I noted that in a recent show you said oil prices were back to the pre-invasion levels. It is also notable that the US Strategic Petroleum Reserve has been reduced from about 600M barrels to 380M barrels, and is at the lowest level in nearly 40 years, so this release of oil cannot continue for forever.
What happens when the US stops oiling the market? US administrators think they should start to refill the SPR when it oil is >$70. The big question is will OPEC let oil below $70?
Hi Shane, yes, that’s a great point. What would the oil price be without the release of that reserve? I can’t see Biden replenishing the reserve such that he pushes oil prices up again. But, as you say, experts are urging him to refill. I would do it opportunistically. At 70 or less, buy a barrel or two. At that price, US petrol prices are roughly where they were a year ago. Which is politically acceptable.
I didn’t know that, very interesting point. I wonder does this show the value of having those oil reserves in the first place? In which case, whoever enacted that policy should be praised for a bit of foresight.
That makes sense however it is the mythical future that the Tories / Brexiteers have sold to the general British public that they should be much more concerned about
On the subject of requests for future topics (thankfully ruling out personal finance advice!) have you considered doing Ask Me Anything or, more to the point, Ask US Anything pods?
I totally agree with your comments on the Irish “right-wing”. In 2020, the FG election manifesto pledged to split all excess budget capacity 4:1 between spending increases to tax cuts. Only on planet Ireland could that be considered right wing. And on societal issues, we have become a very liberal country across the political spectrum. The gay marriage and abortion referenda clearly demonstrate that.
In my humble opinion, if either FF or FG were to move more to the right economically in the next general election, they might have a good chance of eating the other’s lunch. Their leaning to the left is borne out of fear of the rise of the left in ireland. Whereas, there’s a substantial cohort of the population who feel like they’re paying for everything in this state, and neither FF or FG are capitalising on that.
Your point about the rise of celebrity economists made me laugh. In fairness to David McWilliams, he has successfully predicted 20 out of the last 3 recessions!
Spotting a bubble can be quite easy. But timing it is very hard. Imagine if somebody followed advice back in 2000 to refrain from buying their own house cause there was a bubble. How much if their lives would have passed before they saw the bottom of the market, and how did they waste their money while they waited for the burst?
Thanks Sean, political labels have different meanings in different countries. As a Brit I could never understand the point of the existence of the 2 main parties: I could never distinguish their policy manifestos, either in terms of a priori intent or ex post outcome. Somebody did eventually point out the role of the civil war and then everything fell into place.
Ireland has never needed a socialist party dedicated to the interests of the industrial working class because its never had an industrial working class. No steel, coal, car or shipbuilding industries. The joy of that is you don’t have all of those industries in secular decline giving you unhappy people susceptible to populist claptrap.
I think historians will look back at one of the richest, socially cohesive countries in the worldand ask why, in 2024, did it think it necessary to install a 1970s style socialist government. Ironically, the leaders of that socialist movement sounding like 1970s British trade unionists.
A possible subject for consideration for a future episode:
I have every sympathy for people whose homes have been destroyed by pyrite and mica. I accept that the State are at least partially responsible due to its failure to properly inspect and implement quality control on the quarries involved.
What I don’t understand is, why have the banks of mortgaged properties not been required to contribute to the remediation of the assets. Prior to the State intervention all banks involved were holding worthless assets on foot of substantial mortgages. Post the “deal” and the commitment of billions of Irish tax payer euros the problem was solved for the mortgage creditors at zero cost to them?
I am astounded that this point has never been raised, considered or discussed by any politician or media per. Am I missing something here?
Suppose banks are made foot the bill, how do we make that happen? The state cannot just send them a bill because they challenge it as not theirs. You have to tax them or levy their products. And when that happens on an industry level, they simply pass those costs back on to the consumer. So in the end Joe Customer applying for a new mortgage rate ends up paying, not “the banks” (i.e. the banks shareholders, which will be largely owned by us through our pension scheme’s investments).
The points you make are reasonable and are born out by the uncompetitive pricing . However in principle the Govt should not shirk their responsibility to share the financial burden of the scheme with the banks who hold mortgages on these properties simply because the said banks may in turn attempt to share that cost ultimately with their customer base.
To do nothing and allow the banks off the hook is to 100% guarantee that the consumer / tax payer foots 100% of the bill. I totally accept we live in an imperfect world to which we normally apply imperfect solutions, but to do nothing must surely be less of a solution
When we take measures like this, it adds to the business strain and contributes to the likes of Ulster Bank and KBC leaving the Irish market, which harms the competitiveness you quite rightly mentioned as being a problem.
I always struggle with this idea of “the banks” as if a bank’s balance sheet can some way be punished and the consequences of that punishment stays where it is and does not end up affecting a “normal person” in some indirect way.
I would agree if the banks were simply owned by fat cats and they didn’t have any ability to pass their costs of running business onto consumers when they set prices, and were obliged to stay in the Irish market no matter how penal the business environment is. But that’s not the reality.
In my opinion, dragging the banks into this is virtue signalling rather than improving any outcomes.
I was reading a blog recently called Blu (a family office) in which the blogger made the point “every year approximately 250,000 people who voted for Brexit die and another 250,000 who would most likely have voted against it, become of voting age”. It is an interesting apparently factual statistic that leads me to believe that another vote to reverse Brexit is inevitable, if true democracy prevails in the U.K.
The issue of another referendum is perhaps more one of “when” rather than if?
Just looking at the correlation - the older you are, the more likely you are to be both Tory and pro-Brexit. Being old means you become more conservative and more nostalgic for a mythical past.
Fred, i think it could take at least a decade before/if it will be revisited.
