Q3 Online Traders Forum Ticket

Ticket for the Q3 Online Traders Forum - which also includes access to the recordings post event.

£20.00

Traders,

For several years now I’ve run the London and Dublin Traders Forum – a once-a-year all-day event for Traders to come together, learn and socialise with each other.

This years London Traders Forum will be on Saturday 6th October 2018 in Central London. Put the date in your diary and keep your eyes peeled for details and early-bird opportunities.

In the meantime the next event will be the Q3 Online Traders Forum on Saturday 7th July.

This is a new initiative from traders, for traders. The idea is for it to be a short, intensive 3 hour online seminar that covers various aspects of the 4M’s of Trading: Markets, Method, Money and Myself. The idea is for you to be able to learn some new trading ideas, whilst in the comfort of your own home, and without sacrificing your entire weekend.

The plan is for there to be one Online Traders Forum the first Saturday of Q1, Q2 & Q3 with the London Traders Forum at the start of Q4 the main all day event.

For the Q3 Event we’ll have the following speakers:

Paul Wallace from FXTraderPaul.com and the London Traders Network will deliver the market analysis section focusing on FX, Indices, Commodities (and perhaps some Crypto) and look at where to focus for possible Q3 Trading Opportunities.

Martin Walker of ForexTradingLondon.com will take a deeper look at Price Action, what are its constituent parts, and how to identify and read it on your charts. He will show you how to use this knowledge in your trading. Understanding and being able to read Price Action is key to identifying Trends, Breakouts and False Breakouts, Market Turns and much more.

From Dublin, Ian McFadden from the Symmetry Trading FB page will talk about his way of intra-day trading Oil using the CL Futures contract. Ian has traded using Fibs for over 10 years and he will explain how he uses them to analyse Oil and find intra-day trade set-ups.

There is a charge for £20 to attend. Why? Because we’re not selling anything. Its proper educational content rather than a slick pitch in the hope to up-sell you something. Furthermore the sessions will be recorded, and as an attendee you’ll have access to them afterwards.

You can get your ticket here: Q3 Online Traders Forum
It promises to be an enjoyable session that will help you grasp the opportunities that Q3 2018 will present.
Trade well!

Hello Traders,
Great to chat with some of you at the recent LTN Social – the next one is Wednesday 18th July.

As people with an interest in markets and FX you may have seen this morning article on BBC regarding currency: The hidden cost of currency fees.
If you’ve ever traded FX then, like me, you’ve probably spat the dummy out when you see what Travel Shops try and offer you for currency conversion. Furthermore along with a crappy exchange rate they may charge you a commission on top for the pleasure of doing business!
It’s rare that I recommend any product or service – and I only do so if I love it and use it myself. With regards to Foreign Exchange payments I use Transferwise and heartily recommend them. Cheap, fast, and at a rate v close to the wholesale.
Furthermore they have recently released a Transferwise borderless debit account that allows you to hold bank accounts in the UK, Europe, US & Australia – along with approx. 60 currencies all on one card. I use it myself, I think it’s wonderful. It has enabled me to hold my money in USD these last 2 months during this period of Dollar strength (more on how to do that in the future!)
As I said I very rarely recommend anything unless I use it and like it myself – and Transferwise meets that criteria.
Trade well,
Paul

Hello Traders,

Yeah I know I haven’t posted as much as I normally do – shock horror – I’ve been busy trading these glorious markets.

However now and then I do get away from the desk and indulge in normal people’s behaviour. And so last Thursday I found myself in Liverpool for the day and decided to visit the Tate Liverpool Art Gallery in the Albert Docks. Now I have an admission: I am quite the ignorant, Neanderthal, philistine ( I suspect most of my readers had already worked that out.) I find most modern art a bit self-indulgent, in the same vein as jazz, namely more likely to be enjoyed by the artist than the viewer. That’s not to say there aren’t some stunning, spectacular, moving, thought-provoking pieces – it’s just that I end up shaking my head and shrugging my shoulders at a lot of it thinking to myself, “How many drugs did the artist have to take to think that would be a good idea?” 

