Good press for Ireland on Bloomberg

Cork boy 55

Seems to be a trend for good press on Ireland in the international press
over last couple of months:D
Heres two examples from Bloomberg yesterday

Dara Doyle

http://www.bloomberg.com/news/2011-09-19/ireland-recovers-as-greece-sinks-in-debt-market-affirming-kenny.html

Irish bonds with a duration of more than a year returned 17.4 percent in dollar terms since June 17, the most of the 26 government debt markets tracked in indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies

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“Ireland will be the first of the euro countries to recover because they really bit the bullet,” Ross, said in an Aug. 30 radio interview on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. “Once they get through all that, the fundamental advantages of Ireland are intact.”

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Surveillance Midday with Tom Keene




"Ireland is the one shining example of a successful austerity story."

Richard Franulovich, a senior currency strategist at Westpac Banking Corp., and Charles Dumas, research director at Lombard Research Ltd., talk about Europe's fiscal crisis, risk for Greece and Italy and global currencies. They speak with Tom Keene on Bloomberg Television's "Surveillance Midday." (Source: Bloomberg)


video at 4:30 mentions Ireland briefly

http://www.bloomberg.com/video/75706276/

Anyone else watch the Tom keene show great show its on about five on bloomberg

waken

Looks like we are the teachers pet at the moment and its good to see but Im not sure if this will do us any good in the long term. I guess it all depends on what happens if or when Greece eventually defaults.
Waken

thebman

waken wrote: »

Looks like we are the teachers pet at the moment and its good to see but Im not sure if this will do us any good in the long term. I guess it all depends on what happens if or when Greece eventually defaults.
Waken

We aren't heavily exposed to Greek debt as far as I'm aware so I'd say it wouldn't be a killer blow to us.

The Outside Agency

pride comes before a fall :P

i distinctly recall expert economists refute any notion of assistance from the IMF not that long ago.. and before that the same experts were recommending everyone buy a house as an investment.

What austerity?

The majority of people in Ireland are still well-off and haven't experienced much hardship. A drop in Income, yes, but not hardship.

1.8m working, highest min wage, high dole and pension payments and high public sector salaries.

Shamefully, those who suffer the most are children having increased class sizes and the sick, with beds and wards closed down.

Those with mortgage difficulties are in that position as a result of their own decisions.

People can afford to give more. Be it more tax (property, water) and a reduction in dole payments/salaries.

Ireland's debt is 148bn and rising. We shouldn't be borrowing so much. Spending ought to be more in line with tax income.

Sand

We're back to Q3 of 2010:

"We've turned a corner!"

"Ireland is different! Not like those durty Greeks!"

"Ireland wont need a bailout!"

Etc, etc.

The basic, fundamental facts are as follows:

Unemployment figures are appalling, and getting worse. A whole generation of young males left education chasing jobs on building sites. Even a large proportion of the brighter sparks went and wasted years earning legal qualifications which will never, ever earn them a penny. Thats going to turn into a large and growing long term unemployment problem with predictable and costly social problems resulting.

NAMA is a timebomb. The Sovereign invested every single man, woman and child into the greatest, riskiest junk property bond vulture fund ever seen. And the news around it has got very, very, very quiet. Very quiet.

The "reform" agenda is running into sand whilst we are still 18 billion short of a balanced budget. The EBS privitisation debacle, Croke Park and the various kickbacks on what are minor, minor, minor reforms shows the resistance of the insiders to reality.

Economic growth rates are being cut and cut and cut. Both in Ireland and abroad. Any debt burdern is "manageable" if you presume enough growth. Thats what the advocates of the November 2010 surrender did, but reality seems to have a political bias...much like the credit rating agencies.

And remember, the wise and responsible sages who have guided us to this disaster did so in the belief that the Germans would swoop in to save the day by forgiving all our debt and splurging the cash. That hasnt happened, and that wont happen.

hmmm

Sand wrote: »

Unemployment figures are appalling, and getting worse.

The rate of layoffs has considerably slowed, and nearly halted.

NAMA is a timebomb.

We finally have reasonably good estimates as to what the loss will be on NAMA and our investments in the banks.

The "reform" agenda is running into sand whilst we are still 18 billion short of a balanced budget.

