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Industrial production rises 13.7% in February - The Irish Times - Fri, Apr 09, 2010
Annual industrial production rose 13.7 per cent in February compared to the same month in 2009, the Central Statistics Office said today.Turnover was 3.6 per cent lower compared with February 2009. The rise in volume was driven by growth in the production of basic pharmaceutical products and preparations, which rose 33.4 per cent. This was offset by a 32.3 per cent decline in the production of computer, electronic and optical products. The "modern" sector, which includes high-technology and chemical sectors, gained 18.5 per cent for the month, while the traditional sector rose marginally at 0.5 per cent. Seasonally adjusted figures show the volume of industrial production for the three-month period to the end of February 2010 was 5.7 per cent higher than the preeceeding quarter. Turnover in the same period was up 4.3 per cent for manufacturing industries."In overall terms, the figures for 2009 weren't too bad all things considered, even though it was the `multi-national' sector that was once again the main output driver. However, given the positive start to 2010, there is every chance that we will see a healthy average increase in manufacturing output this year," said Bloxham's chief economist Alan McQuaid. "The industrial output data are consistent with Ireland's external trade figures, as they clearly show a performance which is better than the global average, but in effect completely driven by a healthy chemicals sector, which can be quite volatile at the best of times. Chemicals account for over 50 per cent of Ireland's merchandise exports, and the fact that the products produced in this industry tend to be less cyclical than other sectors is a huge plus in times of recession."
Annual industrial production rose 13.7 per cent in February compared to the same month in 2009, the Central Statistics Office said today.
Turnover was 3.6 per cent lower compared with February 2009. The rise in volume was driven by growth in the production of basic pharmaceutical products and preparations, which rose 33.4 per cent. This was offset by a 32.3 per cent decline in the production of computer, electronic and optical products. The "modern" sector, which includes high-technology and chemical sectors, gained 18.5 per cent for the month, while the traditional sector rose marginally at 0.5 per cent. Seasonally adjusted figures show the volume of industrial production for the three-month period to the end of February 2010 was 5.7 per cent higher than the preeceeding quarter. Turnover in the same period was up 4.3 per cent for manufacturing industries.
"In overall terms, the figures for 2009 weren't too bad all things considered, even though it was the `multi-national' sector that was once again the main output driver. However, given the positive start to 2010, there is every chance that we will see a healthy average increase in manufacturing output this year," said Bloxham's chief economist Alan McQuaid. "The industrial output data are consistent with Ireland's external trade figures, as they clearly show a performance which is better than the global average, but in effect completely driven by a healthy chemicals sector, which can be quite volatile at the best of times. Chemicals account for over 50 per cent of Ireland's merchandise exports, and the fact that the products produced in this industry tend to be less cyclical than other sectors is a huge plus in times of recession."
Whoops.
Regardless, basing your tax take on property building and transactions is not a good plan, was not a good plan.
The current plan is to cut spending and increase taxes and service charges, because a deflationary spiral will increase the tax take or something. <shrug> Fucked if I know how that's meant to work, but it makes the Commission, the ECB and the financial markets sort of happy.
So the first problem is ideological: why are taxpayers being made liable for private losses - and thus also removing all semblance of moral hazard.
The second problem is also ideological - we tax income and spending, but not property and speculation - so guess where all the money goes, and why property bubbles ultimately become unsustainable - they aren't related to incomes (and ability to pay rents/mortgages) or real economic value, make Ireland uncompetitive, and unbalance the economy to the point where construction industry becomes 30% of GDP.
The third problem is also ideological. We didn't believe in sufficiently regulating "the markets" when the markets where preciously gaming a system of trust on which we all depended. notes from no w here
Frank you seem to be speaking about the future, I was asking about the 7% deficit in 2009. I doubt those 50 billion will come out directly from the budget and all during the same year. luis_de_sousa@mastodon.social
Now, of course, all these factors are compounded by the Government having to introduce swinging capital and ongoing expenditure reductions to try and rein in the deficit.
Basically the whole edifice had been built on the assumption of ever rising property prices with, at most, a "soft landing" or mild correction every now and then. As you know, the "market is always right". notes from no w here
Now, of course, all these factors are compounded by the Government having choosing to introduce swinging capital and ongoing expenditure reductions to try and rein in the deficit.
Fixed that for you.
It is, of course, arguable that the Government should have gone down the Greek route and kept incurring that level of borrowing in the hope that a quicker recovery in the economy and tax take would have enabled us to reduce the deficit at less social cost in due course.
However my point is that we should never have nationalised private debts in the first place. We need a functioning banking system, but that need did not have to be fulfilled through bailing out existing bondholders in exiting banks. The banks, especially Anglo - should have been allowed go bust on a Friday evening and reconstituted as new entities the following Monday.
As David McWilliams has argued, banks go bust all the time, debts are restructured all the time, and there is no reason why such defaults should have had any longer term effect on Ireland's Sovereign debt rating.
Indeed, as we started out from a relatively low level of National debt (c. 28% of GDP at its lowest) 12% budget deficits would have been sustainable for a few years if we hadn't invented NAMA or bailed out the private banks. notes from no w here
It's not about deficit reduction, it's about looking good to the markets.
Markets: Help! We're broke!
Governments: Here's a bailout...
Markets: Oooh - just look at all the new public debt. We're not having that. You might default on us.
I cannot help feeling that "the market" is looking on in shopcked bemusement that we are bailing out the banks in the first place. "We can't trust people who are that stupid now can we"? notes from no w here
But when it is ok to run 50% deficits at one side of the Atlantic but it is not ok to run 12% deficits at the other end, I must concede that something's wrong... luis_de_sousa@mastodon.social
50% refers to total debt to GDP.
I don't think budget deficits equivalent to 12%+ of GDP are sustainable except in an emergency and for a relatively short period. Not only do you have the increased servicing cost, but the interest rates demanded by sovereign debt markets become unsustainable - as in the case of Greece.
Frank this is objectively true in our case in the Eurogroup. But for a state with its own currency such deficits can be run for "long" periods without defaulting. First of all you have to continuously depreciate your currency so that rolling over debt doesn't kill you. Secondly, you set up some sweet rates on government bonds to seduce local investors, keep the debt in borders. Watch the US closely for something along these lines.
There's an obviously problem, at some point the folk may become nervous about an ever depreciating currency. After that it's game over. luis_de_sousa@mastodon.social
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