Good economic news thread

FreudianSlippers

fxotoole wrote: »

How much of this is down to people doing training courses/work placement/jobbrisge type schemes?

I.e. If one were to look at the prsi/tax/usc take in conjunction with this figure what kind of picture would it paint?

Personally I'd say that there are more people moving into full time employment and looking at the prsi/usc/tax take would probably validate this.

Income tax receipts of €2.89bn were collected to end February 2015, a year-on-year increase of €183m or 6.8%. For the month of February, income tax was €91m or 7.1% above target.

Source



If the graph breaks, it's here: http://databank.finance.gov.ie/Reserved.ReportViewerWebControl.axd?ReportSession=d2wfb3qf13xaaa45utqzsy55&Culture=6153&CultureOverrides=True&UICulture=1033&UICultureOverrides=True&ReportStack=1&ControlID=4d898399ad684723866e2dff3026b576&OpType=ReportImage&IterationId=76004c63c25145dda41cce1cceeedf13&StreamID=C_46iT1_1

Up 5.2% since 2008; Up 22.9% since its 10-year-low in 2010. Edit: Sorry the 2015 figure is actually only to Oct 2015; projection is higher than 2014 which is +52.15% since the low in 2010 and +30.20% since 2008

Fairly impressive and totally debunks the myth that the unemployment reduction is all jobbridge and emigration.

AlmightyCushion

fxotoole wrote: »

How much of this is down to people doing training courses/work placement/jobbrisge type schemes?

I.e. If one were to look at the prsi/tax/usc take in conjunction with this figure what kind of picture would it paint?

Personally I'd say that there are more people moving into full time employment and looking at the prsi/usc/tax take would probably validate this.

From the article:

There was an annual increase in employment of 2.9%, or 56,000 in the year to September.

The number of people in work is now estimated at 1,983,000 - the highest number in work since the first quarter of 2010.

All of the growth came in full-time jobs, while part-time employment fell by 3,400 over the quarter.

draiochtanois

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FreudianSlippers

draiochtanois wrote: »

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Without adequate public transport, people cannot successfully live in the commuter belt and work in the city. This artificially inflates house prices inside the canals without merit - ****ty, outdated and uninsulated homes are 10x their actual value because people purchase them to not have to commute for 2 hours a day.

This invariably leads us back into a property boom/bust cycle - people with mortgages far in excess of the average value of their homes means that when the market retracts (and it will no matter what) they are left in extreme negative equity rather than minor and affordable negative equity or at best a zero-sum amount.

You can blame the banks as much as you want, but in reality this is the government's fault for not buildings proper public transport and the DCC's fault for not allowing adequate height outside the historic core. Banks are only reacting to the market and giving people what they want/need. To pay 10x too much for an uninsulated 50 year old house in West Cabra for €600k.

Zubeneschamali

FreudianSlippers wrote: »

when the market retracts (and it will no matter what)

What leads you to this conclusion?

I'm not saying you're wrong, but the recent crash is the very first time it ever happened. Back in the 80s, things stagnated for years, but values did not actually drop.

draiochtanois

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FreudianSlippers

Zubeneschamali wrote: »

What leads you to this conclusion?

I'm not saying you're wrong, but the recent crash is the very first time it ever happened. Back in the 80s, things stagnated for years, but values did not actually drop.

We have fairly consistently gone from houses being underpriced to overpriced based on market conditions rather than actual house values.

I think if you look internationally (as I don't have Irish data) there is a constant boom-bust cycle; admittedly the boom in the 00s was the greatest.





EDIT: see here: http://www.economist.com/blogs/dailychart/2011/11/global-house-prices
Check out the prices in real terms (compare to US/Britain for similarities to Case Shiller) and perhaps more importantly prices against average income.

serfboard

draiochtanois wrote: »

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From all I've read, the root cause of the economic crisis in Ireland was massive inflows of foreign capital to our banks (and in particular to dodgy institutions like Anglo and Irish Nationwide), and no-one regulating what was going on. The banks in turn then fired this money at property developers to build stuff, and fired money at consumers to buy it.

When the foreign capital inflows stopped, the economy crashed.

K-9

I can see his point, our love affair with owning a home here means owning a house in the suburbs with a garden, not an apartment, and that drove (!) people to seek out places further and further out of Dublin. In country areas people wanted bigger and bigger houses.

I suppose it was more a symptom of the credit bubble, but exemplifies the lack of willingness by Dublin or local Government to plan properly or to try and put brakes on an out of control market.

The issues with fire safety certs in apartment complexes gives an example of how little checks and regulations there were. This stuff should have come up during construction, not a few years after completion.

andrew

Zubeneschamali wrote: »

What leads you to this conclusion?

I'm not saying you're wrong, but the recent crash is the very first time it ever happened. Back in the 80s, things stagnated for years, but values did not actually drop.

