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Recession predictions

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    #452
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    KyussB wrote: »
    Agreed generally - though on the last sentence, falling energy prices is often a symptom of a recession :)

    The sharp falls in crude oil prices in March 2020 were due to Saudi-Russian tensions within OPEC, about Russia's refusal to cut production.

    Nothing specifically to do with COVID.


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    #453
    Tea drinker
    Registered Users Posts: 2,818 ✭✭✭Tea drinker


    Wanderer78 wrote: »
    i am indeed, and i ll keep going until its widely accepted. we need to step away from the idea of constantly feeling the need to reduce public debt, private debt has in fact, historically caused far more damage, as we ve recently discovered. create the bonds, keep creating the bonds, until confidence returns, particularly in the private sector, then redirect towards servicing public debt
    UK is spooked https://www.independent.co.uk/news/uk/politics/coronavirus-pandemic-economy-tax-rises-national-insurance-vat-a9696751.html
    “Hefty” tax rises will be needed to deal with the economic aftermath of the coronavirus pandemic, but chancellor Rishi Sunak will have to delay as long as two years to introduce them to avoid choking off recovery, a respected thinktank has said.

    And the director of the Institute for Fiscal Studies, Paul Johnson, said that Mr Sunak will have to hike rates of the most high-profile taxes, like income tax, national insurance and VAT, in order to raise the “really serious amounts of money” needed to fill the black hole in state finances.

    Rises in levies paid by all would be politically perilous, as their impact would be felt in voters’ pockets just as Boris Johnson is preparing for the general election scheduled for 2024.

    but will they be delayed for 2 years? Meanwhile over 'ere https://www.independent.ie/business/irish/resilient-taxes-cant-match-ballooning-government-spending-as-9452bn-defecit-recorded-39498950.html
    The amount of tax being collected by the State has continued to defy the scale of the pandemic economic crash but nowhere near enough to fund ballooning spending, new Exchequer data shows.

    The State recorded a deficit of €9.452bn for the nine months to the end of August as government spending dramatically outstrips income.

    Total net voted expenditure to the of end of July was €43.2bn, up 28pc on last year.

    The rise is driven by the State's response to the Covid-19 pandemic, including a sharp rise in health spending and spending by the Department of Employment Affairs and Social Protection on wage supports and job subsidies.

    One bright spot in the numbers was a payment of €2bn from NAMA to the Exchequer.
    A bright spot? Just means we are down 11 billion not 9.


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    #454
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    Tea drinker wrote: »
    UK is spooked

    but will they be delayed for 2 years? Meanwhile over 'ere https://www.independent.ie/business/irish/resilient-taxes-cant-match-ballooning-government-spending-as-9452bn-defecit-recorded-39498950.html


    A bright spot? Just means we are down 11 billion not 9.

    unfortunately cant read the uk link, whats the craic?

    keep covid payments in place, keep people spending, consider rolling this out to all citizens, should make things a little easier, but it will introduce its own issues, but things will probably be far worse if you dont!


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    #455
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    im truly terrified of another financial sector hiccup


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    #456
    Roger the cabin boy
    Registered Users Posts: 365 ✭✭Roger the cabin boy


    Wanderer78 wrote: »
    im truly terrified of another financial sector hiccup

    9 months into Covid, with record everything -ve, the Dow Jones is near its all-time high. The tech indicises are actually at all time highs.
    All this whilst the arse is falling out of the industrial economy.

    We have bigger problems than the banks...


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    #457
    Tea drinker
    Registered Users Posts: 2,818 ✭✭✭Tea drinker


    Wanderer78 wrote: »
    unfortunately cant read the uk link, whats the craic?

    keep covid payments in place, keep people spending, consider rolling this out to all citizens, should make things a little easier, but it will introduce its own issues, but things will probably be far worse if you dont!
    dunno the craic, just do a search for UK tax rises the Independent article will come up I think.

    89 new cases confirmed today so it hasn't exploded off the 217 yesterday. How the disease progression is viewed by the government with kids back to school is crucial. More lockdowns or more back to work.


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    #458
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    Roger the cabin boy wrote:
    We have bigger problems than the banks...


    Oh watch this space, this has the potential to go horribly wrong, very quickly, financially, I suspect our banks are not as stable as we think! Its important to remember how complexly intertwined our global banking system has become, contagion is still globally possible, hopefully I'm completely wrong


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    #459
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    Wanderer78 wrote: »
    im truly terrified of another financial sector hiccup
    Well judging by the amount of posters who want to draw down a mortgage while on a government subsidy who think their jobs are 100% safe, and those who want to get a mortgage BEFORE they lose their job I think your fears may be realized.
    Also I get the feeling the American stock market is artificially inflated and dependent on 3-4 big tech stocks
    I can see a black Monday of 1987 coming again


