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We're paying for gaffes of middle-class mandarins

Are Enda Kenny and John Hurley related? They're both decent skins, but that's not proof of blood relation. What makes me suspect a common gene pool is their propensity to goof things up, just when the going gets good. In Enda's case, voter anger at the Government prevented his Sinn Fein gaffe from derailing Fine Gael's home run last Friday. In John's case, history will be less forgiving. His statement that house prices were set to fall further is going to inflict more misery on those trying to sell their houses, not to mention the thousands of young people in negative equity.

Before he opened his mouth, the signs of recovery were getting stronger by the day. Last Wednesday UK house prices rose by over two per cent in May. On Thursday European Central Bank President Jean-Claude Trichet held out the promise of economic recovery next year. Unlike its Irish counterpart, the ECB is actually doing something to bring it about: since September rate cuts have reduced mortgage repayments by two-fifths, more than offsetting the impact of domestic tax increases. With November's Tax Commission report likely to abolish stamp duty, the fundamentals for recovery were falling into place and only two things more were needed. Firstly, the National Asset Management Agency (Nama) needs to finalise the clean-up of bank balance sheets by August so that credit can start flowing in time for the market's traditional resumption in the autumn. Secondly, confidence needs to be restored in the market's future.


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