You're overstating the deficit. Approximately 7 billion is once off payments to the banks. The deficit is on target - we can argue where cuts should come, but the public finances have been stabilised.

Economic growth rates are being cut and cut and cut. Both in Ireland and abroad.

At least they are still growth and not a contraction.

And remember, the wise and responsible sages who have guided us to this disaster did so in the belief that the Germans would swoop in to save the day by forgiving all our debt and splurging the cash. That hasnt happened, and that wont happen.

The only people who believed that our debt would be written off are the default-monkeys. The rest of us know we have a long hard struggle ahead and there are no shortcuts or magic money trees to be found.

Sand

The rate of layoffs has considerably slowed, and nearly halted.

Yeah, its been "stabilising" for the past year whilst also steadily getting worse. I suppose when theres less people in employment, theres less people to sack.

It looks like 14-15% unemployment is the new normal.

We finally have reasonably good estimates as to what the loss will be on NAMA and our investments in the banks.

Oh right, so that was the purpose of NAMA - to get "reasonably good estimates" of the loss. And by the by to stick the taxpayer with all of it.

Not to get credit flowing again. Not to prevent the spectre of bank nationalisation.

All part of the new normal.

You're overstating the deficit. Approximately 7 billion is once off payments to the banks. The deficit is on target - we can argue where cuts should come, but the public finances have been stabilised.

Yeah, maybe theres 999 trees in the forest, maybe theres 899 trees. You go off and count them. Ill be happy to consider it a forest.

At least they are still growth and not a contraction.

Oh, more of the new normal...

Look, we dont just have to grow. We have to grow by enough to ensure we can meet all the obligations put upon us by the morons in the civil service, the useful idiots that comprise the Dail, and our dear friends in the ECB/Europe.

Almost is never enough.

The only people who believed that our debt would be written off are the default-monkeys. The rest of us know we have a long hard struggle ahead and there are no shortcuts or magic money trees to be found.

Oh, more of the new normal. The wise and responsible sages didnt argue against default. They argued against what they described as "default" (I'm amused by how that word has been rehabilitated - previously a dozen people would jump in to denounce "default" whilst allowing for "restructuring").

Whilst proclaiming Ireland would be as mad as a bag of monkeys to threaten to default unilaterally, there was the repeated reassurance that the EU position was evolving and that if Ireland went along with "the plan" then there would be an organised, EU agreed default/restructuring later.

Again, as predicted by the "doom and gloom brigade" that hasnt happened, and it wont happen.

But then again, isnt that all part of the new normal?

hmmm

Sand wrote: »

But then again, isnt that all part of the new normal?

All I see is invective in your post, no facts. I'm afraid I don't get as emotional as you do about whether or not I get to be proved right or wrong, I like to stick to the reality (which is never as bad or as good as commentators who are trying to fill 24 hour news channels make it out to be).

jackiebaron

Cork boy 55 wrote: »

Seems to be a trend for good press on Ireland in the international press
over last couple of months:D
Heres two examples from Bloomberg yesterday

Dara Doyle

http://www.bloomberg.com/news/2011-09-19/ireland-recovers-as-greece-sinks-in-debt-market-affirming-kenny.html

---

Surveillance Midday with Tom Keene




"Ireland is the one shining example of a successful austerity story."

Richard Franulovich, a senior currency strategist at Westpac Banking Corp., and Charles Dumas, research director at Lombard Research Ltd., talk about Europe's fiscal crisis, risk for Greece and Italy and global currencies. They speak with Tom Keene on Bloomberg Television's "Surveillance Midday." (Source: Bloomberg)


video at 4:30 mentions Ireland briefly

http://www.bloomberg.com/video/75706276/

Anyone else watch the Tom keene show great show its on about five on bloomberg

It's bollocks. We are being used as a benchmark, nothing more. Ireland is the most bankrupt country in Europe. Among the PIIGS we have the least to offer....nothing. At least Spain, Portugal, Italy and Greece can still grow the best tomatoes and strawberries by the side of the road. We have NOTHING. So this crap about Ireland "emerging from the quagmire of bankruptcy" is utter gibberish.

ardmacha

So this crap about Ireland "emerging from the quagmire of bankruptcy" is utter gibberish.