My view was only hardened after I walked into one side-room to find a arty film showing a grown mature man, dressed as a baby, hitting himself with toys in what looked like a child’s bedroom. I was told that this was art. Personally I thought it was a big bag of tosh – from a clearly disturbed man – and walked away muttering under my breath that it’s no surprise that the art world is full of sex-abusers and paedophiles. Anyway I digress.

The reason I chose to pop in was because I was intrigued to see that there was a Roy Lichtenstein exhibition on, and one of his famous pieces was there (see below).

The piece is called “Whaam!” its from 1963 and depicts aerial combat in pop-art form. I have it as a fridge magnet (see I told you I was a philistine)What can I say? The former Air Defender in me is still alive and well and takes pleasure in scenes of aircraft getting shot down! (As an aside I learnt that Lichtenstein served in the US Army during the Second World War and in particular focused on anti-aircraft drills and operations and lots of his early work consisted of drawings of aircraft – so maybe he too derived pleasure from scenes of aerial combat?)

However I was pleasantly surprised to find the piece below – and I would love to have it on my office wall! It’s by Andrew Gursky and is a double exposed photo of the trading floor at the Chicago Board Of Trade from 1999. I thought it was fantastic and ended up having to explain to my date and several others what it was representing. It’s a huge piece and sadly my photo doesn’t do it justice.

I loved it so much that I went to the shop and tried to buy a copy (see, even Philistines can support the arts, now and then.) Sadly they had none. Boo.

In a weird world of coincidence just a couple of days later I got a text from my friend and colleague Malte Kaub (Twitter: @SE_1Trading) who sent me a similar photo. It turns out that Gursky has an exhibition on at the Haywards Gallery in the Southbank Centre until 22nd April. It’s not free but if you’re a trader then maybe pop along and see his work – I loved the photo – I now have visions of a large copy of it filling the wall of my trading office. To many people looking at it would give them a headache. To me, it’s just a great insight into the frenzy of a world no longer with us.

Even cooler was when I tweeted the photo a guy on twitter actually spotted himself in the photo. How cool is that?

Here’s an interesting aside for the traders within us. I was today interviewing a former trader who started up as a floor trader on Liffe and then made the transition across to electronic trading. I asked him about how the transition went – he said it was extremely hard, and most floor traders did not make the transition. We talked about it and came to the conclusion that in the old days you saw your enemy – he was the guy on the other side of the pit – you could see the whites of his eyes, and get a picture of whether he was confident or sweating about his position. That was an edge. Whereas when you look at a screen you don’t get the same sense of the other participants sentiment. It may explain why there is an increased interest in trading psychology / performance coaching within the electronic trading community. Instead of taking cues from the guys around you, now the only feedback you get is from yourself – and so you need to know how you think, operate and behave far more intimately than ever before. Food for thought? (Be sure to disagree with me if you think so – I’ll happily listen to opposing views.)

Anyway I’ll finish up with a joke about artists from my good Irish trading pal Ian.

“Why do artists always look happy?”

“Because they get to party on other peoples money!”

Da-dum-tsch!

“Regrets, I’ve had a few, but then again too few to mention…” so sang the late great Frank Sinatra. Whilst an undoubtedly great song I have always struggled with that line. You see I’ve never understood people who say “I have no regrets….” for when I look back at my life I have plenty of regrets. That’s not to imply I’m unhappy, or ungrateful, or that I’m seething with resentment, for I am not. I just know that there’s lots of things that if I had the chance again I would do differently. I’m well aware that I cannot change the past, just my attitude towards it, and that what’s done is done. Perhaps it’s just my perfectionist streak that doesn’t let up on me about past mistakes. Always driving me on to learn from them and improve against a bar/standard that I’ll never achieve. Make of that what you will. Which leads us onto this blog piece and the review of my own year.

Welcome to 2018 traders – I hope you enjoyed the break and that you’re ready for an interesting year ahead.

