How Christopher Nolan is changing the economics of Hollywood
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What is the main topic discussed in this episode?
Taking stock with Susan Hayes Culleton. With Nifty Business, the fleet management specialists. Keeping your business fleet moving with service you can count on. This is Newstalk.
Well, hello and welcome to Taking Stock. I'm Susan Hayes-Cullerton, and this is the show that looks at business and economics from a wider perspective. Coming up on today's show, the grim milestone of a thousand days of war in the Middle East. And we ask how the Middle East itself is changed forever. The Central Bank this week is giving the Minister for Finance a warning in advance of Budget Day. The question is, will Simon Harris listen? Plus, is Christopher Nolan changing the economics of modern cinema? You can email the show, takingstockatnewstalk.com, or you can message me on socials at Susan Hayes Cullerton. Now, for my explainer this week, I wanted to talk to you about earnings season. After the umpteenth time I brought up an earnings call in a production meeting, John Fardy, the series producer, said to me one time, Susan, how can it be earnings season all the time?
So let me explain. Earnings season starts about two weeks after the end of a quarter and it lasts around about six weeks. And during that time, publicly traded companies release their financial results, including revenue and profits and future outlook. Now, as regular listeners will know, I think these earnings calls are such a phenomenal business and economics education. And the reason that I'm bringing them up this week is JP Morgan just beat its own record for the highest quarterly profit in the history of American banking. And when did I learn that? During earnings season. Now, this week, the Minister for Finance, Simon Harris, received a pre-budget letter from central bank governor warning that the underlying budget deficit could rise to £25.7 billion by 2030.
But he also pointed out that the government's previous and upcoming commitments to public investment have the potential to have a transformative impact, but achieving value for money is difficult in an economy at full employment. So to delve into the challenges that the government faces as the budget edges ever closer, I'm delighted to be joined by the well-known economist Seamus Coffey. Seamus, as I read this letter, it is full of, we're doing great as an economy, but there are risks everywhere. And I've been warning you about these all along. Please listen to me now. And I'm summarising a seven-page letter there in that. What was your take on what we saw from the central bank governor this week?
Yeah, I think there was a lot in it. And on the public finances in particular, I think the government and other agencies are clear that there's possibly a need to see some greater budgetary discipline over the coming years compared to what we've seen in recent years. Now, we know what's happened. That sort of ill discipline and failure to stick to budgetary parameters has sort of been covered up by these booming corporation tax receipts. So even with fairly rapid increases in spending and even with significant overruns and within-year policy decisions, the public finance is at a headline level. remain in strong shape. Like there aren't many countries in Europe running surpluses and with declining debt ratios.
But I think that the key risk that's pointed out in the governor's letter and by others is these corporation tax receipts and the calculations done by the central bank show that if these excess or bumper receipts corporation tax receipts were to be stripped out for one reason or another, then there would be a pretty significant deficit emerging within the public finances because the level of spending has been growing faster than what we might call the sustainable or underlying revenue of the economy, our typical income tax VAT. Excise duties are standard corporation tax, not these bumper ones we've seen. Now, the governor and nobody else seems to be making a prediction that these corporation tax receipts are likely to fall.
It's just that maybe we're becoming a bit too dependent on them.
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Chapters
5 chapters
1
What is the main topic discussed in this episode?
0:00–9:33
2
What is the Central Bank warning to the Minister for Finance ahead of Budget Day?
9:33–15:19
3
How could Ireland’s heavy reliance on corporation tax create future fiscal risks?
15:19–24:59
4
Which five actions does the Central Bank recommend to boost Ireland’s growth and resilience?
24:59–37:27
5
Why is increasing capital spending challenging despite having the funds?
37:27–45:50
Speakers
4 identifiedMore from Taking Stock
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