A bit like your post, then?

Problems remain and the international situation isn't great. But that is leading to lower interest rates and a more conciliatory approach from the likes of the ECB. I'd be more worried if there was an international recovery and we weren't taking advantage of it. Now the international recovery will be perky enough when it comes and we'll then be able to exploit that.

The Outside Agency

ardmacha wrote: »

A bit like your post, then?

Problems remain and the international situation isn't great. But that is leading to lower interest rates and a more conciliatory approach from the likes of the ECB. I'd be more worried if there was an international recovery and we weren't taking advantage of it. Now the international recovery will be perky enough when it comes and we'll then be able to exploit that.

Have you been watching the news lately?
What international recovery are you talking about?

IMF Cuts Global Growth Forecast

Crazy Horse 6

The delusion continues unabated.

ardmacha

Have you been watching the news lately?

Did you read my post, at all?

The Outside Agency

ardmacha wrote:

Now the international recovery will be perky enough when it comes and we'll then be able to exploit that.

ardmacha wrote:

Did you read my post, at all?

Yes.

You're indicating a future recovery, you're confident it will happen and Ireland can exploit it.

nivekd wrote:

Have you been watching the news lately?
What international recovery are you talking about?

Our current global banking system is based on issuing money which is then paid back with interest.

If I am Mr.Banker in control of euros and give out 1 euro to Joe with the expectation of getting 2 back, where will the other euro come from?

It's a very simple ponzi scheme.
You cannot roll over debt with more debt and believe the problem is solved, it's retarded.

A lot of people hold the belief we can just continue letting banks control the money supply and we'll be back to happy days in no time, that's retarded aswell.

Watch Ben Bernanke give his speech tomorrow and see how the financial markets react.

You can call me a doomer when a litre of petrol goes back to 1 euro.
The current banking system requires infinite growth but collides with finite energy. (gas, oil, coal)

You can see petrol going higher?
35% increase in gas prices recently, why is that?

Here's a little article for you, hope that helps.

CrystalLettuce

salonfire wrote: »

What austerity?

The majority of people in Ireland are still well-off and haven't experienced much hardship. A drop in Income, yes, but not hardship.

1.8m working, highest min wage, high dole and pension payments and high public sector salaries.

Shamefully, those who suffer the most are children having increased class sizes and the sick, with beds and wards closed down.

Those with mortgage difficulties are in that position as a result of their own decisions.

People can afford to give more. Be it more tax (property, water) and a reduction in dole payments/salaries.

Ireland's debt is 148bn and rising. We shouldn't be borrowing so much. Spending ought to be more in line with tax income.

Who's to say we shouldn't be borrowing so much?

Cutting welfare is a bad idea, since that money goes straight into the economy. The richer someone is, the less likely they are to spend all that money, at least in the short term. This is why welfare is a driver for economy and cuts hurt more than tax hikes.

"Those with mortgage difficulties are in that position as a result of their own decisions. " is just ludicrous, and it doesn't disappear the problem. Most people don't know much about the details of these things - they go to their banks for advice. Someone is not at fault for not realising what a big cod everything was. It was the fault of the banks.

A lot of people have to try and raise those kids on the Dole now.

Peanut

CrystalLettuce wrote: »

Cutting welfare is a bad idea, since that money goes straight into the economy. The richer someone is, the less likely they are to spend all that money, at least in the short term. This is why welfare is a driver for economy and cuts hurt more than tax hikes.

Does the money borrowed for welfare provide enough economic growth to facilitate repaying that loan, with interest, at a later date?

If that's true, why can't we get out of this mess by simply borrowing more money to give out as welfare?

femur61

salonfire wrote: »

What austerity?

The majority of people in Ireland are still well-off and haven't experienced much hardship. A drop in Income, yes, but not hardship.

1.8m working, highest min wage, high dole and pension payments and high public sector salaries.

Shamefully, those who suffer the most are children having increased class sizes and the sick, with beds and wards closed down.

Those with mortgage difficulties are in that position as a result of their own decisions.

People can afford to give more. Be it more tax (property, water) and a reduction in dole payments/salaries.

