it would be the likes of RareAulDub – not Tony Brogan’s and mine discussions on fiat (even though I grant it, they went on for too long: perhaps technically limiting the maximum lenght of comment to 1,000 words would be a solution for DMW? – this or update the design of the website).

          • Grzegorz Kolodziej

            I’m teasing with the following idea: let’s give everyone, say, 2,000 words per article for commenting, plus 3 links as now. It’d be up to them whether they use it for one big comment, 30 small comments, copying&pasting or personal abuse. That would make the website easier to read. Adam Byrne is so loaded and so happy that he could re-design it for free. We can also have “WTF + FFS” corner for people who want to duel with other people, cryptocurrency exchange corner, and a dating room for the most desperate. Of course, Polish classes for one special old reader too ;-)

            https://www.tcd.ie/Russian/courses/undergraduate/polish/index.php

            “A real Dub is noble
            A real Jackeen is NOT noble” – my experience too.

          • RareAulDub

            Quit blaming David, you are the problem.

          • Grzegorz Kolodziej

            I don’t blame him, I merely point out to his inconsequence on condemning “personal remarks” – either we have a discussion or engage in ad hominems. I can do both, but with ad hominems, the quality of the blog will go to the dogs – and it won’t be my fault – it’ll be yours because you started it.

          • Re: RareAulDub – don’t be so sensitive Grezegorz.

          • No one is going to stick to such rigid rules (nor even remember them) Grzegorz, but we know you love sticking to rules so your suggestion does not surprise me.

            The website badly needs a redesign. Navigating it is way too time consuming.

        • Deco

          UCD is a circus.

          • Grzegorz Kolodziej

            Again, sciences are decent there – but talking to their first-year history students imbued me with conviction that they are just catching up with secondary school levels of historical knowledge; philosophy there is mainly postmodernism, with one or two exceptions, and they don’t have proper logic; while their sociology department teaches things like “Lenin’s views on late capitalism”. On the positive side, they have a nice canteen, lake and arguably Dublin’s best bookshop, with titles you won’t get elsewhere.
            UCD seems to have devolved now – before the recession, they had all sorts of debates and student gigs.
            I remember that when the recession came, you’re going through the campus and you wouldn’t see any posters, even though the vast majority of those gigs were free anyway.
            The road from the bus to UCD proper is way too long for students who have to commute long distances anyway – in Poland, you get off the tram/bus/metro, and there it is – the gate to your college – you don’t have to walk 20min over traffic lights, motorways and marathon-like paths.

            P.S. The level of higher education in Poland dropped dramatically when they decided to triple the numbers of students in the 1990s (I don’t know if that was some pre-EU condition or they’ve done it just spontaneously, to solve the unemployment problem – as it was done in Ireland in the 1980s.

    • Truthist

      David McWilliams

      ?Verified account @davidmcw

      31 Dec 2017

      David McWilliams Retweeted Steve Stewart-Williams

      What other measures of inequality could you think of ?? ????

  11. KryptoK9

    NB: I’m back to post for ‘lurkers’ who visit this site who requested another stand-up stint by BrummieBoy, I’m not here to re-join you all in your mental mosh-pits or deal with lame trolling….. STAY IN YOUR LANE! Or you WILL be vapourised….

    so…..

    just got back from New Year in Reykjavik and, funnily enough, went into Ye Olde Irish & Englishe pubs there to check out the insanity of prices for a pint of stout. I thought CPH airport was the limit but, obviously our ‘Nordic Paddy’ friends in Iceland had to go one better. They are gettting ready to trash themselves again, it’s both funny and sad to be a voyeur, but there we go. They didn’t listen to BrummieBoy and the runes have been cast and read.