Below is a graph of the average price of a new home (adjusted for inflation) since 1975. The recent crash is the first time there's been a crash, but it's not the first time there's been a decline in house prices.





In general, in 17 of the past 44 years, real house prices have fallen.

Zubeneschamali

andrew wrote: »

Below is a graph of the average price of a new home (adjusted for inflation) since 1975.

This is indicitave, but not exactly what we need. If I buy a new house this year, and a different new house sells next year for less, that doesn't affect me at all.

The problem only arises if the house I bought is worth less than I owe.

That only happened once, in the recent crisis, as far as I know. I remember reading about negative equity in the UK in the early 90s, but never here.

andrew

Zubeneschamali wrote: »

This is indicitave, but not exactly what we need. If I buy a new house this year, and a different new house sells next year for less, that doesn't affect me at all.

The problem only arises if the house I bought is worth less than I owe.

That only happened once, in the recent crisis, as far as I know. I remember reading about negative equity in the UK in the early 90s, but never here.

Falls in house prices do effect you even if you're not in negative equity, via the wealth effect. Basically, when people take a hit to their wealth, they consume less. And there's evidence that the wealth effect in Ireland is quite strong (though this effect is stronger when you're in negative equity too). This matters to the extent that consumption matters for the economy as whole, though Ireland is much less dependent on consumption than many other countries.

Villa05

Zubeneschamali wrote:

That only happened once, in the recent crisis, as far as I know. I remember reading about negative equity in the UK in the early 90s, but never here.

In the past there were much more stringent rules on how much could be borrowed to purchase a house. From 1996 to 2005 these rules were abandoned gradually.
2.5 one persons income + 0.5 the 2nd income to 5/6 times combined salary
20 year mortgage term moved to 35 years

That is the cause of the spike in the graph.

Any future economic shocks will result in considerable falls in property prices in the future as people are forced to borrow there max allowable and borrowing over 30/35 years to get something basic and inadequate for the long term

The old rules had leeway for recovery from shocks, however, when you are borrowed to the max. There is little room for recovery.

There is also the problem mortgages from the noughties that have not been dealt with adequately, this includes non performing mortgages and performing trackers

draiochtanois

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Tea drinker

According to yesterdays Sunday Business Post some "officials" have used terms like "off the charts" and "out of this world" to describe the Nov tax receipts.
Also said growth for the year may be 10% rather than 6.2% forecast a few weeks back.

BoJack Horseman

Tea drinker wrote: »

According to yesterdays Sunday Business Post some "officials" have used terms like "off the charts" and "out of this world" to describe the Nov tax receipts.
Also said growth for the year may be 10% rather than 6.2% forecast a few weeks back.

That would be higher than the dubiously calculated Chinese growth figures...
So I'll believe it when I see it!

Of course, no matter what the mantra is , it's apparently nothing to do with the government... its all the Troika (everyone should be run by the troika seemingly!)

Godge

draiochtanois wrote: »

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Cherrywood and Adamstown are two of the few opportunities left to get it right.

Godge

Tea drinker wrote: »

According to yesterdays Sunday Business Post some "officials" have used terms like "off the charts" and "out of this world" to describe the Nov tax receipts.
Also said growth for the year may be 10% rather than 6.2% forecast a few weeks back.

http://www.businesspost.ie/bonanza-tax-take-surges-as-economy-hits-tiger-era-levels/

Astonishing is the only word to describe it.

ezra_pound

BoJack Horseman wrote: »

That would be higher than the dubiously calculated Chinese growth figures...
So I'll believe it when I see it!

Of course, no matter what the mantra is , it's apparently nothing to do with the government... its all the Troika (everyone should be run by the troika seemingly!)

It's actually a Denis O'Brien scam using jobsbridge and Sierra to massage the corporation tax and income tax figures. Nothing to do with the troika or government policy.

serfboard

draiochtanois wrote: »

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There is no way you can say that this would not have happened in the face of massive capital inflows. In fact, in your argument, there would be less properties available, making the prices even more expensive.

draiochtanois wrote: »

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If it's true that planning permission for retail space for a population of 14 million wouldn't have been (I presume you mean) granted, then all that would mean would be that existing properties would become more expensive. Simple supply and demand. And the demand was fuelled by debt, which was fuelled by massive capital inflows.

draiochtanois wrote: »

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No they wouldn't. Things only have value if people are willing to pay the price. People could only pay the price because cash was being fired out to them.

draiochtanois wrote: »

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I don't disagree here. The irony of the Celtic Tiger is not that we built too much, but that we didn't build enough - at least not in the right places. Or as you put it:

draiochtanois wrote: »

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Again from what I've read, we have a housing crisis now for reasons of vastly inadequate social housing on the public side, and developers not building on the private side. Private developers won't build becuase we now don't have the banks firing money at us like they were doing before - because (a) they don't have it (b) there are rules about how much people can borrow and (c) (I hope) they are being better regulated now.

