The Economy : Any one else starting to get very worried ?

The Rape of Lucretia

All the headlines starting to look very good :

- exchequer returns up and ahead of forecast
- unemployment dropping each quarter
- unions looking for double digit pay increases
- Ireland the fastest growing economy in Europe
- construction industry rising steadily
- Iseq index on a steady rise since 2011
- widespread wage increases beyond inflation
- people cannot afford property and agitation for govt subsidies to help them


Oh ****. Where have we seen these before ?
Oh, thats right. Its déjà vu all over again repeatedly for a second time.

Anyone else starting to get nervous about all these 'positive' economic notices ?

smash

The Rape of Lucretia wrote: »

Anyone else starting to get nervous about all these 'positive' economic notices ?

Fcuk no... I can sell my house, clear the mortgage, have profit and buy it back at half price in 4/5 years!

HeidiHeidi

The Rape of Lucretia wrote: »

All the headlines starting to look very good :

- exchequer returns up and ahead of forecast
- unemployment dropping each quarter
- unions looking for double digit pay increases
- Ireland the fastest growing economy in Europe
- construction industry rising steadily
- Iseq index on a steady rise since 2011
- widespread wage increases beyond inflation
- people cannot afford property and agitation for govt subsidies to help them


Oh ****. Where have we seen these before ?
Oh, thats right. Its déjà vu all over again repeatedly for a second time.

Anyone else starting to get nervous about all these 'positive' economic notices ?

The thing most worrying me is the size of the Irish Times property supplement these days. Getting bigger and more salubrious by the week.

donegaLroad

I'm not sure if I feel worried, but I heard yesterday that a couple of local pharma companies are only offering 3 month contracts at the minute.. and a particular call centre not too far away only rent their pcs and office furniture (maybe that's normal? I don't know).

darkpagandeath

Sure when the world economy goes t*ts up again we will be fine. Oh wait what happened last time.

The Sidewards Man

Dont get worried until you see the crew cab 4x4 outside the pub with no tow hitch.

donegaLroad

HeidiHeidi wrote: »

The thing most worrying me is the size of the Irish Times property supplement these days. Getting bigger and more salubrious by the week.

back during the Great Delusion, the Sunday papers were practically funded by the estate agents and companies with vested interest in property.

screamer

Not really you've got to remember the **** base that these figures are coming from. Compared to pre 2008 figures which were from a pie in the sky base. As the old saying goes when you hit the bottom the only way is up.

But sure with typical oirish pessimism let's talk ourselves into doom gloom kaboom once again.......

The Randy Riverbeast

Nope, just missed out on the last one but was old enough to be told we all partied and I'm entitled for expecting to get paid to work. This time I'm gonna ****ing party like it's 2001. Loans for everything, living beyond my means and then when it goes tits up blame someone else.

Live in an apartment, will stick the decking in the living room with a patio heater.

DontThankMe

No OP we shouldn't be worried at all as long as the government uses a contractionary fiscal policy which would be raising taxes and lowering government spending to cool the economy. This is the opposite of what the government did during the previous boom they we using an expansionary fiscal policy by increasing government spending and lower taxes this magnified the boom in the economy making the recession that followed a lot worse. Growth is good as long as it is controlled and steady.

The Rape of Lucretia

DontThankMe wrote: »

No OP we shouldn't be worried at all as long as the government uses a contractionary fiscal policy which would be raising taxes and lowering government spending to cool the economy. This is the opposite of what the government did during the previous boom they we using an expansionary fiscal policy by increasing government spending and lower taxes this magnified the boom in the economy making the recession that followed a lot worse. Growth is good as long as it is controlled and steady.

The new government could be in for a tough summer then.

Huge marches agitating for a rise in taxes and decreases in health, education, and social welfare spending on the cards then. Water protests were only the tip of the iceberg. Could get nasty, with minister for finance pinned in his car by an angry mob baying for an increase in the base income tax rate and for the USC to be doubled.

People pressure on the govt will provoke a really austere budget this autumn I expect.

kneemos

The same self defeatest crap every time things look vaguely better.Some people ain't happy unless they're wallowing in misery.

washman3

screamer wrote: »

But sure with typical oirish pessimism let's talk ourselves into doom gloom kaboom once again.......

