David McWilliams - In Search of the Pope's Children

[edo]

cWilliams seems to think that trying to coin some clever phrase for the bleedin' obvious makes him a social commentator/economist extraordinare. His one definitive claim is his clucking that the sky is falling in on the property market & its going to crash. Sure it you stick to a slogan for long enough it may well eventually come to pass - but after, say, 10 years from his first revelation to the public that the property market is doomed will he admit he was premature/incorrect on that one.

I dont know if its just me , but I have been following McWilliams articles in the papers and other media for quite some time now and I have yet to find one instance where he has actually said that property prices are going to fall ,in 2002,2003 ,2004 etc etc. Actually the only comentators who have been calling the market for the immediate 12 months have tended to be from the more bullish sectors.

Even the Economist - who stated that Irish Property was overvalued by 15-20% didn't state it believed the market would fall - it was just stating concern and its belief that the market was overvalued. just because the sky didn't fall immediately upon this pronouncent doesn't mean its validity was incorrect.In a speculative bubble the hardest thing to predict is not that it will burst( once asset price and yield get that much out of kilter its a given) but when it will burst.

Seeing as there appears to be a slight stalling in the market at the mo - Im not sure I'd be feeling so darn smug about slagging off McWilliams for predictions that he has never made - I am quite prepared to be corrected on this - with some solid evidence folks .

he has ,without doubt articulated ,extremely well in my opinion , the rise and rise of the property phenomeneon and how it has been enabled by the ready supply of cheap money from an economists point of view and more importantly how this massive diversion of investment into bricks and mortar from productive sectors of the economy is leaving us extremely vulnerable to the vissitudes of the Global market. This is extremely important - as rates go up and money supply tightens we will have to fall back on that old fashioned way of gaining cash - working for it and for a small open economy like our own that means exports.

As 87% of the value of our exports come from software,electronics and pharamceuticals - all owned by foreign multinationals - the worrying thing for the future is that all 3 of these industries are gradually moving their centres of production to the Far east and Indian sub continent where China and India are pumping out millions of well educated graduates a year who will work in this industry for a % of the average manufacturing wage in Ireland , let alone the average salary in the Public service , Construction, or financial sectors - all massively dependant on German pensioners loaned money for their existence. if even say 10% of investment in Property had been pushed in the direction of our indigneous R/D sector our prospects for the future would seen a hell of a lot better .

It probably wont radically effect anybody coming to the end of their working days now or the next few years but the for all those coming after it will be critical. In that regard I give McWilliams great credit for consistently highlighting this and the consistent historical folly of putting consumption (I place property in that category) before real investment , An argument he has been making for the last 5 years - something the Gov have only recently woken up too and are slowy getting their butts in gear to address.

 

[bazermc]

Anybody know what age McWilliams is? I am guessing about 40ish!

 

[annR]

Actually the other thing I liked about the program was his pretty good attempt at having a conversation in Irish with the lady in the Gaelschool. His Irish wasn't bad at all for someone who is obviously not a native speaker.

 

[joe sod]

I watched the show too and have followed McWilliams articles in the sunday business post for the last few years. He is excellent in print and has flagged these issues for the last 5 years. In fact he was probably the first to point up the deficiencies in the irish success story. However I thought George Lees Boom show was much better and to the point. Eddie Hobbs rip off republic was also better and more entertaining. David Mcwilliams has that irritating habit because of his south dublin backround of not being able to talk as an irishman but more as a south dubliner. His reference to macaroon bars and not being able to buy curly wurlys he saw on UTV was typical south dublin. I also agree that his categorisation of people as "decklanders" and "popes children" does not work. Its as if he is trying to say following George Lees program and Eddie Hobbs program "ME TOO"

 

[TarfHead]

His reference to macaroon bars and not being able to buy curly wurlys he saw on UTV ..

I'm a couple of years older than him and cannot remember not being able to buy curly-wurlys - maybe they were only unavailable in The Borough ?

I do remember looking forward to visiting the Woolworths sweet counter in Derry on the way home from Donegal because of all the unfamilar brands (Caramac, Munchies, Mintolas .. mmmmmmmm), but Curly Wurly was not one of them.
The mot was reared in Co. Waterford and she too remembers Curly Wurlys from her earliest days.

 

[annR]

Yeah I thought that was a bit silly - relying on that to make his point. It nearly seemed like it was some kind of inside joke which no one else really got.
I am a dedicated south Dublin watcher and as they go I thought he wasn't too bad. And like I said fair play for having a stab at the Irish.