Hi Lads,
I noted that in a recent show you said oil prices were back to the pre-invasion levels. It is also notable that the US Strategic Petroleum Reserve has been reduced from about 600M barrels to 380M barrels, and is at the lowest level in nearly 40 years, so this release of oil cannot continue for forever.
What happens when the US stops oiling the market? US administrators think they should start to refill the SPR when it oil is >$70. The big question is will OPEC let oil below $70?
Hi Shane, yes, that’s a great point. What would the oil price be without the release of that reserve? I can’t see Biden replenishing the reserve such that he pushes oil prices up again. But, as you say, experts are urging him to refill. I would do it opportunistically. At 70 or less, buy a barrel or two. At that price, US petrol prices are roughly where they were a year ago. Which is politically acceptable.
I didn’t know that, very interesting point. I wonder does this show the value of having those oil reserves in the first place? In which case, whoever enacted that policy should be praised for a bit of foresight.
That makes sense however it is the mythical future that the Tories / Brexiteers have sold to the general British public that they should be much more concerned about
On the subject of requests for future topics (thankfully ruling out personal finance advice!) have you considered doing Ask Me Anything or, more to the point, Ask US Anything pods?
Hi Lads.
I totally agree with your comments on the Irish “right-wing”. In 2020, the FG election manifesto pledged to split all excess budget capacity 4:1 between spending increases to tax cuts. Only on planet Ireland could that be considered right wing. And on societal issues, we have become a very liberal country across the political spectrum. The gay marriage and abortion referenda clearly demonstrate that.
In my humble opinion, if either FF or FG were to move more to the right economically in the next general election, they might have a good chance of eating the other’s lunch. Their leaning to the left is borne out of fear of the rise of the left in ireland. Whereas, there’s a substantial cohort of the population who feel like they’re paying for everything in this state, and neither FF or FG are capitalising on that.
Your point about the rise of celebrity economists made me laugh. In fairness to David McWilliams, he has successfully predicted 20 out of the last 3 recessions!
Spotting a bubble can be quite easy. But timing it is very hard. Imagine if somebody followed advice back in 2000 to refrain from buying their own house cause there was a bubble. How much if their lives would have passed before they saw the bottom of the market, and how did they waste their money while they waited for the burst?
Thanks Sean, political labels have different meanings in different countries. As a Brit I could never understand the point of the existence of the 2 main parties: I could never distinguish their policy manifestos, either in terms of a priori intent or ex post outcome. Somebody did eventually point out the role of the civil war and then everything fell into place.
Ireland has never needed a socialist party dedicated to the interests of the industrial working class because its never had an industrial working class. No steel, coal, car or shipbuilding industries. The joy of that is you don’t have all of those industries in secular decline giving you unhappy people susceptible to populist claptrap.
I think historians will look back at one of the richest, socially cohesive countries in the worldand ask why, in 2024, did it think it necessary to install a 1970s style socialist government. Ironically, the leaders of that socialist movement sounding like 1970s British trade unionists.
A possible subject for consideration for a future episode:
I have every sympathy for people whose homes have been destroyed by pyrite and mica. I accept that the State are at least partially responsible due to its failure to properly inspect and implement quality control on the quarries involved.
What I don’t understand is, why have the banks of mortgaged properties not been required to contribute to the remediation of the assets. Prior to the State intervention all banks involved were holding worthless assets on foot of substantial mortgages. Post the “deal” and the commitment of billions of Irish tax payer euros the problem was solved for the mortgage creditors at zero cost to them?
I am astounded that this point has never been raised, considered or discussed by any politician or media per. Am I missing something here?
Hi Fred.
Suppose banks are made foot the bill, how do we make that happen? The state cannot just send them a bill because they challenge it as not theirs. You have to tax them or levy their products. And when that happens on an industry level, they simply pass those costs back on to the consumer. So in the end Joe Customer applying for a new mortgage rate ends up paying, not “the banks” (i.e. the banks shareholders, which will be largely owned by us through our pension scheme’s investments).
Sean,
The points you make are reasonable and are born out by the uncompetitive pricing . However in principle the Govt should not shirk their responsibility to share the financial burden of the scheme with the banks who hold mortgages on these properties simply because the said banks may in turn attempt to share that cost ultimately with their customer base.
To do nothing and allow the banks off the hook is to 100% guarantee that the consumer / tax payer foots 100% of the bill. I totally accept we live in an imperfect world to which we normally apply imperfect solutions, but to do nothing must surely be less of a solution
I hear your frustration.
When we take measures like this, it adds to the business strain and contributes to the likes of Ulster Bank and KBC leaving the Irish market, which harms the competitiveness you quite rightly mentioned as being a problem.
I always struggle with this idea of “the banks” as if a bank’s balance sheet can some way be punished and the consequences of that punishment stays where it is and does not end up affecting a “normal person” in some indirect way.
I would agree if the banks were simply owned by fat cats and they didn’t have any ability to pass their costs of running business onto consumers when they set prices, and were obliged to stay in the Irish market no matter how penal the business environment is. But that’s not the reality.
In my opinion, dragging the banks into this is virtue signalling rather than improving any outcomes.
I was reading a blog recently called Blu (a family office) in which the blogger made the point “every year approximately 250,000 people who voted for Brexit die and another 250,000 who would most likely have voted against it, become of voting age”. It is an interesting apparently factual statistic that leads me to believe that another vote to reverse Brexit is inevitable, if true democracy prevails in the U.K.
The issue of another referendum is perhaps more one of “when” rather than if?
Regards
Fred
That’s right - I’ve seen similar stats. Of course, as younger people grow old they could become Tory Brexiteers!
Why??😂😂😂😂
Just looking at the correlation - the older you are, the more likely you are to be both Tory and pro-Brexit. Being old means you become more conservative and more nostalgic for a mythical past.