The latest government suggestion to gullies, "SPEND MORE"!

MrDarcy

Taoiseach Brian Cowen insisted today that people must start spending more cash as he dismissed claims that Ireland was heading for a double-dip recession.

Official figures revealed the economy began to contract again between April and June after showing the first signs of recovery in the previous three months.

National output dropped a significant 1.2% but Mr Cowen rejected claims that the country was slipping back into a second prolonged downturn.

“I don’t accept that analysis, based on this second quarterly report,” he said.

“You have to look at the full year to get the best possible estimate of how things will go.”

Mr Cowen said the Central Statistic Office report came against a backdrop of the economy performing better than expected in the first three months of the year.

Despite unemployment soaring to 462,000, the Taoiseach singled out the big decline in consumer spending and claimed that people will have to get out and shop to help resurrect the country’s fortunes.

“We have to continue to encourage people – those who have disposable income - to spend in the domestic economy,” he said.

The CSO report showed Gross Domestic Product (GDP) – the value of goods and services including foreign-owned companies – suffered a 1.2% decline in trade between April and June.

The downturn came after businesses, both homegrown and multinational, had shown signs of picking up after the New Year.

Domestic firms were also hit in the second quarter, but not to the same extent, with their value down by 0.3%.

In a breakdown of the national accounts, the CSO said the economy was hit by a fall in consumer spending – down 1.7% compared to the same period last year.

The Government suggested a sudden surge in imports had also damaged the early signs of recovery.

Finance Minister Brian Lenihan insisted he stood by his assessment late last year that the economy had turned a corner and called for a cautious analysis of the report.

“I agree that these (figures) are not encouraging but we have moved from a position of a very sharp, steep, decline to a position where we have stabilised,” he said.

He added: “It is clear the economy is sluggish. But it has moved from a position of decline to a position of stability and that will pose serious budgetary challenges for the Government.”

The Government is planning to issue revised forecasts on the economy and state finances in October ahead of Budget 2011.

The Opposition dismissed the Government’s insistence that a corner had been turned.

Joan Burton, Labour’s finance spokeswoman, said the figures should come as a cold dose of reality and a bitter disappointment.

“These numbers show that far from having turned the corner earlier this year, the Irish economy suffered a ’dead cat bounce’,” she said.

Arthur Morgan, Sinn Féin’s finance spokesman, said: “The Irish economy may have technically emerged from recession in the first quarter of the year but today’s figures underscore the reality that there can be no sustainable economic growth when there is still an absence of jobs.”

The report overall showed the domestic economy was still struggling, prompting analysts to warn over how far the Government should go with plans for at least €3bn cuts in the December budget.

Question marks have also been raised over Mr Lenihan’s economic forecasts after last December’s budget projected a return to growth in six to nine months.

Mr Cowen said a lot of work remained to be done to drive up exports, despite the CSO reporting an €884m rise on the same three months in 2009.

The CSO also reported that the overall value of industry output grew 1.7% on the second quarter of last year but construction, one of the biggest victims of the country’s downturn, was down 28%.


Read more: http://www.breakingnews.ie/ireland/cowen-urges-people-to-spend-more-to-offset-economic-setback-474843.html#ixzz10N0VD9pp

MrDarcy

If only it was that simple, if only WE HAD IT YOU FAT OBESE F*CKING PLEB!

Mr Benevolent

Spend more? I'm on the dole and trying hard to save most of it in case there's a massive cut!

MrDarcy

He obviously can't get past the sheer hundreds of thousands of people who can't pay ESB and Bord Gais bills and winter hasn't even f*ckin' started yet?!?!?!?!?!?!?!?!?

If you're a father of two, unemployed and you can't pay your gas or your ESB bill, I can kind of think it's a safe enough assumption to make that you can't head into South William Street and treat the wife and kids to an Indian?!?!?

What planet is this guy living on, does he not read the papers or something, is he drunk again?!? :mad::mad::mad:

jimmycrackcorm

There are a hell of a lot of people who actually have a lot of cash but are apprehensive to spend it:

• Not everyone is on the dole.
• Not everyone has had a pay cut.
• Some people have even gotten rises.
• Many People who had bought houses pre-boom benefited from the rise in incomes while their cost ratio improved (mortgage as a % of their pay).
• Lots of people stashed away nice profits from property deals made during the boom.