Ireland's debt is 148bn and rising. We shouldn't be borrowing so much. Spending ought to be more in line with tax income.

I have to agree with you on.

djpbarry

nivekd wrote: »

i distinctly recall expert economists refute any notion of assistance from the IMF not that long ago.. and before that the same experts were recommending everyone buy a house as an investment.

I distinctly recall experts (OECD, Central Bank, ESRI) sounding alarm bells with regard to Ireland’s overheated property market long before the crash. Nobody wanted to know.

salonfire wrote: »

The majority of people in Ireland are still well-off and haven't experienced much hardship. A drop in Income, yes, but not hardship.

Incomes haven’t really dropped at all for those in employment. Taxes have gone up, yes, but gross income has only declined marginally.

jackiebaron wrote: »

It's bollocks. We are being used as a benchmark, nothing more. Ireland is the most bankrupt country in Europe. Among the PIIGS we have the least to offer....nothing. At least Spain, Portugal, Italy and Greece can still grow the best tomatoes and strawberries by the side of the road. We have NOTHING.

So what’s all this then?

CrystalLettuce wrote: »

"Those with mortgage difficulties are in that position as a result of their own decisions. " is just ludicrous, and it doesn't disappear the problem. Most people don't know much about the details of these things...

Perhaps not the finer details, no. But the basic idea of paying back a principle sum plus interest is not beyond the grasp of most people.

OMD

CrystalLettuce wrote: »

Who's to say we shouldn't be borrowing so much?

Cutting welfare is a bad idea, since that money goes straight into the economy. The richer someone is, the less likely they are to spend all that money, at least in the short term. This is why welfare is a driver for economy and cuts hurt more than tax hikes.
.

What proof do you have that the richer someone is the less they spend?

HivemindXX

Here's an old article from Business Week about that.

I'm sure you could find more up to date and statistic rich information if you tried. However I don't really believe it's necessary.

If I need to spend €10k a year to live and someone gives me €100k chances are I'll spend waaaay more than €10k but not nearly all of it. I'll save some of it, or (if I was foolish) I'd do my part to inflate the gold bubble and buy some pretty metal. Neither of which helps the Irish economy much in the short term.

If the someone split the €100k and gave €10k each to 10 people then they are much more likely to have the entire €100k spent buying necessities, feeding and clothing the people the money went to, having a percentage return through VAT, giving revenue to shops and small businesses allowing them to keep people in work etc etc.

draiochtanois

This post has been deleted.

lasnoufle

djpbarry wrote: »

Perhaps not the finer details, no. But the basic idea of paying back a principle sum plus interest is not beyond the grasp of most people.

I'll have to disagree on this one. I know people around me that believed that borrowing €100000 on a 10 year term at 3% would cost them €103000. You're overestimating people here... Not saying understanding the principle is beyond their grasp, but I think they just seem to go for the understanding that seems the more interesting to them and don't even bother to check it against reality.

EDIT: Now then... I won't pity them. That's natural selection.

draiochtanois

This post has been deleted.

OMD

HivemindXX wrote: »

Here's an old article from Business Week about that.

I'm sure you could find more up to date and statistic rich information if you tried. However I don't really believe it's necessary.

If I need to spend €10k a year to live and someone gives me €100k chances are I'll spend waaaay more than €10k but not nearly all of it. I'll save some of it, or (if I was foolish) I'd do my part to inflate the gold bubble and buy some pretty metal. Neither of which helps the Irish economy much in the short term.

If the someone split the €100k and gave €10k each to 10 people then they are much more likely to have the entire €100k spent buying necessities, feeding and clothing the people the money went to, having a percentage return through VAT, giving revenue to shops and small businesses allowing them to keep people in work etc etc.

I agree to a certain extent but higher paid are also most likely to borrow so in the short term to medium term they spend more than they earn. Also higher paid are more likely to spend on luxeries which have vat on them. Those on benefits are more likely to buy the cheapest which is more likely to mean imports. Also people on benefits are most likely to use black Market. Thus taxes are lost on this money and it goes into black market and into organised crime.

jackiebaron

OMD wrote: »

What proof do you have that the richer someone is the less they spend?

