Growth in 2013

In the Irish Times, Michael Noonan is quoted as saying:

“On next year’s profiles we’re looking at 2.2 per cent of growth in GDP. The uncertainty caused by a No vote will cause that to come down and consequently that would make my job more difficult in planning the next budget. I don’t want to be put in a position where we have to increase the pace of the correction and, simply, the electorate are entitled to that information.”

I am curious. Am I the only one who thinks that plus 2.2 per cent is wildly over-optimistic, unless there is a radical change of direction in Eurozone macroeconomic policy?

58 thoughts on “Growth in 2013”

  1. @Kevin O’Rourke

    “Am I the only one who thinks that plus 2.2 per cent is wildly over-optimistic”

    You are not alone.

  2. @ Kevin,

    This time last year the projected real growth for 2012 was 2.5%. In November it was reduced to 1.6%. By December it was down to 1.3% and finally last week it was put at 0.7%.

    It is very likely the 2013 projection will undergo the same process.

  3. Growth (?) if you can call depletion growth can only occur in the eurozone through a further depletion of resourses , the striping of the commons etc etc.

    It(growth) did grave damage during the credit hperinflation phase and will do more damage during the money depletion phase.

    We are in a Fisher like debt deflation – we need interest free base money to fill the waste void the eurozones “investments” has created.

  4. Just a comment from someone in the real day to day economy – if the economy continues to perform as it has over the past 2 years there will be no GDP growth and GNP will remain on a negative trend for the next 3 years. As a business with a lot of experience and intelligence we do not currently see any trend or sign which is pointing to anything resembling slightest growth.

  5. Could the Minister quantify the fiscal impact of a Yes and No vote on growth? That would be a more useful exercise rather than simply inventing claims and counter claims about growth rates.

    As the rest of the afflicted in the EU are cutting growth projections, Ireland raises its projection by almost 500% from this year’s likely outcome.

  6. No, its part of the same propaganda machine that gave you melt down, ‘the guarantee’, a penal fail of a bailout; not satisfied with that, now followed by a Treaty that has the same respect for giving away the Irish Constitution as The Indian Removal Act of 1830. Its the ‘one, two, three’ stroking of the figures, Irish jig of figures goes like (3,2,1)² or (1,2,3)² with minus and plus multiple floating variants that lead to leprechaun pots of gold for official Ireland, as they try to win respect for the governors of the future principality of Direlandstein. Reality is cubed in Tir na N’Óg filled with its modern variants of Dermot MacMurrough. Forget Edward R Murrow Vs Senator McCarthy, see Irish McCarthyism portray its opponents as left wing loonies. You couldn’t make it up. Looking forward to the full campaign to see what crawls out of the woodwork 🙂
    left wing loonies

  7. Steve from Virgina

    “A common remark is that for everyone to consume like Americans the world needs four more Saudi Arabias.

    Since there are no more mega-suppliers to be had the next best thing is for demand to be driven to zero in some consuming areas so it can be exported to others.

    Europe is ‘low hanging (demand) fruit’ because it is not federated: finance can bankrupt Europe simply by refusing to lend to it. Any fuel that isn’t consumed by Europe is available to be consumed elsewhere … in America or China. Since Europe consumes roughly 15 million barrels per day, cutting that to 5 million is the same as discovering a second Saudi Arabia … without having to take the time to drill any wells.”

    Dork – there was 1MTOE less energy consumed in Ireland during Y2011 when compared to Y2010.
    In a world without energy growth or decline that energy went somewhere else – be it Germany , the US or China.
    They aim to drive the periphery into surplus in the most brutal monetary manner as there is no more Saudis to conquer.
    We are going back to our 19th century roots me fears – and I am talking the first half of the 19th century.
    Especially after the end of the Napoleonic bubble and the non default on debt policey that pretty much destroyed this country.

    In my opinion Europe has been dead in the water since the early 1980s.

    You had a rise of the pro bank credit anti money production mob.
    This made new Nuclear impossible as it needs money rather then credit production.
    Major countries programmes such as Italy & Spain were halted in the early /mid 1980s.
    While the UK did it deindustrial thingy and France soon followed ….EMU finally killed it.