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    #460
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    brisan wrote: »
    Well judging by the amount of posters who want to draw down a mortgage while on a government subsidy who think their jobs are 100% safe, and those who want to get a mortgage BEFORE they lose their job I think your fears may be realized.
    Also I get the feeling the American stock market is artificially inflated and dependent on 3-4 big tech stocks
    I can see a black Monday of 1987 coming again

    ah shur asset price inflation has been the aim of the game for a long time now, sadly, i think my fears are gonna be confirmed, its very worrying stuff, i cant see the stress tests standing up to things


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    #461
    What Username Guidelines
    Registered Users Posts: 2,139 ✭✭✭What Username Guidelines


    brisan wrote: »
    Well judging by the amount of posters who want to draw down a mortgage while on a government subsidy who think their jobs are 100% safe, and those who want to get a mortgage BEFORE they lose their job I think your fears may be realized.
    Also I get the feeling the American stock market is artificially inflated and dependent on 3-4 big tech stocks
    I can see a black Monday of 1987 coming again

    Tech stocks dipping today since market opened. No idea why they were rallying as I'm not big on the market, but it seems like a lot are down ~5%


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    #462
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    Geuze wrote: »
    The sharp falls in crude oil prices in March 2020 were due to Saudi-Russian tensions within OPEC, about Russia's refusal to cut production.

    Nothing specifically to do with COVID.

    When oil hit negative territory in April 2020 it had nothing to do with Russian SAUDI tensions
    Oil futures came up ,no one wanted the oil ,no one had any space to store it and the holders of the futures were obliged to buy and take delivery of the oil.
    There is one story going around where a Russian billionaire hired oil tankers in the weeks beforehand and when oil hit negative he was paid money to take the oil and load it in the tankers .
    He then sold when lock downs finished .
    So a downturn in demand will drive energy prices down unless supply is cut as well
    https://www.forbes.com/sites/salgilbertie/2020/04/23/will-oil-prices-go-negative-again/#1d024f4d7e9c


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    #463
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    Q2 GDP and BoIP estimates are out:

    https://www.cso.ie/en/csolatestnews/presspages/2020/internationalaccountsandquarterlynationalaccountsquarter22020/


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    #464
    brisan
    Registered Users Posts: 2,242 ✭✭✭brisan


    GDP contracted by 6.1% in Q2 2020
    Personal Consumption of Goods and Services, a key measure of domestic economic activity, decreased by 19.6% in the quarter
    Spending by Government on goods and services increased by 7.5%
    Contraction of 38.3% in the economic activity of the Construction sector, while the multinational dominated Industry sector grew by 1.5% in Q2 2020
    GNP contracted by 7.4% in the quarter
    The Balance of Payments Current Account recorded a surplus of €11.7 billion in transactions with the rest of the world in Q2 2020


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    #465
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    brisan wrote: »
    GDP contracted by 6.1% in Q2 2020
    Personal Consumption of Goods and Services, a key measure of domestic economic activity, decreased by 19.6% in the quarter
    Spending by Government on goods and services increased by 7.5%
    Contraction of 38.3% in the economic activity of the Construction sector, while the multinational dominated Industry sector grew by 1.5% in Q2 2020
    GNP contracted by 7.4% in the quarter
    The Balance of Payments Current Account recorded a surplus of €11.7 billion in transactions with the rest of the world in Q2 2020

    jesus, theyre kinna scary figures, lets hope the financial sector doesnt jump into the game


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    #466
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    If I look at Figure 2 of today's GDP Q2 release, it seems that Q1 has been revised downwards from small positive growth to a contraction? See Figure 2.


    Am I correct?


    Where as the final Q1 release has positive growth.

    https://www.cso.ie/en/releasesandpublications/er/na/quarterlynationalaccountsquarter12020final/


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    #467
    Mongfinder General
    Registered Users Posts: 1,993 ✭✭✭Mongfinder General


    Wanderer78 wrote: »
    jesus, theyre kinna scary figures, lets hope the financial sector doesnt jump into the game

    BOP figure doesn't seem too bad?


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    #468
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    Mongfinder General wrote: »
    BOP figure doesn't seem too bad?

    the system as a whole must also be considered, i.e. globally, as our own financial sector doesn't exist in a vacuum, a similar set of conditions are currently unfolding within our global system, compared to 08, i.e. rising private debt, and rapid decline in the demand for new credit, along with the increasing possibility of defaults and non performing loans, this is exactly what occurred leading up to 08, but thankfully private debt in ireland has been dramatically falling in the last few years, so hopefully we arent as exposed, lets hope this one passes by, globally


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    #469
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    CPI for Aug published today

    1% deflation

    https://www.cso.ie/en/releasesandpublications/er/cpi/consumerpriceindexaugust2020/


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    #470
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    Geuze wrote:
    1% deflation


    Its amazing this is the case, even with all the money creation occuring, economic systems are bizzare


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    #471
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    Contributions to the overall CPI – monthly change

    The divisions which caused the largest downward contribution to the CPI in the month were Miscellaneous Goods & Services (-0.11%) and Food and Non-Alcoholic Beverages (-0.05%). The division which caused the largest upward contribution in the month was Restaurants & Hotels (+0.07%).