Even though the recession has gotten worse since last year, more new cars have been sold this year because people have started to get over the shock from last year but they are still generally cautious.

hinault

Cowen's statement.
Bit like Hitler telling people to come to Berlin on holiday in 1945:D:D:D





I wonder was Cowen pickled when he made that statement?
Seriously.

wilson10

Yeah, get out and spend your money on Korean TVs, German cars, Italian leather sofas and just about everything else made in China.

Wait a minute, won't that mean most of our hard earned money going out of the country.

I thought it was goods & services we needed to be going out and money coming in.

Oh darn it, I'm all confused now, I'm sure Mr. Cowan must know what he's talking about, after all he is running the country so he must be very clever.

P. Breathnach

jimmycrackcorm wrote: »

There are a hell of a lot of people who actually have a lot of cash but are apprehensive to spend it....

There's truth in that. There's a lot of saving going on.

hinault

jimmycrackcorm wrote: »

There are a hell of a lot of people who actually have a lot of cash but are apprehensive to spend it:

• Not everyone is on the dole.
• Not everyone has had a pay cut.
• Some people have even gotten rises.
• Many People who had bought houses pre-boom benefited from the rise in incomes while their cost ratio improved (mortgage as a % of their pay).
• Lots of people stashed away nice profits from property deals made during the boom.

Even though the recession has gotten worse since last year, more new cars have been sold this year because people have started to get over the shock from last year but they are still generally cautious.

Indeed, Jimmy.

And all those new car sales were subsidised by you and me, the hardpressed taxpayer, via the scrappage scheme.

I have some money set aside.
But I'll be damned if I am going to trust Clowen or Lenihan.
They moved the goalposts too often since September 2008.
You'd be a fool to trust either of them.

Olaf

Even the people with disposable income must surely be a bit wary of the budget coming up designed to remove as much of that as possible.

If you had spare cash at the moment, would you be throwing it around?

dan_d

What he said was "those who have extra money have to get out and spend it".

That's what got us into this mess in the first place. Following this, we then went out and spent money we didn't have (technical term being "credit").

We pretty much spent ourselves into the ground.

Is this the best he can come up with? Spend your money, so my quarterly figures look good? No matter that you won't have any kind of a cushion for when you lose your job?

ei.sdraob

Make me!


Anyways sounds like ff are planning to raid the savers' savings

lmimmfn

right so the country is fecked, no job is safe and were supposed to spend everything that might actually help us get by if we lost our jobs? or spend it all and have nothing indefinately with the next 2 years tax increases?

lol, i actually laughed when i heard Cowen on about this on the news today

Sikie

If you have a job you are cutting back household spending and saving as you don't know whether next week will bring a P45.

goat2

now asking the few that had a bit of sense all along to know that the past 10 years seemed too good to be true, and knew it was too good to be true, these same people who did not put us in the position we are now in, they were not fooled in the past, and they will not just be spending willy nilly now.if others did what these few did, we would have a great place

BornToKill

All my money is already tied up in investments:

Count Dooku

MrDarcy wrote: »

“We have to continue to encourage people – those who have disposable income - to spend in the domestic economy,” he said.

When in few months time, Gilmore will be next taoiseach, all disposable income will taken out from pockets of private sector workers through high taxes to preserve living standards of public sector workers anyway.

gurramok

We have one of the highest private individual debt levels in the EU(there was a link on this forum somewhere before).
That together with the prudent who still have jobs been shafted by profitable companies using the recession as an excuse to reduce pay and create job uncertainty is also fuelling the contraction.

flutered

yeah i wish i could spend more, my pension of 201 lids is going to have a 15% slice knocked off it come december, as i am disabled i am an easy target, who is going to bother helping my equals, but i am goning have some temperory fun when them gits come asking for my vote.