    No BTUs no Buck Rodgers.

  8. @Kevin O’Rourke
    Far from being alone in your pessimism, you’re in the majority I’m sure.

    @Michael Noonan
    I’d be hard put to think of a less persuasive argument for a ‘Yes’ vote than “if you vote ‘No’ you’ll make the government’s job more difficult.” Even if Yes => 2.2% growth and ‘No’ => -2.2% growth, I’d prefer you started planning for the latter. It’s high time you started planning for an abrupt cutoff of lending; hopefully it won’t happen, but planning for it might do something to sharpen your thinking.

  9. @Kevin

    Thanks for pointing this obvious truth out. I’ve just had a little rant over on JMcH post where an amazing nominal 4.5% growth in 2015 seems to be accepted without much criticism.

    This is madness. With massive public and private debt burdens and a hawkish ECB, we cannot rely on some magical boom to get us out of the current hole.

    What really puzzles me is how so many well qualified professionals can have their heads so deeply buried in the sand. Or is Upton Sinclair’s famous statement appropriate??

  10. @ PR Guy
    “So is Noonan lying or just wrong?”

    I belieeve in giving the man the benefit of the doubt – he’s not lying but he is being given the wrong numbers. The penny will drop sooner or later. The indigenous manufacturing base of the country is being quietly and slowly etherised.

  11. Growth, as in ‘business-as-usual’ terms is over, possibly forever, with the exception of a few Dead Cat bounces. Difficult for this to be absorbed. So you get silly (and morally disingenuous) commentary.

    @PR Guy: I like Noonan, he was a very clever, astute politician. But he has lost his Moxie. I can summize why, but its too late to correct. Lying, no. But greviously misled, yes. I believe he has little idea that the advice he is getting is so poor. Look behind him for the problem.

    Either a Yes or a No vote will have no physical impact on ‘growth’. That will be controlled and dictated by fundamentals: energy costs and debt load. A No vote, would on balance (personal view), provide a psychological boost to citizens, but would further strengthen the arrogant and dismissive behaviour of our national and EU politicians.

    Now if the next Red C or whatever shows a significant (negative) shift in political opinion – and an improvement in the No estimate. Things might just get a tad interesting.

    @Nuts: You sound like that poor innocent; “Hey folks, the Emporer has no cloths, he’s bollock naked”. Which he is!

  12. Following the 0.7% increase in GDP in 2012, the Central Bank is saying 2.1% in 2013, the ESRI is at 2.3%, the IMF say 2.0%, the Reuters consenus foecast is 1.8%….a conspiracy of sameness perhaps, but what would be your own forecast Kevin…or what would be a non-wildy over optimistic forecast…

  13. @Kevin O’Rourke,

    “Am I the only one who thinks that plus 2.2 per cent is wildly over-optimistic, unless there is a radical change of direction in Eurozone macroeconomic policy?”

    Why does the primary obligation always have to be on others? Why not a radical change in Irish microeconomic policy? I only have very much second-hand – even third-hand – insight in to the thinking of policy makers in Berlin and Brussels but I gather they are quite bemused by the structure of the cost base of the Irish economy, by the pay levels required to maintain standards of living given this cost base, by the antics of those in the sheltered sectors, by the way municipal and infrastructure services are managed and funded and by the fact that a considerable amount of state equity is tied up, unproductively and inefficiently, in the semi-states.

    Why should they force a radical change in their policies to allow all this nonsense to continue? Christine Lagarde is right; it does take two to tango. But I reckon governing politicians and policy-makers in the creditor countries see no reason to join this dance until they see evidence that quite a few pennies have dropped in the debtor countries.

    And if I were in their position I would do exactly the same.

    It’s time for Official Ireland to wake up and smell the coffee.

