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Posts tagged ‘Public sector’

UK Housing Market: Sellers Forced to Cut Asking Prices

By: Nadeem_Walayat

Since my May 2011 analysis, further research into the reasons for the differences in asking prices against valuations between areas has revealed the following possible explanations that are just as valid for most UK cities as they are for Sheffield:

Sellers

Grossly over valued properties will fail to sell, thus sellers risk chasing the market ever lower remaining just out of reach of   buyer interest. Therefore sellers need to get multiple valuations to get a more   realistic price and if their property fails to attract any interest to not delay   in cutting their asking price by a significant margin i.e. in steps of 10% so as to attract buyer   interest. Else you risk wishing you had cut earlier and thus obtained a higher   final sale price.

read full article at source here: http://www.marketoracle.co.uk/Article29357.html

Buyers

Given that the average asking price is estimated at 16% above valuations, It seriously pays for Buyers to do their own research, look at what similar previous properties actually   sold for in the area you are targeting. If a house looks fairly priced compared   against others in the area then ensure that there is not a reason why it differs   in price, which may be due to issues such as the property is leasehold instead   of freehold, or that there is an issue for instance with flooding.

  • Population Growth and Decline– Some areas of the city are witnessing falling or stagnant populations, which usually effects the mid range properties of an area rather than those at the higher or lower end, such as the East and the South of the City, which results in those seeking to sell properties over inflating asking prices as they compare general price trends across the city against their own properties expectations. The effect can be as serious as making the difference between 50% price increase over 10 years and zero increase or even a price fall.
  • Local Schools Changing Performance – House prices can be effected in both directions if the local schools improve or decline in performance over time, which may fail to register with home sellers as their children may have grown up many years ago.
  • Rivers – Up until June 2007 when Sheffield was hit with the Great Flood, many Sheffielders had never taken the issue of flooding seriously, however that no longer applies where the path of Sheffield’s many rivers has negatively impacted on house prices that are deemed to be at risk of flooding and therefore likely to incur difficulty in insuring, which effects both affluent and the poorer areas equally, where a matter of a 100 metres can effect similar houses to the difference of as much as 25% in price as well as resulting in greater supply on the market as these flood risk housing is more likely to remain on the market for far longer than properties elsewhere. The same holds true for all of the UK’s major cities that are built on canal and river water ways.
  • New Houses – New housing stock usually from the low to middle price range areas of the city are unlikely to appreciate much during the first 10 years. Which can result in over valuations by sellers as they price their houses in terms of how average properties in their area’s have appreciated.
  • Cluster of Valuations – Over valuations and realistic valuations tend to cluster by area’s because   home sellers tend to look at what price others in an area are also selling for and therefore price according to the competition.
  • Competing Estate Agents – There may be greater competition in overvalued areas between estate agents for   business therefore a tendency to give properties higher valuations so as to   secure business and shut out other agents, then a few months down the road when   properties have failed to sell ask clients to cut asking prices.
  • Crime Rates – Even a  few bad crime stories of shootings and killings can have a significant and lasting effect on buyer demand for an area as well as the longer-term trends for crimes such as burglaries.
  • Social Housing – Areas with more social housing will tend to see less appreciation in house prices, which may not be reflected in asking prices.
  • No or Negative Equity – Home owners trapped into no or negative equity properties will find it difficult to price their properties at a level that the market will bear. Those most likely to be in negative equity will have many of the contributing factors as listed above and be unwilling to accept less than their outstanding debt.
  • National Events Skewing Seller Expectations – One off national events can impact on Seller expectations such as is with the case of the Olympics in London, which has resulted in an estimated 10% inflation in asking prices even allowing for rising selling prices. The question mark is will London Sellers still be pricing in an Olympics premium after the Olympics? Meanwhile they can enjoy the boost for another year.
  • Public Sector Recession – Just as the Olympics are boosting London, so is the public sector recession as a consequence of 500,000 planned job losses to depress areas where public sector works tend to reside and that impacts harder on Northern UK cities such as Sheffield, Liverpool, Newcastle than Southern cities. Therefore Sellers in cities such as Sheffield may not be taking into account the consequents of a contracting public sector which will hit those areas of the city that rely more heavily on the public sector for employment i.e. the middle income bracket areas, hence expectations for sharply higher supply could result in a very wide margin of difference between seller expectations and what the market is prepared to pay.
  • Artificially Low Interest Rates – The current rate of inflation is 5% whilst the base interest rate is 0.5%. This results in low seller financing costs for mortgages and therefore reluctance for Sellers to market their properties in line with market demand. However sellers are playing a dangerous game as once interest rates do start to rise then they will see sharply higher debt financing costs, especially as market interest rates will move ahead of the base interest rate as well as coupled with less buyer interest as they are also similarly squeezed in terms of what they will be able to afford.

