Dublin Opinion

In November 2007, Standard and Poor issued a research update on Ireland and its ‘triple A’ rating. While the rest of us were screaming about the dangers within the Irish economy, these so-called experts were saying:

The ratings on the Republic of Ireland are supported by the diversified, resilient, and flexible nature of its economy, and its high per capita income, fiscal prudence, and favorable demographic structure. The general government budget posted a strong surplus of 2.9% of GDP in 2006, but the 2007 budget will generate a smaller surplus of 0.8% of GDP, owing to weaker revenues and significant fiscal spending. It is expected that the budget will then swing into a small deficit as the construction sector winds down and investment decelerates to more sustainable levels”

These are the people who the goverment say we have to convince that the Irish economy is on the right track.

With predictions like these, how would they know what the right track looked like?

This is Standard and Poor in the same report (November 2007), talking about the Irish housing market:

Meanwhile, as the housing market winds down and private consumption decelerates, we expect annual GDP growth to fall below 4% in the medium term, down from an average of 6% since 2004. A slowdown in the construction sector, which accounted for 9% of GDP in 2006, indicates an increased risk of a moderate correction in consumer demand.”

In February 2008, Moody’s issued a report on the Irish economy - again here’s the economic experts on Ireland:

The correction in the Irish housing market and, thus, the construction sector, is expected to continue at least in 2008, still a soft landing is expected in these key economic sectors…. Indeed, Ireland’s fiscal position remains sound even though public infrastructure and social spending are being raised. Such increases do not represent a trend change in Ireland’s overall fiscal stance.”

We know that rampant unsustainable speculation has brought the Irish economy to its knees, but here’s the experts in Moody’s about the reasons behind the Irish property miracle:

Reflecting strong demographics, substantial real income development, and ongoing catch-up effects, Irish house prices have risen about 15% annually for several years.”

Nothing about the role of banks, cheap credit and speculation - nor of the role of government in subsidising this speculation.

There be the experts.

Indeed.