Markets

This is what Ballybunion is going to look like after a bit of global warming. Looking out at Bondi Beach as the big surf rolls in and the beautiful people catch the waves on a warm Sydney autumn evening, it is easy to imagine the west of Ireland in a few decades.

Is raising taxes the best thing to do in a crisis? What economic theory tells us that, in the face of a meltdown in the economy, the best thing to do is to reduce expenditure and raise taxes? There is none. The lunatics have taken over the asylum.

What have Brian Lenihan and Donald Rumsfeld got in common? Why “unknown, unknowns” obviously! The security dilemma outlined infamously by Rumsfeld in February 2002 sums up our minister’s dilemma perfectly. What most people fail to realise about the recapitalisation is that it is an exercise in reassuring the rest of the investing world that it is safe again to invest in Irish banks and, by extension, Ireland.

On Monday afternoon Killiney Hill was full of delighted children, squealing at the sight of snow. Many had never seen snow before. The children screamed as they threw snowballs and rocketed down the side of the hill on makeshift sledges.

Admittedly, looking out towards the horizon of the Indian Ocean from the volcanic heights of the French island of La Reunion is not the worst place to be writing about any economic crisis

Although I never thought I would say so, it would be preferable for us to nationalise our banking system than to allow a private equity consortium to own and control our major banks.

As the banks move to sort out their bad debts, it’s imperative that the state also tries to alleviate negative equity problem facing young workers.

Every evening, there is a little ritual in our house. Our young children, having been settled by their mother, demand dad tells them a story ‘‘from your head’’ before bed. This lark involves all classes of adventures, heroes and implausible tales starring themselves as central characters.

The current market instability could create lucrative chances for those willing to take a risk.

Because of the panic that has gripped the markets, the next few months will probably be the most profitable opportunity to make money in this generation. But you’d hardly think so by listening to the mainstream commentary in Ireland.

Things are going downhill so rapidly that we need to look at changes day to day, not year to year.

In economic analysis, it is normal to compare year-on-year figures in order to draw some inference about what is happening to the economy. Every day we hear experts saying that new car sales are down 42 per cent since last year, or unemployment is up 47 per cent since last September, or whatever.