The net effect of the prevalence of over valued asking prices is for an ever increasing supply of property that will further put downward pressure on house prices especially in specific areas of cities, this is reflected in official statistics which show that 70% of properties  on the market have failed to sell this year hence sellers starting to cut asking prices.

Should Public Banks Print Money Without Holding Reserves?

Tuesday, June 14, 2011 – by Staff Report

 

The Giant Banks Are ALREADY State-Sponsored … So Why Not Create Public Banks to at Least Share the Gains, Help Out Main Street, and Grow Our Local Economies? … Economist Steve Keen writes today: Neoclassical economists do not understand how money is created by the private banking system – despite decades of empirical research to the contrary, they continue to cling to the textbook vision of banks as mere intermediaries between savers and borrowers. This is bizarre … – Washington’s Blog

Dominant Social Theme: If we could just print as much money as we want, everything will be OK.

Free-Market Analysis: Just yesterday we presented an article from Washington’s Blog on US false-flag manipulations of the public. It was a bold summary of a dominant social theme that provided additional support for reports that have long appeared here. But we are somewhat disappointed with this recent financial article (see excerpt above) that also seems to us a kind of dominant social theme.

Now we know that Washington’s blog does not purposefully purvey power-elite memes, but the views expressed in this article are likely nonetheless satisfactory to Western elites. It is a kind of elite meme, in fact, because it argues for state control of money. Dominating state processes are what elites are good at doing. Such a process is called mercantilism.

Those who believe that the “people” will be able to maintain control of public banks are probably being naïve in our view. This is one reason we argue for a free-market solution. A CLEARER remedy in our view is a fully established system of PRIVATE money. The relationships between people in government and the private sector are inevitably opaque. It is a lot more convenient to use free markets because it is relatively easy to determine if the public sector is encroaching on the private one

full article at source :http://www.thedailybell.com/2494/Should-Public-Banks-Print-Money-Without-Holding-Reserves.html

Irish Bombshell:Irish Government Raids PRIVATE Pensions

The Irish government plans to institute a tax on private pensions to drive jobs growth, according to its jobs program strategy, delivered today.

 Without the ability sell debt due to soaring interest rates, and with severe spending rules in place due to its EU-IMF bailout, Ireland has few ways of spending to stimulate the economy. Today’s jobs program includes specific tax increases, including the tax on pensions, aimed at keeping government jobs spending from adding to the national debt.

The tax on private pensions will be 0.6%, and last for four years, according to the report.

From the jobs initiative release:

The various tax reduction and additional expenditure measures which I am announcing today will be funded by way of a temporary levy on funded pension schemes and personal pension plans. I propose that the levy will apply at a rate of 0.6% to the capital value of assets under management in pension funds established in the State.

It will apply for a period of 4 years commencing this year and is intended to raise about €470 million in each of those years. The levy will not apply to pension funds established here and providing services and benefits solely to non-resident employers and members. Further details regarding the proposed application of the levy are set out in the Summary of Initiative Measures.

Ireland’s ability to levy further taxes on other parts of the economy is restricted because its economic growth has been inhibited in the wake of a financial crisis that crippled its banking sector and decimated its public finances.

Unwilling to budge on the country’s low corporate tax rate, Enda Kenny’s Irish government has chosen to target pensioners for funds to grow the economy. Whether it turns out to be an example to other countries seeking alternative ways to raise revenues with aging populations is yet unknown.

Read more: http://www.businessinsider.com/irish-bombshell-government-raids-private-pensions-to-pay-for-jobs-program-2011-5#ixzz1MA7qyyWv

A HIGHLY paid teacher union leader who earns up to €158,000 a year has not

By Anne-Marie Walsh Industry Correspondent

Friday May 06 2011

A HIGHLY paid teacher union leader who earns up to €158,000 a year has not
taken a pay cut, although thousands of his members have had their salaries
slashed.