    The main factors contributing to the monthly change were as follows:

    Miscellaneous Goods & Services fell primarily due to a decrease in the price of appliances, articles & products for personal care.
    Food and Non-Alcoholic Beverages decreased due to lower prices across a range of products such as breads & cereals, vegetables and fruit.
    Restaurants & Hotels rose mainly due to an increase in the cost of hotel accommodation and higher prices for alcoholic drinks and food consumed in licensed premises, restaurants, cafes etc.


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    #472
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    The main factors contributing to the annual change were as follows:

    Transport fell mainly due to a reduction in air fares and lower prices for diesel and petrol. This decrease was partially offset by an increase in the cost of motor cars and higher prices for services in respect of personal transport equipment.

    Housing, Water, Electricity, Gas & Other Fuels decreased due to a reduction in the price of home heating oil, lower rents and a fall in the cost of electricity and gas. This reduction was partially offset by higher mortgage interest repayments.

    Communications fell due to a reduction in the cost of telephone & telefax services and telephone & telefax equipment.

    Food and Non-Alcoholic Beverages decreased due to lower prices across a range of products such as vegetables, sugar, jam, honey, chocolate & confectionery and mineral waters, soft drinks, fruit & vegetable juices.

    Restaurants & Hotels increased primarily due to higher prices for alcoholic drinks and food consumed in licensed premises, restaurants, cafes etc. This increase was partially offset by a reduction in the cost of hotel accommodation.

    Alcoholic Beverages & Tobacco rose mainly due to higher prices for tobacco products.

    Recreation & Culture increased primarily due to higher prices for package holidays and an increase in the cost of recreational and sporting services.

    Health rose mainly due to an increase in the cost of medical and dental services and higher prices for pharmaceutical products.


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    #473
    CorkRed93
    Registered Users Posts: 3,434 ✭✭✭CorkRed93


    https://au.finance.yahoo.com/news/vw-man-truckmaker-cut-many-063144346.html

    stark


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    #474
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    CorkRed93 wrote: »
    stark

    yup, the really scary part of covid is now just unfolding, this could get hairy very quickly


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    #475
    beggars_bush
    Registered Users Posts: 4,345 ✭✭✭beggars_bush


    Its a wonder the UK isn't in recession too

    Or maybe it is and i missed it


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    #476
    Roger the cabin boy
    Registered Users Posts: 365 ✭✭Roger the cabin boy


    If you are in commercial real estate, I'd run for the exits.

    If you are in any business that feeds off commercial office foot fall, I'd follow.

    WFH is real and here to stay and it's only going to get stronger and stronger.

    The office 9-5 is dead.


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    #477
    Geuze
    Registered Users Posts: 13,073 ✭✭✭✭Geuze


    beggars_bush wrote: »
    Its a wonder the UK isn't in recession too

    Or maybe it is and i missed it

    Difficult to miss a 20% fall in GDP, quarter over quarter.

    Staggering.

    https://ec.europa.eu/eurostat/documents/2995521/10545471/2-08092020-AP-EN.pdf/43764613-3547-2e40-7a24-d20c30a20f64

    Much worse than any EU country.


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    #478
    Mongfinder General
    Registered Users Posts: 1,993 ✭✭✭Mongfinder General


    Roger the cabin boy wrote: »
    If you are in commercial real estate, I'd run for the exits.

    If you are in any business that feeds off commercial office foot fall, I'd follow.

    WFH is real and here to stay and it's only going to get stronger and stronger.

    The office 9-5 is dead.

    I've noticed a few articles circulating suggesting pay cuts for those working from home - and not just new hires. If you've got a building worth €100m in the IFSC you're going to want to make sure it's value on the balance sheet is protected.


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    #479
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    Mongfinder General wrote: »
    I've noticed a few articles circulating suggesting pay cuts for those working from home - and not just new hires. If you've got a building worth €100m in the IFSC you're going to want to make sure it's value on the balance sheet is protected.

    gives more spending power into the economy, makes sense!


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    #480
    Mongfinder General
    Registered Users Posts: 1,993 ✭✭✭Mongfinder General


    Wanderer78 wrote: »
    gives more spending power into the economy, makes sense!

    True - I think that there is major concern in London. There's a real push to get people back to work there. I don't think I'd like to get on a tube any time soon.


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    #481
    Wanderer78
    Registered Users Posts: 28,805 ✭✭✭✭Wanderer78


    Mongfinder General wrote: »
    True - I think that there is major concern in London. There's a real push to get people back to work there. I don't think I'd like to get on a tube any time soon.

    jesus no, i wouldnt go anywhere near it


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