Irish Economy Crumbling With 1.6% Contraction

[Realistbear]

http://www.bloomberg.com/news/2011-03-24/irish-economy-shrinks-1-6-as-consumer-spending-investment-exports-drop.html

Irish Economy Shrinks

1.6%

as Consumer Spending, Investment, Exports Drop

By Colm Heatley and Joe Brennan - Mar 24, 2011 3:49 PM GMT

Based on gross national product, Ireland’s economy shrank 2.1 percent in 2010 after a 10.7 percent drop in 2009.

Ireland’s economy shrank the most in a year in the fourth quarter of 2010 as rising unemployment curtailed consumer spending and investment and exports declined.

Gross domestic product fell 1.6 percent from the previous three months, when it increased 0.6 percent, the Central Statistics Office said in a report published in Dublin today. Consumer spending declined 0.4 percent and exports fell 1.4 percent. In 2010, the economy shrank 1 percent, a third annual contraction.

This may weigh heavily against the Euro--Portugal next.

Edited March 24, 2011 by Realistbear

[Liquid Goldfish]

GNP went up 2.0% though. I'm sure I read last year that this was the more important measure in Ireland, although I can't remember why, or why there's often a huge divergence

Quarterly decline in GDP and increase in GNP in Q4

2010

Initial estimates for the fourth quarter of 2010 indicate a seasonally adjusted

decline of 1.6 per cent in GDP at constant prices and an increase of 2.0 per cent in

GNP compared with Q3 2010.

Edited March 24, 2011 by oldsport

[neil324]

Scouting around on the internet last night for work as a bricklayer in Australia. Lots of Irish brickie's jumping ship and posting messages for help in obtaining visa's etc. There will be no one left to pay the debt off.

[TheCountOfNowhere]

The water's broke, the contractions have started...a new revolution will be born soon.

Edited March 24, 2011 by TheCountOfNowhere

[ralphmalph]

GNP went up 2.0% though. I'm sure I read last year that this was the more important measure in Ireland, although I can't remember why, or why there's often a huge divergence

GNP is the Irish economy with all of the Multinational Corporations i.e American removed. GDP includes the MNC's.

The big problem of including the MNC's is the money laundering that they do. For example Microsoft routes all electronic license sales for Europe through Ireland and Google does the same. To do this MS employs 2 lawyers working in a Brass Plate office and it is the most profitable business in the world. The only problem for Ireland is they get zero benefit of employment and they do not tax the laundered money because of the "double Irish", but for them it turns up in the GDP figures.

So the Irish for years have been saying hey we have fantastic export growth and GDP figures, whereas the exports are electronic and the money staas in Ireland for about 1millisecond before going to the Caymens via Amsterdam.

This is one of the reasons they are so fecked. Illusory exports boosted GDP whilst the real Irish economy i.e GNP had been declining.

If you want to know more finfacts.ie is constantly exposing the scams and how bad they are for the real irish economy.

[Ash4781]

What would happen if they lost their low corporation tax rate?

[ralphmalph]

What would happen if they lost their low corporation tax rate?

They might be able to pay off some of their debts.

[Self Employed Youth]

They might be able to pay off some of their debts.

Surely its better for a country to have workers pay taxes whilst corporations cream off the value of their citizens' labour.

Whilst we increase NI, we are cutting corporation tax. Ireland are doing great, we should do the same!

[ralphmalph]

Surely its better for a country to have workers pay taxes whilst corporations cream off the value of their citizens' labour.

Whilst we increase NI, we are cutting corporation tax. Ireland are doing great, we should do the same!

Ireland are doing great! What drugs are you taking?

You need a decent mix of corporate, personal taxes and indirect taxes. If corporate taxes are too low then the company can afford to pay higher wages in that country than other comparable countries and this is especially true of MNC's. MNC's will have to return a %tage profit back to HQ if corp tax is low then this money an be returned with highr salaries than a country that has a higher corp tax rate. This is why in Ireland they lost so much wage competitiveness to Germany and wages got massively out of whack. The result of this is that when the recessions comes (they always will) there is a much large cost base because of higher salaries so more people have to be laid off causing more misery.