As for myself I closed down shop over the Christmas period. Apart from an occasional glance at a chart of Ripple I stayed away from all markets and trading. For me, it was the right choice.

As part of my downtime I like to conduct a review not only of my data but also of my behaviour and my decisions, along with planning my year ahead. This blog post is part of that. I apologise for the length and the rambling nature of it. You don’t actually have to read this yourselves if you don’t want to – it’s more a missive to myself about mistakes I made and lessons to learn (or even re-learn). Perhaps some of it will resonate with your own experience, perhaps some of it will make no sense, perhaps some of it will offend you – I can’t control how people interpret my words so I don’t bother trying. It is what it is.

I’m always happy to talk about my mistakes, misses, the woulda, coulda, shoulda’s. I figure people can learn more from my mistakes than my successes. Furthermore it shows that none of us are exempt from the human condition or perfect in our trading.  None of us are beyond reproach – we are all striving, and evolving, towards being the best trader that we can be.

So lets see what shall I start with? How about the markets and the correction that never came.

What, no crash? I wrote 2 blog pieces at the start of summer about how I sensed that we may have reached the highs and be due a healthy correction, if not a crash. The summer came, and went, and so did my plan. I was wrong. Dead wrong. Completely wrong. For which I apologise.  Markets looked like they may roll-over but in reality they just took a breather before resuming their upwards, unstoppable momentum. Even though I had a suspicion that markets may roll over that was not an indication to sell everything but I did have a few short trades on the NASDAQ which were profitable but never truly followed through.  I remember reading an interview with (I believe) Stanley Druckenmiller  who talked about how when he worked for Soros that if George wanted to short a market the first thing he would do…is buy it. If it kept going up then it was not ready to roll-over and he would stay away. Wise advice – if you can afford it. And it’s exactly what I should have done. When my NASDAQ shorts ran out of energy that was my first warning sign. The next was once price had traded back up to previous highs, and then broke them, I should have bought the market. That was remiss of me. The market is always communicating to us – it had told me that it wasn’t ready to go down, it wanted to carry on up…..and I did not leverage that information accordingly. Shame on you Paul.

Lesson for Paul:  I’m actually coming round to the idea that we’ll continue grinding north – which was helped by some excellent insight from a client – experienced traders are fearful, they’re like a cat on a hot tin roof, but that’s rarely when crashes happen. They happen when fear has left the market and everyone is complacent – and we’re not at that point yet. So we grind north, we maybe have a good melt-up, and then it all goes ‘Pete Tong’ – but that could be 6-18 months in the future. For the moment you have to trade what you see – and markets have been continuing North. I’m always reminded of this quote:

“Citigroup CEO Chuck Prince told the Financial Times in July 2007: “When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you’ve got to get up and dance. We’re still dancing.”

You can have all the opinions you want Paul….but the music is still playing.

(He actually said this in Nov 2007 when people may suggest that the music had already stopped playing. If it had not stopped, the markets were certainly at that quarter-to-2 in the Disco time when you did a quick prowl of the dance floor to pull a girl for the last dance. I believe they call it ‘bin-raking’ these days. Charming. You get what I mean. The end was nigh.)

Crypto – Too late to the party. Simple as that. I had always treated it as a bit of a fad. I also think it’s a culture / generational thing. I remember very clearly the Dot-Com bubble. There are many differences (for me at least). During all the dot-com hype I could actually see and understand the implications of the new companies and technologies. A company that you could buy pretty much any book in the world at cheaper prices than the book store and have it delivered? Yes, I’ll have a bit of Amazon thank-you. Having all your Music downloaded into one cool looking gadget the size of a cigarette packet? Yes, I’ll have some Apple. Being able to buy your Waitrose Groceries online and have them delivered? Yes, I’ll have a bit of Occado thank-you. Even Lastminute.Com (the straw that broke the camels back) I could understand that here was a website that offered a one-stop shop for all your last minute holiday getaways.  Furthermore the Tech companies that underpinned the internet infrastructure I could understand (which was a good job as I was working in Telco and Internet Tech at the time.)

