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What happened in Ireland?

Grish

Liche
True Blood
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Oct 11, 2007
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5,444
#1
Hearing all about it's financial problems in the news, but how did it happen? What is going on there, I thought it was a financial beast in the last 10-15yrs..?
 

Sanai

Stylish Deviant
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Oct 30, 2009
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#2
Ireland is a pretty tumultuous country. Lots of tensions and stuff there.
 

desfer

Necromancer
Joined
Jun 13, 2010
Messages
811
#5
Well, what happened is that the ppl of Ireland now have to pay for the incorrect management of economics by their goverments and banks. Incorrect investments almost emptied the banks and as a result the goverment has to take a loan so they can support them. The problem is that the terms are very cruel o_o
 
Joined
May 31, 2009
Messages
734
#6
Well I'm no economist but from what I can understand our banks , many of which have been bailed out with some crazy NAMA things and whatnot and Anglo is going to be dissolved , lended money they did not have to people who could not pay it back in the 90s and created a false boom called the "Celtic Tiger" and the whole thing collapsed in the recession which reduced the markets confidence in Ireland and pushed us further into recession which lead to us having to be bailed out by the IMF , if the current proposed budget goes forward , and getting a loan from Britain .
But then again what do I know , I'm just a student .
 

Grish

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Oct 11, 2007
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#7
Thanks for the news sites Oph. I have most of that knowledge in Canada, listening to the news everyday.

As I understand what happened, is that:

1) Ireland had a low corporate tax rate, encouraging companies to set up shop there
2) This created a boom situation as corporations were doing business there, funnelling money to the country.
3) It inflated property prices
4) The bankers were friendly with the builders/property developers, and lent out too much money
5) The bubble burst, banks had loans out they couldn't collect on, liquidity was compromised, and that loss of liquidity due to bad loans to property developers caused everything to cascade
6) Now the government is paying off bank loans to prevent collapse, thereby putting the burden on the people

Is this right?
 
Joined
May 31, 2009
Messages
734
#8
1)12.5% I think which will not change .
2)Most of the money supposedly coming in was not real , whatever that means its just something I've heard said .
3)By a lot .
4)Everyone in power are more or less best mates meaning bankers , politicians and developers .
5)The property bubble generally bursts when no one can afford it .
6)Yep and I heard somewhere , I think it might be one of my doomsaying teachers , that I'll only be done paying off the debt by the time I'm in my forties
 

Get of W'soran

CN's Lord of Masks
True Blood
Joined
Apr 23, 2008
Messages
9,239
#9
Grish said:
Thanks for the news sites Oph. I have most of that knowledge in Canada, listening to the news everyday.

As I understand what happened, is that:

1) Ireland had a low corporate tax rate, encouraging companies to set up shop there
2) This created a boom situation as corporations were doing business there, funnelling money to the country.
3) It inflated property prices
4) The bankers were friendly with the builders/property developers, and lent out too much money
5) The bubble burst, banks had loans out they couldn't collect on, liquidity was compromised, and that loss of liquidity due to bad loans to property developers caused everything to cascade
6) Now the government is paying off bank loans to prevent collapse, thereby putting the burden on the people

Is this right?
Basically yes it seems to be, Ireland has been to confident with it's financial security since the Celtic Tiger economic boon.
It also doesn't help that they accepted the Euro to be honest.

I'm just glad I moved to England for Uni rather than staying in Ireland and going down South.
Things seem a right mess.

I only did Economics at A-Level but to be fair my teacher back two years ago had been predicted this for ages.
 

Mr Saturday

Vampire Count
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Dec 28, 2007
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1,897
#10
This might help explain the situation in Ireland. Imagine Ireland is the guy at the poker table who is down to his underwear after failing to quit while he was ahead and is now boned. The casino offers to cover his next bet, but at an insane interest rate. He then produces the deed to his house as collateral...

Sigh.
 

Boo

Vampire Lord
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Joined
Feb 13, 2008
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3,195
#11
Mr Saturday said:
This might help explain the situation in Ireland. Imagine Ireland is the guy at the poker table who is down to his underwear after failing to quit while he was ahead and is now boned. The casino offers to cover his next bet, but at an insane interest rate. He then produces the deed to his house as collateral...
Dang. :(
 
Joined
Aug 12, 2010
Messages
4
#12
Pietr Von Carstein said:
1)12.5% I think which will not change .
2)Most of the money supposedly coming in was not real , whatever that means its just something I've heard said .
3)By a lot .
4)Everyone in power are more or less best mates meaning bankers , politicians and developers .
5)The property bubble generally bursts when no one can afford it .
6)Yep and I heard somewhere , I think it might be one of my doomsaying teachers , that I'll only be done paying off the debt by the time I'm in my forties
Yea pretty much that timeline looks solid, of course I'm just a yank who's a news nerd and all. That said I would have issue with the phrasing of 'I'll be paying off the debt', I mean you CAN break it down to "each citizen will pay x of this debt if it's all split up" but it really is kinda a meaningless stat that just serves to scare people who go 'but I don't HAVE 100k! What will I do?!'

But yea, basically when your government bends over backwards for corporations, and does all they can to accommodate them over citizenry, you wind up with a whole lot of bubbles propped up by what amount to theoretical dollars, and if any of the bubbles burst you wind up in the stink.
 
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