K-9

BoJack Horseman wrote: »

That would be higher than the dubiously calculated Chinese growth figures...
So I'll believe it when I see it!

Of course, no matter what the mantra is , it's apparently nothing to do with the government... its all the Troika (everyone should be run by the troika seemingly!)

We are such an open economy though that just as sometimes there isn't much any Government can do about poor performance from external factors, the opposite has to apply to.

It will be interesting to see a detailed analysis of the CT figures in particular, 10 huge multinationals provide a big chunk of that revenue but if we could be in a position to eliminate the budget deficit next year, that's pretty spectacular.

draiochtanois

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listermint

Godge wrote: »

http://www.businesspost.ie/bonanza-tax-take-surges-as-economy-hits-tiger-era-levels/

Astonishing is the only word to describe it.

ezra_pound wrote: »

It's actually a Denis O'Brien scam using jobsbridge and Sierra to massage the corporation tax and income tax figures. Nothing to do with the troika or government policy.

Well tbh there is something arry about it all.

The lads on newstalk this morning were correct, no one can really explain the figures or the jump. But Corporate Tax appears to be an area of plausiblity.

We are in danger of being vilified by the US if it becomes clearer that we are a tax haven for their multinationals.

that recent pharma deal did not help optics.

And we havent heard anyone from the finance department heralding these massive figures. Id say they are more bewildered than anything. With a tinge of trepidation

Godge

listermint wrote: »

Well tbh there is something arry about it all.

The lads on newstalk this morning were correct, no one can really explain the figures or the jump. But Corporate Tax appears to be an area of plausiblity.

We are in danger of being vilified by the US if it becomes clearer that we are a tax haven for their multinationals.

that recent pharma deal did not help optics.

And we havent heard anyone from the finance department heralding these massive figures. Id say they are more bewildered than anything. With a tinge of trepidation

If you read the article you would have learned that the official figures are due out on Wednesday. We should get an explanation then.

listermint

Godge wrote: »

If you read the article you would have learned that the official figures are due out on Wednesday. We should get an explanation then.

Yes and early indicators is that it was unexpected.

When i say 'heralded', I mean they may not think this is a good thing.

ezra_pound

listermint wrote: »

Well tbh there is something arry about it all.

The lads on newstalk this morning were correct, no one can really explain the figures or the jump. But Corporate Tax appears to be an area of plausiblity.

We are in danger of being vilified by the US if it becomes clearer that we are a tax haven for their multinationals.

that recent pharma deal did not help optics.

And we havent heard anyone from the finance department heralding these massive figures. Id say they are more bewildered than anything. With a tinge of trepidation

We do know that income tax is also responsible for the massive growth in tax receipts as well as corporation tax. Of course we need to be careful of fluxes of corporation tax receipts. At any rate it will be certainly interesting to find out more on Wednesday.

FreudianSlippers

listermint wrote: »

We are in danger of being vilified by the US if it becomes clearer that we are a tax haven for their multinationals.

I don't think you know what a "tax haven" is. Certainly 12.5% corporation tax is not "haven" levels. Furthermore, it's clear that companies are paying tax in Ireland.

The problem was the "double Irish" system whereby companies were actually not paying tax anywhere.

listermint

FreudianSlippers wrote: »

I don't think you know what a "tax haven" is. Certainly 12.5% corporation tax is not "haven" levels. Furthermore, it's clear that companies are paying tax in Ireland.

The problem was the "double Irish" system whereby companies were actually not paying tax anywhere.

I do understand what tax haven is, i was using the term as a perception....

I in no way indicated that the companies where not paying tax here ? can you explain where i said that. In fact if you had read the post you would see that was my reference for the boon in the finances....

As i said the likes of the Allergan do not benefit us optically to the US, this is not a 'good thing'




Read my post again. please before insulting my intelligence.

K-9

FreudianSlippers wrote: »

I don't think you know what a "tax haven" is. Certainly 12.5% corporation tax is not "haven" levels. Furthermore, it's clear that companies are paying tax in Ireland.

The problem was the "double Irish" system whereby companies were actually not paying tax anywhere.

I think the Allergen case is an example, that's using a system to book profits here and the optics aren't great. A bit of clever accounting would increase our tax take and nothing else, a paper exercise really.

Godge

K-9 wrote: »

I think the Allergen case is an example, that's using a system to book profits here and the optics aren't great. A bit of clever accounting would increase our tax take and nothing else, a paper exercise really.

http://economic-incentives.blogspot.ie/2015/11/the-pfizer-impact-on-irish-statistics.html

It looks like Pfizer/Allergen would increase GNP but not Corporation Tax. It would actually cost the country money as our EU contribution would go up.