Recession predictions

KyussB

wassie wrote: »

I don't think anyone here is advocating a US style non-recourse home loan system here.

It well acknowledged that the inability to repossess houses in Ireland where homeowners are strategically defaulting comes at a real cost to the rest of us in the form of higher interest rates.

The only people claiming that are anonymous posters on the Internet.

The cost that you're talking about is deferred interest payments from mortgage holders - which are generally recouped - with only a small minority actually defaulting. So that means: The actual/real cost is tiny.

The cost to people however, of high interest rates above baseline on their mortgages, does not line up with this at all - it is Absolutely Fucking Gigantic in comparison.

That does not match up.

brisan

KyussB wrote: »

The only people claiming that are anonymous posters on the Internet.

The cost that you're talking about is deferred interest payments from mortgage holders - which are generally recouped - with only a small minority actually defaulting. So that means: The actual/real cost is tiny.

The cost to people however, of high interest rates above baseline on their mortgages, does not line up with this at all - it is Absolutely Fucking Gigantic in comparison.

That does not match up.

Numerous high profile cases in the papers where people paid nothing or very little for up to 10 years off their mortgage
Pamela Flood and Glenda Gilson parents are 2 cases that spring to mind
Twink has been days away from losing the house ever since her husband unzipped his mickey
There are probably thousands more

Darc19

brisan wrote: »

Tell that to those in the hospitality and retail sector .
I am sure they will be glad
Heading for record unemployment
14.7 % according to the CSO

Most of the retail sector is doing very well and many parts have taken on a lot of extra staff.

The hospitality sector is the main loser, but it will bounce back fairly quickly.

The cso and tax figures just don't support a serious recession.

brisan

Darc19 wrote: »

Most of the retail sector is doing very well and many parts have taken on a lot of extra staff.

The hospitality sector is the main loser, but it will bounce back fairly quickly.

The cso and tax figures just don't support a serious recession.

Have you actually walked around DCC lately
Retail except food is on its knees

I do not know how you interpret CSO figures but its a recession that much is not in doubt

Darc19

brisan wrote: »

Have you actually walked around DCC lately
Retail except food is on its knees

I do not know how you interpret CSO figures but its a recession that much is not in doubt

Dublin city center is the only area that has seen a continued fall off.

Check any retail park in the country on a Tuesday - busy

Check the main streets of the bigger towns (and some small towns) - busy

Check out the larger towns - busy.

A family member is in retail, they are expecting their best ever year. She said it's the same for others in her area of retail unless they are in Dublin city center.

Dundrum, Liffey Valley, blanchardstown and swords all reporting near normal sales too.

Timing belt

Felipe Ashy Signboard wrote: »

what do people make of the todays budget ? have they mitigated any disasters by some of the promises they've made on spending?

The spending is justified but I think they missed an opportunity to address the housing crisis as I think there actions will be ineffective but time will tell.

It will be interesting to see how long it takes to deliver as in the past announcements like today have taken up to 10 years to implement.

Geuze

Darc19 wrote: »

Most of the retail sector is doing very well and many parts have taken on a lot of extra staff.

The hospitality sector is the main loser, but it will bounce back fairly quickly.

The cso and tax figures just don't support a serious recession.

There was a serious recession in 2020, thankfully we are in slow recovery now.

You are correct, the recession has not been even, many sectors hit brutally, other sectors thriving.

Massively variable impacts on the labour market.

Thousands unemployed, yet you can't get a trades person.

Geuze

October IMF World Economic Outlook

Timing belt

I question what impact the QE will have over the medium to long term. We know the QE boost consumer confidence for 3-6 months but that will fall away without more QE and we could find our self back in recession

We know that QE can influence CPI but the main transmission channel for this is exchange rate depreciation so if all countries are undertaking QE this becomes ineffective.

Geuze

Since QE started in 2014, the main impact it seems to me, is on Govt bond yields.

It has driven them low, yes.

Has it boosted consumer confidence?

I don't think so.

Timing belt

Geuze wrote: »

Since QE started in 2014, the main impact it seems to me, is on Govt bond yields.

It has driven them low, yes.

Has it boosted consumer confidence?

I don't think so.

I tend to agree and think that we will see negative rates for retail deposits within the next 6 months. Probably on a tiered basis where balance over 50k will attract a negative interest rate.

