Saturday 10 December 2016

Brendan O'Connor: A colony once again – the Great Irish fire sale

Buying high and selling low is a strange way to do business. But we seem delighted with ourselves, writes Brendan O'Connor

Published 02/03/2014 | 02:30

Fire sale? Duncan Bannatyne says his loans were sold at a discount of 25-30 per cent but his offer to buy them at a lower discount was refused. Photo: Edmond Terakopian
Fire sale? Duncan Bannatyne says his loans were sold at a discount of 25-30 per cent but his offer to buy them at a lower discount was refused. Photo: Edmond Terakopian

IF IRELAND were a person, you wouldn't want them managing your money. The golden rule of dealing in stock, property or any other tradable commodity is "buy low, sell high". In Ireland, we have tended to go the opposite route. Having bought the whole place from ourselves very high, we are now selling low to whoever will take it.

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On a human level, we can all understand this tendency. Once bitten, twice shy and all that. You get up to your neck in debt without really thinking about it, you get burnt, and then suddenly you never want to get into extreme debt again. You think back on the amount of money you owed and you freak out and wonder how you slept at night and you deleverage as fast as you can.

So think of that on a national scale. A country that got burnt really badly decides "never again" and proceeds to sell off everything, regardless of price.

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