Sizzler

I know its nigh on 5 months ago but has Clowen forgotten this already?

http://www.moneyguideireland.com/national-solidarity-bond.html

Trampas

the vicious circle of wanting people to spend to increase tax returns and maybe generate a few jobs but people afraid to spend as they don't know when they need that rainy fund which seems only around the corner.

johnnyskeleton

MrDarcy wrote: »

If only it was that simple, if only WE HAD IT YOU FAT OBESE F*CKING PLEB!

Supposing for a minute that we did have it. Let's say after all everyday expense everyone had 5k p.a. extra from their pay packet.

What should they do with it?

Should they buy a new car under the scrappage scheme, sending their money to Germany?

Should they buy things that they neither need nor particularly want?

Should they spend more on the same things that they are already buying (I insist on paying an extra 20c on this loaf of bread marked €2, in the public interest)?

God forbid that they keep it and save it in case they lose their jobs. Or invest it in a start up company. Or lodge it in a failed bank to reduce the amount of money the government has to put in.

I wish he would tell us what we are supposed to spend our hard earned yos on, because I genuinely want to know. Should I buy more ipods or something?

johnnyskeleton

P. Breathnach wrote: »

There's truth in that. There's a lot of saving going on.

1. I think the level of savings is usually overstated.

2. Saving is exactly what people should be doing right now.

3. I'm not saying you are suggesting it, but this kind of talk sounds to me like a precursor to additional tax on savings and/or a general campaign against savers.

In the real world, if I work harder than my neighbour and spend less, thus leaving me a nice pile of savings, I'm a prudent, sensible person and I have been a net contributor to the economy. However, in Ireland, the neighbour is the victim of a ruthless plot by the saver to get him into a mire of debt and because the saver refuses to change his godless habits and go out and spend, the neighbour loses his job selling overpriced bling and tat.

whatawaster

Why does he expect people to spend money when it's likely most things will be cheaper next year, when prices are forced down by lack of demand?

Idbatterim

must be great to not have to worry about your job or pension hah Cowen?

ardmacha

I'm not saying you are suggesting it, but this kind of talk sounds to me like a precursor to additional tax on savings and/or a general campaign against savers.

But if people remove money from banks they will have even bigger problems.

Scarab80

ardmacha wrote: »

But if people remove money from banks they will have even bigger problems.

If the money is spent in Ireland it gets redeposited in sellers bank account so it's not a problem from a banking point of view, just a transfer of disposable income / savings to someone working.

Figures from the Central Bank Credit, Money and Banking Statistics.



There has been some decrease in amounts held on deposit however the main way people have been saving money is by paying down their credit. Since Feb 09 approx 50bn has been removed from the private sector money supply.

Of the €179bn currently on deposit, 97bn relate to households, 36bn to non-financial corporations and 46bn to pension funds, insurance companies and other financial intermediaries.

Scarab80

johnnyskeleton wrote: »

2. Saving is exactly what people should be doing right now.

Gotta disagree with this. Saving is what people should have been doing for the last decade when there was too much money in the economy but instead we inflated our wages and gave all our money to landowners.

A release of these savings at the start of the recession would have ended it fairly quickly, maybe we wouldn't have had a recession at all.

Unless you earn your income exclusively outside Ireland you need people to spend money to keep you in employment, if it were possible for people to save 100% of their income almost the entire country would be unemployed.

rumour

MrDarcy wrote: »

Taoiseach Brian Cowen insisted today that people must start spending more cash as he dismissed claims that Ireland was heading for a double-dip recession.

Official figures revealed the economy began to contract again between April and June after showing the first signs of recovery in the previous three months.

National output dropped a significant 1.2% but Mr Cowen rejected claims that the country was slipping back into a second prolonged downturn.

“I don’t accept that analysis, based on this second quarterly report,” he said.

“You have to look at the full year to get the best possible estimate of how things will go.”

Mr Cowen said the Central Statistic Office report came against a backdrop of the economy performing better than expected in the first three months of the year.

Despite unemployment soaring to 462,000, the Taoiseach singled out the big decline in consumer spending and claimed that people will have to get out and shop to help resurrect the country’s fortunes.

“We have to continue to encourage people – those who have disposable income - to spend in the domestic economy,” he said.

The CSO report showed Gross Domestic Product (GDP) – the value of goods and services including foreign-owned companies – suffered a 1.2% decline in trade between April and June.

