The graphs below show the number of people on the live register. We are currently at a level similar to 1999.Expectations are for another significant change this month. The majority of these jobs would appear to be from the construction industry and you can see the changes in the graphs as construction levels rose in the late 90's to present day, unemployment decreased.
Note: no adjustments have been made for population increases or an increase in foreign labour.
The latest update on the Live Register is due on Friday.
The graph below is from 2006 to 2008. To try your own go here.
This short piece provides an interesting & scary comparison between the sub-prime & Alt-A levels of lending and default. The information has been obtained from the New York Fed and is pretty easy to follow.
The basics are that there is more lending in the Alt-A market for higher amounts a lot of which is for non owner-occupied housing. The lending ratio is up around the 90% mark and defaults are already at 14% which is similar to that of the sub-prime area last year.The credit rating difference between these two isn't that great. The majority of these loan applicants were based on stated income or "liar loans". And, finally, the majority of mortgage resets on the Alt-A's are set to kick in over the next two years.
There are strong comparisons that can be made between America & Ireland. We also had 100% lending (and more). Lax lending standards. The "rent a room" to supplement/increase the mortgage. Interest only loans; when people finally see the real level of repayments they have to make what will happen? Negative equity is beginning to kick in for those who have purchased in recent times on a high loan to value rate.
In America, it's easier to file for bankruptcy, hand back the keys and walk away. It's not so easy in Ireland, but that's not to say it won't happen. What about construction workers who can't afford their mortgages due to lack of work. What's to stop them from picking up tools, moving to Oz where there's a demand for their labour and leaving their Irish mortgage troubles behind them?
First, a brief note of explanation. The concept of super-senior debt was essentially invented by creative bankers about four years ago to refer to the chunk of debt that sits at the very top of the capital structure of a collateralised debt obligation. It is the bit that gets paid off first, before other investors, if the CDO ever defaults. In theory, it makes this debt super-safe; indeed, so secure that rating agencies have been happy to give super-senior CDO debt a AAA tag, irrespective of what lay inside the CDO.