Ever hear of Bush's tax cuts for the wealthy? His rationale.....give money back to the wealthy and they will pump it back into the economy creating more jobs and stimulating growth. Only that's not how it works. Give a multi-millionaire who's got 10 houses, 20 cars, 30 misstresses and 40 mill in the bank a 2 million dollar tax rebate you think he's going to all of a sudden open a new plant employing 100 people or he's going to go out and buy 2 million worth of household appliances and consumer durables? Bollocks. It goes straight into his slush fund to be used for the next round of campaign contributions (another word for bribes) to ensure that the guy he's "contributing" to will further erode the rights of the slobs in his factory or the safety standards at his steel mill so he can cream off even more and pad the bottom line.

Rich people don't buy extra stuff with their extra money...at least extra stuff that would stimulate growth the way Joe Sixpack would if he had an extra 200 bucks a month in his paw.
Joe Sixpack is going to take his family one extra time to Red Lobster or Pizza Hut. And enough Joe sixpacks doing that will increase the need for more waitresses. Or he'll splurge on new sports gear for each of his brats every other month....which I suppose will increase Chinese factory output and maybe bump up the need for a few extra shelf-stackers at Wal-Mart or Foot-Locker.

New tyres for the Bentley or a few more crates of '71 Bordeaux for moneybags doesn't stimulate the underlying economy.

srsly78

Yeah all that money going to vineyards just disappears into thin air right?

ei.sdraob

srsly78 wrote: »

Yeah all that money going to vineyards just disappears into thin air right?

Aint Bentley quite a profitable subsidiary of VW? I suppose those cars design and build themselves

Irishstabber

nivekd wrote: »

Yes.

Our current global banking system is based on issuing money which is then paid back with interest.

If I am Mr.Banker in control of euros and give out 1 euro to Joe with the expectation of getting 2 back, where will the other euro come from?

It's a very simple ponzi scheme.
You cannot roll over debt with more debt and believe the problem is solved, it's retarded.

A lot of people hold the belief we can just continue letting banks control the money supply and we'll be back to happy days in no time, that's retarded aswell.

Bravo well said. And until people realise that (Those who don't benefit from it that is) the economic woes of the world shall continue.

We can't borrow forever its impossible. There will come a time, quite soon, hopefully within my lifetime that we will literally run out of credit.

How can a sovereign pay back a loan when the principal has been spent on debt consolidation + yearly budgets and the interest it owes doesn't even exist in any shape, physically or digitally?

Money will become worth less and less as the years go on which will force more borrowing and more debt. Its perpetual, the world will come to a head on this matter sometime we seem to just enjoy lingering on the edge of that cliff. Or should I say being cornered on a cliff by our sovereign choice to be part of that monetary system.

Unfortunately it seems to be the only system available to us, we all know what happened to Iraq and Libya when they tried to change their systems.

Now I'm not saying that one of the reason those sovereign nation were attacked is because, Iraq was changeing its reserve currency to Euro or that Libya was testing a gold backed currency, but if the shoe fits?

Anyway, the ECB and IMF (and our many other creditors) wouldn't let aul Eire default on her dues or change our monetary system without some tough economic sanctions(and most probably more severe measures) but sure we would be all alone and would most likely return to the potato famine days so it wouldn't work.

Therein lies the problem. Since its all or nothing for an overhaul of the world economic and monetary policy we will eventually meet that lovely era of unstoppable inflation and spiraling borrowing (oh wait? have we got there already?).

We all know what happend to joe bloggs who kept borrowing and consolidating and borrowing and consolidating over the course of his life.
He died and got away with it.....Not really, he went bankrupt and lost everything. Do we really think a sovereigns debt is any different.

Check out any public debt graph of almost any country then go to bed tonight and be afraid be very afraid ha. Or ignore it and pretend everything will be alright, that seems to work for most people.

Rant over, I had fun :-):D

djpbarry

jackiebaron wrote: »

Rich people don't buy extra stuff with their extra money...

They don’t buy bigger houses, bigger cars, fancier holidays, pay other people to do stuff they don’t want to do, etc., etc., etc. ? All just sits in the bank, does it?

jackiebaron

ei.sdraob wrote: »

Aint Bentley quite a profitable subsidiary of VW? I suppose those cars design and build themselves

Well I suppose new tyres for a handful of bentleys is going to have the same massive boost to production as new tyres for say 30 million family saloons?