I think the banks will pass on the cost of the negative interest rates and it will be encouraged by the ECB to get customers spending. The risk is that customers will move the funds into assets and contribute to the asset bubbles.

Wanderer78

Timing belt wrote:

I think the banks will pass on the cost of the negative interest rates and it will be encouraged by the ECB to get customers spending. The risk is that customers will move the funds into assets and contribute to the asset bubbles.

Yup, that's all I see to, I can't see this miraculous spending spree at all, from the introduction of negative rates, some will spend of course, but I suspect many won't. Central banks are running out of options, rate changes aren't truly doing what they're hoping they'll do, many people, particularly younger generations, are becoming stuck in precarious employment and then there's their other major problem, property. Governments have to do something serious here, or we re gonna have an even more serious problem on our hands, in the very near future. This government is under serious pressure

riddles

Wanderer78 wrote: »

Yup, that's all I see to, I can't see this miraculous spending spree at all, from the introduction of negative rates, some will spend of course, but I suspect many won't. Central banks are running out of options, rate changes aren't truly doing what they're hoping they'll do, many people, particularly younger generations, are becoming stuck in precarious employment and then there's their other major problem, property. Governments have to do something serious here, or we re gonna have an even more serious problem on our hands, in the very near future. This government is under serious pressure

The short term nature of politics is not capable of delivering long term solutions.

Wanderer78

riddles wrote:

The short term nature of politics is not capable of delivering long term solutions.

This is very true, and it's becoming more evident over time, and young voters have had enough of it, and I think they're right to, the only problem is, we re ending up with risky and sometimes potentially dangerous voting outcomes. Traditional parties such as ffg are under serious pressure to maintain their positions of power, they're running out of time quickly. I also believe their property policies are gonna continue to fail, particularly in relation to providing these younger generations with what they need, so God only knows where that's gonna lead us to.

brisan

Wanderer78 wrote: »

This is very true, and it's becoming more evident over time, and young voters have had enough of it, and I think they're right to, the only problem is, we re ending up with risky and sometimes potentially dangerous voting outcomes. Traditional parties such as ffg are under serious pressure to maintain their positions of power, they're running out of time quickly. I also believe their property policies are gonna continue to fail, particularly in relation to providing these younger generations with what they need, so God only knows where that's gonna lead us to.

More than likely a SF majority in the next election
Maybe not enough to form a Gov on their own but they will more than likely be the biggest party.
SF policies MAY not work
FFG policies DO not work
Young people may take the chance

Wanderer78

brisan wrote: »

More than likely a SF majority in the next election
Maybe not enough to form a Gov on their own but they will more than likely be the biggest party.
SF policies MAY not work
FFG policies DO not work
Young people may take the chance

even though i understand your logic for such a possibility, im still not convinced that sf will play a significant role in the next government, the last few years has shown us that ffg are well in control, and even when theyre not in government, i.e. confidence and supply. but again, i do believe if ffg dont pull their fingers out quickly, regarding the critical needs of voters, particularly property and health care needs, we might just end up in a governmental cul-de-sac such as our neighbours, and that could be detrimental to us all

brisan

Wanderer78 wrote: »

even though i understand your logic for such a possibility, im still not convinced that sf will play a significant role in the next government, the last few years has shown us that ffg are well in control, and even when theyre not in government, i.e. confidence and supply. but again, i do believe if ffg dont pull their fingers out quickly, regarding the critical needs of voters, particularly property and health care needs, we might just end up in a governmental cul-de-sac such as our neighbours, and that could be detrimental to us all

If SF had of gauged the groundswell of their support better and stood more candidates for election they would have gained more seats
They topped the poll in quite a few constituencies and got more than double the quota in a few constituencies
For a party that normally squeezes the max out of every vote that badly misread the situation
I doubt they will make the same mistake again
FFG have found the magical money tree that everybody said was a figment of SF imagination AND IT WILL BE VERY HARD TO HIDE IT IN FUTURE
Covid may be top of the agenda for now but the housing crisis has not gone away

Wanderer78

brisan wrote: »

