Good economic news thread

Head The Wall

Godge wrote: »

And the good news keeps on coming


http://www.rte.ie/news/business/2014/0806/635380-services-pmi/

It is great to see services expanding as most service businesses are labour-intensive


http://www.rte.ie/news/business/2014/0805/635302-higher-tax-take-leads-to-better-exchequer-deficit/

This is really good news. €800m better than expected over 7 months is about €1.3 bn over 12 months, meaning next year's austerity requirement is down to €700m. With €500m already earmarked from water charges, the budget will only need to find another €200m IF this rate of improvement continues. Even if we plateau, it will be significantly less than €2 bn.

Let's ignore the fact that government spending is only down 0.7% and over 5 billion a year is being spent on interest

Yeah, everything is brilliant indeed

Godge

Flex wrote: »

They should look at Public vs Private sector pay by doing another like for like comparison to see what the remaining gap is, similar to the ESRI report done in 2006, if they do

The ESRI report was a load of rubbish, similar to many of those type of reports from them. They get some things right but some stuff way wrong. Another example was their work on the incentive to work.

Godge

Head The Wall wrote: »

Let's ignore the fact that government spending is only down 0.7% and over 5 billion a year is being spent on interest

Yeah, everything is brilliant indeed

that 0.7% is greater than the 0.3% predicted, so yes, we are doing well.

What bit of the economic recovery do you not understand?

Head The Wall

I'll treat the government's figures and predictions with the same disdain and trust as always. Can you tell me has the dept of finance increased the number of staff with relevant education skills to their job compared to the % that was in charge and doing such a good job previously

It's obvious you have a major one for the govt and public service but plenty of others don't buy the BS and ridiculous figures they throw out.

Head The Wall

Godge wrote: »

The ESRI report was a load of rubbish, similar to many of those type of reports from them. They get some things right but some stuff way wrong. Another example was their work on the incentive to work.

You're the one always on here saying reports are king and then you choose to ignore/belittle one that doesn't agree with your view about the wonderful public sector

Godge

Head The Wall wrote: »

You're the one always on here saying reports are king and then you choose to ignore/belittle one that doesn't agree with your view about the wonderful public sector

You are mistaking me for someone else. I do not live in a black and white world where public sector good, private sector bad, government bad, opposition good etc.

I always look at the facts and the figures behind reports, then critically analyse the assumptions used to interpret those facts and figures. Quite often you will learn that the reports text do not match what the figures say and that the assumptions used give rise to misleading conclusions. Where that is so, I point it out, where in my opinion, the reports are correct, I point that out.

In relation to the current good economic news, the reason for this thread is that most of the facts and figures (and even some of the reports:)) are pointing towards good economic news yet there are many camels with their heads in the sand ignoring the changing world and talking the language of 2008-2010.

fxotoole

Not sure if this is necessarily good news, but the number of cars registered for the first time jumped by 50%, as compared to July last year.

Can't properly post the link, as I am a new user, but the article is on the Journal.ie here:

www. thejournal.ie /new-vehicles-licensed-ireland-1610058-Aug2014/

The reason I say it's not necessarily good news is because the article doesn't say whether or not the cars were purchased on credit. Obviously if they were purchased on credit, that's a bad thing, because it means that the purchasers are taking on more personal debt.

Then again, it could be said that this is positive news no matter what way you look at it, as it implies that more people are financially capable of running a car as compared to this time last year.

comongethappy

fxotoole wrote: »

Not sure if this is necessarily good news, but the number of cars registered for the first time jumped by 50%, as compared to July last year.

Can't properly post the link, as I am a new user, but the article is on the Journal.ie here:

www. thejournal.ie /new-vehicles-licensed-ireland-1610058-Aug2014/

The reason I say it's not necessarily good news is because the article doesn't say whether or not the cars were purchased on credit. Obviously if they were purchased on credit, that's a bad thing, because it means that the purchasers are taking on more personal debt.

Then again, it could be said that this is positive news no matter what way you look at it, as it implies that more people are financially capable of running a car as compared to this time last year.

Taking on debt isn't necessarily a bad thing.

We took on €17k debt to buy a new car in 2011....we're making the payments easily & hope to pay it off early.

I don't get the assumption that borrowing = wrong.

Godge

fxotoole wrote: »

Not sure if this is necessarily good news, but the number of cars registered for the first time jumped by 50%, as compared to July last year.

Can't properly post the link, as I am a new user, but the article is on the Journal.ie here:

www. thejournal.ie /new-vehicles-licensed-ireland-1610058-Aug2014/

The reason I say it's not necessarily good news is because the article doesn't say whether or not the cars were purchased on credit. Obviously if they were purchased on credit, that's a bad thing, because it means that the purchasers are taking on more personal debt.