Just like we did the last time...
It wasn't really a recession, we just believed it was..;)

darkpagandeath

screamer wrote: »

Not really you've got to remember the **** base that these figures are coming from. Compared to pre 2008 figures which were from a pie in the sky base. As the old saying goes when you hit the bottom the only way is up.

But sure with typical oirish pessimism let's talk ourselves into doom gloom kaboom once again.......

Yeah glad we are not affected by the world economy.

PARlance

DontThankMe wrote: »

No OP we shouldn't be worried at all as long as the government uses a contractionary fiscal policy which would be raising taxes and lowering government spending to cool the economy. This is the opposite of what the government did during the previous boom they we using an expansionary fiscal policy by increasing government spending and lower taxes this magnified the boom in the economy making the recession that followed a lot worse. Growth is good as long as it is controlled and steady.

And you think a Government with an election looming in the next couple of years will do that?

DontThankMe

PARlance wrote: »

And you think a Government with an election looming in the next couple of years will do that?

I doubt it because it is an unpopular policy but spending and not taking in enough tax revenue was one of the reasons the recession was so bad. We can't just keep spending all the extra revenue the goverment takes in i think most of the electorate don't realise this. So even if a government did try to introduce these policies they'd be voted out in the next election.

mzungu

HeidiHeidi wrote: »

The thing most worrying me is the size of the Irish Times property supplement these days. Getting bigger and more salubrious by the week.

Must be why they hiked up the price! It sure wasn't the news section that got bigger anyways.

5starpool

The Rape of Lucretia wrote: »

The new government could be in for a tough summer then.

Huge marches agitating for a rise in taxes and decreases in health, education, and social welfare spending on the cards then. Water protests were only the tip of the iceberg. Could get nasty, with minister for finance pinned in his car by an angry mob baying for an increase in the base income tax rate and for the USC to be doubled.

People pressure on the govt will provoke a really austere budget this autumn I expect.

Who the hell would protest to get big tax increases?

dresden8

screamer wrote: »

Not really you've got to remember the **** base that these figures are coming from. Compared to pre 2008 figures which were from a pie in the sky base. As the old saying goes when you hit the bottom the only way is up.

But sure with typical oirish pessimism let's talk ourselves into doom gloom kaboom once again.......

Yup, this time it's different. That's also a sure sign.

dresden8

kneemos wrote: »

The same self defeatest crap every time things look vaguely better.Some people ain't happy unless they're wallowing in misery.

There's another one. Safe as houses I tells ya......

PARlance

DontThankMe wrote: »

I doubt it because it is an unpopular policy but spending and not taking in enough tax revenue was one of the reasons the recession was so bad. We can't just keep spending all the extra revenue the goverment takes in i think most of the electorate don't realise this. So even if a government did try to introduce these policies they'd be voted out in the next election.

Really!

DontThankMe

PARlance wrote: »

Really!

Yup even though it is the right thing to do economically for the country, it would be political suicide.

PARlance

DontThankMe wrote: »

Yup even though it is the right thing to do economically for the country, it would be political suicide.

Bingo.

Damien360

We learned nothing as a country from the last recession. The economy is out of control and rising too fast again. We will be bailing out banks again in the not too distant future.

JustTheOne

There is a common theme in this country.

FF boom the economy then bust it.
FG come along fix it.
FF get back in and we're off again.

FG take the slack for doing the responsible thing and taking the nasty measures needed.

Happened before and is happening again and the people are only too happy to lap it up.

Thankfully the only people who are acting sensibly and not allowing a property bubble to happen again is the central bank with their lending rules but they are coming under pressure to ease them from all angles and we may have another one soon.

Hopefully they see sense and stay committed to their rules.

Raging_Ninja

DontThankMe wrote: »

I doubt it because it is an unpopular policy but spending and not taking in enough tax revenue was one of the reasons the recession was so bad. We can't just keep spending all the extra revenue the goverment takes in i think most of the electorate don't realise this. So even if a government did try to introduce these policies they'd be voted out in the next election.