Whereas Bitcoin seemed a bit of a fad for me. And my experiences just reinforced that. Last summer I was in a coffee shop in Ballsbridge, South Dublin minding my own business reading the FT when the guy at the table next to me started blathering on at me about how he was the ‘chief imagineer’ (no, I have no idea what one of those is either) for the HSE (the Irish equivalent of the NHS) and that he was asking would I invest in his idea for a ‘health bitcoin’ where people’s health records would be allocated bitcoin and the more healthy your lifestyle was the more of these coins you’d be allocated.  I couldn’t help but think that this guy’s time and effort would be better spent sorting out the present-day HSE (which in many cases is in a worse state than the NHS) rather than being paid top dollar to think up hare-brained ideas like that.

Another example was just before Christmas we had an electrician in to fix some lights and he was telling me about his Bitcoin holdings. Now fair play to him, he’d bought in at approx. $300 so when the price was hitting 15-16,000 USD just before Christmas he was cock-a-hoop with excitement. I am chuffed that he has made money – but when your electrician is giving you investment advice an old cynic like me starts to get a bit grizzly.

My grizzliness was extended by not backing myself on Ripple / XRP earlier. I had monitored it for the last 2-3 months but it had already sailed past my ideal entry point. I was forced to join the party at 25 cents..only for it to have gone past 48 cents by the time I bought. Woulda, coulda, shoulda.  It is what it is.

So I do have some Crypto exposure, but no-where near as much as I would have liked. Woulda, coulda, shoulda. Furthermore in the interests of full disclosure I have not made much personal gain from my Crypto holdings. However, my 8 nieces, nephews and god-children on the other hand have done very well. The Jammy Bastards. (When I was a kid I used to be happy if I got a Subbuteo set and a model Spitfire! Times have changed.)

Lesson for Paul: Overcome your own bias and get back to being an early adopter. My experience of the Dot-Com boom (even though I did well out of it) had made me overly cautious. There’s money to be made in the run-up, the inevitable crash, and the aftermath if you plan it right.

2018 FX – Normally at the end of each year I have an idea about where my focus should be in terms of a particular FX pair for Q1-2 of the next year. There’s normally one FX pair that stands out as a ripe target for my focus. Last year was USD – and the price action in January just confirmed that. For the first time in a good few years I have no particular bias for any particular FX pair going into this year. I shall wait and see what the markets offer up.

Lesson for Paul: Watch and Shoot – watch and shoot! The Comdolls have started well so far this year.

Intra-day trading. I used to do it a lot. Then, not so much. Over the last 2 years I have done a little bit but on a purely opportunistic basis i.e. if i was at my desk for a few days then I’d look at what was available.  And in the second half of 2017 I found myself returning to it. Partly because of market conditions but also partly because my schedule allowed me to structure my time better to focus upon it.  Furthermore I found myself re-visiting the 1 minute chart – in particular on the DAX. (Most of my previous intraday trades were made on 15 & 5 min charts).

I have avoided the 1 minute for a long time. Some of you may know why. When I first started trading FX many years ago my mentor encouraged me to trade 1 minute charts. It turned out at the time that I was not very good at it. Why? Firstly I found that it tapped into the hyper-aggressive side of me. It brought out my killer instinct, and not always in a good way. Secondly I found the 1 minute charts were too slow for me. How so? When I sat down and reflected upon it I realised that when I’d been a Fighter Controller I used to watch radar screens update 6 times a minute. So every 10 seconds I would have a new picture and need to make a decision: climb, descend, turn, accelerate, interrogate, engage etc. So waiting 60 seconds for a candle to complete seemed like an absolute life-time. So on one hand I had hyper-aggressiveness rearing its head (the part of Paul that wants to kill everything) and on the other hand I was applying the brakes as I waited for the chart to update. This meant i was getting into trades too soon, and also getting out of them too quickly, if it wasn’t doing what I wanted it to do swiftly then I’d pull the plug on the trade, and was therefore cutting myself off from profits and opportunity. So I decided to give 1 minute charts a miss many years ago.