  14. @ Kevin Donoghue

    In the language of propaganda and Newspeak impoverishment of language, the goal above all is to emphasise the positive and build confidence. No Plan B will be allowed to diminish focus on achievement of confidence in a positive result for the main stakeholders. Scare mongering tactics will be used to denigrate positions not in keeping with the party line. Do not expect any high end discussion of the pro’s and cons. As in Orwell’s Animal Farm, teachers will be expected to absorb simple arguments and pass these simple arguments on to others in as simple a form as possible. One of the leading simple arguments used will be, ‘on balance, its best to vote Y’. This allows for suspension of disbelief and the belief the recipient of this information doesn’t have to think for themselves 🙂

    Aidan Kane post on data journalism, interesting study here:

    http://datajournalismhandbook.org/1.0/en/case_studies_1.html

  15. @ Kevin:
    Yes, the only way we will achieve growth is by leaving the euro and going with our own (devalued) currency.

    @ PH:
    Devaluation will, overnight, solve the cost base issue that you rightfully point out is our major problem.

  16. @Brian Woods Snr

    “I like Noonan, he was a very clever, astute politician. But he has lost his Moxie. I can summize why, but its too late to correct. Lying, no. But greviously misled, yes. I believe he has little idea that the advice he is getting is so poor. ”

    Brian – if he’s so clever and astute, how come he hasn’t figured that out?
    Just asking is all.

    I am definitely moving to your camp on the growth thingy. Inflation, fiat money printing, more debt, natural resources consumption, growing populations, etc. firing up so-called growth just cannot go on. I think it’s ‘gone waved bye bye some’ (to use the Aboriginal term) – that bit on the rollercoaster ride where you slightly pause at the top before the rush downhill. I wonder if I will see the fall of the empire in what’s left of my lifetime. It would be interesting to observe it if nothing else.

  17. Kevin D, PH,

    We should plan now for a No vote. MN should announce that in the event of a No vote, he is assuming there will be no further official funding. ERGO, public sector pay and welfare rates have to go 10% below German levels starting on 1 Jan 2013.

  18. @Tull
    I assume you think we would still be the eurozone ?
    If so you must right off private debt as public sector pay & welfare is really the only money production & distribution in the economy now.

  19. @tullmcadoo

    ERGO, public sector pay and welfare rates have to go 10% below German levels starting on 1 Jan 2013.

    There is indeed widespread agreement on the pro-treaty side that adjustments have to be born by the disenfranchised and poor, access to ESM will simply allow the speed which the lower social strata are to be squeezed to be reduced to a politically acceptable level and also allow the financial sector continuing access to the public money that is rightfully theirs for giving us all so much financial leverage in the past.

    Am I missing something?

  20. The Minister comes out with a gigantic lie (that a “No” vote will affect the growth of the Irish economy) and here on irisheconomy.ie, you’re arguing about the accuracy of his growth projection.

    Typical.

  21. @ Ernie

    do you think there are no negative growth implications, directly or indirectly, from a No vote?

    Do you not think that there is a chance of a faster fiscal adjustment being required in the vent of a no vote?

    Could inward investment to at least some degree be delayed/postponed until investors can get a better handle on what the No means for Ireland and the EU?

  22. @Shay
    There is a willful blindness to the two different types of money both vertical & horizontal.
    In terms of wasting real resourses bank credit beats base money hands down but they wish to crush more & more people to sustain their completly unsustainable bank credit model both in their consumer bank credit inflationary phase and the money defaltionary phase when Mario gives them cheap money to bail out those catostrophic investments via a subtraction of your deposits.

    After 1987 this country wasted more resourses on Grot then its entire history before that time !!
    Mac the Knife did not do a austerity operation – he did a transfer of present and future resourses to a kleptocratic local elite.

    The horror the horror….. the waste the waste….

  23. I wouldn’t take a Department of Finance forecast too seriously. Never got them right in the past

  24. @Kevin O’Rourke’s

    I am curious. Am I the only one who thinks that plus 2.2 per cent is wildly over-optimistic, unless there is a radical change of direction in Eurozone macroeconomic policy?

    Now hold on there sir. The emperor’s suit is a little diaphanous, I’ll allow, but there was definitely a hint of some material fluttering there and I love the detailing on the crotch..

