Is NI economy going broke?

smokiewater

What about encouraging everyone to support their local shops and small businesses this Christmas and keep what money is being spent in the local economy!

Tescos, Sainsburys and Asda will always be cheaper for shopping, but it would be great if everybody could buy some of the pressies and little extras from local traders this year.

It is also so easy to click on Amazon or ebay, but by keeping it local hopefully in a small way we will be able to help our local economy!

suki1964

smokiewater wrote: »

What about encouraging everyone to support their local shops and small businesses this Christmas and keep what money is being spent in the local economy!

Tescos, Sainsburys and Asda will always be cheaper for shopping, but it would be great if everybody could buy some of the pressies and little extras from local traders this year.

It is also so easy to click on Amazon or ebay, but by keeping it local hopefully in a small way we will be able to help our local economy!

I already do - as much as possible

Actually my local hardware shops are cheaper then B&Q and with careful planning buying my groceries locally isnt any dearer then MrT

Local school fayres, garden centres etc are great for gifts

x12yhp

pgilc1 wrote: »

Within your solution (a) its worth pointing out that the banks are extremely reluctant to agree mortgages at the moment leaving a lot of people who could otherwise afford to buy...

Oh I know all about it! (a) was rather tongue in cheek because it seems to be the least likely scenario!

A.L.D.A wrote: »

One point on housing, on the low end the numbers for buy to let is starting to make sense again so I don't see much room for further falls in that section of the market. I think next Spring, early Summer could well be the bottom on low and medium value houses, but in truth it is a guess as all it would take to throw us all into a tail spin is a Greek default.

I am not sure... if banks are reluctant for OO mortgages... BTL sounds extremely difficult! I don't think BTL is going to take off in NI again, not for a number of years anyway!

warmhands.coldheart

smokiewater wrote: »

What about encouraging everyone to support their local shops and small businesses this Christmas and keep what money is being spent in the local economy!

I completely agree

smokiewater wrote: »

Tescos, Sainsburys and Asda will always be cheaper for shopping,

On this I'd air caution.... They are certainly more convenient a lot of the time but definitly NOT always cheaper.... I noticed a big box of Roses in a local shop 50p cheaper than those on offer in Tesco....
Local Spar is doing 5p/litre off fuel when you spend £10... makes it cheaper than both the local Tesco or Sainsburys.
Still worth shopping around..

saverbuyer

The N.I “economy” really is a strange one. It’s true that we have been largely shielded from previous recessions and the resulting job losses because of our large public sector. This recession whilst similar is no like other recessions. We are dealing with the collapse of a massive consumer and sovereign credit bubble. The levels of public debt in the U.K are truly staggering with some economists saying the difference between U.K and Greece is “12 months”. NI has been shielded from previous recessions because of our bloated public sector. This is unlikely to save us during this one. The UK government publically state that they are trying to cut the deficit and rebalance public spending. The inevitable course of action will be a shrinking of the public sector. We will be proportionally greater affected.
We completely redefine the economy here and move away from our reliance on the public sector. Look at the construction sector here. It’s on its knees with things set to get worse. The capital budgets (building) are being severely cut.
Our public sector consumes our wealth. It does not create it. The thing that will bring all our living standards up is an export led private sector.
Selling housing to each other will not create wealth. It takes real wealth from the economy because the money we would be spending on mortgage payments could have been used to purchase local items or invested in ventures that create wealth.
We have a massive benefit culture, a real drain on our economy. We need to readdress this as a priority.
On ALDA’S point on QE,3,4,5 I really would not like to think this is the case. He talks about inflation being historically low but does not mention the fact that before this recession we had actual wage inflation. It’s not happening now. Official inflation figures can be misleading. Food inflation and basic goods inflation is running at twice the official rate. We are all getting poorer. But as he also fails to mention the government has no input on interest rate decisions. The BOE decides these based on the bond markets. I would hate to see the bond market’s reaction to that much QE. Basically QE is a default (through the back door) on government debt. It is creating money out of thin air. Betting on interest rates at these all-time low levels is a reckless gamble.
On the point of lower and mid houses being at the bottom, well I would say there is absolutely nothing to back this up. The transaction levels don’t. The interest rate environment certainly does not. In fact the only thing that does is ALDA’s opinion and he makes money from houses (indirectly). If my livelihood was dependant on increased transaction levels I would be talking the market up too. The lower end of the market is supported by Housing benefit levels. I’ve told you this time and time again ALDA. How stupid is it to base an investment on the lowest interest rates ever and a government commitment to decrease housing benefit with universal credit. That does not point to a bottom it points to some fools calling a false bottom.
And please don’t talk about the need to build more houses. Look at the property sites. We have loads of houses. Who are these houses you are planning to build for? The unemployed? The public sector workers going to lose their jobs? HA tenants?

saverbuyer

pgilc1 wrote: »

Within your solution (a) its worth pointing out that the banks are extremely reluctant to agree mortgages at the moment leaving a lot of people who could otherwise afford to buy...

The banks will give you a mortgage no problem provided you have a decent deposit and can afford the repayments at normal interest rate levels. Don't have a deposit or lending multiples are too big you don't get a mortgage. I fail to see the problem.

Continued Lowering prices are helping with the affordability with both deposit requirements (LTV levels) and monthly payments. The only losers are those who try to remortgage having bought a house in the last 10 years on an interest only mortgage.

A.L.D.A

smokiewater wrote: »

What about encouraging everyone to support their local shops and small businesses this Christmas and keep what money is being spent in the local economy!

