Ireland leads eurozone into recession

[T_i_B]

Source: Daily Telegraph

The economy shrank by 0.5pc in second quarter following a 0.3pc contraction in the second quarter, according to the statistics office, marking an emphatic end to the stellar years of the Celtic Tiger.

A long list of eurozone states are expected to follow in short order as the oil shock, surging credit costs, and the global downturn all combine to choke growth across the region. Denmark is already in recession, but is not a member of European Monetary Union (EMU).

"Italy will definitely be next, and probably Germany," said Julian Callow, Europe economist at Barclays Capital.

"Ireland is suffering from a massive reliance on real estate. Construction was 21pc of GDP at the peak last year, which is even worse than Spain (18pc) and far worse than America (11pc) at the height of the bubble," he said.



Read more: http://www.telegraph.co.uk/finance/economics/3079522/Ireland-leads-eurozone-into-recession.html

[grannie4peace]

1. i thought i read some news about ireland

doing really good economically? they must have been lying!!!!!

[mduffy31]

3. I do know in Limerick they manufacture Dell Computers

and that was a real boost to the economy

[CountAllVotes]

9. that plant is now closed down

n/t

[Igel]

5. Things change over time.

I remember reading about the US doing really well economically. Were the mid-late '90s really a recession in disguise?

[qwertyMike]

17. I remenber those days too

sigh

[Yavin4]

18. Past Tense of "doing really good"

is "was doing really good". Toxic mortgages are not constrained to the U.S.

[newfie11]

2. So they have a real estate bubble too

are we bailing them out also or is their government planning on charging it citizens billions of dollars to maybe fix the problem.

[alcibiades_mystery]

4. The Irish Miracle...another fantasy of the neoliberals

In smithereens...

[WriteDown]

6. Huh?

I was in Ireland in the 80's when I was considered the "rich" relative for having a job in sales. I went again early in the 00's and the change was unbelievable.

[Lydia Leftcoast]

7. They grew too fast, I bet

You can't always sustain growth like that.

[Rambis]

8. Mid July

10,000 construction workers were let go. You can't just keep building it is not sustainable. In 2006 there were cranes in every skyline in ever place I went except the smallest of villages. My friend's brother had a house worth a half a million euro near Rosslare harbour now it is worth a third of that. The market is definitely coming back to sanity.

[CountAllVotes]

10. there were some very sleazy lending practices going on there too

I have a relative over there. Said relative's son went to the bank to take out a loan and was advised to "triple the numbers and come back tomorrow" which he did and hence received a loan for 300,000 euros. This sub-prime meltdown is not unique to the USA, believe me.

:(

[WriteDown]

11. But why on Earth would he do that....

and take out that loan? Someone tells me to cook the books and I tell them to take a walk .

[CountAllVotes]

12. he did it for one reason

he needed/wanted the damn money. Same story, different place.

[WriteDown]

13. I will amend your statement just a bit....

He WANTED the money. No one needs a particular house THAT badly :).

[Rambis]

14. agreed

my friend's brother was the opposite, he bought cheap and could have sold and moved to the sates and lived well. He is in the shipping trade in Rosslare and didn't sell while he had the chance to make big money. He did not know what he would do in the states because if he moved here he would be landlocked. He has been in and around the port working on the cruise ships as a young fella then got into shipping products, modernizing the efficiency of packing etc so....

[CountAllVotes]

15. it was a sad joke IMO

I was at a family reunion in 2005. I had not been to Ireland since 1984. I was totally shocked. :wow:

I couldn't figure out where all of this new "wealth" came from as no one seemed to have a job nor was anything much going on but a lot of construction (esp. in Dublin).

It was surreal to me and I thought to myself, "this cannot possibly last".

I doubt it is anywhere near over and Ireland isn't planning on borrowing money on credit to survive this last I heard.

My relative that lives there is quite well off and has nothing to worry about being he owns a lot of land and a farm that has been in the family for hundreds of years. As for his son that borrowed all of the money, I don't know what he will do. :shrug:

This is a huge mess and the USA is not to blame. In Ireland, the people did it to themselves just as we have seen here in many cases with the sub-prime loan lies.

[Rambis]

16. I bet you were

I went through Athlone on my way to Clifden and there were at least 7 cranes on the river Shannon.