    Given the trends in GDP growth that the current policies have produced expecting these trends to change unless either the policies change or the wider economic environment improves is deluded. Plain and simple.

    On that front a “Yes” vote is certainly a negative, it strengthens the hand of those who have advocated (and enforced) the current policy set.

    @Bond Eoin Bond

    @ Ernie

    do you think there are no negative growth implications, directly or indirectly, from a No vote?

    There have to be, a certain proportion of FDI will be frightened away just by the idea that Ireland is not toeing the European establishment line, business investment is conservative in every sense of the word and that conservatism frequently trumps big picture analysis. On the flip side economic stability depends on more than just FDI and the capital attracted by lying back and thinking of the Euro may not make up for the capital lost through the continuing collapse in domestic demand. The economic calculus is involved.

    Though it might seem a bit twee it might help us arrive at a synthesis if we paired off the pro/cons for the Yes and No vote and checked which seemed more plausible.

    Vote
    No: FDI is reduced as investors worry Ireland might be less “business friendly” (where friendly implies a certain amount of timidity)
    Yes: FDI is reduced as permanent austerity policies reduce the overall levels of demand.

    and so on.

    I think that when we look at the implications for the overall direction of the EU and whether Ireland can survive in it the rationale for approving the treaty is very weak, however when it comes to the gut response of the capital controlling classes and the effect those attitudes have on Ireland’s economy the rationale for approving the treaty is on much stronger ground, at least while the German/ECB bloc is in the ascendant.

    Postpone the referendum for six months is still my favourite option.

  25. @seamus

    “This time last year the projected real growth for 2012 was 2.5%. In November it was reduced to 1.6%. By December it was down to 1.3% and finally last week it was put at 0.7%.

    It is very likely the 2013 projection will undergo the same process.”

    Every journalist and Michael Noonan should be forced to read this:

    international space station.

    http://ftalphaville.ft.com/blog/2011/07/25/633496/what-the-united-states-could-learn-from-chile/

    Every one will be shocked, shocked! by just this one paragraph:

    “Republican OMBs overestimate inflation while Democratic OMBs overestimate unemployment. Italy is the most optimistic forecaster in the eurozone — though the corresponding paper was written without knowledge of Greek statistical practices. The UK, Finland and Sweden on average exhibit pessimistic bias. The UK and Sweden, of course, were not trying to get into the euro.)”

    “Unsurprisingly, optimism bias is more pronounced during boom times. But Frankel also found that it is present during busts, too. ”Evidently official forecasters… over-estimate the permanence of the booms and the transitoriness of the busts.”

    A thespian formerly of this parish used the rule of thumb in that analysis, a biro and an envelope to demolish Noonan’s forecasts. This is five minutes work and a bit of nouse from Gavin Kostick in April 2011.

    “@ Eamon Moran and Grumpy

    This from “The Irish Economy in Perspective June 2011 Department of Finance”

    P. 33 (where there is also a nice chart)

    “Following a contraction of 1% in 2010, there is now a broad consensus that the Irish economy will return to annual growth this year. While near-term prospects remain subdued on the whole – reflecting significant headwinds on the domestic front – a strong export performance is expected to translate into GDP growth of around ¾% in 2011 and 2½% in 2012 (see Chart above).

    Turning to the medium term, the Irish economy is forecast to grow on average by 3% per annum over the period 2013-15.”

    So 0.75%, 2.5%, 3%.

    Applying yer man’s average ‘optimistic tendency’ of +0.2, +0.8, +1.5 (years 1, 2 & 3).

    We get a prediction of 0.55% for 2011, 1.7% for 2012 and 1.5% for 2013

    Can’t wait – must come back and check.”

    What is Michael Noonan’s line going to be after the referendum is passed?

  26. …don’t mention the international space station, it gets everywhere – worse than Simon Cowell.

  27. What could underpin growth?
    1. An increase in bank credit. (Increase in I).
    2. An increase in exports/reduction in imports. (Increase in (X-M).
    3. A divergence between CPI and HICP (i.e. stuff costs more so C is increased, but the GDP deflator less so, in real terms a boost to GDP).

