How's the economy going to go?

Strokesfan

Hey everyone, I'm a novice as far as it goes in analyzing the economy, but as a nation will we continue to do well for the foreseeable future? Will our incomes and disposable incomes continue to rise? and if so, for how long?
I'd really like your view if anyone could help me.

Pa ElGrande

Strokesfan wrote:

Hey everyone, I'm a novice as far as it goes in analyzing the economy, but as a nation will we continue to do well for the foreseeable future? Will our incomes and disposable incomes continue to rise? and if so, for how long?
I'd really like your view if anyone could help me.

Your question is answered by the economists at the ESRI - http://www.esri.ie/, Bank of Ireland, & Davy Stockbrokers.

If you are an employee or student, you would best spend your efforts researching your subject/career/interest area for new developments and opportunities rather than analysing the economy in general.

Economists have sucessfully predicted 9 of the last 4 recessions.

There is a thread already running if you feel bearish about the economy.
http://www.boards.ie/vbulletin/showthread.php?t=2054915795

Strokesfan

Thanks

Sonnenblumen

Economists/ESRI do not make money, never did and never will. What's more they've no role in determining private sector performance and I'm not aware of any role in defining strategies.

I think they're more akin to College lecturers except they have a friendly ear within ArETeeEee etc for VOX POPs.

More likely to get better intelligence on performance and emerging trends from Banks and major corporates etc. Afterall, they have key roles in financing and/or making developments happen.

Economic analysis is Government PR speak about someone else's action.

DublinWriter

Strokesfan wrote:

I'd really like your view if anyone could help me.

It's impossible to discuss Irish economics without discussing global economics. We're not the little self-sufficent dairy producing island of maidens dancing at the crossroads as Dev once dreamed about, we're totally tied into global equity and FX markets now.

Personally I think we're in for tough times once 'peek-oil' is reached - this is basically when it costs more to drill oil out of the ground than it is to sell it. Current estimates put it as happening somewhere between now and 2012.

You'll hear lots of arguments on here about the property market, the jobs market, etc, discussed as if in a bubble. Everthing we do is governed by oil and energy.

However, watch for when, not if, OPEC transfer from US dollars to Euros to sell oil. This will precipitate the global ecomonic collapse, and here's why...

Basically, now, if you want to buy oil, you first need to buy US dollars. This has caused a lot of artificial demand for the dollar, a currency many consider to be grossely overvalued for this very fact.

When OPEC switches to the Euro, it will massively destablise the US dollar because of the US's massive trade deficit. A collapse in value of the dollar would cause massive shock-waves to travel all around the world, not only in terms of direct investment in foreign countries by US corporations, but in global equity and futures markets.

ronbyrne2005

DublinWriter wrote:

However, watch for when, not if, OPEC transfer from US dollars to Euros to sell oil. This will precipitate the global ecomonic collapse, and here's why...

Basically, now, if you want to buy oil, you first need to buy US dollars. This has caused a lot of artificial demand for the dollar, a currency many consider to be grossely overvalued for this very fact.

When OPEC switches to the Euro, it will massively destablise the US dollar because of the US's massive trade deficit. A collapse in value of the dollar would cause massive shock-waves to travel all around the world, not only in terms of direct investment in foreign countries by US corporations, but in global equity and futures markets.

Nonsense again,did you really work for an investment bank as you previously claimed?
As it stands anyone selling oil and accepting dollars can immediately switch it into euro yen swiss franc, these people who currently receive dollars choose to maintain their dollar holdings when they could instantly enter market after receiving dollars and buy another currency ,they dont and your argument is spurious. The fact that any commidity is priced in a particular currency has little if any impact on that currencies relative strength,the dollar is the worlds main reserve currency and foreign central banks etc hold trillions is dollar denominated treasuries etc and this is why it is artifically high if it really is artifically high,in a perfect market its current value would reflect the reserve currency factor into current price.

Pa ElGrande

The five major trends reshaping the world economy
http://www.moneyweek.com/file/15985/the-five-major-trends-reshaping-the-world-economy.html

ronbyrne2005

DublinWriter wrote:

It's impossible to discuss Irish economics without discussing global economics. We're not the little self-sufficent dairy producing island of maidens dancing at the crossroads as Dev once dreamed about, we're totally tied into global equity and FX markets now.

Personally I think we're in for tough times once 'peek-oil' is reached - this is basically when it costs more to drill oil out of the ground than it is to sell it. Current estimates put it as happening somewhere between now and 2012.

Peak oil is where the level of overall production reaches an all time zenith and enters a terminal decline,it has little to do with cost of drilling it out of ground and everything to do with a falling supply which increases price Ceteris Paribus.

daveirl

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DublinWriter

daveirl wrote:

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Daz reight. But what kind of effect do you think petrol going to €10 a litre will have on the economy and society on the whole?

Hint: Not a very good one.

daveirl

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dochasach

daveirl wrote:

This post has been deleted.

Maybe he was speaking in terms of energy based accounting. One day in the not-too-distant future, it will take more energy to extract a barrel of oil than is contained in that barrel of oil. Regardless of what that oil's value is in dollars, euro or yuan, this will have a major impact on the global economy.

Oil has a huge effect on the global economy, but I don't think we should worry too much. Rising interest rates, government bloat, pricing ourselves out of global competitiveness, and the collapse of a speculative property bubble will do the damage long before peak oil destroys the U.S. economy and gives us a touch of 2nd hand economic pnemonia.

Personally I think peak-oil is a bit off yet. It'll definitely happen but with prices rising more and more oil will become economical to get out of the earth. Tar Sands in Canada for example.

The ratio of extraction energy to extracted energy in oil sands is terrible. Traditional oil wells return about 20 barrels for every barrel worth of energy input. Oil sands return 1.6 barrels for every barrel of energy equivelent (usually gas) used in the extraction process.

The best way of assuring that our oil resources will be available to burn, make plastics, chemicals and pharmaceudicals in the future is to use less oil. Ireland has significant wind energy resources and a (crumbling, but still existent) public transport system which is slightly better than that in most of the U.S. But we seem to be pulling away from the E.U. model and towards the U.S. car-based society. Our success in the post cheap oil economic world depends on how far we allow our compact self-sufficient villages and public transport system to unravel in the next couple of years.