Irish Economy and Budget Watch / / /Emergency Budget Announced for April 7th

johnfás wrote:

Cowen has questions to answer for every ministry he put his dirty little hands on.

Dempsey put his hands in our pockets a good few times too.

I am referring to new art there. Contemporary is where it is at with the major auction houses at the minute. Of course it is all trends and perhaps now is the best time to pick up an 18th century painting.

johnfás wrote:

I am referring to new art there. Contemporary is where it is at with the major auction houses at the minute. Of course it is all trends and perhaps now is the best time to pick up an 18th century painting.

There is a tendency to invest in art as a form of saving in times of trouble. The problem with Art is the gap between personal taste and what may at some future date may be of value.

IMO Expensive paintings are more bother than they are worth, who wants to live in a house with the shutters drawn? Same problem with books, fabrics etc. You need a section of the house as the museum and another where you live and can bask in the sunlight without too much care about humidity levels and cooking.

You can combat alot of that with glass Squire.

johnfás wrote:

You can combat alot of that with glass Squire.

Books and paintings fade in direct sunlight. Normal glass does not prevent this. You even need to be careful with artificial light. Books are a particular problem, apart from fading too dry and leather cracks and too moist and you get mould. Paintings also need stable moisture levels. Trust me some things which have sentimental value can be real mill stones.

Senan Moloney in the Indo today says that the Govt will have half a billion to play around with after the recent pay talks. What will they do with it? Only three and a half years to the next election. With thepublic pay freezes there might be a lot less consumer spending in the next while, tightening things up a bit more with the VAT take and it's probably good that the private sector gets there pay rise after 3 months (how can the government do such deals with the private sector ??) so the spending might be staggered if it has any effect. Then

Quote :

The new deal will typically see:

l A staff nurse currently earning a starting salary of €31,098 getting a 6pc pay increase over the course of the deal, bringing annual pay to €32,964.

l A civil service clerical officer at the lowest grade on €23,174, getting a €1,390 increase.

l The salary of a garda earning €41,596 rising to €44,092.

There were claims last night that, given the worsening economic situation, many employers would be unable to pay.

"It looks like an agreement at any cost, and, unfortunately, the cost will be jobs," claimed Mark Fielding of ISME, which represents small and medium enterprises.

Six months ago, IBEC called for a six-month pay pause and offered a 5pc carrot, he said. Instead, they had settled for a three-month pause and a 6pc hike for most workers.

Irish Congress of Trade Unions chief David Begg said he was confident the pay deal would be passed by members.

But across the trade union movement, the reaction was generally muted.

Opposition parties roundly criticised the deal, accusing the Government of squandering an opportunity to introduce both an anti-inflationary package and a HSE redundancy package.

Any potential pay gains for workers will be swallowed up by rising inflation, increased prices and the faltering economy, Fine Gael's Richard Bruton said.

The total pay rise for public sector workers will cost taxpayers at least €1.2bn a year, when fully implemented.

In securing an 11-month pay pause, the Government has ensured it will only need to find an extra €235m for next year for its own employees, when it announces its budget on October 14.

Taoiseach Brian Cowen has effectively postponed the pain of a massive pay bill until after the European and local elections next June, in the hope that the public finances will improve by late next year.

Budget bounce for Cowen - Indo

'Significant rise' in people moving cash to post office, according to PO dude on Radio1.
Are we going to have a bank run here ?
Joe Duffy sounds like he's trying to start one.

EvotingMachine0197 wrote:

'Significant rise' in people moving cash to post office, according to PO dude on Radio1.
Are we going to have a bank run here ?
Joe Duffy sounds like he's trying to start one.

Your money is ok up to 20,000 (thank God ) but after that you lose it

There could be a lot more _ on the fan by the time Lenihan gets around to merrily announce his first ever Budget.

It guaranteed 90% of your deposit up to a maximum of 20,000. If a bank went bust and you had a deposit of 20,000 you would lose 2,000.

johnfás wrote:

It guaranteed 90% of your deposit up to a maximum of 20,000. If a bank went bust and you had a deposit of 20,000 you would lose 2,000.

And once again it's us Irish getting (accepting) the crap conditions. It's 40 or 50K in UK and elsewhere.

EvotingMachine0197 wrote:

'Significant rise' in people moving cash to post office, according to PO dude on Radio1.
Are we going to have a bank run here ?
Joe Duffy sounds like he's trying to start one.