I wish people would make the effort where it makes sense. Tried to get a steel shovel, was it in Tesco, B&Q, ASDA? NO! Castle DIY! Cheaper than the plastic things on offer and what I actually wanted. Super stores do not necessarily improve choice!

smokiewater wrote: »

Tescos, Sainsburys and Asda will always be cheaper for shopping,

That is so often not the case, milk is cheaper in the local shop, many groceries are little different. As Suki pointed out Hardware is nearly always cheaper in hardware shops never mind Builders yards. Also a lot of local garden centres (need to chose with care) are much cheaper for plants. There is an excellent one on the hills midway between Larne and Ballymena.

If we want the NI economy to recover we all need to make a bit of an effort to keep money locally and when we do let us not blow it on ridiculously priced imported cars. Cars costing £60,000 when one costing £15,000 does the same job is pure self indulgence. A period of frugality and investing our surpluses here would make a big difference.

Mistral001

HouseACA wrote: »

Buying stuff in and selling between ourselves will not help the recovery.

Yes, that goes for houses and various things. Perhaps there is more scope for agricultural produce and other home produced items to be traded within NI, but generally my sentiments are in agreement here. The retail sector perhaps have been put on a pedestal for far too long. They have provided employment for the construction industry while building the giant superstores, but have they provided employment? Perhaps, but it coulid be argued that some much needed jobs have been lost. I do not mean just the retail jobs in the shops that they have replaced, but in many of the services that supplied these closed local shops. In particular, the many of the business services needed to set up the large stores and run them such as marketing, accountancy, architectutal design and legal services (I am sure there are plenty more) are carried out at headquarters based outside NI. That is basically lost jobs to GB.

HouseACA wrote: »

Our location on a small island inhibits our potential to manufacture and export, but I think we could have definite potential to look towards future tech, software development, green energy etc and try to lead the way with developing these.

I would not underestimate how many firms here actually do a lot of trade globally. We do have ports and airports here you must rememeber. Often manufactured goods have to be transported to a hub in GB or the continent and that means perhaps a slight disadvantage in competing with say Manchester or Hull for example. However, the Irish sea part of the journey, I would hazard a guesss, accounts for only a small percentage of the overall cost of transport of goods pruduced here in order for them to their final destination say half way round the world.

chunter

Future of NI?
Tourism, with a large slant on geneology.
The biggest thing we export in large quantities is people (and have done for centuries).

There seems to be a lot of money in educating people.
And we have an astonishing well educated population (give or take a few population centres).
Open a platter of universities and take in tens of thousands of foreign students.

A.L.D.A

saverbuyer wrote: »

Our public sector consumes our wealth. It does not create it. The thing that will bring all our living standards up is an export led private sector.

On that we are in total agreement. We need to create the environment for investment in productive manufacturing and service sectors, energy generation and tourism.

saverbuyer wrote: »

We have a massive benefit culture, a real drain on our economy. We need to readdress this as a priority.

It is wider than benefits. A friend referred to much of the Civil Service and Council departments as benefits for the middle class. Perhaps a bit cruel, but you can see where he was coming from. But it is worse than that so many business expect grant aid and assistance. What they should be looking for is less 'take and give' and creating a better environment for businesses, and that involves more than just tax structures.

saverbuyer wrote: »

On ALDA’S point on QE,3,4,5 I really would not like to think this is the case. He talks about inflation being historically low but does not mention the fact that before this recession we had actual wage inflation.

I did mention wage inflation as being important? It will eventually kick in, always does! Once unemployment starts to decline wage inflation tends to increase.

saverbuyer wrote: »

Basically QE is a default (through the back door) on government debt. It is creating money out of thin air. Betting on interest rates at these all-time low levels is a reckless gamble.

The government is playing an interesting game, but note that the largest borrower is the government and I am sure that inflating some of that debt away has not escaped their notice. Bond markets are also about confidence and that is provided by alleged reductions in Government spending. They will also be interested in seeing economic expansion for only then will the need for Government borrowing decline.

saverbuyer wrote: »

On the point of lower and mid houses being at the bottom, well I would say there is absolutely nothing to back this up.

If you can buy the property and rent it and make a good profit then people will! I do believe I did mention this.

saverbuyer wrote: »

If my livelihood was dependant on increased transaction levels I would be talking the market up too.

You are making an incorrect assumption. Most of my income is commercial rental, cheap property suits me, expensive property does not! On the Architectural side the lower the land values and property prices go the better, as investors will be more likely to buy. If I do work for people wishing to develop to let rather than sell fine. I have a lot more work this year than last, but do not know if that is generally the case. If it is then there will be some recovery in Building say 18 months out. One thing I do know is that building prices are now going up.

saverbuyer wrote: »

The lower end of the market is supported by Housing benefit levels. I’ve told you this time and time again ALDA. How stupid is it to base an investment on the lowest interest rates ever and a government commitment to decrease housing benefit with universal credit. That does not point to a bottom it points to some fools calling a false bottom.

More sweeping assumptions. You are assuming borrowing is required! Don't forget that for every one that paid too much for their house someone made too much!

saverbuyer wrote: »

And please don’t talk about the need to build more houses. Look at the property sites. We have loads of houses. Who are these houses you are planning to build for? The unemployed? The public sector workers going to lose their jobs? HA tenants?

I am telling you that I am 100% certain that we are not building enough houses, but you know better. Give it a few years and we will see who is right. If you are worried about future government costs, I would view the current levels of house construction with considerable concern.