    ‘…we can go up North’….yes, we can. To Denmark where the prices reflect an attempt to maintain a kinda/sorta nostalgia for a socialist solidarity gig of an economy whereby taxes on booze fund the sensible stuff, supposedly. And Lyin Air are told to take a hike. Or we can go Nordor Og Nidur [go north, go down into Hades] which I did last week, to an ‘arts festival, darling!’ at Harpa which was spectaculoso in the xtreme. The Icelandic Octopus Oligarchs of the past IceSave excesses are back in control of the steering wheel with their Useful Idiots left-green foot-soldiers doing the cut’n'paste PR bollocks for ‘progressive issues’. The stench of dodgy runic finance spellcraft in The Borg & Apotek alongside the crypto-server farms gave a sage-shaman like myself all the ammo I need to declare Iceland as on the cliff-edge and about to jump, never mind the Chinese spies posing as tourists but that was the last thread and I can’t be arsed to think about that again….

    If you’re ever in Reykjavik (which I don’t recommend unless you’re a nutjob like me) then you might want to pop in to the Irish Pubs. The price will make you savour every last sip, *lads*. Mr McWilliams may wish to ruminate on adding both Denmark & Iceland to this Stout Volatility Index with an explanation of how/why one has a Narrative and the other is just another bombeen huckster scam-job on gullible tourists (think Temple Bar on steroids), Kim/Kanye clones lost in their Instagram trances at the industrial Blue Lagoon fake-fantasy of ‘nature’. Reykjavik & Copenhagen. They’re both ‘north’ and in different ways as confusing and brain-achey as Norn Iron, which i’m studiously avoiding thinking about…. Phew! Managed to get through this comment without calling for a Thermonuclear Brexit asap!…..

    New Year’s Eve in Reykjavik is like the end of the cosmos with ever star exploding. You can’t buy stout by the can in the Government controlled liquor stores on New Year’s Eve as it’s…..closed…I kid you not. But you can get fcUK’d for a pint of the black stuff in the ersatz Irish pub where Icelanders go to try and pretend they’re not Nordic Paddies as revealed by the DNA map. They hate on me for having pointed it all out but i could care less….anyway….
    Note how the pub website below doesn’t reveal the price of a pint but does reveal the price of a meal….they save the Big Reveal about how much it costs to get pissed in Reykjavik until you’re at the bar….what’s Icelandic for sleveen? Can’t remember if you can buy stout at the airport on the way in or just that gut-rot Brennevin horror-syrup.
    Wishing you all a healthy, happy & prosperous 2018.

    Andy Mooney

    ‘The Drunk Rabbit is an authentic Irish pub with all that an Irish pub has to offer and more. Here you will find the perfect pint of Guinness.’

    https://www.drunkrabbit.is/bar/

    Repetez et ecoutez…..NB: I’m back to post for ‘lurkers’ who visit this site, not to re-join you all in your mental mosh-pits. STAY IN YOUR LANE! Or you WILL be vapourised….

    Andy Mooney
    Hobbiton
    The Shire

  12. Before a person can vote or propose solutions for a sovereign state they must first think like a sovereign person. Here is an essay that examines “Consent” and what it actually means.
    It is common parlance today to examine consent in the context of human interaction but there is little consent allowed when it comes to government and the individual.

    http://www.thedailybell.com/news-analysis/how-the-lack-of-consent-has-made-us-all-victims/

    • Spain denies sovereignty to the Catalans

      “Spain:

      Rajoy says Catalan parliament should meet on 17-Jan: RTE cited Spanish Prime Minister Rajoy, who said the new Catalan parliament should hold its maiden session on 17- Jan, the first step in reinstating local government after Madrid fired the old regional administration for illegally declaring independence. The article noted once the parliament is formed, potential leaders of the regional government will put themselves forward for a vote of confidence, although it could take months for a new government to emerge.
      Former Catalan leader urges Spain to accept secessionist election win: Reuters cited Catalonia’s former leader Puigdemont, who over the weekend urged Spanish Prime Minister Rajoy to accept the results of the 21-Dec local election which gave a slim majority to parties favoring a split of the northeastern region from Spain. He said Catalonia had demonstrated it was a democratically mature population that had won the right to become a republic, and asked Rajoy to start negotiating with independence leaders. posted at http://www.lemetropolecafe.com

      • Deco

        The ECB is in a rather vulnerable position.

