Dire economic outlook as exports fail to lift gloom

When will these people ever get it? Consumer spending is a result of economic growth and not the other way round.

If the government wants to acheive economic growth, it needs to shrink itself. But turkeys don’t vote for christmas.

independent.ie/business/iris … 95385.html

Elsewhere, on the bank stress tests, the IT reports that…

irishtimes.com/newspaper/fro … tml?via=mr

Experts schmexperts.

We’re now at a point where you cannot satirise Irish financial and economic expertise. It is beyond satire because if you used the actual predictions of Bloxham, Davy’s, the ESRI, the CB et al over the last 10 years in your satire it would lack credibility because you’d be accused of hyperbole. Which kills satire.

I guess that’s a long way of saying it’s beyond a joke.

Yeah, la-la land doesn’t quite do justice to it. I had to laugh at the headline of Stephen Collins opinion piece: “True scale of banking crisis must be established now”… only four fucking years into the banking crisis!

I agree completely that Irish establishment economic forecasts have been predictably woeful.

But am I the only Pinster looking at that the Q4 GNP number and the exports uplift and thinking “actually, that’s a lot better than I expected”.

Against my usual doom-laden inclination, I cannot help looking at the YOY exports and GNP growth and thinking that if this is the way the economy responds to the IMF arriving, the place will actually turn around.

I’ll just take out my hobnail boots and stomp your green buds…

Almost all the export growth was in the MNC entrpot sector which accounts for around 80% of exports but is mostly decoupled from the general economy. It will inflate GDP but has almost no effect on GNP. So its not going to help pay off those IMF loans. I note that the GNP/GDP difference is now almost 25%. During the real boom back in the 90’s is was around 10%. So the MNC tax evasion sector is booming.

So now, only half way through the crash, GNP per capita is now below EU 15 average. Factoring in the fact that government expenditure covered by borrowing is more than 20% of GNP, by the time the crash is over (and the budget is balanced) Ireland will be back to where it was in the 70’s. A semi poor country nestling somewhere in the Greece, Portugal, Spain cluster.

Its going to be real fun when that particular harsh economic reality sinks among the general population in a few years time. That’s when the real political nastiness will start as the various VI’s finally realize that the good times are not coming back and they starting fighting in the scramble to grab whatever shiny objects they can find in the rubble.

Did that cheer you up?

You can forget about those export figures having any meaningful impact. As jmc rightly points out,this growth is driven by MNC’s.Think about it.I twon’t stop the media and others trumpeting the export figures at every opportunity. Either they do not know what these figures actually mean (which is entirely possible) or they are deliberately misleading people.

Anyone for the last of the fig leaves ?

guardian.co.uk/business/irel … ns-bermuda

Interesting analysis of the GOOG accounting there…
So the net profit in Ireland is €45m which they pay 20% on, so €9m in corporate tax on revenues of circa €8,000m!!

Huh? You will have to explain that one. We have had lots of “shrinkage” and the economy is ,if anything, worse.

Why is economic growth considered to be the only solution to our problems?

Well, no it isn’t. The latest QNA says it is getting better. There are some lags to some data points - unemployment has been understated by extrapolating live register figures, corrected in the latest QNHS for Q4 2010.

I don’t believe in expansionary fiscal contractions, but I don’t believe that ‘standard’ money multipliers apply to Ireland either. There are not many reasons to be cheerful, but growth in the economy is one of them.