However recently I had noticed that a lot of my intra-day trades upon reflection were offering earlier opportunities to get on board at better prices thereby reducing my trade risk, and offering a more handsome reward-to-risk potential (see later point below). So I decided to investigate, learn some new ideas and concepts, and see if they could be applied to my intra-day trading. Furthermore I’m a slow old duffer these days, with far more patience and less desire to shoot everything down in front of me (though that desire never really fully leaves you)so trading 1 minute charts doesn’t create the problems it used to.

Lesson for Paul: Get in the fight and start attacking the charts – (ok, maybe that hyper-aggressiveness is returning) anyway there are some great opportunities out there. I have a good trade plan, some great set-ups and the ability to deliver.

Risk-to-Reward Ratio (3R) I had noticed that my risk-to-reward- ratio had diminished over the last 18 months. It was still healthy, and still on the happy side of asymmetric, but no-where near as good as it used to be. Why was that? Is it a case of lack of volatility? Perhaps.

Upon some reflection I realised that I have spent too much time around new traders who are too scared to go for anything more than small gains – those who jump out of a trade after its hit 1:1. I have allowed this to influence my thinking – shame on me!

Lesson for Paul: Push myself to get back to bigger asymmetric reward-to-risk ratios

I’m still shit at trading Swiss Franc: I don’t know why this is – but historically I always have my worst performance on the CHF pairs – why is that? I have no idea. Bunch of cuckoo-clock making, toblerone eating chumps, pissing around with their multi-use (and admittedly very handy) knives

Lesson for Paul: Keep CHF pairs exposure very small. No-one trusts the SNB.

I don’t take enough holidays: that’s just a lesson I’ve realised this last 24 months. There have been some extenuating circumstances with family members health, however I don’t take enough holidays. I take lots of long weekends, and have always worked on the premise that a change is as good as a rest. So spending time in Cheshire, Dublin, London and elsewhere is refreshing for me – and I enjoy being around other traders.  What I realised is that at my age all my friends and relatives are married with kids. They’re going on holiday with their families (even though they’d secretly love to go to the Buenos Aires Rugby 7’s instead) 😉  I get bored with going on holiday on my own – I just end up doing some work…..or getting in trouble. Which tends to be why I avoid holiday invites from other traders – there’s no escape. Anyway I need to get over that and sort out something.

(Also I have a real wanderlust and I’m secretly scared that if I go walkabout….I’ll just never come back! This probably explains why I have resisted buying motorbikes or VW Camper Vans – you’ll never see me again – I’ll just put a satcom on the top of the Van to give me good connectivity and then clear off to the Algarve driving around surf beaches, learning to surf, and spending my nights reading great literature, drinking Port and eating cheese. And then when I’m bored I’ll just drive down through Africa to Cape Town and go surfing there. Actually, upon reflection, this sounds fucking brilliant. It’s a plan. Sign me up.)

Lesson for Paul: book some holidays. Get your girlfriends involved to plan holiday time away from work / markets etc. Get a life you saddo.

Recency Bias, and anchoring effect: For those unaware Recency bias is the tendency to think that trends and patterns we observe in the recent past will continue in the future. (Wikipedia)

As for anchoring its a cognitive bias that describes the common human tendency to rely too heavily on the first piece of information offered when making decisions. Once an anchor is set, other judgments are made by adjusting away from that anchor, and there is a bias toward interpreting other information around the anchor. (Wikipedia)

We all experience them but I have noticed that I have a real challenge with it.  Maybe its a new thing, or maybe its something I always had but have just raised my awareness of it recently. I’ve noticed them in both my trading and my personal life (particularly with buying/renting a place in South Dublin – but that’s another story. I realise that the trader in me only wants to buy at my price – not at what the market is demanding from me – because I believe it be overvalued. I am anchored to prices from 2012 when I first moved there and looking at the recent patterns of rising prices (for rental and purchase) leaves me feeling like I’m buying into a parabolic move and that I am chasing price – something I religiously refuse to do in my trading.) I’ve fallen prey to one of the oldest tricks in the book. Shame on you Paul!