Then again, it could be said that this is positive news no matter what way you look at it, as it implies that more people are financially capable of running a car as compared to this time last year.

I am not sure that credit is a bad thing at the moment.

For the last five or six years, domestic consumers have been saving at an incredible rate, paying down domestic debt. While undoubtedly there are many people for whom more borrowing would be insane, there are others who have been promoted, who have got a job, who have paid off boom-era debts, for whom a little borrowing may not be a bad thing, and for the economy will be a good thing.

fxotoole

comongethappy wrote: »

I don't get the assumption that borrowing = wrong.

Too much personal debt, especially beyond a person's ability to pay it back is what got us into the state we're in today/

Godge

fxotoole wrote: »

Too much personal debt, especially beyond a person's ability to pay it back is what got us into the state we're in today/

http://www.centralbank.ie/polstats/stats/summarychart/documents/ie_financial_statistics_summary_chart_pack.pdf

Charts 1,7,8 and 9 in the attached would show you that overall indebtedness of the Irish consumer is still going down, which is good, considering the levels it was at.

What is also good, is that the new car sales figures would indicate is that those individuals who are ahead of the curve have started to borrow again, which is very good for the economy.

The only thing that would be a worry would be if those who have had mortgage write-offs are borrowing as they would have learned nothing and will be back to the taxpayer for another hand-out in a few years.

Head The Wall

http://m.independent.ie/opinion/comment/burtons-way-or-brussels-way-theres-only-ever-going-to-be-one-winner-there-joan-30323529.html

So it appears as if the EU isn't buying our miraculous recovery as reported by the govt



And what of the detail of yesterday's report? The eurocrats had no shortage of criticisms of swathes of government.

Michael Noonan's Department of Finance is scolded for not spelling out more fiscal specifics and for what the commission believes is its too-rosy assumptions about the future. "The achievement of the budgetary targets is not supported by sufficiently detailed measures for 2015," the study said, adding that "the authorities' forecast for the later years of the programme are optimistic (and) medium-term budgetary plans are not supported by well-specified adjustment measures."

There are also questions raised about the most basic aspects of the tax system. The Commission is critical of how work is taxed. "Labour taxation is fragmented and complex," it notes, while the way Ireland taxes consumption also comes in for comment. "Reduced VAT rates are not an efficient and well-targeted policy tool to protect vulnerable groups," it states in an implicit suggestion to move towards one VAT rate for all goods and services, as is the case in some other countries.
- See more at: http://m.independent.ie/opinion/comment/burtons-way-or-brussels-way-theres-only-ever-going-to-be-one-winner-there-joan-30323529.html#sthash.FJbGPoTX.dpuf

Frank Lee Midere

The real issue is increased interest rates in the future. If interest rates tend towards 5-6% then the typical tracker mortgage will start to cost 2000-3000 for a boom time house. The domestic economy will collapse.

Sand

While that would be game over (it would imply an increase in sovereign bond debt servicing costs as well) 5-6% interest rates on trackers are unlikely for the foreseeable future. The ECB's main problem is inflation is so low that it is not meeting its target of near to 2%. It would require a huge, broad recovery across the Eurozone (or at least Germany) before the ECB starts hiking interest rates again.

That is also not very likely given every state is engaged in austerity and keeping zombie banks propped up. But I have to presume with the crazy fanatics of Trichet and Co out of power, the ECB will be slow to risk choking off a recovery by hiking rates too soon.

Sand

Head The Wall wrote: »

http://m.independent.ie/opinion/comment/burtons-way-or-brussels-way-theres-only-ever-going-to-be-one-winner-there-joan-30323529.html

So it appears as if the EU isn't buying our miraculous recovery as reported by the govt[/url]

Not too surprising - the government and the green jersey brigade have been predicting for each of the last 7-8 years that *this* year is *the* year that the recovery will kick on.

Now eventually, they'll be right. Eventually.

Flex

Godge wrote: »

The ESRI report was a load of rubbish, similar to many of those type of reports from them. They get some things right but some stuff way wrong. Another example was their work on the incentive to work.

Why was it a load of rubbish? CSO produced rubbish too?

Edit : I actually wasn't even commenting on the findings of the reports, rather that I'd like to see public money spent a bit more intelligently. Doesn't matter though, based on Brendan howlins recent announcement

Phoebas

Another small bit of good news:
Fitch upgrades Ireland's credit rating to 'A-minus' from 'BBB-plus'.

http://in.reuters.com/article/2014/08/15/ireland-ratings-fitch-idINL4N0QL4N520140815

1huge1

Very good to see.