Get fcuking real!

jackiebaron

djpbarry wrote: »

They don’t buy bigger houses, bigger cars, fancier holidays, pay other people to do stuff they don’t want to do, etc., etc., etc. ? All just sits in the bank, does it?

Can you read?

It certainly doesn't get pumped back into the economy the way wage increases or tax cut for the proles does.

jackiebaron

srsly78 wrote: »

Yeah all that money going to vineyards just disappears into thin air right?

WHAT???

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srsly78

Jackie what have you got against vineyard and automotive workers?

djpbarry

jackiebaron wrote: »

Can you read?

Can you produce evidence to support your argument?

jackiebaron wrote: »

It certainly doesn't get pumped back into the economy the way wage increases or tax cut for the proles does.

Why? Because you say so?

Irishstabber

djpbarry wrote: »

Why? Because you say so?

Id imagine its got to do with the droves of people, most of the population actually, who would benefit from a wage increase or lower rate tax cut as opposed to the top 5% who would benefit from a higher rate cut no???

CrystalLettuce

jackiebaron wrote: »

Ever hear of Bush's tax cuts for the wealthy? His rationale.....give money back to the wealthy and they will pump it back into the economy creating more jobs and stimulating growth. Only that's not how it works. Give a multi-millionaire who's got 10 houses, 20 cars, 30 misstresses and 40 mill in the bank a 2 million dollar tax rebate you think he's going to all of a sudden open a new plant employing 100 people or he's going to go out and buy 2 million worth of household appliances and consumer durables? Bollocks. It goes straight into his slush fund to be used for the next round of campaign contributions (another word for bribes) to ensure that the guy he's "contributing" to will further erode the rights of the slobs in his factory or the safety standards at his steel mill so he can cream off even more and pad the bottom line.

Rich people don't buy extra stuff with their extra money...at least extra stuff that would stimulate growth the way Joe Sixpack would if he had an extra 200 bucks a month in his paw.
Joe Sixpack is going to take his family one extra time to Red Lobster or Pizza Hut. And enough Joe sixpacks doing that will increase the need for more waitresses. Or he'll splurge on new sports gear for each of his brats every other month....which I suppose will increase Chinese factory output and maybe bump up the need for a few extra shelf-stackers at Wal-Mart or Foot-Locker.

New tyres for the Bentley or a few more crates of '71 Bordeaux for moneybags doesn't stimulate the underlying economy.

I did actually post a statistical proof for this, but it got ignored, since it proves the right wrong about things.

CrystalLettuce

Peanut wrote: »

Does the money borrowed for welfare provide enough economic growth to facilitate repaying that loan, with interest, at a later date?

If that's true, why can't we get out of this mess by simply borrowing more money to give out as welfare?

One could ask the same question about Austerity, which clearly isn't working.

Obviously you can't solve the issue purely by injecting cash into the economy, you need to create jobs too.

OMD

CrystalLettuce wrote: »

I did actually post a statistical proof for this, but it got ignored, since it proves the right wrong about things.

Where is this statistical proof?

Bandana boy

The Rich your all talking about is in reality the middle classes, and I along with most recognized Economic folk agree that sustained growth comes from Expenditure in the middle classes.

There is also a whole host of morale of the country and expectation of it citzens reasons not to boost social welfare but instead cut middle class taxs.

Also to the couple of Chicken little's in the thread the sky is not falling down.

Really it is not

I would not lie to you ..........

CrystalLettuce

OMD wrote: »

Where is this statistical proof?

I already said I posted it a while back. I'm pretty sure you were one of the people who ignored it at the time, actually. It'll take a while to backthrough all my posts as I didn't have it bookmarked. But don't be surprised when it turns out to exist.

OMD

CrystalLettuce wrote: »

I already said I posted it a while back. I'm pretty sure you were one of the people who ignored it at the time, actually. It'll take a while to backthrough all my posts as I didn't have it bookmarked. But don't be surprised when it turns out to exist.

