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Being robbed by the bank

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By Michael O’Connor from theislandinvestor.com

This week, inflation in Europe hit 10.7%. Just 12 months ago, this figure was 4.1%.

Painfully high energy and food prices continued to push inflation to record levels. Over the past 12 months, energy prices rose by 41.9%, while food prices increased by 13.1%. With Russia's withdrawal from an agreement that allowed grain exports from Ukraine, grain prices are likely to go up even more.

Of course, we don't need to be told the exact figures. We can see it all around us; the food we buy, the bills we pay.

The precarious balancing act that the ECB now faces is too layered a discussion point for this short article, but it is a fight they are currently losing.

Statements from the IMF this week reiterate this point.

"European policymakers face severe trade-offs and tough policy choices as they address a toxic mix of weak growth and high inflation that could worsen."

As the outlook worsens, the knee-jerk reaction may be to do nothing. But this is not the answer.

One point I have been trying to press home with clients lately is - the price of inaction in the current inflationary environment is immense.

In economics, the Fisher Effect is the tendency for interest rates to change to follow the inflation rate. As inflation rates rise, so too should interest rates, or at least this was the case before the mass amounts of credit in the system made this an unviable option.

Historically, the Fisher Effect held true. In the late '70s, inflation ripped through economies and in turn, interest rates rose to nearly 20%. Those battling inflation had the ability to offset these rising prices by simply leaving their money accumulate the higher interest rates available in their savings accounts at the bank. Doing nothing was an option.

Since then, things have changed. Bank interest rates in the US reached an all-time high of 20% in March of 1980 before a precipitous decline brought interest rates to a record low of 0.25% in December of 2008. Europe took it a step further and introduced negative interest rates.

Despite the changing narrative, the old belief that 'your money is safe in the bank' still rings true for many. Unfortunately, the residual advice of a previous generation who benefited from a different economic framework muddies the clarity for many trying to save in this new environment.

What worked for your parents won't work for you. A lot has changed. Simply putting away a little money every week into a savings account isn't enough anymore if you want to be able to function as an independent adult. It's a harsh reality, but it's true.

What you are saving for is rising in price faster than you are saving, so you need to do something to tie yourself to these higher prices.

Take the first step

They say the price of inaction is far greater than the cost of making a mistake. This is especially true for so many investors in the current market.

On average, the stock market has returned roughly 10% annually since 1974. A far more enticing return than the pennies on offer in your savings account.

You don't need to make a huge decision regarding your life savings all at once. Focus on finding an investment better than your current deposit account and work from there.

Start small but start now. After that first step, it all gets a little easier.

Doing nothing is no longer an option.

If you have any questions, scan the QR code above and reach out. Always happy to help.

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WEEK 14: Felicity’s Summer in Killarney

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WEEK 14
Felicity’s Summer in Killarney





Previously: Here on Dundag it was far easier to relax than anywhere else. They had a picnic blanket, some cold drinks and what felt like all the time in the world.

“I can’t believe I leave on Monday” Felicity said tiredly.

“Neither can I. This summer has flown. Tell me you have plans to come back sometime soon though? I don’t think Sheila and I can be as good of a mischief-making duo as me and you.”

Felicity had already spoken with her parents about her return to Killarney. “I’d like to come back for Halloween. Who knows, with my apprenticeship you may be seeing a lot more of me.”

Felicity glanced at Jack, who was looking far out over the lake. “That wouldn’t be so bad.” He paused. “There’s loads of things to do in Kerry around Halloween. There are countless events and festivals in the surrounding towns and parishes.”

“That would be nice. I love Halloween, it would be great to see how ye do it down here.” A few years ago she and her friends had run a school scare event in Dublin, for TYs and above only. It had been some of the best fun they’d had in school together.

“It’s going to be really strange not having you just around the corner anymore. I’ve gotten so used to showing up at Sheila’s and you being there.”

Knowing that her friends were going to miss her so much made Felicity’s chest twist. She knew that Auntie Sheila wasn’t looking forward to her leaving either. “At least I’ll be back soon. You’ll be seeing me off of the train before you can blink.”

“Yeah, I can’t wait.”

