The charm of the Kilkenomics festival is that the players managed to talk human without being patronising
THE VENUE is the Set, a little jewel of a theatre with a bar. The (very) middle-class audience settles down with pints and bottles and wine. The place is packed and the mood expectant.
The show is called How Bad Could it Get?Once the five panellists take to the stage, the populism is kept to a minimum, the tone is just the right side of playful but the content is unabashedly grave – so grave, that the man in front whistles and ceases to rustle through his sweet bag.
So how bad? “The country’s got cancer. No point in just treating it with an aspirin a day. It could go on for nine years,” says Vikas Nath, a broker, hedge funder and emerging markets expert, who also brings us up to speed on bond yields. Regrettably.
Our bond yields are higher than whose? Iraq’s (at war). Gabon’s (IMF in during the 1990s). Sri Lanka’s (civil war, tsunami). Ireland is perched slightly above North Korea and Cuba, apparently. The reason being that the Government has inextricably merged the banks with the Irish State, says Brian Lucey, the Trinity College professor who turns out to be a cool, amusing performer.
The fact that everyone seems to know what bond yields are is alarming. But the charm of Kilkenomics is that the players manage to talk human without being patronising. They also remain focused enough to regulate themselves.
One rather smug, finger-pointing ramble by a couple of home-based speakers provokes a comment from Nath that bears repeating: “It sounds like the country is drowning and all people are doing is describing the water.”
Still, three years ago, who would have predicted that a comedian (Richard Cook), an economist (David McWilliams) and a publisher (Penguin) could inveigle several thousand Irish people to an economics festival? An intriguing mix of sombre, focused Asians, wet-behind-the-ears graduates, couples on dates, extended family groups and single, bull-headed business people – all hungry for an answer, or an explanation at least – were prepared to spend an entire weekend and hundreds of euro across five little venues in a small midlands city, listening slack-jawed to a thoroughly hard-headed crew of regulators, economists and authors of such works as Towards a Co-operative Federalism.
Not least among the crew is the author of that volume Martín Lousteau, the entertaining, former (for about five months) Argentinian economics minister and expert on his country’s defaults, devaluations, depressions and recessions – which are apt to occur, he says, oh, every 30 years or so.
So is he left with a healthy forelock-tugging deference for the IMF? Lousteau powers up his iPad and mockingly reads extracts from patently contradictory reports issued by the fund over several years. And he is fearless about default. Who says no one will lend money to a country after a default? According to Lousteau, the evidence is almost entirely to the contrary.
Which leads to a discussion about what in the Irish make-up makes us so needy, that we always have to be the best children in the class. Did anyone mention that Lousteau also looks like a rock star? A big, serious managing director of a thriving, 250-strong Dublin food company “loves” the Argentinian. “He is very funny about the booms, depressions and recessions and defaults. And he said there was no such thing as getting no more money when it’s over – that you’re a better bet having defaulted.”
So why is this successful managing director in Kilkenny? “For two things,” he says, “primarily to find out how to protect my bit of wealth and also whether the Government should have given the bank guarantee.”
He has paid €105 to attend five or six sessions (out of 24 in total, costing between €10 and €20 each), and another €400 or so in expenses – “and that’s my own money too. Write that down,” he adds. But he got his money’s worth. He “loved” the American Bill Black, a former bank regulator and white-collar criminologist “who showed it’s possible to put people away [for white-collar crime]”. And he also got answers. “We absolutely should not have given the guarantee to delinquent bankers – in fact, it was nearly immoral to bail them out. But it’s too late now because once the politicians were bullied into the guarantee by the bankers, it became our debt of honour.”
The tragedy, he says, is that the Government spent €700-800 million on bailout advisers when they could have got it all "from those five guys up there" for €105. And whither his "bit of wealth"? After "listening carefully" to Peter Schiff (American author of Crash Proof: How to Profit from the Coming Economic Collapse), he plans to avoid the dollar, but will be "looking at Canada, Swiss francs, and gold".
Diarmuid Byrne, a 24-year-old trainee solicitor, aware that he’s of the lucky generation that got free university fees but not the negative equity, was intrigued by Trinity lecturer Constantin Gurdgiev’s arguments around welfare benefit, which Gurdgiev would limit to 10 years of meaningful benefit.
Peter De Groot, a 44-year-old Cork-based IT consultant, came along because he lost “a lot of money” in the tech crash 10 years ago, realised that he “knew nothing about money”, so took up economics as a hobby. “I always thought it was me who was missing something, but finally realised that it really didn’t make sense. It took me a while to realise that our economics system is a Ponzi scheme, which depends on endless growth. But that can’t exist in a stable state – how can everybody get out more than they put in?”
A couple with red wine in hand turn out to be Kilkenny residents Tomm Moore and Liselott Olofsson, a primary teacher. Moore, the 33-year-old Oscar-nominated animator (for The Secret of Kells) who runs his own company, has invested €100 for five sessions here. For that, he also gets a book plus "20 Marbles" (Kilkenomics currency equivalent to a euro but with a 10 per cent premium). He happened to be in New York when Lehmans collapsed and wants to understand the context. "I was worried that the comedians here would be too chatty and you'd get very little information but it's a good balance."
Another happy group includes Don Landy and his son Clayton, who run a construction company in Waterford. The Irish Timesinstinctively sympathises. "Oh no, we're still flat out," says Clayton. Having been "caught" in 1973, explains Don, he studied how the "old plumbers" looked after their customers: "They never got too big to fix the little washers on their customers' taps and we learned to do the same."
For many, the weekend came down to two looming choices: default and/or leave the euro. When Bloomberg’s Andrea Catherwood asked for an audience poll on debt default, the response was virtually all in favour.
When she asked whether Ireland would abandon the euro, a course considered by many speakers, it was less than a third. But a third for all that.