    My money is on 1 & 3…

    I think we’ll see bank assets hived off into SPVs to give the banks their deleveraging targets (that I think is the meaning of the Plan B on avoiding firesales). The banks will then be free to do some lending.

  28. @grumpy

    “What is Michael Noonan’s line going to be after the referendum is passed?”

    Er, external factors, beyond our control, southern Europe, unpredictable, volatility, global contraction, international space station, Simon Cowell, weak export markets, ECB not acting as lol, everyone’s fault but ours, …..

  29. @ Shay

    given that we have seen continuing high levels of FDI into Ireland in 2011 and 2012 so far, does it not seem difficult to suggest that austerity is scaring off FDI, especially given that most FDI is for export purposes and so not impacted by domestic demand?

  30. Many international commentators on FX are suggesting a significant devaluation of the euro against other major currencies in a relatively short timeframe (say within the next 18 months). It’s becoming commonplace (again) to hear of 1 euro = 1 $, etc, say 30-35% devaluation. That would be helpful! However, these fx projections have been consistently wrong (and the US just prints money or swaps it for euros in backstop arrangements) to keep its currency down. China is also suspected of being involved in keeping the euro high, in its own economic interest.

    So, while I think the current Govt propaganda and spin is deplorable, it is difficult for anyone to rubbish 2.2% (or 4.5% in 2015 or whatever)…Projections are based on assumptions. Whoever is behind MN is optimistic, albeing far too optimistic in my view…..Govt believes that the Irish cost base has made the country super competitive and that, with a bit of luck, international growth will lift the Irish boat. There is feedback from the MNC sector for instance that much lower property rentals is very helpful. So too are much lower entry level salaries for qualified staff. A friend who established a very successful IT firm makes the same comments. The problem of course is that the internationmal economic climate is looking ominously threatening to the downside. Beyond that, the level of debt overall is far too high and simultaneous adjustment of private and public debt makes no sense at all.

    Ultimately, there will have to be debt resolution I believe. I suspect that the John McH’s & co. are trying to buy time via the FC in the hopes that this point will be achieved /initiated by someone else other than Ireland initiating it, but knowing full well in the meantime that the current debt and fiscal trajectory is unsustainable (Ireland is chronically insolvent). The rationale I suspect too is that this approach is justified on the basis that ‘there is always a chance that it will work out’. The problem of course is that this crisis is going on and will continue for a long time. In the meantime, in the absence of some escape route based on the international economy turning positive, the domestic (GNP) economy will be increasingly decimated. If things get bad enough, social instability will set in….and then all conventional thoughts of foreign investor confidence, etc.will be moot. That point of social instability does not appear too far off…..but who knows.

  31. @Bond. Eoin Bond…

    given that we have seen continuing high levels of FDI into Ireland in 2011 and 2012 so far, does it not seem difficult to suggest that austerity is scaring off FDI, especially given that most FDI is for export purposes and so not impacted by domestic demand?

    I try to stick to saying things that are simple due to a severe writing impediment but I do not recall anyone else saying that FDI to Ireland has been “scared off” by our current strain of austerity.

    There are certainly strains of austerity that could do that, here taxation has had a very small part in the fiscal consolidation morality play. That could change when we find ourselves on the “glide path” into the ground that post Fiscal Compact EU permanent austerity logic demands and that could eventually make Ireland less attractive for FDI.

    The case that post Fiscal Compact Europe is survivable for Ireland is not convincing.

  32. I should add that Ireland also needs a functioning bank system to underpin any possible recovery of the economy. So, the Govt is also focused on that.

    So, while I believe that debt resolution is required sooner, before the ‘no return’ tipping point under the existing Programme & FC path, so that Ireland has some base from which to recover (a bank-only foundation clearly willnot work…but what will be left!), the Govt can argue that it has been pursuing ‘conventional practice’ in pursuing ‘recovery’. Again however, my view (and that of many here also) is that recovery willnot look anything like the pre-crisis 15 years. Pursuing that vision is therefore folly…and unfairly favourable to Ireland’s ‘elites’.

