Recovery index: Dental work
We're all going to start looking like Shane MacGowan fairly soon. That's not a good thing. When the economy tanks, people put off going to the dentist. It costs a blooming fortune to go to the dentist and it's rather scary, too. Between 2009 and 2011, the number of fillings put in by Irish dentists tumbled 44 per cent, with the amount of teeth yanked out dropping 11 per cent, according to the Irish Dentistry Association. The number of new teeth and dentures fitted also slumped 28 per cent.
Irish households have become debt-paying machines. Since 2008, we've paid off more than €12bn in debts. There's another €188bn to go. While it's good for our personal balance sheets, this debt repayment is sucking the life out of the domestic economy. In the long term, it's a positive.
Sales of school bags on eBay.ie vaulted a staggering 104 per cent this year, with sales of pencil cases up 96 per cent. The traditional August splurge on school uniforms, new books, Spider-Man lunch boxes and other school equipment provides stimulus to certain sectors of the retail sector. Good for them, but not much cheer for consumers who have to cough up every year. It's another bill that has to be paid.
There was a massive increase of 1,355 per cent in the number of days lost to industrial disputes in Ireland during the second quarter of 2012 in comparison to the same period last year. The plight of the Vita Cortex workers certainly had a big impact on these figures. The impact of labour disputes is felt in national productivity and on to the Exchequer. Foreign direct investment can also be impacted.
Sales of coffee at Insomnia dropped by 9 per cent last week compared with the same week last year. Small discretionary spending patterns are watched incredibly closely as they track the mood of consumers. A mega fall like this could indicate a reluctance to spend money. . . but in this case it's mostly down to having one day's less trading because of the bank holiday.
Consumers are spending less and squirrelling away lots more as fear over future prospects continues to keep purse strings well and truly closed. The latest Smurfit Business school Consumer Market Monitor showed consumer spending down 2.1 per cent this year, with the amount being saved rising to 13 per cent of disposable income. Back in 2006, we were saving just 1 per cent of our disposable income. This is grim news for the domestic economy as weak spending means less new businesses and fewer new jobs. There are, however, some sectors performing well amid the gloom. Sales of used cars on carsireland.ie rose by a healthy enough 6.4 per cent last week.
Irish bond yields
It's funny how countries' threats to default blend into the humdrum of the news these days. The markets barely batted an eyelid at neither Greece's request for a two-year austerity extension or their suggestion of delaying the repayment to bondholders by a month. In spite of these developments, Ireland's key bond yield has placidly traded flat at 6.07 per cent.
The euro fell to annual lows of $1.22 due in part to the seemingly endless eurozone debt crisis. The dollar got stronger because of better economic data. It appears that the world is beginning to dip its toes into the world of risky assets again, and they are turning their eyes to the US for those buying opportunities. This suits the Irish economy just fine for now as our balance of trade surplus continues to strengthen.
Sunday Indo Business