Their expected GDP for this year is in line with the department of finance at 2.7% growth this year, but only c.a. 2% next year. I'm assuming thats more due to the underlying issues in the Eurozone rather than domestic issues at this stage (not to say we don't have domestic issues by any means).

washman3

Phoebas wrote: »

Another small bit of good news:
Fitch upgrades Ireland's credit rating to 'A-minus' from 'BBB-plus'.

http://in.reuters.com/article/2014/08/15/ireland-ratings-fitch-idINL4N0QL4N520140815

Yet anytime during the last few years our credit rating was downgraded Fitch were rubbished by Kenny, Noonan and the 'Green Jersey Brigade'
If the cap fits wear it I suppose...:rolleyes:

1huge1

washman3 wrote: »

Yet anytime during the last few years our credit rating was downgraded Fitch were rubbished by Kenny, Noonan and the 'Green Jersey Brigade'
If the cap fits wear it I suppose...:rolleyes:

Of course, thats what politicians do...

What is more important now is that more pension funds etc will have access to Irish bonds, many of them are not allowed invest in countries that have anything less than an A rating.

I doubt it will have any real effect on our yields though due to the ECB helping to keep them at artificially low levels.

Rucking_Fetard

Fitch and S&P are pure Bullsh1tters of the highest order and any report from them is not even fit to wipe your ass with.

Bit like Met Eireann.

washman3

comongethappy wrote: »

Taking on debt isn't necessarily a bad thing.

We took on €17k debt to buy a new car in 2011....we're making the payments easily & hope to pay it off early.

I don't get the assumption that borrowing = wrong.

Taking on other peoples debt is a problem.!!
Would you fancy borrowing another €17k for a car and giving it for free to your neighbour.??
Because that in effect is what our leaders did when they saddled all of us with the debt of a minority.

Phoebas

Rucking_Fetard wrote: »

Fitch and S&P are pure Bullsh1tters of the highest order and any report from them is not even fit to wipe your ass with.

Which ratings agencies do you consult when making your bond buying decisions?

... meanwhile, back in the real world, organisations who do actually buy bonds do actually listen to what Fitch and S&P have to say.

OMD

Phoebas wrote: »

Which ratings agencies do you consult when making your bond buying decisions?

... meanwhile, back in the real world, organisations who do actually buy bonds do actually listen to what Fitch and S&P have to say.

They do and they don't. When the ratings agencies were rating Irish debt as junk which essentially meant they were saying "do not buy" Irish rates were about 4%. 4% is not consistent with junk status so those actually putting money on the line did not listen to the ratings agencies. Irish rates are now less than USA & UK who both have better ratings than Ireland.

Phoebas

OMD wrote: »

They do and they don't. When the ratings agencies were rating Irish debt as junk which essentially meant they were saying "do not buy" Irish rates were about 4%. 4% is not consistent with junk status so those actually putting money on the line did not listen to the ratings agencies. Irish rates are now less than USA & UK who both have better ratings than Ireland.

Many buyers do listen to the ratings agencies regardless of the rates. Indeed some funds are restricted by their rules from buying bonds based on ratings from the ratings agencies.
As I said, its a small bit of good news.

antoobrien

Phoebas wrote: »

... meanwhile, back in the real world, organisations who do actually buy bonds do actually listen to what Fitch and S&P have to say.

Many buyers (pension funds, states etc) have policies that explicitly forbid them from holding bonds that are not investment rated by at least two of Fitch, Moodys and the S&P. Most of them require all three to be investment grade.

Sheldons Brain

Employment increases by 1.7% or 31,600 in the year to the second quarter of 2014, bringing total employment to 1,901,600.
Employment is a real benefit to people.

Dave!

http://www.independent.ie/business/irish/economy-set-to-grow-by-31pc-this-year-as-recovery-broadens-30532983.html

Economy set to grow by 3.1pc this year as recovery broadens

Ulster Bank has rowed in behind other predictions that Ireland's economy is on track to grow by over 3pc this year.

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Releasing its forecast this morning, Ulster Bank said it expects the country's gross domestic product (GDP) to rise by 3.1pc in 2014 as the recovery becomes "more broadly based".

It said that this year will mark the first since 2007 that exports, consumer spending, and investment will all be growing together.

The bank said that's an important sign that Ireland's economic recovery is looking "more sustainable".

Ulster Bank had previously predicted that Ireland's GDP would grow by 2pc this year.

Its revised prediction puts it on the same page as other forecasts released this month. It's also expecting the economy to grow by 3.2pc in 2015.

Davy Stockbrokers said earlier in August that it expects the country's economy to grow by 3.5pc this year, up from its previous forecast of 2.5pc. It also said that gross national product (GNP) would grow by 2.8pc this year and 2.3pc in 2015.

comongethappy

Now that the government changed the rules and started adding arbitrary values covering crime to inflate GDP, its hard to take them seriously.

fxotoole

comongethappy wrote: »

Now that the government changed the rules and started adding arbitrary values covering crime to inflate GDP, its hard to take them seriously.

But this particular prediction is from a private bank, not the government.