Lesson for Paul: Learn from this raised awareness. Those two biases rarely help you. Put up or shut-up. Preferably both.

Trading Challenge: I have decided based on the points above to give myself a trading challenge. I often talk to intra-day traders about how in an ideal world you should be trading the Triple Three: Three hours a day, Three days a week for Three weeks a month, otherwise it becomes very easy to burn out as an intra-day trader. Based on the lessons learnt above I decided to do my own version of this from the end of January. Regardless of my other trading activities I will prioritise my own Triple Three challenge: Three hours a day of intra-day trading, Three days a week, for Three ‘R’ a session. This will either go spectacularly well…or horrifically wrong. We shall wait and see.

There you go – if you’ve made it this far and haven’t cut your own wrists then you deserve a big strong glass of whisky! (I did say you didn’t have to read it – its more a note to myself than anything else.)

I’m sure you have your own views on my failings this year – feel free to present your own thoughts, or your own learning points – we can all benefit from them.

Regardless I wish you all the very best of success in your trading endeavours.

Trade well!

Paul

Last night in Ireland on channel TV3 there was a TV show called ‘McWilliams Ireland’ driven by the Irish media personality, and occasional economist, David McWilliams (that was my Irish mate’s joke) which is a series looking at modern Ireland through the lens of an economist and the impact it has on everyday Irish folks.

If like me you spend a lot of time in Ireland for family, business and personal reasons you’ll be acutely aware of the rampant rise in prices over the last 2 years. House prices up by 60%, hotels up between 50 & 100% etc. The fall in GBP against the EURO has only made that pain more palpable for people coming from the UK. Because I travel so much between Ireland, the UK, and Europe I believe I’ve developed a good perspective on the situation.

David’s TV series has been focusing on the rising cost of living in Ireland and he’s to be congratulated in attempting to raise people’s awareness of the situation. It’s not always easy to garner the interest of the working man and woman – they’re usually to busy working hard to make ends meet. But overall David’s articles and TV shows do a good job of trying to educate the average man and woman on the situation – and he’s to be applauded for that.

I was in the audience for last nights show and found it fascinating that people had lots of complaints about costs, and lots of reasons why…..however no-one dared touch the one area I was hoping they would discuss / cover. Namely the staggering cost of public sector pay and pension liabilities. They didn’t touch upon it there, and I’m sure as an English guy there was no chance of them answering my points about it on the show (I can just see the response I’d have gotten trying to raise points on taxes and public sector liabilities – ‘who’s that fat English prick giving out to us? The cheek of him coming on here with his notions….’ )  So let me lay out my thoughts here. Read on McDuff. As Alan Partridge so ignorantly said “There’s more to Oireland…dan dis.”

Shall we start with a chart? I love a chart, me. (I am a primarily a technical trader after all).

So you can see that the Irish stock exchange, the ISEQ, has been powering up since late 2012. In fact it’s more than doubled since late 2012 (the small blue line). What happened in late 2012 to turn around Ireland’s fortune? Simply put – that’s when I moved to Ireland. I like to tell people that it was my copious consumption of Irish carbohydrates, in the name of: Brennan’s Bread, Apple Pie, Guinness, and Potatoes (and that was just my standard breakfast) that singlehandedly dragged Ireland out of recession.

On a more serious note you can see that the Irish economy has done a grand job the last few years – which I have written about before – I always felt it was due to the recovery of the US and UK which lifted Ireland out of its post GFC gloom rather than anything that the Irish politician’s did.  There has been an influx of US, and global, tech companies that have located in Ireland. The official story is because of the quality of life and the availability of a well-educated workforce. The brutal reality is that the Irish government offered stunning tax deals, on an already attractive corporate tax rate – which has been good for Ireland, but has infuriated US and EU tax authorities. (The French in particular are disgusted that such companies are based in backwater Ireland when they should be based, and more importantly, paying taxes, in the glorious French republic.)