        It has propped up the Spanish banks.

        And it is now printing money and propping up the Italian banks.

        [ note - it never offered this to Greece or Ireland or Cyprus ]. The main lesson, is that if you are big, you get a pass on the type of superficial gestures to “make an example” of somebody ].

        In any case, this could spark another ES banking weakness.

        The Brussels response has been very much as expected. They are backing Rajoy.

        Apart from anything else, they do not want Flanders to jump out of Belgium, and cause Belgium to go into insolvency.

  13. The real state of the US economy

    Sub prime car loan delinquents.

    http://investmentresearchdynamics.com/is-sub-prime-auto-loan-armageddon-coming/

    Mortgage defaults?

    https://usawatchdog.com/2018-economy-goes-cold-inflation-hot-danielle-dimartino-booth/

    Not to mention the rampant inflation in full view. Ask yourself, Has the economy grown much have wages increased, have people paid down debt. No , no, and no.

    What is the wealth effect. Things have gotten more expensive. houses, stocks and bonds? Yes, yes, and yes. People living off credit cards and using their house as an ATM is the present not the past. This activity will accelerate in the near future.
    The crypto market booms. The money is there. One pays another for the same thing recycled. One bit coin e.g. was a dollar, then 10, a hundred, ten hundred and ten thousand. What changed. Nothing, it is still one bit coin (in your imagination too). It just changed hands several times and people paid more for it than the previous person. The greater fool theory. A pass the parcel game. Just do not be holding the parcel when the music stops.

    So what changed? Easy. The amount of money available. So based on bitcoin, fiat currency is already toilet paper. I’d call that hyper inflation. Yes inflation stares you right in the face and wags a finger at you.

    Based on high housing prices inflation is double digits. Ditto for the stock market. But cryptos tell the real story.

    Soon that Guinness will be 100E

    • Metropolitan Hillbilly

      Tony
      I read a similar article titled ‘Carmaggedon’. Your link is

      • Metropolitan Hillbilly

        is well worth a read for anyone currently with a PCP finance deal or considering such a deal in Ireland.It’s the sub-prime finance scandal for cars. The ‘guaranteed minimum values’ are pure fantasy.

        • Ok so if I want to buy a car in Ireland, what’s the absolute best way to do it?

          • I did a review of available E320′s in this locale and found a surprising number of relatively low mileage quality cars for less than 5000 dollars.
            There is little depreciation to lose. so you pay extra for gas or insurance but it is way more economic than a new car and a very comfortable ride. check out the repair history of the model you are looking at.

            A new car halves in value every 50 years.
            40,000 in 5 years is 20,000. 20,000 in 5 years is 4000 a year . That is your annual expenses covered for the 2nd hand quality car.
            Otherwise, Adam, sorry I am no help.

          • Metropolitan Hillbilly

            1) Buy bitcoin early in the cycle. I think you’ve got that covered. Sell at a prudent time and crystallize your profit.
            2) Check the main dealer price in Ireland.
            3) Check the equivalent price at a main dealer or supermarket such as cargiant in the UK.
            4) Check ROS revenue site for the cost of VRT.
            5) Factor in the sterling differential.
            6) Transit expenses are approx €350 including flight, public transport UK, car ferry, fuel, food and 1 night hotel UK.
            7) Phone Irish and UK main dealers and aim for 10-15% discount for cash(draft) settlement. Under no circumstances enter any finance or pcp contract with any motor dealer.
            8) See who delivers the best value and spec for the price.
            9) Check all documentation using Kartel,Experian or similar site.
            Do NOT buy from a private source unless you know what you’re doing. Ever.
            10) Buy a car 3 years old max. That gives reasonable value as it has normally hit 50% + depreciation from new at that point.
            Enjoy.