The 15,800 rank-and-file teachers who are members
of the Teachers Union of Ireland (TUI) have
endured a 14pc pay cut in the past two years.

But its general secretary Peter McMenamin’s pay remains the same — even
though it is linked to a grade in the civil service that has also been hit by a
pay cut.

Mr McMenamin refused to comment last night on why he is still on the old
pre-pay-cut salary level — and refused to reveal exactly what he is paid.

His union would only say that his pay scale ranges from €131,748 to
€158,644.

The pay of officials in the teaching and lecturing unions is funded through
subscriptions from members.

These subscriptions are usually deducted from salaries at source, by the
Department of Education and Skills.

The revelation about Mr McMenamin’s pay comes as more than half the 23 public
sector union leaders refused to disclose how much they were being paid.

But it has emerged that none of the other senior
TUI officials — among the unions most resistant to public sector reforms
outlined in the Croke Park
Agreement — have taken a pay cut.

In stark contrast, senior members of the INTO teaching union have taken a
cut.

INTO general secretary Sheila Nunan, whose pay is also based on the same
assistant secretary grade as Mr McMenamin’s, revealed she had taken a pay cut.
However, her potential earnings remain around €153,885.

The TUI, which only recently backed the Croke Park deal, defended its
decision not to cut the pay of officials at head office in the wake of the last
Government’s pension levy and pay cut.

The wages of more than 300,000 public servants were slashed by an average
14pc.

TUI president Bernie Ruane said: “Both TUI’s annual congress last year and
the union’s executive committee decided that head office staff would not have
their pay cut.

“The union opposes pay cuts for anybody and accordingly refused to make cuts
to the salaries of its own staff.”

The motion put forward by delegates at the TUI conference, which was
defeated, called for pay cuts to ensure membership and employees of the union
were “treated equally”.

Many unions who would not reveal pay details have been most resistant to the
Croke Park agreement, including university teacher union IFUT, which has still
not backed the deal.

Teacher unions, including the TUI, only recently agreed to work extra hours
that were due to commence at the start of the last school year.

Others, including the AHCPS, would not give pay figures and would only refer
to the public sector pay grades their leaders’ wages are linked to.

General secretary of the Public Service Executive Union, Tom Geraghty, whose
union represents 11,250 mid-ranking civil servants, said he regarded questions
about his pay “intrusive prurience”.

PERSONAL

The Garda Representative Association said that its leader’s salary was
“personal information”.

General secretary of the largest dedicated public sector union, IMPACT, Shay
Cody, would not give details of his current pay but did reveal he had taken a
pay cut.

His spokesperson said his pay was no longer linked to the pay of the Cork
county manager, which stood at €171,313 in 2009.

He said Mr Cody had taken a voluntary pay cut and waived a portion of his
salary on appointment, and also declined a public sector pay award.

Construction union BATU, which has up to 500 public sector members, said
officials’ pay had dropped by 40pc in the last two years but would not say what
general secretary Paddy O’Shaughnessy’s pay was.

However, other unions were more open about their leaders’ wages.

They included SIPTU, where staff took a 5pc pay
cut while national officers took a 10pc pay cut, bringing general president Jack
O’Connor
‘s basic pay down to €112,000 a year.

The survey also reveals huge discrepancies in what unions pay their
leaders.

For example, the head of the small trade union, OPATSI, is paid around
€45,000 — less than a third of what some teachers’ representatives get.

Jimmy Kelly, head of UNITE, which has 60,000 public and private sector
members, earns €60,000 a year, while PDFORRA leader, Gerry Rooney, with 8,000
members, earns €96,000.

Meanwhile, employer body IBEC refused to give details of its director general
Danny McCoy’s pay.

– Anne-Marie Walsh Industry Correspondent

Irish Independent

source: http://www.independent.ie/national-news/union-chief-keeps-top-pay-as-teachers-suffer-2639341.html

Comment:

A touch of “I’m all right Jack”!

“We do not and cannot accept the principal that incompetence justifies
dismissal “
This only exposes to cosy number these top Union Bosses have
the talk the Talk the talk but do not walk the walk! They are living in another
world and are just as out of touch as their political pals with the masses . This is why we are not seeing mass demonstrations on the streets these guys are quite happy with
the way things are and have gone native with the politicians and are keeping
the masses off the streets

We need a new clean out of the top Unions they are not representing
the real needs of the workers!