So Ireland needs to raise corp tax and lower the amount of money that needs to be earned before taxes are paid (currently a married person with kids does not pay any tax before 30K euros have been earned).

[Liquid Goldfish]

If you want to know more finfacts.ie is constantly exposing the scams and how bad they are for the real irish economy.

Thanks for the link where I found this, which I'm still a bit confused by what it says there about GNP

GNP

Growth in GNP, which is typically the preferred indicator for economic growth in Ireland, has actually been positive in Q3 (1.5%) and Q4 (2.0%). But this has been driven largely by a reduction in expatriated profits from multinational exporters, which is hardly a sign of strength

Why does a change in expatriated profits affect GNP; isn't GNP independent of expatriated profits? And I'd ahve thought +ve GNP must be good, but they seem lukewarm?

Edited March 24, 2011 by oldsport

[Self Employed Youth]

Ireland are doing great! What drugs are you taking?

You need a decent mix of corporate, personal taxes and indirect taxes. If corporate taxes are too low then the company can afford to pay higher wages in that country than other comparable countries and this is especially true of MNC's. MNC's will have to return a %tage profit back to HQ if corp tax is low then this money an be returned with highr salaries than a country that has a higher corp tax rate. This is why in Ireland they lost so much wage competitiveness to Germany and wages got massively out of whack. The result of this is that when the recessions comes (they always will) there is a much large cost base because of higher salaries so more people have to be laid off causing more misery.

So Ireland needs to raise corp tax and lower the amount of money that needs to be earned before taxes are paid (currently a married person with kids does not pay any tax before 30K euros have been earned).

Sarcasm pal

Tax and NI is 32%, just up from 31%, before the mega regressive taxes come into play.

Whilst corporation tax is being reduced to a very low 20s % rate.

[interestrateripoff]

The European debt crisis is far from over.

[LJAR]

Tax and NI is 32%, just up from 31%, before the mega regressive taxes come into play.

Whilst corporation tax is being reduced to a very low 20s % rate.

The idea that some faceless corporation pays corporation tax while you pay income tax and NI is just a fantasy.

You pay all of it, corporation tax just means higher prices and lower wages for the same amount of profit.

ALL taxes eventually come out of your pocket, there are no other pockets for it to come out of.

[plummet expert]

It was all fixed months ago and the recovery locked-in. What could possibly go wrong. At least Greece is sorted and there are no problems in Spain or Italy. Some minor issues to deal with in Ireland and Portugal but apart from that all is well. And we are in great shape , the cuts have worked and we are well on the road to recovery.

Ha Ha Ha!!! It was fix alright. The debt mountain is actually growing in all these countries and ours. We are actually unlikely to be able to cope with our debt, with monthly borrowing increasing again. The national debt would be unserviceable if IR's on our 'paper' started to go up much. It will be £1.05 trillion in a year. Lower growth is threatening us with a Moody's downgrade and that would mean higher rates on national debt. Inflation is edging out of control and the medicine (higher rates) would cause the economy to stutter for sure. It's a vicious circle because a total tw*t called Brown (and Darling too) borrowed far too much for far too long before there was any crisis and left a bloated public sector with a much smaller wealth creating private sector. How could he not see that allowing a continued decline in just everything primary and secondary, whilst the conomy became 38% international casino *anking! We are down to a measly 12% manufacturing sector as a proportion of the economy. It was 30% only 30 years ago.

Italy has massive debts. Spains banks are wobbling again, Portugal has gone into a tail spin at the sight of cuts. Ireland is a basket case. Greece is still in dire straights.

The US is borrowing like no tomorrow and pretending it's a recovery!

[mattyfc]

Ireland will be delighted if interest rates rise in April, just what is required to get the economy going.

[tallguy]

http://www.bloomberg.com/news/2011-03-24/irish-economy-shrinks-1-6-as-consumer-spending-investment-exports-drop.html

Irish Economy Shrinks

1.6%

as Consumer Spending, Investment, Exports Drop

By Colm Heatley and Joe Brennan - Mar 24, 2011 3:49 PM GMT

Based on gross national product, Ireland’s economy shrank 2.1 percent in 2010 after a 10.7 percent drop in 2009.

Ireland’s economy shrank the most in a year in the fourth quarter of 2010 as rising unemployment curtailed consumer spending and investment and exports declined.