I don't know where you were back then, but the State ran a budget surplus during the boom years...

JustTheOne

JustTheOne wrote: »

FG take the slack for doing the responsible thing and taking the nasty measures needed.

"Oh they were SOOOOO nasty".

Denis O'Brien.

JustTheOne

[Deleted User] wrote: »

"Oh they were SOOOOO nasty".

Denis O'Brien.

Rabble rabble.

KomradeBishop

While individual sectors in the economy, like construction, can overheat - you deal with them individually (e.g. getting lending under control, which has been done now), cutting government spending in general, is a very very blunt instrument to be using, for targeting just one sector of the economy - which will hold back the rest of the economy.

The time that government spending will lead to overheating the economy in general, is when full employment is reached - that's when it needs to be tapered off.

As things are: Yes, do be worried. Europe is now in deflation again (something that can only really be cured with a massive government spending boost EU-wide) - this is a trend we may become stuck in Japan-style, for an extremely long time - if that's the case, we're in for long-term stagnation - and as debatably 'good' as Ireland is supposedly doing now, we are in deflation too and this will drag us down over time too.

Mongfinder General

kneemos wrote: »

The same self defeatest crap every time things look vaguely better.Some people ain't happy unless they're wallowing in misery.

I don't know why some people just don't go and kill themselves...

Jawgap

I think the only people who need to be worried are those funding their lifestyles on credit.....

.....but the signs of the boom getting boomier are all there - lots of builders with new vans / jeeps, bulging property supplements, tower cranes in Carlow, people changing their car every year......

.....all we need now is billboards advertising flats by using strawberries and a girl draped across high end kitchen fittings and some Cork langer on d'telly pushing property on a windswept Atlantic island as a great investment

whiskeyman

The Rape of Lucretia wrote: »

Anyone else starting to get nervous about all these 'positive' economic notices ?

What an interesting discussion.

What say you come over to my house and we'll chat on my lovely new decking til the small hours thanks to my new outdoor heater...

valoren

A bubble as per Hyman P Minsky.

Step 1 - Disturbance, something new happens like the Internet or in our case The
Tiger
Step 2. - Prices start to rise
Step 3 - Mortgages and Credit becomes cheap and easy to get, adding petrol to the
flames. Speculators arrive in droves flipping properties and making a bundle using
cheap bank cash.
Step 4 - The market overtrades leading to shortages so prices accelerate and easy
profits are made. That attracts new types of players, outsiders, inexperienced,
greedy, foolish and desperate to get their share.
Step 5 - It becomes euphoric. You can’t lose. It’s a new world. The wise, cautioning
fellow citizens are laughed at by the charlatans talking up the market. They’re only
grumps, down-in-the-mouths, pessimists. Eventually the charlatans adopt the soft
landing theory, a soft deceleration in prices to calm the nerves. A culture of denial
takes over even though everyone knows prices can’t keep rising.
Step 6 - Quietly experienced insiders start to tip toe out of the market. They
remember the old world, how things were and see the madness for what it is.
Insider profit taking is the end signal.
Step 7 - Slower insiders begin to panic. The panic spreads to outsiders. Everybody
wants to sell but there’s no buyers. Buyers read a collapsing market and hold off.
That pushes prices even lower. The banks pull the plug. Credit dries up, prices
keep tumbling, there is no end in sight. Huge losses accumulate.

That the above will never happen here again is naive.

Source - http://www.eddiehobbs.com/content/30%20Things%20to%20do%20with%20your%20SSIA%20Summer%202006.pdf

worded

Eddie set up an property investment company badly timed before the crash

Property prices havnt risen as fast as the 2008 crash due to lack of supply and 20% deposit requirements

lawlolawl

worded wrote: »

.... and 20% deposit requirements

This was actually a fairly good move by the banks even if it is really unpopular.

It goes some way to making sure that people can actually somewhat *GASP* :eek: afford the property that they are buying.

Mr. teddywinkles

darkpagandeath wrote: »

Yeah glad we are not affected by the world economy.

From a worldwide perspective, it's not being portrayed as good as it here so it does beg the questions.