The current union bosses can be relied to tow the line just like their champagne socialists
in the Labour party.

More on the 17 “leading figures”or17 self-righteous messiahs

By crimson-observer.blogspot.com

So 17 self-righteous messiahs, many of whom clung with a vice-like grip to the skirt hems of the Haughey, Ahern and Cowen administrations, have formed themselves into a rump to ‘advise’ the new Government on creating jobs, reforming the public sector, rebuilding international confidence and re-engineering the banking system. Economic salvation can be achieved, they argue in A Blueprint for Ireland’s Recovery, through manufacturing, tourism, agriculture, life sciences and ICT.

No vested interest, apart from their own, is ignored to flatter their dreams and aspirations. Is it not inspiring to observe individuals’, some of quite moderate ability, but who were cute and wily enough in taking care of their personal interests, to earn humongous sums, from the public purse in many instances, to focus their ‘advice’ on the mutilation of the public sector and the ‘reform’ of the welfare system?

‘To restore confidence and Ireland’s reputation, an investor relations strategy should be developed to attract overseas investment. Among the targets suggested, is that 20% of FDI should be sourced in South East Asia by 2015’. Are they aware of Horizon 2020, of did they see no reference in it when they regularly read the The Beano, The Dandy and The Hotspur?

source:http://crimson-observer.blogspot.com/

A Perfect Storm (The Irish Economy)

Common side of €1.

Image via Wikipedia

The Irish economy has been hit by a Perfect Storm that combines:

  • a deeply rooted crisis in public finances;
  • a structural collapse of the banking sector;
  • an unemployment crisis stemming from the collapse of employment and jobs creation;
  • a competitiveness crisis that is not limited to wages and labour costs, but the cost of living and doing business;
  • The crisis in the quality and efficiency of domestic services – dominated and restricted by the excessive market power of the incumbent state-owned and state-regulated oligopolies.

These crises have been exacerbated by the Government policies since 2008. These policies have saddled ordinary families and individuals (regardless of whether they work in public sector or private sector, employed or unemployed, young or old) with the full cost of stabilizing vested interests and elites. This manifested itself in rising tax burden, falling provision of public services, lack of reforms in banking and public sectors. The resulting devastation of private entrepreneurship and businesses, contracting investment and availability of operating capital, a catastrophic lack of confidence in economy are the corollaries. The accompanying spikes in unemployment and businesses failures and a hike in precautionary savings are additional manifestations of these.

The current crisis has clearly shown that the corporatist state – where vested interests, including Political, Business, Social and Environmental collude with the state to set economic and social preferences and priorities – is morally, politically and economically bankrupt. I believe that Irish democracy cannot be surrendered to the vested interests, no matter how broadly-based or highly minded they might be.

comment:

I picked this up somewhere over the net and I thought it ample expressed my views

Essential services and civil servants’ jobs are on the block!

Tánaiste Mary Coughlan has insisted that the Government will not be walking away from the Croke Park deal
There has been increasing speculation that the agreement on public sector pensions and reform could be under threat, given the deepening crisis in the public finances.
But IMPACT, the union representing public sector workers, said it met with Finance Minister Brian Lenihan earlier this week and received assurances that the Government was still committed to the plan.
Tánaiste Mary Coughlan today reiterated the Government is still willing to live up to its end of the agreement:
“We are very much committed to the deal and we feel that it is the most appropriate way in which we can bring transformation in the public sector,” she said.
Read more: http://www.breakingnews.ie/ireland/coughlan-govt-still-committed-to-croke-park-deal-476607.html#ixzz11a5wQnq5
 
Comment:
I wouldn’t bet on the government sticking to their word I will bet that they are just biding their time, one look at the graph below tells you that they have no choice in the matter.
 
The only doctors that are getting work are the government’s spin doctors.
Quietly all over the country beds and services are been closed and been removed, I found this report (Behind the Croke Park dealPDF) on such closures earlier this year and things have only gotten worse!
Bottom line the government has run out of money because of the financial lunacy of bailing out bankrupt banks and the gambling subordinate bond holders of Anglo Irish Bank
Essential services and civil servants’ jobs are on the block!

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