          • Thanks, I appreciate the comprehensive reply.

            I will go through it in detail but it looks to me that the opportunity cost would be way too high for me.

          • Thanks Tony, I wouldn’t buy a second hand car anyway – way too risky and time consuming. Looking for the best deal for a new car.

    • Deco

      Tony,

      What are your views on the record level of private sector debt in Canada ?

      And also the fact that public sector debt is also climbing upwards, in a rather troubling manner.

      What Canada is “achieving” is rather frigthening – it is increasing both public AND private sector debt at the same time. And the private sector debt levels are getting very troubling. normally a country that accumulates private sector debt, on the scale that Canada is doing, is able to reduce the public debt.

      But…..CAN can’t”

      Does “Junior” know about this ?

      Or is he still on vacation, in a manner that suggests possible compromis, and definite contempt ?

  14. Grzegorz Kolodziej

    Guinness:
    Ireland – 100
    Germany – 85
    Austria – 75
    Malaysia – a bit over 50

    And they say that Guinness doesn’t travel well…

    Industry Weekly Wage____Euros___________Pint€________________Pints
    1969____________________19.63___________0.20__________________100
    1973____________________38.30___________0.24__________________159
    2002____________________483.05__________3.24__________________149
    2006____________________597.66__________3.74__________________160
    2017____________________695.80__________5.50__________________126

    Keep the recovery going!

  15. Truthist

    NEWSFLASH !
    .
    //////////////////////////////////////////

    PREAMBLE ;

    THEORETICALLY …
    WHITE CAN CO-EXIST ALONGSIDE BLACK
    JUST LIKE DRAUGHT GUINNESS

    …………………………….

    Guinness is very popular in Nigeria-land

    BUT … BUT … BUT

    Nigeria-land is NOT very popular in Ballbriggan ;
    Such is the argument of the Irish aborigines there.

    …………………………………………..

    AS NOT REPORTED ON “RTE Views” [ RTE News 8-) ] YET … [ EVER ? ]

    https://twitter.com/OnlineMagazin/status/948160054133477376

    Online Magazin?

    @OnlineMagazin

    ????????????? #Ireland :

    THE TWEET ;
    Media blackout !
    About 700-1000 Irish residents of Balbriggan marched to their local Garda station to protest against violent Africans terrorizing their area and community !

    https://twitter.com/OnlineMagazin/status/948160054133477376

  16. Truthist

    “Twas da drink that made me do it Magistrate”
    .
    .
    Opportunity of cheap parts for ur car now.
    .
    I wonder does basic Insurance cover for all the cost of replacement, & with no hike on premiums, for such an event ?
    .
    .
    https://www.express.co.uk/news/world/899126/Emmanuel-Macron-France-New-Year-thugs-revolt-torching-1000-cars-lynching-police

  17. Truthist

    There is an alcoholic in the story here who never has to worry about the price of a pint of Guinness ;
    .
    .
    https://www.express.co.uk/news/world/898995/EU-Switzerland-referendum-Doris-Leuthard-Jean-Claude-Juncker

  18. Truthist

    “A jacuzzi full of Guinness for yer get-together with the missus, & friends Mr. CEO.”
    .
    .
    So, how, & where, does the IDA entice Silicon Valley, California to invest in Irish State ?
    .
    .
    HEADING ;
    “Oh My God, This Is So F—ed Up”:

    SUB-HEADING ;
    Inside Silicon Valley’s Secretive, Orgiastic Dark Side
    Some of the most powerful men in Silicon Valley are regulars at exclusive, drug-fueled, sex-laced parties—gatherings they describe not as scandalous, or even secret, but as a bold, unconventional lifestyle choice.
    Yet, while the guys get laid, the women get screwed.
    In an adaptation from her new book, Brotopia, Emily Chang exposes the tired and toxic dynamic at play.
    .
    .
    https://www.vanityfair.com/news/2018/01/brotopia-silicon-valley-secretive-orgiastic-inner-sanctum