  33. To address the deficit.

    Dork “….public sector pay & welfare is really the only money production & distribution in the economy now”.

    That is true. While the Croke Park Agreement is a political abomination, even those in the private domestic sector agree that reduction of spending in the public sector pay and welfare arenas ultimately damages them even more by extracting more cash (for debt service) from the economy.

    The current strategy is, as Dork says, the reduction of human and physical capital, rather than the reduction of spending (there has been no meaningful adjustment as yet). PH is right that a real discussion of this microeconomic and social policy aspect is needed (it is under the carpet for now).

    However, the deficit must be reduced. Reducing it now without other (macro) fiscal adjustment makes no sense at all as it will simply deflate and destroy the economy….cause a bigger crisis. Again, maybe that’s why no meaningful attempt is being made on this item. My suggestion therefore would be to begin reduction of the deficit ‘stimulus’ in the context of a reduction of Ireland’s interest bill i.e. by a reduction of Ireland’s debt service obligations, by means of write off (certainly), term elongation, etc (probably a combination of methods). It will be important in effecting deficit reduction to keep the exercise relatively ‘cash neutral’ for the economy. Has anyone any thoughts as to how that can be done without a corresponding reduction of Ireland’s interest bills?

  34. @Paul
    The fiscal defecit is the money supply , however there is no need for the money supply to be a fiscal defecit.
    You simply print more money and the defecit goes away as more money would be available to be taxed.
    However imports would collapse – the social dislocation would be large (destruction of the outer suburbs , sub rural areas , shanks mare for most etc etc.)

    The waste withen the country lies in the built envoirment….

  35. On the projected growth rate of 2.2% next year…I wonder if the Rogoff and Reinhardt theory (that debt over 80% of GDP leads to decline in growth) has been factored into this forecast.
    We are,as I understand it, heading for 120% debt/GDP.

  36. @ Dork Yes if one goes back to printing one’s own currency: one can print away the deficit but, yes, everyone will have to go back to growing & eating their own potatoes….!. Little chance of that for now. Anyway, I’m not in favour of Ireland leaving the euro unless that simply becomesunavoidable. So dealing with what is in front of us – the euro – Helpfully, the fx world is forecasting a euro market devaluation, based on the EU’s currently negative (and increasingly negative) fundamentals. That possibly provides a pivot that Ireland can take advantage of. However, if that ‘advantage’ is squandered on debt interest service, nothing much is gained.

    From an EU perspective, that market devaluation could be combined with continued easing /easy money supply policies. So some of the benefits of having a weaker currency, printing currency…..That would help the Mothership.

    On Ireland: the problem of course is that Official Ireland is likely to use that to maintain status quo rather than reform e.g. less incentive to reduce the deficit, etc. In some ways, the discipline of the Programme is needed to avoid that.

    Ireland is not ready….as usual, it will react after the fact, too slowly.

  37. People with very lucrative careers to protect are most unlikely to come forward with career challenging forecasts, no matter how obvious the indicators.
    That goes for all forecastors be they Irish, EC, EU or indeed IMF.
    It also goes for private secotr organizations.
    I remember doing a little forecast in August 2008, showing the impact of revenue falls to 80%, 75%, 60% and 50% of existing revenue levels. There was no comment at all on the fall to 60% or 50%. It was like the C word in times past. Not mentioned. But very scary and very real.

  38. I think a look at the graph at the link below sheds a lot of light on our growth prospects for the future.

    http://www.sensiblemoney.ie/how-modern-economies-operate/#whats-different-about-this-recession

    It’s a graph of total deposits with, and total debts to, the Irish banking sector over time.

    1. It demonstrates that money is created in parallel with debt and that money is deleted as debts are repaid.

    2. It shows how unique this recession is since we now owe much more than exists in an era when mortgages cannot increase in duration.

    3. It shows Ireland’s likely growth prospects since a declining money supply will mean a reduction in GDP because of our methods of measuring GDP.