You posted no statistical proof on this thread. I will be astonished if it is true statistical proof. It may be opinion but doubtful it is statistical proof

CrystalLettuce

http://blogs.wsj.com/source/2011/08/07/five-false-premises-about-economic-recovery/

4. Taxes for the rich should not be raised, if we are to promote growth.

As most strikingly manifested in the recent U.S. budget deal, the strong presumption behind the current recovery orthodoxy is that tax increases for the rich should not be used for deficit reduction so that these wealth creators can invest and generate growth; making the rich richer (at least no less poorer than they are now) will in the end make all of us richer, is the belief.

However, the record of the current generation of the rich in this regard has been dismal. Despite the rise in income inequality in most countries in the last three decades, economic growth has slowed down rather dramatically—the world economy grew at 3.2% in per capita terms between 1960 and 1980, while it grew at 1.4% between 1980 and 2009.

Nowhere has the failure of the rich been as evident as in the U.S.. According to the Economic Policy Institute, a Washington D.C. think-tank, between 1979 and 2006 (the latest year of available data), the top 1% of earners in the U.S. more than doubled their share of national income, from 10% to 22.9%. The top 0.1% did even better, increasing their shares by more than three times from 3.5% in 1979 to 11.6% in 2006. Despite getting such a bigger share of national output, the rich in the U.S. have failed to increase the growth rate. The U.S. growth rate in per capita terms since 1980 has been around 1.8%, which is the same rate as the one seen between 1950 and 1980.

So, figuratively speaking, the Americans have been paying their “wealth creators” two to three times more than before to get the same outcome. What makes people think that they will behave differently this time around?

Explain?

OMD

CrystalLettuce wrote: »

http://blogs.wsj.com/source/2011/08/07/five-false-premises-about-economic-recovery/



Explain?

I will be astonished if it is true statistical proof. It may be opinion but doubtful it is statistical proof

djpbarry

Irishstabber wrote: »

Id imagine its got to do with the droves of people, most of the population actually, who would benefit from a wage increase or lower rate tax cut as opposed to the top 5% who would benefit from a higher rate cut no???

But we're not talking about the population as a whole, we're talking about average individuals. The point is essentially being made that the rich (I'm not sure exactly who that label is being applied to) hoard their cash while the not-so-rich part ways with it rather easily. That seems to me like a ridiculous (and baseless) generalisation.

CrystalLettuce

djpbarry wrote: »

But we're not talking about the population as a whole, we're talking about average individuals. The point is essentially being made that the rich (I'm not sure exactly who that label is being applied to) hoard their cash while the not-so-rich part ways with it rather easily. That seems to me like a ridiculous (and baseless) generalisation.

You're missing the point - those on low incomes have to spend what they have to pay for day to day essentials. This pumps money into local business and creates jobs. Higher earners simply have more money available for "Hording" in the first place, so obviously, are more likely to do so by virtue than those on lower incomes can't.

there's actually been quite a bit written about this, I'll see if I can pull it up.

CrystalLettuce

OMD wrote: »

I will be astonished if it is true statistical proof. It may be opinion but doubtful it is statistical proof

But those are statistics, and they're damning. Do you have anything to counter it?

djpbarry

CrystalLettuce wrote: »

You're missing the point - those on low incomes have to spend what they have to pay for day to day essentials. This pumps money into local business and creates jobs.

I don’t know about that. Ireland is a very open economy – an awful lot of what is consumed is imported. And what do we mean by “those on low incomes” anyway? From where I’m sitting, the average person in Ireland is extremely well paid.

OMD

CrystalLettuce wrote: »

But those are statistics, and they're damning. Do you have anything to counter it?

In the late 80s into early 90s we had major cuts under Mac the knife McSharry. We also had massive cuts in income tax. The top rate dropped from 65% to 42%. After this we had one of the best periods if growth in this country's history.

In Tatchers Britain top rates of income tax were cut even more and again they experienced a massive boom.

Arfan

Correlation is not Causation. You will need to prove tax cuts for high income earners caused an economic boom not just that one followed the other.

OMD

Arfan wrote: »

Correlation is not Causation. You will need to prove tax cuts for high income earners caused an economic boom not just that one followed the other.

Exactly. But it works both ways