A few hours passed before Felicity and Jack returned to Hedgerow Place. Jack dropped her off at the door, promising to meet her at the bus station tomorrow to see her off. Felicity trudged towards the door morosely.

Auntie Sheila met her on the other side with a sad smile. “Hopefully you’ll be back soon poppet. I suppose for now you should probably pack.”

Felicity nodded and made her way upstairs. She entered the spare room , her room now, really. Auntie Sheila had offered her it permanently if she were to get her apprenticeship. That would be a dream come true, to live in Killarney and have something as exciting as an apprenticeship to work on.

Felicity packed slowly. She let herself daydream about what her life could look like, and how easy it would be to sink into it. Thoughts of coming back here, to a room that was fully hers circled around her head. Felicity looked around her room as she slowly progressed towards fitting her whole summer into just the two small suitcases and backpack that she had come to Killarney with.

It felt like her experiences were too big, too meaningful to pack away with her. Too much had happened this summer to pack it all away. The only solace, Felicity thought, was that she had to go so that she could come back again.

The Bus
Now she was standing once more at Killarney Bus Station, waiting to get the Expressway back to Cork before the next leg to Dublin. Auntie Sheila and Jack both stood nearby waiting to see her off.

Felicity had spent the last few days packing, reminiscing on her time in Killarney as if it were years ago, and had not started a mere three months previously. The adventures she’d had and the friends she made were all so different from what she knew in Dublin. It almost felt like going back to the city was going back to a different world, a different life.

“You have to stay in touch,” Jack said with a frown. “And I will hold you to your promise to come back at Halloween. We have to go to some of the Halloween events. I know it’s a trek down but it will be faster by train.”

Felicity didn’t know why her parents had booked her a bus down and back and not the train, but she was almost thankful for the extra travel time on the way back. It would take all of it and more to acclimatise back into her old life.

When the bus arrived, Jack helped her stow her luggage in the undercarriage. It was with a heavy heart and tearful eyes that she hugged them both goodbye. Felicity promised both to them and to herself that she would be back for Halloween, even if she didn’t get her apprenticeship, she would make the time around her college schedule to visit. God, she should have applied for college in Killarney. If only she had known what it was like when she was filling out her CAO.

Felicity trudged up the steps onto the bus. She hadn’t missed how cramped the seats were. The train would undoubtedly be the better option for her return.

She turned and waved at Jack and Auntie Sheila as the bus pulled out of its berth. She could see Auntie Sheila smiling up at her. Something her aunt had told her the night before swirled around in her head. “It doesn’t matter that you’re leaving now,” she had said, “because you’ve been to Killarney once, and now there will always be a home for you here.”

Summer in Killarney had been transformative, to say the least. The bus went around the Daly’s roundabout and travelled down the hill towards Cork. Felicity looked longingly at the turn to Woodlawn Road as they trundled by. Killarney, and Auntie Sheila’s little house on Hedgerow Place, had snuck its way into her heart. Felicity was going to miss it. She couldn’t wait to come back again.

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Frustration mounts over morning gridlock at Coolcorcoran

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Frustration mounts over morning gridlock at Coolcorcoran


Mounting traffic gridlock at the Coolcorcoran junction onto the N22 Killarney Bypass is causing daily delays for commuters, with local motorists calling on Killarney Municipal District and elected representatives to take immediate action.


Early morning traffic coming from the Tralee side has become severely backed up past BG Motors during the peak 8.15am commute.
Motorists attempting to enter the bypass from the Coolcorcoran side face long queues and increasing frustration as they struggle to join the main road.
Local drivers point to a specific design issue at the exit, where a raised kerb and a section of unused footpath prevent left-turning vehicles from merging smoothly into the traffic flow.
Road users are requesting a simple layout modification to resolve the bottleneck: converting the exit to left-turn only, removing the kerb obstruction, and directing driver traffic to loop via a U-turn at the Killarney Sports and Leisure Centre roundabout. Similar left-turn measures were previously implemented at the nearby Lewis Road junction to improve safety and traffic flow.
The request comes as broader plans for the N22 bypass upgrade and new link road infrastructure remain under progression by Kerry County Council and Transport Infrastructure Ireland.
Motorists wishing to share their views on local road issues can email info@killarneyadvertiser.ie.

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