Chart of the Week
The ESRI published a special report this week on the Irish residential property market, which sparked all sorts of reporting of imminent price surges. Others might have been more impressed at the real – that is, excluding inflation – price trend of Irish property which shows that real prices have collapsed since the 2007 boom, but are still considerably up on values recorded in the 20 years from 1978-1998.
Table of the Week
My perception from experience of both the ESRI and E&Y and their respective economic forecasting is that both tend to be outliers, the ESRI optimistic and E&Y pessimistic. Both produced economic forecasts this week. If the actual outturn is between both forecasts, we will still be in for trouble, because at present the ESRI is closely matching the Government’s own forecasts.
Quote of the Week
“A parliament should never run to the tune set by print or news bulletin deadlines. To do so would leave the Dáil open to accusations of populism. The editorial then goes on to declare that ‘since becoming Ceann Comhairle 16 months ago Sean Barrett has attracted most public attention for his efforts to impose a Dáil dress code’. If you had replaced the word ‘public’ with ‘media’, then this would, in fact, be an accurate comment. Yes, the media has given disproportionate attention to what is just one of the many steps for improvement that the Ceann Comhairle has highlighted since his appointment… At the very least, the editorial of one of our most popular daily newspapers should have a better grasp of the role of the Ceann Comhairle and the rules of our parliament before it chooses to offer advice in such knowing tones. Finally, I honestly cannot think of a single member of the Dáil who does not agree that the Dáil must become more relevant, but they also know it is a little more complicated than you suggested in your editorial last Friday” Mark Mulqueen, the Head of Communications for the Houses of the Oireachtas, extract from what is described as “an unpublished right of reply article sent to the Irish Independent Monday, 18th June, 2012” responding to negative reporting in the Independent on the Oireachtas’ handling of Deputy Mick Wallace’s tax affair. Hands up anyone else who thinks Mark may have had one too many dwinkies before firing off this missive. The first definition given by my dictionary for “populism” is “A political philosophy supporting the rights and power of the people in their struggle against the privileged elite” The horror! That our Dail would leave itself open to being accused of such a thing! When everyone knows the Dail dances (or runs!) to its own tune…
“On Bill number CC 0091/98 the first applicant complains in a most vague manner of the conduct of Carney J. He has nothing to complain about. No reason for whatever he is on about is set out in the documents. Any issue as to transcripts on a pending appeal is a matter which cannot possibly undermine the legality of the detention of a prisoner following a trial in due course of law resulting in a conviction. The reason I can make no order on an application such as this is that there is nothing in evidence before me which would suggest that the applicant is in unlawful custody”
“Firstly, against a background of numerous applications by this prisoner to the courts, and the consequent build-up of documentation as application is made upon application, very large envelopes are required by him. As the prison authorities will not supply anything beyond envelopes of an ordinary size, he feels the need to apologise to the court that he has to stuff his documents into what he says are unsuitably sized envelopes. The stationery furnished by the prison, he claims, is a breach of his constitutional and human rights. That is a misapprehension. These important rights have to do with the protection of citizens ofIreland in the fundamental entitlements that inure to their benefit, and which they have given themselves by passing the Constitution or which occur by implication of natural law, whereby liberty, life, property and dignity are assured. This has nothing to do with the size of envelopes”
“Secondly, the applicant complains that, when he needs to have an affidavit sworn so that he can make a further application to the courts, he is obliged to pay between €30 and €50 to a practising solicitor, which he characterises as “rip off prices”. In reality, however, he has made this application on a unsworn basis and the remedy of habeas corpus under the Constitution is capable of bypassing any formality by way of court rules or procedure where that is appropriate”
“Some complaints are made on behalf of all three applicants. One particular complaint is apparently only made on behalf of the third named applicant. It is claimed that he has been wrongfully convicted for what is called “the purported murder of Bernard Smyth”. No further details are supplied. In addition it is claimed that new facts have now emerged which will enable that case to be reviewed before the Court of Criminal Appeal. That may or may not be the case. All of the applicants have full access to legal representation under the criminal legal aid scheme where that is appropriate. The High Court cannot be obliged to release a prisoner convicted of murder simply because one of his friends asserts that he was wrongly convicted and that now there are new facts which will prove that he was always innocent. How can anyone know that this is true? Absolutely no particulars are provided. Even if full details were provided the constitutional entitlement of courts to interfere in a lawful conviction is channelled into appeals in the ordinary way.”
All the above are from a judgment published this week (with emphasis added) which relates to a High Court matter where prisoners from the medium-security Midlands Prison in Portlaoise are pursuing grievances. The case serves to highlight an aspect of the Irish judicial system – which considering the above and a large volume of similar cases, some might like to see changed – whereby any prisoner can make complaint directly to the State’s High Court.
Number mysteries of the Week
2.35% versus 4.31% and 5.62% – At the Bank of Ireland EGM on Monday last, the shareholders voted overwhelmingly in favour of the proposal to advance a €3bn loan to IBRC for one year, secured on a Government bond. Bank of Ireland is to receive 2.35% interest per annum for its troubles. Apparently, the Bank admitted that with 1% interest it must pay the ECB for the funds plus credit default insurance, it won’t actually make anything! Meanwhile the Irish government bond maturing in April 2012 is yielding 4.31% per annum and the bond maturing in January 2014 is yielding 5.62%. The State’s shareholding in Bank of Ireland is now only 15%, so you have to be impressed by the philanthropy of the Bank for approving this transaction!
€831,000 was the total package paid to the Bank of Ireland CEO, Richie Boucher in 2011. The weekly unemployment benefit inIreland is €188
In a completely unrelated development, it was announced on Wednesday that two of the North American investors in Bank of Ireland, WL Ross and Fairfax who each own 9.3% of Bank of Ireland have had two directors appointed to the Bank’s board. Wilbur Ross himself as well asFairfax’s boss, the multi-billionaire Prem Watsa will join 10 other directors, including two appointed by our own government. The board now has a distinctly international complexion.
75% versus 48% – In the Dail on Tuesday, Fine Gael’s Deputy Mary Mitchell O’Connor (the joy-riding hi-YAH!) stated “The [household] charge has been paid by 75% of people” On the IrelandAfterNAMA blog, there was a guest post from Mick Murphy, the National Treasurer of the Campaign Against Household and Water Taxes, who – and this will come as no surprise! – claimed that only 48% of property owners had registered. Plainly, both sides – the Government and household charge protestors – have different agendas, but for all of that, the Government has been coy about releasing hard data on the total number of eligible properties, and somehow Mick’s calculations look more credible than the Government’s.
NAMA Wine Lake 
There isn’t really a market for housing in the true meaning of the term here in Ireland. It’s pretty much the same with land price as most farmers aren’t business people but much nearer enthusiastic hobbyists and display the same greed as if they were going for the next pretty bit of majolica or Baccarat Crystal. And the industry that’s there to support them in their lunacy charges equally outrageous prices. The big difference though, the market for what’s produced is a world market.
So, forgetting all delusions. Is it not time to ask the tax people how many are at each and every €5000 strata, 45-50-55-60 and so forth. And is it not time that prices are then pitched to that group. We might then have the base of an economy that would remain stable.
You’d think that with the sheer numbers of civil servants that a crew of them could have read the post ’45 papers and seen the similarities with today.
“because at present the ESRI is closely matching the Government’s own forecasts”. The ESRI is more akin to the Government Press Office than the semi-autonomous body it is meant to be – and that is not a recent phenomonen either. It is of no practical use – Shut it down now.