In the wake of a tumultuous 2016, the next couple of weeks will provide the opportunity to reflect on the circumstances the Munster economy and its inhabitants face as they enter 2017.
There are many issues to ponder so my advice is to fire up the stove, arm yourself with a glass of mulled wine, and contemplate the following.
Like it or not, everyone has an individual responsibility to look after their own material needs.
In 2017, as in all years, the objective should be to match if not exceed any inflation in the cost of living.
For a number of years now, inflation has been muted so, at a macro level, lifting income and asset value by at least 3% was enough to beat the consumer price index.
As a starting point, the combination of your income (post-tax), savings, and other assets (a house is usually key) needs to grow by 3% in value next year to stay ahead of the posse.
I’m sure most investors set out to do better than 3% but that is seen as a credible outturn for those who are risk- averse, in an environment where interest rates have been touching record lows.
That cost of money dynamic is, however, changing now. US interest rates have started to rise, as have Treasury yields.
This suggests the era of ultra-cheap money may be coming to an end.
For borrowers, that is something to consider, as even a small rise in interest rates can cause pain if borrowings are high.
On the flip side, rising bond yields would make life much easier for pension funds as their ability to finance liabilities with risk-free bonds expands.
So, I would be mindful of any debt obligations and consider locking interest rates down to have security over debt repayments.
At the same time, it might be wise to select some bonds that are offering higher annual coupons in your pension or savings pot.
Regular, annual reliable dividends should be the cornerstone of any portfolio owned by someone who wants to stop working, change career or down-shift commitments to work.
Outside of how individuals plan for 2017, the outlook for Munster in general should also be pondered. The decision by Aer Lingus to raise transatlantic seat capacity by 20% in summer 2017 suggests a greater US inflow to the tourism market of the south.
That should help offset any weakness stemming from the UK as a result of Brexit. Note, though, that weak sterling affects all holidaymakers leaving Britain next year so Ireland is only disadvantaged against those who opt for a ‘staycation’ in the UK, usually a small portion of holidaymakers.
Further flows of foreign direct investment are also probable. Brexit has raised the ante for employers committed to the EU but rooted in the UK.
Office rates in Cork, Limerick, and regional towns are far lower than apply not just in London but in Dublin too.
This should help secure landmark deals for new office capacity, including the O’Callaghan development on the Cork quays and the Capital Complex in the centre. These, and others, have the potential to draw new well-paid jobs into the area.
Despite the probable Donald Trump-led reduction in US corporation tax, I still think Ireland remains a highly attractive base for any multinationals who pursue commercial markets outside of the US.
While some may scoff at the advantage provided by young, well-educated, English-speaking graduates, it is probably a significant part of the arsenal of advantages Ireland offers as a base for new or incremental investment.
IT and pharmaceutical sectors, which have a high profile across Munster, may hopefully feature in announcements next year.
The chief risk for 2017 is, in my opinion, complacency. Over-zealous pay demands, excessive government spending, and the growing sense that the lessons of 2008-2011 are fast being forgotten are risks that could undermine what has been a remarkable period of recovery.
Joe Gill is director of corporate broking with Goodbody Stockbrokers. His views are personal.
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