Mr. teddywinkles

Jawgap wrote: »

I think the only people who need to be worried are those funding their lifestyles on credit.....

.....but the signs of the boom getting boomier are all there - lots of builders with new vans / jeeps, bulging property supplements, tower cranes in Carlow, people changing their car every year......

.....all we need now is billboards advertising flats by using strawberries and a girl draped across high end kitchen fittings and some Cork langer on d'telly pushing property on a windswept Atlantic island as a great investment

Carlow? Ya mean the public buildings such as the college. Theres no private projects on going.

namloc1980

The weekend shopping trips to New York are back on the agenda. Let the good times roll!

Jawgap

Mr. teddywinkles wrote: »

Carlow? Ya mean the public buildings such as the college. Theres no private projects on going.

No, I mean tower cranes over Carlow and more tower cranes over Dublin

Mr. teddywinkles

valoren wrote: »

A bubble as per Hyman P Minsky.

Step 1 - Disturbance, something new happens like the Internet or in our case The
Tiger
Step 2. - Prices start to rise
Step 3 - Mortgages and Credit becomes cheap and easy to get, adding petrol to the
flames. Speculators arrive in droves flipping properties and making a bundle using
cheap bank cash.
Step 4 - The market overtrades leading to shortages so prices accelerate and easy
profits are made. That attracts new types of players, outsiders, inexperienced,
greedy, foolish and desperate to get their share.
Step 5 - It becomes euphoric. You can’t lose. It’s a new world. The wise, cautioning
fellow citizens are laughed at by the charlatans talking up the market. They’re only
grumps, down-in-the-mouths, pessimists. Eventually the charlatans adopt the soft
landing theory, a soft deceleration in prices to calm the nerves. A culture of denial
takes over even though everyone knows prices can’t keep rising.
Step 6 - Quietly experienced insiders start to tip toe out of the market. They
remember the old world, how things were and see the madness for what it is.
Insider profit taking is the end signal.
Step 7 - Slower insiders begin to panic. The panic spreads to outsiders. Everybody
wants to sell but there’s no buyers. Buyers read a collapsing market and hold off.
That pushes prices even lower. The banks pull the plug. Credit dries up, prices
keep tumbling, there is no end in sight. Huge losses accumulate.

That the above will never happen here again is naive.

Source - http://www.eddiehobbs.com/content/30%20Things%20to%20do%20with%20your%20SSIA%20Summer%202006.pdf

Dont forget everyone blames banks, developers, there local coffee shop for charging 10euro a coffee and everyone else but never themselves

smash

lawlolawl wrote: »

This was actually a fairly good move by the banks even if it is really unpopular.

It goes some way to making sure that people can actually somewhat *GASP* :eek: afford the property that they are buying.

It's a catch 22. How can someone afford to save say €60,000 when they're paying €1,400/€1,500 a month in rent? The fact that they continue to pay this level of rent is indication that they could afford to pay an even cheaper mortgage.

lawlolawl

smash wrote: »

It's a catch 22. How can someone afford to save say €60,000 when they're paying €1,400/€1,500 a month in rent? The fact that they continue to pay this level of rent is indication that they could afford to pay an even cheaper mortgage.

They clearly can't afford where they are living and need to move and they shouldn't be looking at a 300K mortgage in that case either.

Phoebas

The Rape of Lucretia wrote: »

All the headlines starting to look very good :

- exchequer returns up and ahead of forecast
- unemployment dropping each quarter
- unions looking for double digit pay increases
- Ireland the fastest growing economy in Europe
- construction industry rising steadily
- Iseq index on a steady rise since 2011
- widespread wage increases beyond inflation
- people cannot afford property and agitation for govt subsidies to help them


Oh ****. Where have we seen these before ?
Oh, thats right. Its déjà vu all over again repeatedly for a second time.

Anyone else starting to get nervous about all these 'positive' economic notices ?

There's not necessarily a problem with any of the above.

The problem happens when we start to think that all of the economic improvements will go on forever, and we increase current spending on that basis.

