Recession is over - stop beating the beards

Rujib1

This is from the Irish Times, not that Indo rag ........ so it must be correct, musn't it


Ireland technically out of recession
CHARLIE TAYLORGDP grew slightly during the third quarter but the Central Statistics Office (CSO) has urged caution on calling an end to recession

The latest Quarterly National Accounts, which were published this morning, indicate that on a seasonally adjusted basis there was a 0.3 per cent increase in Gross Domestic Product (GDP) from July through to September.

On an annual basis, GDP fell by 7.4 per cent in the year to the end of October, compared to a 7.9 per cent decline in the preceding quarter.

Technically, given that the definition of recession is two quarters in a row of falling GDP, this means that Ireland has now exited recession.

However, at a press conference earlier today, assistant director general of the CSO Bill Keating refused to call an end to the recession, pointing out that much of the rise in GDP was attributed to profits from multinationals based in Ireland.

Whether Ireland was out of recession or not was " a matter of semantics", Mr Keating said.

"The general picture shows that on a seasonally adjusted basis there is a levelling off in GDP but GNP continues to decline, albeit at a slower pace than it has in previous quarters. Contributing to the GDP increase in a fairly major way was growth in the multinational sector," he added.

GDP is the international method of calculating economic decline but in Ireland's case, the Economic and Social Research Institute (ESRI) and other local bodies prefer to focus on GNP (Gross National Product) a measure which strips out multinational profits, much of which usually leave the country.

According to CSO, profits declared here by foreign-owned enterprises increased by €1,054 million during the year ending October 31st 2009.

During the third quarter Gross National Product (GNP) showed a decline of 1.4 per cent on a seasonally adjusted basis. In the year to the end of October 2009, GNP was 11.3 per cent lower.

Alan McQuaid, economist at stockbroking firm Bloxham said given that international commentators put so much emphasis on quarterly changes in GDP, we shouldn’t downplay the third quarter increase. He said we should take some consolation that on this basis, Ireland came out of recession ahead of the UK.

"Overall, we continue to believe that the Irish economy is making progress and is heading in the right direction," said Mr McQuaid. "While GDP is set to contract by around 7.5 per cent in real terms in 2009, we still think the average fall in national output could be less than 1 per cent next year."

A breakdown of the latest CSO figures show that consumer spending was 7.3 per cent lower in the third quarter of 2009, compared to the same three-month period a year earlier.

Captial investment declined by 35 per cent on an annual basis while net exports were 2,813 million higher than a year earlier.

Over the year the volume of output of industry decreased by 9.6 per cent. Within this the output of the construction sector fell by 34.4 per cent.

Output of distribution, transport and communications was down 9 per cent on an annual basis, while output of other services was 3.4 per cent lower, the figures show.

Commenting on the quarterly figures, Ibec senior economist Fergal O'Brien said the latest data shows the economy is beginning to stabilise.

"In terms of the pace of contraction in the Irish economy, the worst is now clearly behind us. Most sectors of activity are showing signs of stabilisation, with the exception of the construction sector, which continued to lurch downwards in the third quarter," he said. "Today’s numbers do not change our view that GDP will fall by about 7.5 per cent this year and will drop on an annual basis again in 2010. We can now see some light at the end of the tunnel, however, and the economy should begin to grow again around the middle of next year.

Sleepy

Semantics is right. GNP is still dropping, we're far from having a canoe, never mind a paddle...

Rujib1

Sleepy wrote: »

Semantics is right. GNP is still dropping, we're far from having a canoe, never mind a paddle...

Hey, the glass is half full, not half empty. What's all this poor mouth figairy, with half of ye. It's good to be alive. We never died a winter yet :P

Amhran Nua

Rujib1 wrote: »

Hey, the glass is half full, not half empty.

Which doesn't mean much as we need the proverbial entirely full glass to achieve anything.

Has anyone figured out where this growth in the economy is meant to come from, or are we relying entirely on the US pharmas to replace construction?

Sleepy

At a wild swing in the dark: Windows 7?

AlekSmart

What's all this poor mouth figairy,

Now there`s a word I have`nt heard in years....a favorite of My late mothers and one she used in the context of describing somebody doing something nonsensical or having a hissy-fit.

Is it from the midlands region ???

Rujib1

AlekSmart wrote: »

What's all this poor mouth figairy,

Now there`s a word I have`nt heard in years....a favorite of My late mothers and one she used in the context of describing somebody doing something nonsensical or having a hissy-fit.

Is it from the midlands region ???

The Banner county

Diarmuid

Sleepy wrote: »

At a wild swing in the dark: Windows 7?

I'd say it's a bigger picture reason. Worldwide outlook is brighter so the multinationals are seeing a pickup in demand.

gurramok

Why didn't you dig deeper to the truth OP?

GNP is what matters in Ireland's figures.

http://www.rte.ie/business/2009/1217/economy.html

rte wrote:

A breakdown showed that consumer spending remained weak, with a fall of 7.3% compared with a year earlier, while capital investment slumped 35%. Industrial production was down 9.6%, with the construction part of this dropping by 34.4%.