So with a healthy chart of the national exchange you’d be thinking that everything is rosy and there’s nothing wrong? Sadly that’s not the case. It is just under 10 years since the GFC of 2008 – and yet in Dublin at the moment you’d be mistaken for thinking it never happened – everyone is partying like its 2007! Prices are flying and the town has a buzz.

So let’s have a look at some of the numbers: My understanding is that the population of the Republic of Ireland is approximately 4.5 million people. Of that 4.5 million approximately 1.98 million people are tax-payers ( If anyone has more up-to-date / accurate figures I will happily amend.)

My own belief about the cost of living in Ireland is due to the high taxes pushed upon the people. Furthermore those high taxes, as I think most Irish folk would agree, do not always provide world-class services and infrastructure.

Well my belief is that most of those costs and taxes come about to fund the gravy-train that is the Irish Civil Service….or Irish Swindle Service as my Irish friends like to call it!

Once again numbers of Civil-Service employees are a spectrum with numbers ranging 40,000 to 300,00 mentioned to me. (These numbers are very broad and opaque, and may or may not cover all the Quango’s as well – of which there are numerous – i heard there was around 1000! Once again please feel free to help me tighten up the numbers.)

Take a look at some of these eye-watering numbers provided by the Central Statistics Office:

Irish Public Sector pay average: E921 p.w.

Irish Private Sector pay average E658 p.w.  (that’s a -40% differential!)

UK Public Sector pay: £594 p.w..

UK Private Sector pay £517 p.w. (that’s a -15% differential)

(Office of National Statistics)

But it gets worse:

Wages in the Irish education sector exceed Eurozone average by 54%

Wages in Irish healthcare and social work sector exceed the Eurozone average by 39%

(Eurostat figures)

Unemployment Benefit in Ireland: E193 per week

Unemployment Benefit in the UK approx £90 per week (My understanding is that Germanys is roughly similar – once again happy to update the numbers if someone has them.)

Furthermore if the public sector pay was not already a shocka they also receive a lovely golden pension of 150% of final salary, plus 50% for the rest of your life. Also you generally retire much earlier (age 60) on that handsome pension as opposed to private sector workers who have to toil on to age 66 to get the state minimum.

It used to be (certainly in the UK) in the old days that you received a good public sector pension because your average wage was much less than a private sector employee’s. But times have clearly changed, when a public sector employee is now taking home 40% more than the average private sector worker. Perhaps I can now see why friends call the Irish Swindle service the gravy-train!

You also have VAT at 23%, and business rates can be even higher. Along with that you have the most expensive energy charges in Europe. (If you can get a clear answer out of the ESB regarding charges, wages, pensions et al then you’re doing well.)

So you effectively have 80-90% of the people having to toil away till they’re 66, paying high taxes, in order to pay for the high wages/lifestyle/pensions of the 10-20% working in the civil service / quangos who get to retire at 60! Does it make my Irish friends feel good to hear and understand that?

Invariably as soon as someone like myself shines the torch of economic awareness on public sector greed you’re immediately labelled as a right-wing bigot who wants to take money away from Nurses, Firemen, and Gardaí (policemen). That is the usual tactic of those who wish the status-quo to resume.  Nothing could be further from the truth.  My mother was a nurse, I have friends and cousins who are nurses, Gardaí, firemen and teachers etc. Everyone knows that front-line staff do a good job under trying circumstances. It’s not them I am describing. I am talking about the huge swathe of faceless bureaucrats who sit in all those public offices working away without any form of accountability for their work ethic and performance.

So my aim with this piece was not to be disparaging – nor to have ” a crack at the Mick” as my good Irish friend Pearse and I often joke about. (It’s a line from one of our favourite films – Withnail & I. )

More so it was to make people aware of one of the contributing factors to why the cost of living is so high and there is such a high tax burden on the average working person. I’ve seen Irish friends working hard to build a life, and I’ve seen other people taking advantage of the system.  Maybe judging by this article the people are aware of the situation and all want a scoop of that gravy: 28,500 scramble for civil-service jobs

Now some people may say that they are happy with a) the tax levels and b) the public sector salaries and pensions. And that is fair enough. Each to their own.

