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Saturday, April 14, 2018

Personal Economic Indicators

I have commented on several occasions about my personal economic indicators for Greece. Every spring and fall, we spend a couple of months in Thessaloniki and I have developed the habit of looking out for things which - albeit totally non-sophisticated - strike me as being indicative of how the economy is coming along. One of these personal economic indicators is the commercial traffic in the harbor of Thessaloniki.

That commercial traffic had been increasing significantly in the last couple of years. Where I used to count perhaps 3-4 ships in previous years, last year there were always at least 10 freighters, including some very large ones.

We have now been back in Thessaloniki for over one week and --- I see hardly any freighters in the harbor of Thessaloniki! I have certainly not yet seen as many as 4 at one time, not to mention 10 or even more. What is happening here???

Another personal indicator is life in the villages. We spent Easter in my wife's village near Kavala. Off the bat, the village seemed somewhat empty compared to previous visits. The one hotel was closed. Quite a few shops had closed. And, above all, some buildings had obviously been deserted.

On the positive side was the story of my wife's nephew, Giorgos, a graduate of a technical school and now 29-years old. Giorgos had taken over his father's business about a year ago. Essentially, a one-person earth-moving business with some sales of building materials on the side. Where Giorgos' father had considered "working" as sitting on his machines and moving earth, Giorgos considers "working" as doing business, as looking for jobs, as farming out jobs to others when he has no capacity on his own. Of course, Giorgos is - like his father was - an extremely hard worker and he also sits on machines and moves earth. BUT - he spends a good portion of his time knocking on doors to get orders. Most importantly, whereas his father had waited passively for customers to pay their bills, Giorgos spends time collecting them. In the evenings, Giorgos and his fiancée - who is taking care of the sales shop during the day - browse the internet for jobs which are tendered in the area.

When Giorgos' father did not get orders, he had nothing to do and there had been some extremely slow times since the crisis. Giorgos, on the other hand, is extremely busy and when he told me how much money his business made every month, I was stunned. Giorgos says that there is no crisis. Instead, money is lying on the ground and one only has to make the effort to pick it up. There is no unemployment, he says. Those who don't have work don't want to work, is Giorgos' opinion. Those who wanted to work but couldn't find work have left the country, Giorgos says.

Giorgos gives work to several people. They are Greeks and not Albanians, he says. Two of them have university degrees. He employs them officially under short-term contracts; they get between 30-50 Euros/day, depending on the type of work they do, plus insurance. I asked Giorgos if he officially declared all his revenues. He hesitated, thought for a moment and then he said: "If I did that, I would be bankrupt within a year."

Giorgos has the view of a "worker", a small-town operator who can drum up business when he tries hard. He says he doesn't feel too good for anything. When he had a slow period in the winter, he found someone who had a lot of manure to be removed and he found someone else who needed manure. So Giorgos got into the business of transporting manure.

I told Giorgos that, perhaps, the situation if different for a bookkeeper in a large city. If he loses his job and there is no new job as a bookkeeper, he can try as hard as he wants but he will not find work. Giorgos' response: "I would knock on 20 doors every day and ask people if I could do anything for them. I would find some people who needed something."

I discussed this with my neighbor in Thessaloniki. In his view, the overall economic situation is as bad as ever. But, he hastens to add, the situation might be a bit better in the villages. In the villages, he says, there is always something that can be done. If nothing else, one can start cultivating a field. My neighbor is not surprised that Giorgos feels that there is work for everyone but he stresses that this represents the narrow view of a small-town operator and is absolutely not reflective of the country as a whole.

22 comments:

  1. Could this help regarding port activity?

    https://www.fleetmon.com/ports/thessaloniki_grskg_7296/

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    Replies
    1. I am amazed by how much information you get out of the internet! I only see the freighters parked in the bay, not the ones sitting at the dock. Right now I see 1 freighter parked in the bay.