    Paul Ferguson
    Sensible Money

  39. @ PR Guy: Been busy at the ‘day job’.

    MN was very impressive. Not now. Which is a loss. Had he kept his Moxie he would not be Finance; he’d have gone through the mandarins for short-cut and have up-ended the Croker. Which would have been very un-PC. He’s a neutered tom cat. Happens.

    I get the unwelcome feeling that a lot of folk are gazing fixedly where the light is shining, and not poking about in the shadows where the problems are lurking. When the light goes dim, the contrast is reduced – “Oh, no-one saw this coming!” Very true, ye were gazing elsewhere.

    Frantic calls to the usual suspects. Usual guff. But this time it IS different and the peasants are a tad frisky! Less than a decade is my guesstimate. But who knows?

  40. @ John McHale,

    I think a look at the graph at the link below demonstrates how unlikely the current system of money creation is likely to lead to resolution.

    http://www.sensiblemoney.ie/how-modern-economies-operate/#whats-different-about-this-recession

    It’s a graph of total deposits with, and total debts to, the Irish banking sector over time.

    1. It demonstrates the main point of many of my previous posts which is that money is created by banks in parallel with debt and that money is deleted as debts are repaid.

    2. It also shows how unique this recession is since we now owe much more than exists in an era when mortgages cannot increase in duration.

    3. It shows Ireland’s likely growth prospects since a declining money supply will mean a reduction in GDP or GNP because of our methods of measuring both.

    Paul Ferguson
    Sensible Money

  41. @ PR Guy
    Blame FF (It is all their fault. MN only inherited the situation).
    Blame the Loony Lefties (such as self-proclaimed capitalists such as Colm B).
    Blame Fate and Faith.

  42. MN “…I don’t want to be put in a position where we have to increase the pace of the correction.”

    Now, what does that tell us?

  43. Karl Deeter reckons the property market is going to bottom out this year and Noonan is calling growth for next year. I,d like some of their spliffs, pass it around Man.

  44. Ministers spinning is not news and growth in 2013 is likely to be low.
    The forecast of 0.7% GDP growth this year hardly got too much attention and I assume the main interest was that it would not be lower than 2011 and that’s why 0.7% was chosen.

    A more pertinent question is what GDP growth rate would effectively mean no growth?

    While it’s well known that the size of the MNC sector impacts key metrics, what is more important than ministerial spin and what should surely be of concern to the economics establishment are recent trends with the result that published data on for example exports, output and productivity are clearly misleading.

    http://www.finfacts.ie/irishfinancenews/article_1024185.shtml

  45. @ceteris

    We are closer to 140% when all the creatively accounted to be excluded is included – we are beyond unsustainable especially when the household of 200% is also factored in ….

  46. Someone mused about a possible -30% of EU v USD. That would sure bring a lot of folk into an upright position. Their energy and food bills would crucify them. Food looks to be cheap, but its not. There has been continual margin compression and downward changes in packet sizes and nett weights. Most consumers do not notice this – for a while. But its like ZIRP. It has an absolute bottom. Things stabilize, then turn nasty.

  47. Noonan’s comments on potential growth is nothing more than a thinly veiled threat that things could be worse if you vote “no”

  48. @ BW Snr, 8.37pm
    Good comment. But is it not a realistic scenario…? Things are moving quickly….much quicker than Official Ireland (Europe) is able to handle. I have previously alluded to the fact that social unrest will be the game changer in Ireland….It can be set off much more easily than people can (conventionally) imagine. Ireland self-praises (or criticises) for not rioting in the streets like Greece, Spain…..and implies that it is “better” given that. However, that’s been a function of the artificial holding up of the Irish “standard of living”. If that gets squeezed enough, social unrest in Ireland will quickly become a reality.The Troika /Official Ireland Programme has held this scenario /consequence in abeyance thus far. However, a dramatic market-driven change (reduction) in the euro /$ fx rate could put the cat among the pigeons rather quickly, outside official influence or control….if it happens in an uncontrolled, freefall manner. The Emperor has no clothes.

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