Monday, February 04, 2008

All about the Budget numbers

As the budget numbers fall apart, the media seems to still be buying the line that everything is on track. See the problem with the budget has always been that anyone can add 2+2 and get 4, it's ensuring that 2 is in fact going to be there that is the problem.

Cowen had 20,000 net jobs for 2008, the Central Bank last week said 16,000

Cowen had growth of 3%, the predictions are now ESRI 2.4% Central Bank agrees with the minster .

House prices which according to those in the market would at worst be stagnant dropped 7% last year and now they're saying a drop of 5% (does that translate to a 12% drop? ) the problem is of course not alone one for first time buyers who paid over the odds in 2005/2006 but those who traded up and took on significantly larger mortgages along with the parents of the first time buyers who either guarantor on the mortgages or perhaps took out loans themselves to provide them with deposits. The problem will be that they may come to be much less willing to spend and if so that directly impacts on the service industry.

All this at the very beginning of the year, how much worse could it all become?

Again we have to wonder how real the numbers coming from the department of finance were back in Spring 2007.

  • GDP will increase by 3 per cent in real terms;
  • 24,000 new jobs will be created with the total number at work increasing by a little over 1 per cent;
  • Inflation will ease and the Harmonised Index of Consumer Prices will average 2.4 per cent

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