Ireland’s Economy Almost In the Shitter?

Once thriving, the Irish economy appears to have taken the afternoo

Once thriving, the Irish economy appears to have taken the afternoo

In The New York Times, economist Morgan Kelly has predicted that the Irish economy will ‘vaporize’.  Kelly claims that the economy will contract 20% based on bad loans that Anglo Irish, the now-nationalized bank, made last year.

But if Ireland falls, that means the European Union has to come bail them out.  And that would be okay, if there weren’t any other countries they had to bail out as well.  Pick from a list of Greece, Portugal, Italy and Spain.

They’re all pretty screwed.

Ireland has a unique circumstance.  Even though the Irish government has guaranteed deposits at their banks, the people of Ireland seem to still be worried.  If Anglo Irish bleeds from these bad bets, the end result could be the Irish making a run at the bank.  That would be devastating to the economy.

Ireland seems to be better positioned than Iceland, since their debt appears to be manageable.  It’s more the mood of the Irish people that is worrying.  They appear to not have any confidence in the government backing big banks, and why should they?  It’s the same government that let it get to this point.

If the Irish economy collapses, I think the pubs would fill and the Irish people will drown their sorrows in pints and pints of Guinness.

And oh, what a different Ireland that will be.

  • Unlikely

    Knowing this alcohol is taxed too heavily and people aren’t frequenting pubs and drinking fines are getting increasingly stricter. Also most beer in Ireland is now mostly chemical.