  19. Quote of the day.
    Alasdair Macloud

    “”Economists’ forecasts today, with very few exceptions, are a waste of time and downright misleading. In 2016, we saw this spectacularly illustrated with Brexit, when the IMF, OECD, the Bank of England and the UK Treasury all forecast a slump in the British economy in the event the referendum voted to leave the EU. While there are reasonable suspicions there was an element of disinformation in the forecasts, the fact they were so wrong is the important point. Yet, we still persist in paying economists to fail us.

  20. Beware the rise of interest rates causing bond yields and other financial assets to fail.

    https://www.goldmoney.com/research/goldmoney-insights/investment-prospects-for-2018

    “Logically, when money flows from financials to non-financials, fundamentals for equities should improve. But all economic factors leading to improving fundamentals for corporations are typically more than negated by rising bond yields. On this credit cycle, the forces at work are likely to be considerably more violent than seen in living memory, given record levels of debt everywhere, the mistaken attempts to synchronise all the G20 economies into the same credit cycle, and the wholly wrong-footed Eurozone and Japanese financial systems.”

  21. Cryptocurrency – its status as money
    By Alasdair Macleod Goldmoney Insights August 10, 2017
    The cryptocurrency craze is fascinating to an economist, or at least a student of catallactics, because it is a test of the theory of exchange ratios and prices, which is what catallactics is about.
    For this reason, the outcome of the cryptocurrency craze is of great theoretical interest. It is also of interest to students of the psychology of speculation.

    Supporters of cryptocurrencies claim they are money. If they are unable to substantiate this claim, then we must conclude that cryptocurrencies are only a medium for speculation, drawing on increasing numbers of the public to maintain their value. For this reason, their validity as money is fundamental to their future. Supporters of cryptocurrencies are certainly very sensitive to accusations that they are not money, presumably for this reason.

    Mere opinions do not matter. A critical, detached analysis is needed. The purpose of this article is to test the proposition, that cryptocurrencies are money, from a sound theoretical perspective.

    The basis of money

    Before cryptocurrencies, there was government money, and before that metallic money, which was gold and silver. Government money evolved out of metallic money, drawing upon it for its credibility, before abandoning all pretence at convertibility when the US Treasury finally abandoned the dollar peg in 1971. The difference between the two is gold and silver are chosen by people exchanging goods in free markets, while government money is imposed on people by their governments.

    Catallactics, as a theoretical discipline, investigates the exchange of goods in a free society, and is the basis of classical economics from Cantillon, Hume, Ricardo, Jevons/Menger through to the Austrian school. Government money does not stand up to catallactic examination, because its issuance always subverts free markets by interposing influence from the state into transactions between ordinary people.

    https://www.goldmoney.com/research/goldmoney-insights/cryptocurrency-its-status-as-money

  22. The forthcoming global crisis
    By Alasdair Macleod Alasdair Macleod September 21, 2017
    The global economy is now in an expansionary phase, with bank credit being increasingly available for non-financial borrowers. This is always the prelude to the crisis phase of the credit cycle.
    Most national economies are directly boosted by China, the important exception being America. This is confirmed by dollar weakness, which is expected to continue. The likely trigger for the crisis will be from the Eurozone, where the shift in monetary policy and the collapse in bond prices will be greatest. Importantly, we can put a tentative date on the crisis phase in the middle to second half of 2018, or early 2019 at the latest

    https://www.goldmoney.com/research/goldmoney-insights/the-forthcoming-global-crisis

  23. Truthist

    @ Grzegorz,

    Further to ongoing special interest topics of urs :

    Geo-Politics

    Trade Routes

    https://en.wikipedia.org/wiki/File:Radhanites2.png

    https://en.wikipedia.org/wiki/Radhanite

  24. X Pat

    The Singapore number is pretty much an outlier. Heavy duties on alcohol (and there used to be a special penalty for Guinness when it chose Malaysia instead of an agreed spot in Singapore to produce export Guinness) make all alcoholic drinks in Singapore relatively expensive.

