Irish economy slowing down after 4 strong years of expansion. Are we ready for a bumpy ride?

Voluntary

Well-known member
Joined
Nov 8, 2015
Messages
2,858
From today's Independent.ie

The economic red lights are flashing. If a slump coincides with Brexit and industrial unrest, bad times will be back

But now, for the first time in four years, there is significant evidence that the recovery is running out of steam.
[...]
If the slowdown turns to slump, or even outright recession, the position on public finances, among many other things, will quickly turn critical.
[...]
Last Friday, two main indicators of the health of the economy - sales in shops and factory production - were published. They are, respectively, slowing and in effective stagnation. Earlier in the week, new tax figures showed that the amount flowing into the Government's coffers fell for the second time in three months. Both car and truck sales also contracted in October. These developments add to other negative trends: goods exports to Britain are down substantially since January and consumer confidence indicators have been flagging for most of the year.
1. Retail Sales
...remained down on the recent high point of last May. This amounts to the weakest period in retail activity since the recovery began...

2. Industrial production
...aggregate production peaked in the middle of last year before falling sharply. Over the course of this year, output in the “traditional sector” recovered somewhat, but in the third quarter it remained 3pc lower than at the same time last year...

3. Tax revenues
... revenues were 4pc lower in October than in the same month in 2015.
That was the third consecutive month of weakness. In August there was a 13pc year-on-year fall, while in September revenues grew by a weak 2pc. This represents quite a sharp slowdown on earlier in the year...

4. Vehicle sales
New car registrations down by 12.5pc in October compared with the same month in 2015.
Light commercial registration down 2pc in October.
Bigger truck sales down 16pc in October.

The job market
is keeping strong, however:
...the labour market almost always lags behind economic activity. In the jargon of economists, it is a "backward-looking" or "lagging" indicator....

Tourism
still keeps strong too, however:
...the 2007/08 sterling plunge contributed to a one third decline in British visitor numbers which still has not been fully reversed... that the impact of the fall in sterling has yet to be felt in the tourism sector...

Currency
...currency effects will slow an economy that is already losing momentum...



So, should we be bracing ourselves for another recession and the fat years are gone, or is it just a temporary thing and we have noting to worry about?

Maybe this is a warning call. A time of reflection should follow. Maybe it's time everyone asks himself one simple question: if the recession hit tomorrow - will I be OK, will I survive? If the answer is NO then maybe it's time to think about precautionary steps? Recessions happen on cyclical basis and some people survive them better then others. What makes some less vulnerable than others?
Have Irish people learned the lesson and are better prepared this time? What steps can a regular Irish person take to be better prepared for the next round of turbulence?
 


wexfordman

Well-known member
Joined
Nov 19, 2006
Messages
7,760
Recessions happen on cyclical basis and some people survive them better then others. What makes some less vulnerable than others?
Have Irish people learned the lesson and are better prepared this time? What steps can a regular Irish person take to be better prepared for the next round of turbulence?
It's OK no need to panic at all, the Protected Sector will be fine, the real front line workers (paye private sector cannon fodder) will take the bullet for them like the cannon fodder they are.
 

Boy M5

Well-known member
Joined
May 20, 2010
Messages
21,420
No.

Tracker mortgages - ECB will lift rates some time. Also Brexit is a dirty bomb with long term impact.
Only just started - 50% of Brits thought it a good idea. They are sleep walking in their ignorance. Wait until investment slumps (it has started) - then see how nasty things get.
 

Mrwoody

Well-known member
Joined
Jan 24, 2011
Messages
1,853
The dead cat bounce lasted a good while all the same, RIP Mr cat.
 

ger12

Well-known member
Joined
Feb 25, 2011
Messages
47,680
FG are determined to look after their own, like FF in the past, party first.

This has been coming for some time, and again people chose to ignore it.
 

gleeful

Well-known member
Joined
Feb 7, 2016
Messages
7,520
Its really hard to know whats going to happen. I think Dublin and the tech industry will stay strong. Companies that export to the UK are screwed - but UK companies and banks may begin moving her shortly, giving the jobs and property markets a boost.

It looks like a bumpy road ahead. But perhaps mixed rather than negative.
 

Voluntary

Well-known member
Joined
Nov 8, 2015
Messages
2,858
GOODBODY STOCKBROKERS - TAX TREND REVERSAL NEEDED TO HIT DEFICIT FORECASTS

Goodbody Stockbrokers have today warned that tax revenues will have to reverse recent trends if the budget deficit forecast (0.9% of GDP) laid out in last month’s Budget is to be hit.