Thank zod we have MNC's still here.

whatnext

Recession Me AR$E -- this is a pre boom era:D:D:D

New years resolution - Getting up earlier and working harder.

Might get to keep hold of me gaff that way.:eek:

Idbatterim

ha ha! out of recession! yeah thats a good one! Ill be going down to the bank tomorow looking for my 500k! 400k for an apartment in Meath and 100k for the new Beemer! anything thinking of emigrating? you dont need to now! to those 500k on the dole, youll be back living the celtic tiger lifestyle within weeks! That is actually a rediculously misleading headline! Sure if were so sure things are back on track why not reverse the 4 billion in cuts?

greendom

Hoorah, the Celtic Tiger wasn't dead, just having a bit of breather

whatnext

greendom wrote: »

Hoorah, the Celtic Tiger wasn't dead, just having a bit of breather

A sort of "Cat Nap"?

Dirk Gently

Relying on MNC profits to "kinda" technically not still be in recession. Not good tbh. I look forward to a day when MNC's are seen as a welcome boost to an already thriving indigenous economy, and not over relied on to employ our work force.

greendom

whatnext wrote: »

A sort of "Cat Nap"?

Absolutely and a jolly well deserved one too

T "real deal" J

I saw that today too. I sent the author an email back.

"On an annual basis, GDP fell by 7.4 per cent in the year to the end of October, compared to a 7.9 per cent decline in the preceding quarter".

This is meaningless. The rate of economic contraction has slowed? So what.

"The latest Quarterly National Accounts, which were published this morning, indicate that on a seasonally adjusted basis there was a 0.3 per cent increase in Gross Domestic Product (GDP) from July through to September"

from a 4-12 week period (not specifically stated) on a "seasonally adjusted basis" (?) GDP grew by 0.3%. Again so what.

I'm not suprised garbage like this makes headlines. It is ireland after all.

johnnyskeleton

1) GNP fell.

2) The figures are seasonally adjusted, non-seasonally adjusted GDP still fell. So not really out of the recession, just relatively-out-of-the-recession-compared-to-last-year.

3) Most of the increases are due to increased exports (MNC profits) vs. imports (clothes etc) and increased government borrowing (spending) on social welfare.

4) Government borrowing (spending) will decrease GDP & GNP by at least 2.3% next year all other things being equal.

5) ERSI predicts further job losses next year.

6) Do you really believe the CSO anymore?

ragg

sweet, cant wait to get back to double digit payrises, next year

Mr.Micro

GDP grew by 0.3%. Wow as much as that. It was probably helped by all the people filling up to go up north to shop. Still it will be big new news for Lenny and Biffo to shout about as the sign of FF policies working and the green shoots of recovery.

Amhran Nua

Mr.Micro wrote: »

Still it will be big new news for Lenny and Biffo to shout about as the sign of FF policies working and the green shoots of recovery.

What policies, the first sign of any real action was last Wednesday, and they almost didn't go through with that. Won't stop them shouting though...

SkepticOne

I would be wary of the GDP figures in Ireland given our reliance on foreign multinationals making use of our favourable corporation tax. A pick up in GDP in Ireland may not mean much as far as improvement for the ordinary person; it may simply mean more profits are being booked through an Irish subsidiary of a foreign company.

nesf

Sensible analysis by Karl Whelan here: http://www.irisheconomy.ie/index.php/2009/12/17/ireland-out-of-recession/

Honestly, am not surprised in the slightest. Getting GDP positive was the easy task, getting GNP positive was always going to be the real challenge for the country.

Mr.Micro

Amhran Nua wrote: »

What policies, the first sign of any real action was last Wednesday, and they almost didn't go through with that. Won't stop them shouting though...

That's my point any positive news will as a result FF policies ie none in fact, or at least nothing coherent, wait for the rest of the world etc.

MI5

Forgive me for thinking that a majority of people on this topic, seem to have a pathological tendancy, to look on the down side!!!!! It's pretty plain that there is some inkling of good news in the statistics. Not saying the recession is over, but there is some improvement in at least apart of the economy.
So, drop the bah humbug, mindset. Maybe the fact that you have all been gorging on a feast of public service meat, has effected your brains.

Lay off the public service for a while, take an early morning walk in the clear frosty air, look on the bright side, switch off the computers, leave Boards until 2010, dont read the Indo, selectively read the Times, have a few hot toddies, go easy on the turkey and come back nest year to a slightly brighter economic outlook.

Mise le meas.

MI5

View

clown bag wrote: »

Relying on MNC profits to "kinda" technically not still be in recession. Not good tbh. I look forward to a day when MNC's are seen as a welcome boost to an already thriving indigenous economy, and not over relied on to employ our work force.

Don't knock it. It worked in the post-Dot Com recession when the sales of Viagra produced by Pfizer (?) in Cork meant the economy didn't go into recession.