    You can buy a Tiger beer 600ml bottle in Singapore for well under half the price of the Guinness pint, and for more or less what you’d pay in Ireland, and this shows that Guinness is an artificially inflated priced product as it’s assumed that mostly expats who are used to paying through the nose for comfort will be the main customer.

    In addition, alcohol is simply consumed differently in Singapore. There is no Friday evening tradition, and pints of beer are not the staple that they are in Ireland across the population.

    The big mac index is a little more telling, as everyone, rich and poor, Chinese, Malay or Indian scoffs Maccers rampantly in Singapore. Its pricing is 6 SGD or about 3.75 EUR. The internet tells me that this is approximately the same price as Ireland.

    I would say that it is not correct to analogize Guinness with fast food. Many countries have all sorts of taxes and other customs that make alcohol consumption different which are not based on price. I would choose a far less regulated product with different possible social stigmas.

    The currency tracker argument implies that the German, Spanish and Greek currencies are undervalued (all are the euro). Germany and Spain have always been cheaper for beer than Ireland regardless of the currency, and people just won’t buy it if it goes above a certain price, as there are many many alternatives. Japan and the UAE are again not places where the regular street goer will go purchase a stout. And clearly, the index cannot imply that Canada’s (or Germany’s) currency is more undervalued than Russia’s.

    I would instead do a tracker of “standard lager beer” or equivalent in each country. Guinness is a fairly niche product that is marketed differently in different countries, and increasingly as a premium product in any case, making the comparison with a very commoditised fast food product fallacious.

    I guess, in brief, I would say that when you look a little deeply at the premise it simply doesn’t stand up. Admittedly Northern Ireland is a cheap place to go buy things. But then it would have to be as incomes there are so low due to it being a subsistence substate of the UK. There’s no point charging too much for Guinness (or anything else there). But its currency is that of London.

  25. SLICKMICK

    Newly refurbished Bewleys on Grafton st charge 7 euro for a bowl of watery soup.Pubs charge 10 euro for a bowl of soup and a dessert. Renting a four bedroom house in Clontarf costs 3.5 k per month. Twenty per cent dearer than London,double the price in Leeds or Glasgow. Half a million Irish adults live with parents. Dublin house prices have risen by a multiple of seven post 1990.Thanks to relentless immigration. Whisper it gently.

    • X Pat

      “Thanks to relentless immigration.”

      A little justification for this conclusion would be handy. Particularly since the analysis you provide ignores the fact that house prices also plummeted during this period. Right now, there is not enough housebuilding happening in Dublin or Ireland in general, so a more ordinary influence on price (i.e. scarcity) is at work. In addition, Dublin is simply experiencing an employment boom. Narrowing to the IT industries, in fact this boom has been a constant since the 90s and shows no signs of stopping.

      To show that “relentless immigration” is the factor (you said the prices rose “thanks to” it) you would need to show that no other factor has been influential, or influential to the same extent.

      I await your response with trepidation.

    • LKSteve

      Hey Mick, if you’re living in Ireland and paying these outrageous premiums for Soup & houses I deem you mad. Clearly you have a grasp of the ridiculousness of economics on what was formerly this Paddy’s Green Shamrock Shores.
      The country has been run by self serving public serpents & gombeen’s for so long now that it’s no longer a country as such, rather a green, rain sodden riddle at the edge of someplace formerly known as Europe. The ruling class are so corrupt that they make the crypto-scammers seem like choirboys. I believe there is a danger that the ground on which the whole smelly edifice is built will become so boggy that it sinks and disappear for ever. Grab your lifejacket & happy new year.

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