If SF had of gauged the groundswell of their support better and stood more candidates for election they would have gained more seats
They topped the poll in quite a few constituencies and got more than double the quota in a few constituencies
For a party that normally squeezes the max out of every vote that badly misread the situation
I doubt they will make the same mistake again
FFG have found the magical money tree that everybody said was a figment of SF imagination AND IT WILL BE VERY HARD TO HIDE IT IN FUTURE
Covid may be top of the agenda for now but the housing crisis has not gone away

again, yup, i understand where you re coming from, but im not fully convinced sf will be able to continue to ride this wave, and to be fair to them, im not sure anyone foreseen their gains prior to the last ge, i certainly didnt. theres still a strong distrust in the left, in particularly sf in ireland, i think ffg are just about safe for the moment, but as you said, the critical one will be housing, and im not convinced they ll carry it off, and if they dont, god knows where we go from there...

brisan

Wanderer78 wrote: »

again, yup, i understand where you re coming from, but im not fully convinced sf will be able to continue to ride this wave, and to be fair to them, im not sure anyone foreseen their gains prior to the last ge, i certainly didnt. theres still a strong distrust in the left, in particularly sf in ireland, i think ffg are just about safe for the moment, but as you said, the critical one will be housing, and im not convinced they ll carry it off, and if they dont, god knows where we go from there...

I would be in town once or twice a week
The homeless are back in full view after being shielded because of covid
Add this to a non functioning rental market with hundreds of top end rentals sitting empty and an overprices sales market, something has to give
I think it will be the voters patience

Wanderer78

brisan wrote: »

I would be in town once or twice a week
The homeless are back in full view after being shielded because of covid
Add this to a non functioning rental market with hundreds of top end rentals sitting empty and an overprices sales market, something has to give
I think it will be the voters patience

its already happening, and not just here, our neighbours are showing us what happens when you push these situations to limits, do we really want that!

brisan

Wanderer78 wrote: »

its already happening, and not just here, our neighbours are showing us what happens when you push these situations to limits, do we really want that!

I do not but a lot of the younger people trying to get on the property ladder may just take a chance on it
Another hidden issue is divorced couples
When a couple divorce often one or both are not in a position to buy and never will be ,and therefore caught in the rental trap.
What happens when they retire

Timing belt

brisan wrote: »

I do not but a lot of the younger people trying to get on the property ladder may just take a chance on it
Another hidden issue is divorced couples
When a couple divorce often one or both are not in a position to buy and never will be ,and therefore caught in the rental trap.
What happens when they retire

Housing was the biggest issue before covid came along and SF got the vote because of this. Although housing will still be a big problem it won’t be the main issue next time an election comes along as it will be unemployment/government debt so don’t see SF getting the same share of the vote as if they came to power the credit rating of the country would more than likely be impacted.

Wanderer78

brisan wrote:

I do not but a lot of the younger people trying to get on the property ladder may just take a chance on it Another hidden issue is divorced couples When a couple divorce often one or both are not in a position to buy and never will be ,and therefore caught in the rental trap. What happens when they retire

I'd like to think the majority also doesn't want this either, watching our neighbours tearing themselves apart is disturbing to watch, but we re following a similar path, it's time for us to move in a different direction, and quickly. These younger voters are already showing their willingness to go elsewhere with their votes, it's up to ffg to respond now, and if they don't.......

Oh I hear you about divorce and separation, I know a couple of people in this situation, what a bloody mess, where more or less, everyone loses, just some lose more than others, and in my own experiences, males generally end up worse off there, but females also lose. I know a couple of people caught sharing with their ex! WTF!

Oh don't worry, it's looking like retirement is gonna be a disaster for most of us, pension funds don't look too healthy!

Timing belt wrote:

Housing was the biggest issue before covid came along and SF got the vote because of this. Although housing will still be a big problem it won’t be the main issue next time an election comes along as it will be unemployment/government debt so don’t see SF getting the same share of the vote as if they came to power the credit rating of the country would more than likely be impacted.

Again, we truly need to get over this fear of growing deficits, if we really want to move on from these train wrecks of ideologies, private debt is the big problem, and this is starting to resurface, again!

Timing belt

Wanderer78 wrote: »

I'd like to think the majority also doesn't want this either, watching our neighbours tearing themselves apart is disturbing to watch, but we re following a similar path, it's time for us to move in a different direction, and quickly. These younger voters are already showing their willingness to go elsewhere with their votes, it's up to ffg to respond now, and if they don't.......