The downturn came after businesses, both homegrown and multinational, had shown signs of picking up after the New Year.

Domestic firms were also hit in the second quarter, but not to the same extent, with their value down by 0.3%.

In a breakdown of the national accounts, the CSO said the economy was hit by a fall in consumer spending – down 1.7% compared to the same period last year.

The Government suggested a sudden surge in imports had also damaged the early signs of recovery.

Finance Minister Brian Lenihan insisted he stood by his assessment late last year that the economy had turned a corner and called for a cautious analysis of the report.

“I agree that these (figures) are not encouraging but we have moved from a position of a very sharp, steep, decline to a position where we have stabilised,” he said.

He added: “It is clear the economy is sluggish. But it has moved from a position of decline to a position of stability and that will pose serious budgetary challenges for the Government.”

The Government is planning to issue revised forecasts on the economy and state finances in October ahead of Budget 2011.

The Opposition dismissed the Government’s insistence that a corner had been turned.

Joan Burton, Labour’s finance spokeswoman, said the figures should come as a cold dose of reality and a bitter disappointment.

“These numbers show that far from having turned the corner earlier this year, the Irish economy suffered a ’dead cat bounce’,” she said.

Arthur Morgan, Sinn Féin’s finance spokesman, said: “The Irish economy may have technically emerged from recession in the first quarter of the year but today’s figures underscore the reality that there can be no sustainable economic growth when there is still an absence of jobs.”

The report overall showed the domestic economy was still struggling, prompting analysts to warn over how far the Government should go with plans for at least €3bn cuts in the December budget.

Question marks have also been raised over Mr Lenihan’s economic forecasts after last December’s budget projected a return to growth in six to nine months.

Mr Cowen said a lot of work remained to be done to drive up exports, despite the CSO reporting an €884m rise on the same three months in 2009.

The CSO also reported that the overall value of industry output grew 1.7% on the second quarter of last year but construction, one of the biggest victims of the country’s downturn, was down 28%.


Read more: http://www.breakingnews.ie/ireland/cowen-urges-people-to-spend-more-to-offset-economic-setback-474843.html#ixzz10N0VD9pp

This F****ing grotesque monkey still doesn't get it and he's trying to take us all down with him.
Spend all your savings!!!!! When thats done and that pool of money is completely bled from everyone what then??? What then?

DO NOT LISTEN TO THIS IDIOT

hinault

Scarab80 wrote: »

Gotta disagree with this. Saving is what people should have been doing for the last decade when there was too much money in the economy but instead we inflated our wages and gave all our money to landowners.

I agree 100%.
People should have been saving their money during the "boom".

However, if you recall there was a lobby who were very vocal and were saying during the boom that "capital appreciation on property represented a better return for savings".

Scarab80 wrote: »

Unless you earn your income exclusively outside Ireland you need people to spend money to keep you in employment, if it were possible for people to save 100% of their income almost the entire country would be unemployed.

Ideally you want people to save a % of their income.
As you say saving every single penny, is actually harmful to an economy.

Scarab80

hinault wrote: »

I agree 100%.
People should have been saving their money during the "boom".

However, if you recall there was a lobby who were very vocal and were saying during the boom that "capital appreciation on property represented a better return for savings".

Well let's say if people had saved during the real boom then we might not have had the "boom".

Most people I know that bought into the property bubble did so because they saw the "paper profit" others were making and wanted in, I don't know anyone who bought because Donnie Cassidy or Frank Fahey told them to.

Not that government or TDs should be giving out investment advice to the electorate, and bad advice at that, clearly they should not, but I would blame the government a lot more for continuing property related tax reliefs in the midst of a bubble and for failing to take the appropriate delfationary fiscal measures needed in the face of an overheating economy and inappropriately low interest rates.

The damage was done prior to 2008, what happened afterwards was an inevitability, but were any lessons learned?

hinault wrote: »

Ideally you want people to save a % of their income.
As you say saving every single penny, is actually harmful to an economy.

Unfortunately, at the moment people are saving more than they did during the past decade (I shouldn't say more than the past decade as more debt was incurred than money saved) which is just making a bad situation worse.