They have also questioned some of the decisions to ramp up spending once again at year-end for the second consecutive year on the back of higher revenue outturns. They warn that this strategy has backfired on Ireland in the past.
So if the tax take doesn't magically picks up then we will miss the deficit forecasts this year. What are the immediate consequences of missing deficit forecasts (if any)?
 

Mad as Fish

Well-known member
Joined
Dec 6, 2012
Messages
24,185
In these parts it never speeded up.
 

Prester Jim

Well-known member
Joined
Jul 3, 2009
Messages
9,977
It is now that we will see how competent this govt (FG and labour too) are and were, though I have no doubts about it myself.
If they were competent rather than just lucky in gaining an economy that could only go up and a set course of action that they couldn't veer from...
If they had settled the property market last year or the year before or the year before that etc rather than watch as it worsened and then threw whiskey on the fire...
They are a shambles and they have no ideas themselves, they let the troika and then FF and then whichever international interest group dictate their course.
 

gleeful

Well-known member
Joined
Feb 7, 2016
Messages
7,520
O

Oscurito

The Indo article (as reported in the OP) seems to be lacking in analytical detail.
The latest Exchequer returns, released yesterday evening, show total tax receipts were €36.7 billion for the first ten months of the year, 1.7% ahead of target, and 4.7% ahead of the same period in 2015. Overall, the deficit between day-to-day tax and spending continued to narrow, falling from €2.9 billion for the first ten months of 2015 to €1.9 billion for the same period this year.
Analysis: The Exchequer returns came out yesterday - but two figures are flattering the public finances
 

Betson

Well-known member
Joined
Feb 7, 2013
Messages
16,705
And with the Brexit implications yet to fully hit , what a time to ramp up spending on public sector wages.

It is like we have a death wish when it comes to managing the countries finances.

Wait until the currently very low interest rates we are borrowing at suddenly start to rise , then the sh!t will really start hitting the fan.
 

gleeful

Well-known member
Joined
Feb 7, 2016
Messages
7,520
And with the Brexit implications yet to fully hit , what a time to ramp up spending on public sector wages.

It is like we have a death wish when it comes to managing the countries finances.

Wait until the currently very low interest rates we are borrowing at suddenly start to rise , then the sh!t will really start hitting the fan.
I dont see rates rising anytime soon. The ECB will keep printing for years yet - to steady the ship through brexit if nothing else.
 

freewillie

Well-known member
Joined
Feb 3, 2013
Messages
7,295
The fundamentals of the economy are good so we should be ok for a soft landing. Get on the property ladder now just in case
 

mossyman

Well-known member
Joined
Dec 8, 2009
Messages
4,948
The fundamentals of the economy are good so we should be ok for a soft landing. Get on the property ladder now just in case
If you don't buy now you will never own a home.
 

sic transit

Well-known member
Joined
Jan 30, 2008
Messages
25,397
I dont see rates rising anytime soon. The ECB will keep printing for years yet - to steady the ship through brexit if nothing else.
Plus the Italian bank readjustments and any others that emerge from stress tests.
 

Voluntary

Well-known member
Joined
Nov 8, 2015
Messages
2,858
And with the Brexit implications yet to fully hit , what a time to ramp up spending on public sector wages.

It is like we have a death wish when it comes to managing the countries finances.

Wait until the currently very low interest rates we are borrowing at suddenly start to rise , then the sh!t will really start hitting the fan.
Pressure on wages is an immediate consequence of government policy of pumping up the property prices and the rental crisis. People standard of living decreased hugely since the economy picked up as increasing in costs of living hugely exceed the pay increases over this period.
 

Betson

Well-known member
Joined
Feb 7, 2013
Messages
16,705
I dont see rates rising anytime soon. The ECB will keep printing for years yet - to steady the ship through brexit if nothing else.
But It is hardly a responsible plan to hope interest rates do not rise. We simply cannot afford to put more borrowing on top previous borrowing to keep day to day expense of the country going.
 

sic transit

Well-known member
Joined
Jan 30, 2008
Messages
25,397
If you don't buy now you will never own a home.
There is very little to buy at present. Hopefully 2017 will begin to address the supply issue.
 
Last edited:


New Threads

Popular Threads

Most Replies

Top