Morgan Kellys - Article in Irish Times

[Reality Bites]

Having trouble linking this article by the prophetic economist in todays Irish times, well worth a reader! a truly dismal view of this countries position.

[osarusan]

http://www.irishtimes.com/newspaper/opinion/2010/1108/1224282865400.html

[OneRedArmy]

In fairness his message has been consistent, but otherwise nothing new. Certainly nothing of substance in terms of recommendations for a way out of the situtation. His prediction of mass "strategic default" of home mortgages could be construed as a wish rather a prediction.

[total hoofball]

In fairness his message has been consistent, but otherwise nothing new. Certainly nothing of substance in terms of recommendations for a way out of the situtation.
That's what 'new' about this article


You have read enough articles by economists by now to know that it is customary at this stage for me to propose, in 30 words or fewer, a simple policy that will solve all our problems. Unfortunately, this is where I have to hold up my hands and confess that I have no solutions, simple or otherwise.

We have one of the leading (IMO the best) economists this country has openly admitting his now unable to propose ANY solution for Ireland at this juncture. Kelly has said the Irish state is on the brink, as has Brian Lucey this weekend.

Games over folks. Republic of Ireland R.I.P. - raped and murdered by Fianna Fáil/Green Party

[OneRedArmy]

That's what 'new' about this article



We have one of the leading (IMO the best) economists this country has openly admitting his now unable to propose ANY solution for Ireland at this juncture. Kelly has said the Irish state is on the brink, as has Brian Lucey this weekend.

Games over folks. Republic of Ireland R.I.P. - raped and murdered by Fianna Fáil/Green PartyBut whats new?!?!?!?

As for being Ireland's best economist, given the battering the "science" has taken over the last few years, thats like boasting about being the tallest at a dwarves convention.

Ireland has been hanging on the brink for 18months plus, anyone can see that if they bothered to read the ECB liquidity support facility usage stats.

Constantin Gurdgiev and his True Economics blog is streets ahead IMO (although I don't always agree with him) and he provides a wealth of quants to support his arguments.

[Reality Bites]

The basic premise of Mr Kelly Argument is that the big boys have been looked after with the bank bailout..the State for the moment is technically insolvent due to our handout to the big boys (bondholder venture capitalist etc..)..which leaves the small guy who can't meet his mortgage payment at the mercy of the ECB who I am pretty sure will only be interested in correcting balance sheets of wrecked Irish banks with foreclosure being the immediate remedy..but ignoring the tradegy that will be inflicted on many Irish families...2011 is going to be bleak to say the least..

[elroy]

On a micro level, it really is all about keeping your job. As long as you can, you will survive this recession/impending depression.

[Billsthoughts]

Situation is undoubtedly grim but not quite as grim as portrayed. I don't see house prices falling dramatically from the 50% falls already achieved. The current levels already reflect the lack of any finance for home loans. Besides prices are not driven by this alone. Yields support prices and and are not addressed here. Rents have fallen less than capital values and while they may fall a little further they will prevent the complete collapse forecast here. Worst case foreign investment capital will come in and buy high yielding properties. This in turn will support other land/property values at the reduced levels already seen. Ciaran C..

very interesting point from the comments of that article.

[mypost]

On a micro level, it really is all about keeping your job. As long as you can, you will survive this recession/impending depression.

Agree with that. When you have a job, you can adjust your lifestyle. When you don't have a job, it's adjusted for you, as you have no income. Cue posters with "it's better to live on the dole" arguments. It ain't.

If you ask for more money from the government these days, they have a simple question to ask:

"Are you running a bank?"

[Macy]

Agree with that. When you have a job, you can adjust your lifestyle. When you don't have a job, it's adjusted for you
Depends on who you work for!

[BonnieShels]

Cue posters with "it's better to live on the dole" arguments. It ain't.

While in most cases it's not, I have found a lot of situations whereby it can be a lot more advantageous to be on the welfare than to work.

If you are in a lower paid job and have kids and a spouse to support then it can pay off to be on welfare.

[Billsthoughts]

Interesting to read the pasting Kelly is getting in the weekends papers. if ever people wanted to know how complicit the media was in our economic downfall look no further. one piece in the indo yesterday as good as said their wont be a mortgage crisis as "Irish people pay their debts!". Insane.

Just out of interest how would people without mortgage feel about some form of debt forgiveness for mortgage holders? Personally would feel happier see my taxes pay to help my neighbours relations friends etc than roman abranovich etc.

[hedderman]

I don't know to be honest. The public finances are in such a mess that I don't think the state could afford any debt forgiveness for mortgage holders. It's a terrible situation. I know that the State and the banking sector created the climate for a property bubble but I think mortgage holders have to bear a certain amount of responsibility for their own decisions. I heard Ray D'Arcy say on his radio show a few months ago that the relationship between the banks and people saddled to huge mortgages was like a parent and child relationship. I don't think that's true.

As for Morgan Kelly, what was worse was the way in which he was shouted down a few years ago when he wrote his article on the housing bubble.

[bennocelt]

Just out of interest how would people without mortgage feel about some form of debt forgiveness for mortgage holders? Personally would feel happier see my taxes pay to help my neighbours relations friends etc than roman abranovich etc.

I wouldnt be too keen on it. Not really fair for people who played it safe during the boom times and didnt buy the huge house in the middle of nowhere (or longford!)

[pineapple stu]

I can't see how it's affordable to be honest. Say you waive E100k of everyone's mortgages. 300,000 of those is E30bn. That's another bank bailout, and isn't much of a dent in the mortgage debt of the country I'd say.

The article does beg the question of the micro future though. It's all very well saying that the country is bankrupt and the IMF are coming in, etc, but I've not seen any article yet as to what we can expect life in Ireland to be like in 2015 - are things going to be cheaper? Are we going to be earning less (a problem with the debt as it stands)? Will there be an increased percentage of people working for the likes of Tesco - large multi-national paying as little as they can get away with? Is farming going to come back? What other changes are there going to be?

Anyone got any links to any articles on stuff like that, out of interest?