Last year, the Society of St Vincent de Paul spent €6.1 million giving people in Ireland food. This year, it says that requests for food are up 50 per cent, that calls in general are up 35 per cent and in Dublin 50 per cent, and that 25 per cent of callers are new clients, many of whom were contributors to the charity at the church gates last year. These new clients are people who, “like the rest of us”, as one of their volunteers, John Monaghan, says, “were living on 110 per cent of their salaries”; this year, something in the working situation has changed, and they cannot manage their usual debts, mortgage, car, credit card. Monaghan is also worried about the effect of the recent budget on welfare recipients who, he says, will lose between 22 and 43 euros per week. Many of the cuts are aimed at the young, at carers, and at the parents of young children. Families have already lost 2 per cent of their benefits with the loss of their Christmas bonus and this means that people are not able to meet increased winter costs for heat, lighting and clothes.

This time last year the sky was falling, and then it didn ‘t. You wake up after the credit crisis and pat yourself down, and find everything the same, more or less, as it was before. Twelve months later, you look back to see that the sky did not fall so much as sink by inches.

I don’t know if Ireland does recession differently from other countries. We have a long and proud history of poverty, I don’t know if that helps. When I was growing up, you never asked another Irish person what they did for a living, and you never turned a beggar from the door. These are lyrical and dangerous clichés, of course (though incidentally true): Ireland was by no means a classless society. Even so, I do see differences from other countries in the play of rage, entitlement and delight around money: who has it, who deserves it, who gets cross.

The banking crisis that hit in September 2008 played out over the winter, and the sums of the bail-outs were so large, 3 billion here, 3.5 billion there, that the mere €179 million loaned by the speculator’s friend, the Anglo Irish Bank, to its own directors seemed almost acceptable, for being easy to understand. Usually, to get the truth in Ireland, you need a tribunal. The figures were so dizzying, the truth so quick and appalling, it was, in its way, quite an exciting time. In the week of the big snow, the first in February, the country was beautiful and still and full of dread. It wasn’t until the thaw that emotions became ordinary again and fear – the shouty, panicky kind – set in, with people on the radio fighting about public sector pay, and media personalities crying for Ireland on national TV.

For a while, it got quite personal. “Fuck them,” says a friend about the public sector. “They’re not losing their jobs, they’re not losing their pensions. Fuck them.” My entire family works in the public sector. During the boom, the worst you could say was that they were a bit boring. I don’t think they have done anything wrong. I find myself shouting back at her.

I talk to my children about the meaning of the word “downturn” and try to teach them a little about the concept of “tactfulness”. It isn’t a very successful conversation. As far as I can see, boasting is a developmental stage: at six and eight they are hardwired for it. Fortunately they are as likely to boast about a bag of crisps as about new tiles in the bathroom, so there is perhaps no great need to tread carefully. Still, there is uncertainty everywhere. You don’t know how people are doing, or how to ask. In April an emergency mini-budget takes the first cut out of public sector wages and though these things are discussed at length in the media they are not mentioned at family gatherings. Conversation in the street and outside the schools is fretful, but general. In May, news of redundancies starts to filter through (six months late, at a guess), and you nod and say nothing. These are young, highly qualified people, there is no need to panic. In the shops, the sales come early and often. An assistant in Dundrum shopping centre nearly begs me to buy a cardigan; she looks at me and says: “It’s no fun anymore.”

Home from holidays in July, the taxi man says that the flights from Italy and France are the only ones worth meeting, the package holiday “is dead”. Things happen more slowly to the middle classes. We are not so much an income bracket, as a speed.

In August, my husband takes two weeks’ unpaid leave, much of which is spent in the office. Along Dublin’s affluent coastline people seem to be doing all right, though there are dark stories of tracker mortgages gone wrong and bank loans not coming through. People get credit in a completely arbitrary way: I begin to suspect it depends on what the bank has on its balance sheet at the moment you walk in the door. On the property websites, nothing sells. A few prices come down, but not many, and not by much. People will not believe what has happened, or they will not give in to it. The hairdresser says to me: “But it was too mad, really. Don’t you think? It just went too far.” I hear this sense of relief echoed by other people; the excess is over, it’s like getting back on a diet, regaining control.

I don’t see much control. I see tenacity, disbelief, hope, but I am not so sure about control.

Part of the deal between the government and the banks is that foreclosures on home mortgages should be held off until the middle of 2010. The big guys, too, know all about holding tight. A bill establishing the National Asset Management Agency, which will take over the toxic debts of the six major banks, is not passed until November, by which time their debts are considerably more toxic than they were when the percentage price was first established. Everyone is afraid, now. Everyone I ask knows two or three people who have lost their jobs, and any number who are stuck in houses they don’t want to live in for the rest of their lives, some of them with partners they no longer love. The teachers ask for no Christmas presents this year because, they tell the children, they “can’t carry 30 presents home all at once”. Then they stage a one-day strike.