We shouldn't because our banking system is fundamentally sound with profitability recorded at all leading banks. Not for nothing has no Irish bank gone bust in this credit crunch. As others collapse, Irish banks sail serenely through.

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

'Significant rise' in people moving cash to post office, according to PO dude on Radio1.
Are we going to have a bank run here ?
Joe Duffy sounds like he's trying to start one.

We shouldn't because our banking system is fundamentally sound with profitability recorded at all leading banks. Not for nothing has no Irish bank gone bust in this credit crunch. As others collapse, Irish banks sail serenely through.

sailing like that building that fell off the edge of the world at the start of Monty Python's The Meaning of Life

SeathrúnCeitinn wrote:

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

'Significant rise' in people moving cash to post office, according to PO dude on Radio1.
Are we going to have a bank run here ?
Joe Duffy sounds like he's trying to start one.

We shouldn't because our banking system is fundamentally sound with profitability recorded at all leading banks. Not for nothing has no Irish bank gone bust in this credit crunch. As others collapse, Irish banks sail serenely through.

sailing like that building that fell off the edge of the world at the start of Monty Python's The Meaning of Life

I'd disagree with that. The earnings performance of Irish banks has stood exceptionally well in comparison to their international counterparts and we've yet to see any appreciable bank failure in this country. Elsewhere many have occurred. I'm not saying everything is rosy in the garden but we're doing a damn sight better than the neighbours.

Ard-Taoiseach wrote:

SeathrúnCeitinn wrote:

Ard-Taoiseach wrote:

EvotingMachine0197 wrote:

'Significant rise' in people moving cash to post office, according to PO dude on Radio1.
Are we going to have a bank run here ?
Joe Duffy sounds like he's trying to start one.

We shouldn't because our banking system is fundamentally sound with profitability recorded at all leading banks. Not for nothing has no Irish bank gone bust in this credit crunch. As others collapse, Irish banks sail serenely through.

sailing like that building that fell off the edge of the world at the start of Monty Python's The Meaning of Life

I'd disagree with that. The earnings performance of Irish banks has stood exceptionally well in comparison to their international counterparts and we've yet to see any appreciable bank failure in this country. Elsewhere many have occurred. I'm not saying everything is rosy in the garden but we're doing a damn sight better than the neighbours.

I claim no expertise in world economics but I'm sorry I don't share your confidence. If the US and Britain are in 'Super' banks territory why would this capitalist poodle not follow suit.

http://www.finfacts.ie/irishfinancenews/article_1014770.shtml

Michael Hennigan of finfacts posted this article today. Hennigan has persistently and clearly warned of the lemming like path we have been following over the last few years.

Quote :

Ireland is faced with new challenges as the US financial sector faces retrenchment and transformation. The economy has benefited enormously from both the huge growth of the US high tech and financial sectors since 1990. In the aftermath of a dramatic week for American finance, which will remain semi-socialised for the foreseeable future, the longterm consequences for the Irish economy, that is dependent on American firms for 90% of its exports, should at least alert Irish policymakers to challenges ahead, that marketing spoof from politicians and State enterprise agencies, will not provide credible solutions for...

There is much hope that service exports will sustain Ireland's economy but at official level, it's considered good marketing not to distinguish between the overwhelming dominance of US firms and the small number of indigenous exporters.

The Minister for Enterprise, Trade and Employment, is responsible for industrial and service sector policy. It has been almost 14 years since a politician with business experience, has held the portfolio. The current incumbent was a social worker and she was preceded by two former schoolteachers and a lecturer.
There are currently 4 ministers in the Department.

The Senior minister has the important job i.e for public relations purposes, of making jobs announcements on behalf of American firms. The other 3 ministers spend most of their time, making speeches at conferences.

After spending €8.2 billion of Exchequer funds, the goal is that: "Ireland by 2013 will be internationally renowned for the excellence of its research, and will be to the forefront in generating and using new knowledge for economic and social progress, within an innovation driven culture."

Nobody knows what the criteria are for the exalted state. Forfás the science policy advisory agency, isn't even tracking the commercialisation of university patents.

In the 15 years of the Celtic Tiger, the personal windfalls from the boom, went to commercial property investment. Irish investment of €13.9 billion was put into European property deals last year. In contrast, the Irish business sector does not even get a total of €200 million in venture capital investment.

The depressing aspect of policymaking, is that the managers at the State enterprise agencies appear to be cheerleaders for political marketing spoof. How can credible policies be developed if marketing spoof that obfuscates reality, goes unchallenged?