Oh I hear you about divorce and separation, I know a couple of people in this situation, what a bloody mess, where more or less, everyone loses, just some lose more than others, and in my own experiences, males generally end up worse off there, but females also lose. I know a couple of people caught sharing with their ex! WTF!

Oh don't worry, it's looking like retirement is gonna be a disaster for most of us, pension funds don't look too healthy!



Again, we truly need to get over this fear of growing deficits, if we really want to move on from these train wrecks of ideologies, private debt is the big problem, and this is starting to resurface, again!

Private debt has been decreasing the past few years!!

LuasSimon

If the Banks charged negative interest circa -1% on anyone with more than 500K or less even in deposit accounts and gave mortgages at 1-1.5% and personal loans at 4% would it not be good news for the vast majority particularly younger people and the squeezed middle ??

Bottom line too few people have too much of the country’s wealth .

Timing belt

LuasSimon wrote: »

If the Banks charged negative interest circa -1% on anyone with more than 500K or less even in deposit accounts and gave mortgages at 1-1.5% and personal loans at 4% would it not be good news for the vast majority particularly younger people and the squeezed middle ??

Bottom line too few people have too much of the country’s wealth .

Banks are not making a profit at the moment and won't be for a long time to come due to the low interest rate environment and negative rates on gov bonds and ECB deposits. So I would not see any reduction in cost of lending coming anytime soon.

Negative rates on deposits over 500k will only drive these deposits into already over priced asset classes like housing making it more difficult for FTB's.

Wanderer78

Timing belt wrote:

Private debt has been decreasing the past few years!!

Yes, private debt in Ireland has been falling, but we don't exist in a vacuum! private debt globally has been steadily rising, for decades now, this is ultimately what caused 08, and we have not resolved these issues, basically, there's too much of it now, it may never be truly serviceable, but we haven't accepted this possibility yet. Our current private debt obligations are again potentially a danger to our economy, this story is slowly unfolding in front of us. We ve yet again, entered a period of deep economic uncertainty, and there's now a growing concern for possibility of increasing defaults and non performing loans, the stress tests are gonna be tested within an inch of their lives.

Timing belt

Wanderer78 wrote: »

Yes, private debt in Ireland has been falling, but we don't exist in a vacuum! private debt globally has been steadily rising, for decades now, this is ultimately what caused 08, and we have not resolved these issues, basically, there's too much of it now, it may never be truly serviceable, but we haven't accepted this possibility yet. Our current private debt obligations are again potentially a danger to our economy, this story is slowly unfolding in front of us. We ve yet again, entered a period of deep economic uncertainty, and there's now a growing concern for possibility of increasing defaults and non performing loans, the stress tests are gonna be tested within an inch of their lives.

I agree that globally their is a debt issue both in the private and public sector and because of this there will be slow economic growth for a long time to come.

The private debt in Ireland has been falling the past few years and there is no sign of Irish banks having there capital reserves tested by NPL's. In fact it is the opposite whereby the Irish banks have overprovided for arrears in their half yearly results. And this is even called out in the rating agency reports on European banks.

Wanderer78

Timing belt wrote:

The private debt in Ireland has been falling the past few years and there is no sign of Irish banks having there capital reserves tested by NPL's. In fact it is the opposite whereby the Irish banks have overprovided for arrears in their half yearly results. And this is even called out in the rating agency reports on European banks.

I understand all of that, but you can be damn sure, those tests are gonna be significantly tested now, with this growing uncertainty, this has the potential to go badly wrong very quickly, particularly globally, we simply don't have a clue, I truly believe we need to stop with all this deficit nonsense, growing public debt has proved itself to be far more stable than growing private debt, although, not problem free. We need to protect jobs, particularly in the private sector, and particularly in sme's, so hopefully budget measures will do so.

Timing belt

Wanderer78 wrote: »

I understand all of that, but you can be damn sure, those tests are gonna be significantly tested now, with this growing uncertainty, this has the potential to go badly wrong very quickly, particularly globally, we simply don't have a clue,

At the moment there is no sign of the stress tests being tested. This is probably because the financial markets have been propped up by gov debt especially in USA where the fed have been purchasing credit so it never hits the banks books.