I do think that he could stray outside of the Dublin commuter belt to examine the terrible chaos happening in towns all over the country.

 

[Guest127]

thought curly wurlys were made in coolock! but as a native of dundalk I do know where hes coming from. used to kill us to see childer in newry buying a comic for 2p and we had to pay 6p. and the choice of sweets they had. and I know newry is only down the road but there was no cars in those days and a trip to newry was only once every 3 months or so. mostly to buy clothes in the market. what about his comment on a nuclear plant for this country in the future? I have stated elsewhere that IMO its a option open to us that we will have to look at carefully. this NIMBY attitude will have to stop too. if UK, France, US and Finland to name a few didnt have nuclear power plants what cost would oil be today?

 

[Gordanus]

tho to give the guy his credit he is pretty much the only one out there trying to make a fist of trying to explain the last 15 years or so (there is a distinct lack of commentary both verbal or otherwise on this - wonder why?)

We're too busy enjoying it and being smug about it - ah the luck of the Irish - to look into the causes, none of which have a lot to do with any deliberately adopted strategies, but rather a combination of selling out to the multinationals and circumstances. It is a phenomenon which really does bear close scrutiny, especially if we don't want a recession to hit us with equal speed.........

 

[Markjbloggs]

We're too busy enjoying it and being smug about it - ah the luck of the Irish - to look into the causes, none of which have a lot to do with any deliberately adopted strategies, but rather a combination of selling out to the multinationals and circumstances. It is a phenomenon which really does bear close scrutiny, especially if we don't want a recession to hit us with equal speed.........

I 100% agree - the country has been very lucky. Looking back, my impressions are that the ball started rolling with the "cap-in-hand" phase in the early 90's , where Irish politicians went to Brussels to get as much as possible out of the EU. The next phase was the Technology boom in the mid-late 90's, a purely US phenomenon which Ireland benefitted hugely from through the presence of low corporate tax seeking multi-nationals. After the Nasdaq collapse in 2000 and the post 9/11 low interest rate environment, focus switched to property and the boom we are in now.

Does anyone else see these 3 phases? Are there any definitive histories of the Celtic tiger that explores these issues?

 

[TarfHead]

Hmm, either Malcolm Gladwell is reading David McWilliams, or vice-versa, or maybe it's just obvious to those who can see.

http://www.malcolmgladwell.com/2006/2006_05_29_a_risk.html#

"But, as the Harvard economists David Bloom and David Canning suggest in their study of the "Celtic Tiger," of greater importance may have been a singular demographic fact. In 1979, restrictions on contraception that had been in place since Ireland's founding were lifted, and the birth rate began to fall. In 1970, the average Irishwoman had 3.9 children. By the mid-nineteen-nineties, that number was less than two. As a result, when the Irish children born in the nineteen-sixties hit the workforce, there weren't a lot of children in the generation just behind them. Ireland was suddenly free of the enormous social cost of supporting and educating and caring for a large dependent population. It was like a family of four in which, all of a sudden, the elder child is old enough to take care of her little brother and the mother can rejoin the workforce. Overnight, that family doubles its number of breadwinners and becomes much better off."

 

[nlgbbbblth]

I think it's one thing for McWilliams to say that people have decking or eat breakfast rolls; it's quite another to say that those things define the person, which is essentially what he is doing.

.......or reducing another group of real people with hope, fears and emotions to a clicky buzz word so it doesn't feel so bad when you dismiss them all.

Condescending and dismissive crap.

 

[liteweight]

I think it's one thing for McWilliams to say that people have decking or eat breakfast rolls; it's quite another to say that those things define the person, which is essentially what he is doing.

.......or reducing another group of real people with hope, fears and emotions to a clicky buzz word so it doesn't feel so bad when you dismiss them all.

Condescending and dismissive crap.

Very good points. I don't think he particularly meant to be condescending however. There's a tendency to look to the past in Ireland...."it's far from latte you were reared" type of attitude! Well my children don't remember a time when it wasn't available so it's the norm for them. If we never moved on we'd still be living in the era of pigs in the kitchen, which is the way some Americans still view us.

 

[Gordanus]

Since when didn't stereotyping sell?

 

[demoivre]

I dont know if its just me , but I have been following McWilliams articles in the papers and other media for quite some time now and I have yet to find one instance where he has actually said that property prices are going to fall ,in 2002,2003 ,2004 etc etc. Actually the only comentators who have been calling the market for the immediate 12 months have tended to be from the more bullish sectors.

