Falling house sales and prices are payback for an extremely high level of growth in housing over the last 15 years, says Kevin Gardiner, currently HSBC's global markets strategist.
He is the economist who coined the phrase 'Celtic Tiger' in relation to Ireland's economy in the 1990s. Mr Gardiner said that, despite a hangover from this strong growth, Ireland's economy is resilient, and will recover after 2009.
Mr Gardiner says the Irish economy has grown far more quickly and for longer than he would have dared to expect back in 1994 when he referred to the country as 'The Celtic Tiger'.
Speaking in Dublin today, he said Ireland's economy would survive because of a welcoming business culture, low taxes, and foreign direct investment.
Mr Gardiner said the Irish stock market was underperforming European and global markets because it is in 'exactly the wrong place at the wrong time'. He said global investors were worried about financial companies, and those involved in building materials and general construction. Unfortunately, he said, the Irish stock market has a bigger than average weighting in these types of companies.
Mr Gardiner said the housing story in Ireland was more fragile in Ireland than elsewhere. He added that prices would continue to drift lower, and did not look like turning around any time soon.