During the boom, only a handful of Irish firms, made an impact internationally while US firms were overwhelmingly responsible for the diversification of exports from a historic dependence on the UK market. In simple terms, whose interests are served when Microsoft exports from Ireland are claimed as an "Irish" success in the Chinese market? Now that the boom is over, spoof certainly doesn't help the Irish economy.

The term "tectonic shifts" was liberally used this week. There will be no worthwhile reform in governance, the public service, sheltered areas of the private sector and the land rezoning system that adds to poor competitiveness. Neither is there a silver bullet for the export sector. However, the "it will be awright on the day" approach, is hardly the best response to the rapidly changing international environment.

Finally, it is a striking fact, that after the self-congratulation of a 15-year boom, Ireland is likely more dependent on its future prosperity on American firms, than any other developed country. The travails of companies like Dell, AIG and Pfizer will continue to have a particular potency in Ireland and investors with surplus cash will put it in commercial property investment overseas

This extract gives some idea of the extent of Hennigan's anguish, but the full article is worth reading. He deserves credit for his efforts on finfacts.

Yeah, Finfacts rocks. Full marks. The only part I'd dispute is this:

After spending €8.2 billion of Exchequer funds, the goal is that: "Ireland by 2013 will be internationally renowned for the excellence of its research, and will be to the forefront in generating and using new knowledge for economic and social progress, within an innovation driven culture."

Nobody knows what the criteria are for the exalted state. Forfás the science policy advisory agency, isn't even tracking the commercialisation of university patents.

Sorry, but you can't "manage" innovation. You can merely throw cash at research and hope for the best. Other attempts at forcing research elsewhere don't work. I would give the Government full marks for SFI, etc, and the signs are that the strategy is paying off. There were 2 items in the news last week; Irish researchers made a breakthrough on the oil from algae front, and the link between a type of leukaemia and Downs was worked out with input from an Irish team... announcement on the RTE news over the weekend. Furthermore, some of the buried good news in the last few weeks has been about scientific/technical/pharma firms putting more money in R&D here.... So the strategy is paying off.

Another point... Alberta has very high rates of innovation by university faculty, largely because their rules allow said faculty to hang onto 50% of the rights, meaning they have a clear profit motive to pursue their ideas

People need carrots, not sticks.

Well lads and lasses, for the first time since 1983, the Irish economy has contracted over two consecutive quarters meaning that it is in recession

Connected to this confirmation of recession in the Irish economy, the Balance of Payments is coming back into equilibrium.

The trade surplus has also shrunk and the SME sector is gloomy.

A red-letter day methinks.

expat girl wrote:

Another point... Alberta has very high rates of innovation by university faculty, largely because their rules allow said faculty to hang onto 50% of the rights, meaning they have a clear profit motive to pursue their ideas

People need carrots, not sticks.

Good point and I agree. A problem I found with some Universities is an attitude where by the University acts as a dead hand on individual initiative. They tend to regard outside involvement more as a cash cow and really don't have the acumen to turn some of the research into profitable ventures.

We undervalue research.

Squire wrote:

expat girl wrote:

Another point... Alberta has very high rates of innovation by university faculty, largely because their rules allow said faculty to hang onto 50% of the rights, meaning they have a clear profit motive to pursue their ideas

People need carrots, not sticks.

Good point and I agree. A problem I found with some Universities is an attitude where by the University acts as a dead hand on individual initiative. They tend to regard outside involvement more as a cash cow and really don't have the acumen to turn some of the research into profitable ventures.

We undervalue research.

I've heard there is a problem of the Universities not understanding how big the investment is to bring a product to the market, and wanting way too much for licenses. Perhaps there needs to be something more nitty gritty like the IDA with specific responsibility of making sure that good new ideas coming out of publicly funded research get into production (if possible in Ireland).

They also don't really encourage the individual researcher!

The reversal in the Irish economy is something else. Just last year when we received second quarter results from 2007, the economy was growing by 6.7% on an annual basis. It is now contracting by 1%. A 7.7% reversal in the economy is a phenomenon unmatched by many other economies.

I think the economy will contract by 2% this year on these figures.

Construction is now down to 7.2% of the economy compared to 9% in 2006. The correction is halfway through imo.

2% would be a rather significant recession, would it not?

Ard-Taoiseach wrote:

Construction is now down to 7.2% of the economy compared to 9% in 2006. The correction is halfway through imo.

I thought it was higher in the first instance.