Anglo Irish Bank: Post split

Ireland probably has the highest real estate prices in the world now. The Jury's land case (with the square meter price going for 13'000 Euro) demonstrates the astonishing level of risk prevelant in the Irish economy. This is precisely the kind of deal that Anglo Irish would finance based on the following reasons:

a) any price for Irish property is ok because price tomorrow will be higher than price today (which we all know is nonsense)

b) fast growing companies usually meet their downfall when they take ever higher risks to achieve ever higher goals. Conservatism and rational behaviour just goes out the window

Trouble will come when interest rates in the Eurozone reach 4% by 2007 (likely level for "normal" economic conditions). This will mean that mortgage rates will rise to 5% variable or about 6% for 5 year fixed. Commercial real estate requires stable financing costs levels ("never finance long terms investments with short term money" as the adage goes). If stable means 5.5% then commercial real estate prices will plummet

So all in all I am fairly confident anglo irish bank is about to tank