Compared to the crash of 2008, the next crisis will actually be even worse

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By Cormac Lucey It is 10 years since the Irish government’s fateful decision to guarantee the liabilities of the Irish banks. That rubber-stamped the country’s plunge into financial disaster, following the collapse two weeks earlier of Lehman Brothers, which kickstarted the international financial crisis. As with all meltdowns, there had been plenty of warnings. The share price of Bank of … Read More

Italian populism could soon cloud our sunny outlook

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By Cormac Lucey Humans adapt quickly to changed reality and soon take it for granted. Spring replaces winter, and we feel that life should always be like this. We almost forget the experience of winterish conditions, or that in a few months they will return. Similarly, when strong economic recovery replaces a brush with economic depression, we take the positive … Read More

What happens when our corporate tax regime is kicked into touch?

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By Cormac Lucey What does a sports team do if its star player gets injured and is unable to play or, even worse, is forced into retirement? The simple answer is that the coach needs to anticipate such eventualities and develop a pipeline that could replace the star. The Ireland rugby coach Joe Schmidt (pictured above) has managed two great … Read More

EU plans to harmonise corporation tax will bring little in the way of harmony

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By Colm McCarthy Ireland’s agenda with the European Union is getting complicated. After five years of strong recovery, the country’s economic prospects are exposed to developments in EU policy under three headings. There will be profound effects from Brexit about efforts to harmonise corporation tax and about future governance of the eurozone. And the next slowdown, whenever it comes, will … Read More

And now, a message to our sponsors — please take the politics out of our policies

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By Cormac Lucey The row about the role of the government strategic communications unit (SCU) in promoting the national development plan rumbles on. Public money was used to insert advertisements in various newspapers that looked like regular editorial copy. The opinions of several public commentators were sought and used without them knowing where they would appear and, mysteriously, some local … Read More

Compared to government bonds, equities look cheap

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By Cormac Lucey One financial market, which has been hugely affected by QE, is the market for eurozone government bonds, or debt securities. They have been driven up significantly in price by the ECB’s programme of creating fresh money and using it to buy government bonds, thereby elevating their prices compared with what they would otherwise have been. Last week … Read More

Global forecasts are clear on one thing — an inflationary storm will drench us all

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By Cormac Lucey The Standard and Poor’s 500 index of American stocks continues to hit all-time highs. The index of Irish shares — the ISEQ — is at post-crash highs, hitting the level first reached in 2006 towards the very end of the boom era. Unemployment in Ireland has fallen to 6%, not far off the multi-decade low of 4% … Read More

Can Macron make the French connection strong enough to sway Germany?

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By Cormac Lucey At the end of the 1972 movie The Candidate, Robert Redford’s character, Bill McKay, a young and attractive outsider who has won an improbable election victory, turns around to his campaign manager and asks: “What do we do now?” The newly elected president of France, the 39-year-old former banker Emmanuel Macron, must have similar feelings. Macron may … Read More