At the TV show I was sat on a table with two other guys and when I pointed the public-sector pay and pension liabilities out the youngest one was quick to silence me with a monologue about how people should pay high taxes because it was a price worth paying for living in Ireland. I gently chided him that as he was a student he’d never actually paid any taxes, nor did he have a mortgage to pay, or kids to raise. Perhaps he should save his opinions until such time when he’s been paying exorbitant direct and indirect taxes for at least a decade or so and see how he feels then.

So why is this in any way a problem? Well I suppose it’s not – however Brexit is looming – and this will be either a threat or an opportunity for Ireland. Whilst the official Irish government departments are crowing about how much business and staff they will take from London the real story comes from listening to the relocation businesses. The questions they’re being asked are all how about house prices, location and availability, the cost of living, and the availability of good schools.  Is there a chance that Ireland is going to price itself out of the Brexit bonanza?

So why do people put up with this? Well I learnt from living there that you should never underestimate the power of ignorance. If you’re used to paying 4 euro for a shampoo, that is a pound in the UK, then why would you ever challenge the price? Is it any wonder that UK retailers call the country ‘Treasure Ireland’ because of their ability to charge higher prices?

I myself am an example of this. I left Ireland in 2016 for family responsibilities back in the UK. I was looking to move back this year – but the upsurge in costs (amongst other things) caused me to hesitate and reflect. I find these days that Dublin is more expensive than London. I can understand why so many digital nomads have shifted to Lisbon and Berlin instead of Dublin.

So will there be a change? Will Ireland curb its rampant tax take in order to help the average working guy and girl? Of course not!  The people who benefit most from the enhanced public sector pay and condition (namely the politicians) are never going to vote down giving themselves a pay cut! How absurd would that be? This comical skit from the show summed it all up beautifully in 70 seconds.

The Irish politicians already showed their true colours when the EU took Apple to court for not paying enough tax to Ireland – the Irish politicians response was to take Apple’s side(ostensibly turning down the 13bn tax for their own people) and in doing so found themselves sued by the EU for not complying.

Furthermore the French and Germans are keen to push through the EU the Common Consolidated Corporate Tax Base (CCCTB) in an effort to level the playing field and remove Ireland’s tax advantage.  (As an aside if I was Theresa May I’d be on the phone to all those US tech companies saying – you can sidestep the incoming CCCTB by moving here – lets just organise a flat fee of 10% and take it from there. Hey, for the UK it’s better to have 10% of something rather than 100% of nothing!)

Anyway this is turning into another one of Paul’s old-man rants! Apologies for the sprawling treatise – but I do get annoyed when I see people getting screwed over! So we’ll draw it to a close here by saying that yes David’s show was a step towards educating folks (but didn’t go far enough about one of the main contributors to prices – as this reviewer also agreed) and that people’s ignorance of the situation regarding public sector pay and pension liabilities needs to be changed. That’s the only way change will happen – by people realising the truth of the situation and then voting accordingly (though what the alternatives are is another quagmire, best left for another day.)

I know I have quite a few Irish readers of this blog so I’d love to hear your own views on the situation. Do you agree with me? Or are you happy with the present situation? How would you change it?

Have a great weekend, and trade well!

Paul

——-UPDATE———— 20/11/2017

Last week I did a piece on Core TV about this blog post – you can watch it here: Core TV Ireland

On the same day the Irish Times ran a piece on how Dublin was graded 2nd worst European City to emigrate to in a recent survey by Expat City Rankings (the worst European City, if you’re interested, is Paris.) You can read that here: Irish Times

Furthermore I picked up on this piece this morning in the Irish Journal about how Dublin was an attractive option for Tech Job-seekers….but most recruiters had to play down the cost of living as that caused problems.