IN THE LATEST round up of the main economic and business stories of the last week, TheJournal.ie brings you the very definition of a mixed bag.
It was a week that will be remembered as a turning point in our recent economic story, with a plethora of positive data on the economy which could herald the end of austerity, the rigours of which have caused social and economic division never before seen on this island.
And on the downside, the Garth Brooks concerts could be cancelled*.
*Actually, it wasn’t all sweetness and light this week. Read on to find out more…
Need to know
The €2 billion budget cut is not going to happen
Two major pieces of good economic news have strengthened the Government’s budgetary hand. Two weeks ago we reported that the opening shots had been fired in the budget war, with the Government’s fiscal watchdog, the European Commission and the IMF all lining up to call for the full €2 billion adjustment.
The Government, chastened by the hiding it got in the mid-term elections, was never minded to slash as in previous years, but news on Wednesday that the exchequer tax take was €500 million ahead of target has made a tough budget all the more unlikly.
On top of this, yesterday’s figures from the CSO showed that the economy posted a relatively stonking level of growth for the first quarter of 2014, coming in at a healthier than expected 2.7%.
These figures are partially higher because some sectors of the economy are being included for the first time – specifically R&D and (ahem) prostitution, drug dealing, etc – but nonetheless, the results are positive.
As an aside, imagine your correspondent’s chagrin when the CSO failed to explicitely break down just how much we’d spent on vice so far this year. But never fear, the figure for 2013 was buried deep, and we dug it out – €1.25 billion.
Party like it’s 2006
Not literally, of course. We couldn’t afford the shopping weekends in New York, never mind the hangovers.
However, prices for commercial property are certainly behaving like it’s the peak of the boom. It’s well known that Ireland is hot property (sorry) on the commercial real estate market at the moment, but some late breaking analysis today from CBRE shows that transactions for the first half of the year beat the pants off 2006.
With the market heating up at this pace, insiders say that there are plenty of dangers to watch out for. Measures to encourage residential and office building, alleviating supply concerns, are badly needed to take the market off the boil.
Nice to know
- Bewley’s was extremely disappointed by a Supreme Court ruling which overruled a High Court decision to lower their rent. You would be too, if you had to pay a €1.5 million annual bill which was set in 2007 (ouch).
- There was bad news for some customers of Ulster Bank, which said that it is closing another 15 branches on both sides of the border this week. The bank blamed changing consumer behaviour, but seems to be increasingly cool on the Irish market.
- Former billionaire Sean Quinn was on Pat Kenny during the week, and came out swinging for Anglo, saying that they were using his own money to make him and his family “the most hated family in Ireland”. He also had time for the now-obligatory swing at the Dublin meeja.
- There’s a new top dog at the Department of Finance. Derek Moran will replace namesake John, who is returning to the private sector. Moran, who is a lifer in the Department, won’t have been pleased by revelations in the Irish Times this morning that he was among those advocating a ‘soft landing’ for the economy.
- AIB has a plan for helping those in negative equity trade up. It’s a start, said the experts we asked, but more is needed.
- The State broadcaster is back in the black, delivering its first (small) surplus in recent years. But there’s trouble ahead, RTE chief Noel Curran warned.
- These are the 50 towns being targeted for high speed broadband
Now you know
- The Central Bank has urged Bitcoin and its users to learn from the mistakes of the last financial crisis
- Nearly 800 jobs were saved through examinership in the last three months
- New data from MyHome.ie showed that asking prices are up nationally for the first time since the peak of the property boom
- More than three quarters of companies can’t find the right talent to fill open positions, it seems.
Late payments are hurting small business, says ISME… Ryanair’s former CFO stepped down this week… The Central Bank says that lending to small business is on the up, but we’re still focused on repaying debt… UK house prices are back above their 2007 peaks… An e-cigarette manufacturer in Waterford said that it’s going on a hiring spree.
One for the road
Facebook was at the centre of a storm this week after it emerged that it has been running tests on its user base with very few limits. Reaction was divided amongst those who were outraged and those who were more sanguine about the prospect of the company mining their data – but what do you think?
Is the outrage over Facebook’s actions appropriate?