Right now, the headline international investors are reading is "Ireland out of recession" ....

md23040

Diarmuid wrote: »

Worldwide outlook is brighter so the multinationals are seeing a pickup in demand.

The worldwide economy is brighter. Really? The great debt unwind is only 50% through. Have a look at the Baltic Dry Index, a measure of world trade. Presently BDI is trading in the 3152 to 3712 range, from a high of 11,600 two years ago. The BDI measures of sea cargo freight and even present numbers are skewed as a result of many companies replenishing low stock inventories.

Also, so far Ireland has only been window dressing its public finances, serious issues are being ignored for political expediency.

My call is a double dip worldwide recession, with some analysts expecting stocks to slump back to September 2008 levels. If you seen the fractional lending charts of the Fed it would truly scare you.

The debt deleverages of government, companies and individuals are going to drag on and on and on. Irelands up to its neck in debt, in depression and the future grim.

TetsuoHashimoto

Sleepy wrote:

Semantics is right. GNP is still dropping, we're far from having a canoe, never mind a paddle...

10 years of stagnation on its way, welcome to Tokyo's lost years

md23040

TetsuoHashimoto wrote: »

10 19 years of stagnation on its way, welcome to Tokyo's lost years

Japan had an asset deflationary depression, exactly what is presently occurring globally. Whenever economic stimulus packages in America, Germany, China etc dry up though lack of funds (except China - although it needs a GDP growth rate of 7% to contain its model without causing unemployment), then it will be the emperor without his clothes stuff.

The economic growth (or monetary stimulation) spurred by the Fed following the dotcom bubble fed the largest ponzi scheme in the world, with Ireland's own pyramid scheme being the greatest.

ragg

yeah yeah yeah, we're all ****ed, matt cooper told us so.

Double digit payrises again next year, Bring.It.ON :cool:

rumour

MI5 wrote: »

Forgive me for thinking that a majority of people on this topic, seem to have a pathological tendancy, to look on the down side!!!!! It's pretty plain that there is some inkling of good news in the statistics. Not saying the recession is over, but there is some improvement in at least apart of the economy.
So, drop the bah humbug, mindset. Maybe the fact that you have all been gorging on a feast of public service meat, has effected your brains.

Lay off the public service for a while, take an early morning walk in the clear frosty air, look on the bright side, switch off the computers, leave Boards until 2010, dont read the Indo, selectively read the Times, have a few hot toddies, go easy on the turkey and come back nest year to a slightly brighter economic outlook.

Mise le meas.

MI5

Are you a politician by any chance???

Flamed Diving

Sleepy wrote: »

GNP is still dropping.

At a decreasing rate since Q1. Perhaps you do not understand what this means. Think of a bright red car, driving very fast (200mph) at point w, then at point x (220mph) measure an increased rate of velocity, later we measure the velocity (190mph) at point y. We find that the car is still moving forward, but at a decreasing rate. We measure velocity (180mph) again at point z and find that the car is still moving forward, but at a decreasing rate.

We began with a car travelling fast (economy falling), then travelling faster (economy falling, and faster), then slowing (economy still falling, but at slower rate) then slowing some more (you get the idea, I hope).

Understand now?

gurramok wrote: »

Why didn't you dig deeper to the truth OP?

GNP is what matters in Ireland's figures.

http://www.rte.ie/business/2009/1217/economy.html


Thank zod we have MNC's still here.

True, but it is still falling at a decreasing rate.

T real deal J wrote: »

I saw that today too. I sent the author an email back.

"On an annual basis, GDP fell by 7.4 per cent in the year to the end of October, compared to a 7.9 per cent decline in the preceding quarter".

This is meaningless. The rate of economic contraction has slowed? So what.

"The latest Quarterly National Accounts, which were published this morning, indicate that on a seasonally adjusted basis there was a 0.3 per cent increase in Gross Domestic Product (GDP) from July through to September"

from a 4-12 week period (not specifically stated) on a "seasonally adjusted basis" (?) GDP grew by 0.3%. Again so what.

I'm not suprised garbage like this makes headlines. It is ireland after all.

It surprises me that garbage like this comes out of peoples minds. Remember the big red car above? It's slowing down... down...

TetsuoHashimoto wrote: »

10 years of stagnation on its way, welcome to Tokyo's lost years

No, this is not the same as Japan's problem. We are not directly comparable, the relative size of our economies and completely different monetary system, for starters.

md23040 wrote: »

Japan had an asset deflationary depression, exactly what is presently occurring globally. Whenever economic stimulus packages in America, Germany, China etc dry up though lack of funds (except China - although it needs a GDP growth rate of 7% to contain its model without causing unemployment), then it will be the emperor without his clothes stuff.

The economic growth (or monetary stimulation) spurred by the Fed following the dotcom bubble fed the largest ponzi scheme in the world, with Ireland's own pyramid scheme being the greatest.

A little evidence to back these assertions would be really nice.