Gross domestic product fell 1.6 percent from the previous three months, when it increased 0.6 percent, the Central Statistics Office said in a report published in Dublin today. Consumer spending declined 0.4 percent and exports fell 1.4 percent. In 2010, the economy shrank 1 percent, a third annual contraction.

This may weigh heavily against the Euro--Portugal next.

Why the Green font?

[The Mighty Douche]

Why the Green font?

Oh Bejesus!

[Tiger Woods?]

Scouting around on the internet last night for work as a bricklayer in Australia. Lots of Irish brickie's jumping ship and posting messages for help in obtaining visa's etc. There will be no one left to pay the debt off.

The time to come to Australia as a tradie was some time ago. I suspect it will now be a waste of money, especially given the time it takes for an applicaiton to go through.

[EvilEdna]

Well at least Osbourne is not modelling our economy on the Irish system. He has always seen their errors of judgement ...

Yes quite

[Realistbear]

Why the Green font?

Deference to our Irish friends.

In the meantime, it looks like the carrot for corporations to remain in Ireland is about to be completely taken away:

http://uk.finance.yahoo.com/news/Ireland-must-give-low-reuters_molt-693508421.html?x=0

Rhonda "Helpme" Schaffler and Ann Saphir, 3:25, Friday 25 March 2011

CHICAGO (

Reuters

) - France's finance minister on Thursday renewed pressure on Ireland (Berlin: IIK.BE - news) to give up its coveted low corporate tax rate after euro zone countries came to its rescue last year with an 85 billion euro bailout.

European Union leaders are meeting on Thursday and Friday to try to narrow differences on long-term solutions to the euro zone debt crisis.

I think Ireland are in bad shape and that the crisis in the EZ is about to get a whole lot worse. Euros anyone?

[Realistbear]

http://www.bloomberg.com/news/2011-03-25/irish-banks-may-need-27-5-billion-euros-more-aid-analysts-say.html

Irish Banks May Need $39 Billion More Aid, Analysts Say

By Joe Brennan - Mar 25, 2011 12:01 AM GMT

Ireland’s government may have to inject an additional 27.5 billion euros ($39 billion) into the country’s banks after a third round of stress tests next week, according to a survey of analysts and economists.

That will exhaust about 80 percent of the 35 billion-euro fund set up last year in Ireland’s international bailout to shore up the country’s lenders, according to the median estimate of 10 analysts and economists surveyed by Bloomberg News.

Not exactly contained in Ireland then? Portugal seems to have dodged the bullet, for today at least. Euro holding up well after Germn confidence slipped again in March.

Edited March 25, 2011 by Realistbear

[Realistbear]

http://uk.finance.yahoo.com/news/Ireland-makes-fresh-plea-reuters_molt-1993764288.html?x=0

Ireland makes fresh plea for longer ECB bank lifeline

John O'Donnell, 16:12, Friday 25 March 2011

BRUSSELS (Reuters) - Ireland (Berlin: IIK.BE - news) 's prime minister has made a new plea to the president of the European Central Bank to extend its lifeline to the country's banks, giving Dublin more time to tackle problems

many fear are worse than forecast

.

"Worse than forecast." Bit better than us with our "worse than expected" line for every set of data that comes out.

Poor old Ireland look like they are going down again.

[northwestsmith2]

The time to come to Australia as a tradie was some time ago. I suspect it will now be a waste of money, especially given the time it takes for an applicaiton to go through.

I don't know about bricklaying in Australia but people say that about all kinds of things and it's usually not true. Back in 2005 it was far too late to get into IT, no point even trying

and the qualifications were worthless, yet the truth was companies wanted qualifed workers and paid good money, still do.

Anything slightly difficult is worth trying for, even if everyone is talking about it.

[neil324]

The time to come to Australia as a tradie was some time ago. I suspect it will now be a waste of money, especially given the time it takes for an applicaiton to go through.

Maybe your right, if Aus is in a housing bubble and when it pops a tradie will be out of work. But when your desperate you will do anything and reading some of the posts it was evident.

I believe the rules are changing this year making it harder and longer to apply. Although the age is being lifted to 50, not sure though.