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The Briefcase: The €1 trillion question, queues for houses, and the charm of Michael Noonan

This was the week in business.

Image: Sam Boal/Photocall Ireland

Need to know

Bazooka getting bazookaier 

In case you were in any doubt about the scale of the issues facing the eurozone, this week we got a number to put on it: €1 trillion. That’s how much the ECB’s anti-deflation cash pile will add up to after extra measures were announced this week.

Mario Draghi speech The name's Bond...Government Bond(s). ECB president Mario Draghi. Source: Stefan Wermuth

We’re not in the depths of 2012, when the very survival of the bloc was being questioned. Back then, it took ‘Super’ Mario Draghi to step in and say he’d do ‘whatever it takes’ to save the euro.

That saw the wolves from the door, ironically without having to spend a penny (on top of all those bailouts, but hey, who’s counting?).

However, that’s not the case this time around. Contagion is one thing, deflation another. It’s acronym soup up in Frankfurt at the moment, but experts say between the TLTROs and the ABS buying, Draghi’s war chest now stands at about €1 trillion.

And that’s before we get into the QE.

It’s all designed to get banks lending again, increase the amount of cash in the eurozone, and generally encourage consumers to spend again.

Only time will tell if it will work, but most are agreed on one thing: Draghi isn’t done yet, and we’ll get a big injection of Quantitative Easing, like our cousins in the UK and US, before long if the wily Italian can find a way around German opposition.

Read up on what it means for us here.

Queues for houses…again

It seems we’re determined to party like it’s 2006 all over again. Scenes of people queueing up to bid on a new suburban development in Dublin sparked hand-wringing around the country, and property market experts say that prices are only going in one direction: up.

Millers Glen Development queue. Pictured Source: Mark Stedman/Photocall Ireland

Is it a boom? Depends who you listen to. Booms are usually credit driven, and while the banks say that they are lending again (and this is born out in the figures), it’s not at the levels seen during the last days of the Celtic Tiger.

Booms also usually mean people buying as an investment – the assumption that prices will rise exponentially is usually part of the hysteria that emerges. Again, most observers say it’s people looking for a home not an investment who are buying now.

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One thing’s for sure, it definitely feels a lot like it did during the boom. Right down to the faces of the builders involved…although their finances aren’t as healthy.

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manorfromeighteen-630x472 Adare Manor Source: CBRE

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Jack Horgan-Jones

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