Economy growth slowest in 20 years, ESRI
From Irish times, The last paragraph is very concerning…
One thing has to be remembered about ESRI forecasts is that in weighing up scenarios they always plump for the optimistic one. They consistently admit this in their reports. However, this never communicated to the public. Therefore, in the light of the continuing bad news facing the economy then the 1.6% forecast would be at the optimistic end of the ESRI spectrum.
Exactly. What these guys say in public and in private are different things I’m sure. That’s why they are consistently having to revise down forecasts. Even with these numbers they were accused by Tom Parlon of the CIF (on Newstalk radio this morning) of over-egging it. No one wants to be accused of “talking the economy down”, even the ESRI.
An ESRI spokeman was also on the programme and he said that the scale of the downturn in construction and its effect on the wider economy had “surprised” them. This has to rubbish surely? The ESRI know very well how over exposed we are in that area and must have known what outcome was likely. In private, they are probably using the R word. They are just too afraid to use it in public, as it would give Tom and others a big stick to beat them with.
I expect them to continue revising down their forecasts.
Growth at 1988 (pre-Celtic Tiger) levels is going to feel rather “uncomfortable”.
There are a whole generation of Irish, now new and prospective ftb’s, who have only experienced the “good times”, for them, the slowdown is going to be a real shock.
Just a little reminder of 1988
You will find that they will issue infinity of growth forecasts between 0.0000001% and 1.6% There will never be a negative forecast, at least if they take their cue from the statistics that emanated from the EU countries. France, Germany, Italy, Low Countries etc are economically in a very bad way and are nowhere near the heights of profitable production they achieved in the 70s and 80s. Nowadays, a University Graduate would be pleased to land a job that paid €12,000 a year! Yet, there was never a negative growth forecast over the past 15 years.
Country Tom said on Newstalk this morning that the ESRI were being conservative. For once I agree with him.
And he also repeated the crap that house prices have bottomed out!!!
The thing that got me most was that Ger Gilroy was reading out texts saying that newstalk was being too negative yet then we have country Tom wheeled out with the guy from the ESRI…Oh I get it that’s balance
So if ESRI economic forecasts are just auld flannel, designed to keep chins up. Then why not farm this work out to say, a freelance copywriter with a penchant for hyperbole?; think of the savings for the exchequer.
Not knowing much about economics, I’m often puzzled with this idea of ‘growth’ that gets bandied about by the government and other groups like the ESRI, and have come to the following conclusion about what it means, and would be very pleased if someone could take the time to correct me or tell me if it’s on the right track.
My reckoning is that ultimately the only way the government can really measure what’s going on out there economically speaking is by the size of the tax take, so growth pretty much refers only to growth in tax revenues, but not at all to growth in new jobs or new companies or new projects.
If this description is right then it’s also very misleading, because let’s say (all else being more or less equal) the government this year decides to lob 10 cent on the price of a pint - drinkers will complain (they always do) but they’ll quickly forget about it and get back to drinking again, which means next year, although the same number of pints will have been drunk, the tax take on them will have increased, allowing the government to show this as evidence of more growth.
The situation would also probably be even worse than mentioned above because with so many taxes being a percentage of prices, soaring prices would surge the tax take, resulting in more annual ‘growth’, even though the exact same amount of goods and services has been produced and sold as the previous year.
This would also mean with high inflation, the percentage growth could really be a negative growth, but when was the last time we ever heard a negative figure being reported, I can’t remember.
This question may seem rather simple or obvious to some reading it, but I’m only asking because I always assumed ‘growth’ in some way indicated the growth of new entreprises, new factories, new employment opportunities, and now I’m terrified that after all it just means growth in the annual tax grab amount.
A very good question and you are not too far from the truth.
Growth in this regard refers to an increase (or contraction) in the overall economy as measured by either Gross National Product (GNP) or Gross Domestic Product (GDP) see cso.ie/studentscorner/howgdpgnpmeasured.htm for details on both.
Here’s how they work out the rate of chance (i.e. the groth rate be it positive or negative) cso.ie/studentscorner/growthrate.htm
Yup. I’m looking forward to what he’ll be saying over the next few months when that doesn’t pan out.
A good illustration of the pack of lies the ESRI is trying to spin can be seen in the following: they have reduced their growth forecast by 0.7% from 2.3 to 1.6% yet they expect us to believe that this only means a drop from 8k job growth to zero! That is a pack of lies. Even on their own 1.6% figure and methodology they should be projecting 10-15k job losses at least. But no, God forbid the ESRI should deliver bad news into the public domain to the ire of their government paymasters. Even their house completion forecast at 50k is optimistic and it is not as if we do not have good data on this.
This is waay OT, but:
Germany and the Netherlands are doing fine - both have issues (in germany, it’s the cost of absorbing/fixing the east and an outdated education system which doesn’t match industry’s need for high-value employees) but the number one reason why germany looks economically stagnant is that saved money doesn’t contribute to the economy, while borrowed and spent money does. Germany is still the world’s biggest exporter - not bad for a ‘stagnant’ economy - but it’s net cash flow position isn’t so good because it sends so much of it’s money overseas as investments.
France / Italy have more serious issues - a national obsession with wasting their 3rd level education in fields they’ll never use (french students make up 25% of the EU total for psychology), overly strong unions and 75% apparently set public sector employment as their goal - enough said.
And considering the crap most of them study, they’d be lucky to get half that. The level of worker protection doesn’t help either - if you can’t get rid of someone if they turn out to be a crap employee, can you risk hiring them at all? Nope - you’d employ them via an intermediate, who gets most of the cash, and provides you the ability to jettison the people you don’t want.
And they were largely right - because productivity improvements were enough to cause growth on their own.
Hi ragingbear! To avoid going over old ground, please refer to previous exchanges we had on the same topic thepropertypin.com/viewtopic … 0316#20316
I don’t remember being particularly in agreement with you then either
We all have our shortcomings.
Brendan Keenan on The Last Word has said that the ESRI forecast was very optimistic and Alan Barrett of the ESRI did not disagree with him.
Another thing that should be remembered is that the ESRI have consistently underestimated growth figures and projections for the economy for the last 10 years
So they’re completely useless then?