By the time the second budget of the year comes around, in the middle of December, everyone is braced and ready. It is hard to say when reality hit. October, maybe? I begin to remember people who left for Australia 18 months ago, and wonder how they knew. It is hard to say how people are affected, if they still have a job – perhaps it takes a while for them to realise it themselves. The ones who understand it best are those in their twenties and thirties, who are living in negative equity with long commutes into Dublin, and they are too overworked and overwrought to put up much of a fight. Even then, in a radio discussion about the new housing estates that litter the countryside, unfinished, derelict, unsold, a woman insists that her estate is “lovely”, that it “has streetlights” and “is not dangerous after dark”. A year and a half after house prices began to fall, it is still completely and utterly unacceptable in Ireland to talk your property down.

Pundits tend to divide the boom into two phases; in the first, timing, demographics, geographical position, the EU, the US, tax breaks for multinationals, an educated workforce, the global boom, hard work, good luck, low income tax and the blessed relief of the peace process all made for a respectable and well-earned increase in the Irish standard of living. This brought us up to 2001, or thereabouts, after which corruption, clientelism, feckery, free-marketeering, land re-zoning laws and endless tax incentives gave us the builders” boom, which turned into the speculators” boom, when Irishmen bought in London, Bulgaria and Berlin, most of these international mortgages fuelled by the debts of people in their twenties and thirties who were panicked into buying a house, any house, in some distant field, at a price that was increasing every day they delayed. All of this was made easier for everyone by a government that liked to say “yes”, and increased public spending beyond revenue expectations, every good year and a few beyond.

In the middle of 2007 a Romanian taxi driver told me he was going home to Bucharest because “the building site is dead.” All his friends had already gone. He had a wife with a new baby (called Seán, as I remember), and this was why he would be the last to leave. I don’t know why nobody listened to this guy, or how we failed to understand what he was saying. In May 2007, the pre-election rhetoric dealt with worries about the economy, and each party, very helpfully, promised an increase in public spending. By summer the property market had sighed to a halt, a fact no one wanted to notice. A year later, Lehman Brothers fell, and this was so clearly not Ireland’s fault that the brief opportunity to talk about what was actually our fault was lost. I can understand the denial at the end of the boom; what worries me is the denial that made it. From 2001 to 2007 it was not possible to be off-message about the Irish economy or, especially, about the housing market. You would barely be published. Your article would end up in the middle of the supplement, unflagged.

In the summer of 2007, the Economic and Social Research Institute published a report by the economist Morgan Kelly which charted the post-boom fall in house prices in 40 different economies. He said that a fall in house prices does not normally pull down the rest of the economy, but that Ireland’s case might be special, given that house-building accounts for 15 per cent of Ireland’s income – three times more than in most other countries. It was included, without comment, as a link on the RTE news website one morning. I sent it to my nephew, who is studying economics. He said he had already read it. I never met anyone else who had. It was no fun being informed, either then or later. People don’t like you for it, and why should they? Kelly was made a figure of fun. He was accused of economic “contagion”.

One of the strangest feelings, living through a housing boom, is that you are rich or poor not because of the money you earn, but the year you started earning it. It is not a question of effort, but of luck. This was part of the impotence and panic that drove Irish people to buy overvalued houses towards the end of the boom; it was the feeling that we were running up a down escalator and had to grab hold of whatever we could, to stop being swept away. There is very little pleasure in buying a house. Perhaps this fact is not mentioned often enough. For a while, house auctions were a kind of blood sport in South Dublin. There were women who spent their lives going to them, to get high on the smell of money and other people’s pain. It was like living in a casino: the insanity of the sums involved; that blank, ecstatic misery on the faces of the people who won.

Telling the truth was, in the circumstances, not just boring, it was also unlucky, hexed, taboo. It might even be unclean. Careless talk costs jobs. If the bubble burst it would be your fault for calling it a bubble, because, at the end of the day, it’s not an economy, it’s a mood.

I am not a Freudian about this money shit, especially these days when it is so notional, so rarely handled or seen. I do think money is a magical substance, which makes the phrase “frozen desire” a little too … frozen, for me. These days I play with the idea of money as mother’s love; her body, her attention, the blessing of her gaze. It is the thing you fight your siblings for, because to be poor is to be so unloved. But money changes when you multiply it by millions of families, and that is the shift that I can not understand.

Anyway. What does well in a downturn? Security systems, fast food, medical supplies. It has taken Ireland more than two years to get real. The private sector discovered it in 2008, but in 2009 the public sector really learned what a €3 billion, followed by a €3.5 billion readjustment in the national finances does to your pay cheque, your grant, your welfare slip. “And remember, kids”, says the chat show host at the end of the annual Toy Show on television, “Manage Your Expectations.”

On 12 December, everyone in Smyths toyshop in Bray is on the phone, either to the internet or to a spouse. One person is talking in Polish, another couple in German. It looks the same as any other year – maybe a bit quieter – but if you bump into someone you know in the aisle you do not stay to see them weigh one piece of plastic tat against another, or how long it takes them to decide. The place is full of buggies. I love these children with their wise eyes: the ones who are allowed to see it all, because they are still too young for Santa Claus.