Unfortunately, with a weak government, that's exactly what will happen.

mahoganygas

The Rape of Lucretia wrote: »

All the headlines starting to look very good :

- exchequer returns up and ahead of forecast
- unemployment dropping each quarter
- unions looking for double digit pay increases
- Ireland the fastest growing economy in Europe
- construction industry rising steadily
- Iseq index on a steady rise since 2011
- widespread wage increases beyond inflation
- people cannot afford property and agitation for govt subsidies to help them


Oh ****. Where have we seen these before ?
Oh, thats right. Its déjà vu all over again repeatedly for a second time.

Anyone else starting to get nervous about all these 'positive' economic notices ?

If all of those economic indicators were negative instead of positive would you still be nervous?

Not directed at you, but Ireland is a nation of begrudgers. We put ourselves down when we do something right.

Also these are mostly domestic macroeconomic indicators. Ireland is a small open economy. I'd be much more worried about the health of UK/US/EU economies. The single biggest factor we should be nervous about is that large question mark hanging over the Brexit referendum. Everything else you have mentioned goes out the window if Brexit happens.

Mr. teddywinkles

Jawgap wrote: »

No, I mean tower cranes over Carlow and more tower cranes over Dublin

Yea but there government funded jobs not privately funded. Means nothing towards your point saying things are boomeir

smash

lawlolawl wrote: »

They clearly can't afford where they are living and need to move and they shouldn't be looking at a 300K mortgage in that case either.

That's nonsense. How can they not afford where they're living if they can quite easily pay €1,400 or €1,500 a month?

Timberrrrrrrr

Jawgap wrote: »

No, I mean tower cranes over Carlow and more tower cranes over Dublin

I used to operate tower cranes back in the day, was bored one day so decided to do a full circle and count how many I could see.

142 Tower cranes
28 mobile cranes
14 self erect tower cranes.

I was city center based (smithfield) and didn't include ones in the suburbs.

Jawgap

Mr. teddywinkles wrote: »

Yea but there government funded jobs not privately funded. Means nothing towards your point saying things are boomeir

Yes, I know - but here's the thing - they're paying jobs whether the money is coming from foreign banks or the government revenue and that's money going into the local community, impacting local money supply and local prices :rolleyes:

JustTheOne

JustTheOne wrote: »

There is a common theme in this country.

FF boom the economy then bust it.
FG come along fix it.
FF get back in and we're off again.

FG take the slack for doing the responsible thing and taking the nasty measures needed.

This is the myth alright, largely because Fine Gael has not been in power for anything like the time Fianna Fáil has to show its corruption. Take the last government. Can somebody remind us how Fine Gael established Irish Water? The army of private consultants they hired and the couple of thousand superfluous employees making Irish Water a massive statement in crony capitalism, jobs for the boys and abject inefficiency, with the genius responsible, Phil Hogan, promoted by being given a €300,000 plus salary as EU commissioner.

This is before Fine Gael bottled it by refusing to reform the legal or accountancy systems (with their strong financial support for Fine Gael), the very two self-regulating professions which have conspired to deny us competition/lower prices since time immemorial. To think that the same accountancy firms which signed off on fraudulent accounts for the financial institutions are still in receipt of lucrative state contracts is galling. The big 10 law and accountancy firms, the very firms that both advise private firms on tax avoidance and advise state bodies ("Chinese walls" how are you!), are untouched by any genuine reform. Fine Gael is very selective indeed in the groups it decides to "reform".

The only problem is that the central bank have stated publicly that the new mortgage rules will most likely be permanent.



I don't see it at all in Ireland in my opinion people are not spending on credit, there really is more money around based on employment its not a construction based boom.

Although they are at the 100% carry on in the UK.


https://www.theguardian.com/business/2016/may/04/barclays-offers-0-percent-deposit-mortgage-to-home-buyers

Maximus Alexander

lawlolawl wrote: »

This was actually a fairly good move by the banks even if it is really unpopular.

It goes some way to making sure that people can actually somewhat *GASP* :eek: afford the property that they are buying.

As a first time buyer, I agree. It's much harder for us to save what we need for a house we actually want, yet I hope they don't row back on this. It's a good, sensible measure.