Odd then that he has a Poll on his homepage asking " Is David wrong about an Irish property crash? " I totally concur with what Liam Collins said about McWilliams in yesterday's Sunday Independent.

 

[Marie M]

I think it's one thing for McWilliams to say that people have decking or eat breakfast rolls; it's quite another to say that those things define the person, which is essentially what he is doing.

.......or reducing another group of real people with hope, fears and emotions to a clicky buzz word so it doesn't feel so bad when you dismiss them all.

Condescending and dismissive crap.

I find it condescending and insulting, mainly because myself and quite a few family and friends fit into some of his "funny" stereotypes, did he come up with any sarcastic cartoon character for himself?

 

[Wilkes]

Whether David McWilliams called or didn't call a property correction right, whether he did or didn't call the economy, The Celtic Tiger or whether you like or don't like him isn't the main point I think. The facts are that he is challenging and provides an alternative view to the mainstream commentator and subsequently leads to debate. I like him as both a person and a writer even though sometimes he grates on the senses so I'll watch tonight for the same reason along with over 500,000 other viewers.

You can't expect to like everything about a TV personality or agree with all their opinions, but at least you can respect the man for putting himself out there. I much prefer having the likes of Mc Williams, Lee, Hobbs, Mc Dowell, Gurdgiev and others on the box than boring commentators that never challenge either themselves or the status quo.

 

[Betsy Og]

Watched last night, had missed the first one.

It was okish, very padded, the 7 stage property theory was interesting. As posters mentioned below theres a very condescending tone to his widespread categorisation of people.

2 instances in particular last night:
a) when the light was fading and he showed happy decklander with his impressive deck and McW's tone was very sarcastic. Myself and herself turned to each other & said "So whats wrong with that then?".
b) talking about Johnstown near Navan, in self important tones, "Take a good look at it, because in 20 years time this is what Ireland will be like" (or words to that effect). But there was no conclusion. So David, is it a good thing or a bad thing? Does it mean Meath will dominate Lenister football again or will it be joyriding on the back roads of Meath??

And then the closing sequence - "the property market, its up to you the Irish people". So what do you want us to do, precipitate the crash??, keep the thing going??

I think the tester q is do you advise someone to buy now or hold off for the crash? I think you'd say buy for own use, not for speculation, "stress test" for a another couple of % interest rate increase.

Interesting programme but lots of grating guff and a distinct lack of conclusions.

 

[Purple]

Well summed up Betsy Og.
Lots of style but very little substance. It was like someone reading the headings of a presentation without the text below.

 

[homeowner]

I dont know if its just me , but I have been following McWilliams articles in the papers and other media for quite some time now and I have yet to find one instance where he has actually said that property prices are going to fall ,in 2002,2003 ,2004 etc etc. Actually the only comentators who have been calling the market for the immediate 12 months have tended to be from the more bullish sectors.

Well i cant quote exact articles, but i too have been reading his work since around 2000 and I can assure you he has been saying that the property market will crash. His main points that he repeats over and over are to do with comparisons with Japan and boom-bust cycles. I distinctly remember him saying in 2000 (i am paraphrasing here) - if prices keep going the way they are, a 1 bed apt in dublin will cost a quarter of a million (£IR) and that just cant happen - well it did happen and then some.

He has been constantly saying it cant last and the bubble will burst any day now citing other countries as an example. He may not have said the words - "it will callopse on the 10th Oct 2007" but I think that is why people have such a problem with him, because if you say something for long enough, there is a good chance it will occur eventually.

Its easy to look back on the past 7 years and give your theories as to why things were the way they were, predicting it is another ball game entirely and in my opinion that is where McWilliams falls down. He hasnt correctly predicted a bust at all, he just keeps repeating the same statistics over and over. He will then claim he was right. But he has been wrong for the past 6 years insofar that he cant say when the "bust" will happen, it has confounded all the economists and it keeps proving them wrong. But thats not to say it wont happen at all.

Having said that I am a fan and I do like reading his articles, he is thought provoking if nothing else.

 

[Chamar]

I didn't agree last night when he said that apart from what is happening with property that there isn't really a lot going on in the Irish economy. What about all the FDI we have got?

However, people do need reminding of what has and can happen in places like Japan. It is really staggering to think that 20 years ago Japan was predicted to overtake the US but ended up in mess you couldn't believe possible for an advanced economy what with years and years of deflation, property crash, 0% interest rates, banks collapsing etc. etc. I mean, what makes Ireland so special that it can't happen here?