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    2. Observing from Kalamaria might be a bit tricky. Ships of the line?

      https://www.google.com/maps/@40.5870545,22.9297459,3931m/data=!3m1!1e3

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  2. Also MarineTraffic shows a number of vessels:

    https://www.marinetraffic.com/en/ais/details/ports/50/Greece_port:THESSALONIKI

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  3. Job opportunities could be a matter of a mindset. Not everyone has it and those who do see opportunity right now.

    https://www.reuters.com/article/uk-greece-economy-manufacturing/in-ruins-of-greek-economy-factories-turn-to-exports-to-grow-idUSKBN1E01OO

    Dean.

    ReplyDelete
  4. Hi Mr. Kastner,

    Hope you and your wife enjoyed yourselves here.

    Some good "on ground" observations.

    First and foursome. I love your nephews way of thinking and mindset. Luckily more and more people like him are coming out of the wood work. With such mind sets Greece like i said in the past, could and should become a power house. Only if they get out of the old narrow mindedness (the people that is).

    His thoughts are right on. Those who want to work will find work. Those who do not are either picky, momma's children tit fed, spoiled, or old bottom barrel feeders who presented nothing constructive to the economy..................................... The few who have a horrible psychology after being fired or lost work, need help psychologically to get back on there feet. For those few work will come in time.

    I would like to add to your nephews comments, that Greece is the new land of opportunity. Like in the stock market buy low and sell high. Greece cant go lower unless a war erupts and will hit peaks people never imagined. Once that train starts it will snow ball and a good way and not in a bad old style Greek way.

    Personally, i have projects through 2020 and this is in my direct environment. That environment has colleagues and companies which affect 10's of thousands employees and respective families. As such everyday i have a new project. New project new ideas. As such, new employment positions. Freedom to think and source. One brings the other. As your nephew has found out in a simple manner.

    Audit. Auditing = new ideas = new implementations = new efficiencies = new exports = new growth = more employment = reverse of crisis years. (This coupled with a good debt deal will shoot us forward).

    BTW new ideas does not affect my environment but the general market. I will be in Thessaloniki this week to see 3 new sources. I am sure they will be approved and i will open new doors for them and us.

    Sincerely,
    V

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    Replies
    1. If you are in Thessaloniki and would like to meet, send me a mail.

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    2. What is your email ? It's not in your profile.
      Sincerely
      V

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    3. Another new line of business which Giorgos developed during the winter was the transportation of stones. I guess the fields are full of stones and/or small rocks which get into the way of farming. Giorgos found farmers who wanted their fields cleared of stones and others who had use for the stones. I don't know whether he paid for or got paid by the farmers but certainly the ones who needed the stones paid a lot. Altogether, Giorgos said it was a very profitable business.

      Speaking of money lying on the ground waiting to be picked up...

      Delete
  5. Something is wrong with Greece:

    https://www.youtube.com/watch?v=xMKdo9NqV-8

    Dean

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  6. Only in Greece:

    https://energypress.eu/hydra-expected-to-regain-control-of-res-lucrative-agios-georgios-islet/

    Dean.

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  7. This is the problem with Greece. It tries but the performance is mediocre. These receipts ought to be in the 30 Bil. euro range.

    http://www.tornosnews.gr/en/greek-news/economy/30986-bank-of-greece-travel-receipts-grow-by-10-8-at-e14-6-billion-in-2017.html

    Dean.

    ReplyDelete
    Replies
    1. Why should it be double? Are you not happy with growth in general? It is one thing to have potential growth and then the other actual growth. Every company has such budgets. Budget vs Actual.

      I am happy with any kind of growth. It is like a virus. Growth and decline. Once it starts it is hard to stop.

      Sincerely,
      V

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    2. V:

      I would like to see things go faster and w/ greater volume.

      Dean.

      Delete
    3. Dean patience is a virtue.

      If things went faster you know fickle Greeks are, they would say "something is fishy here or someone is making side deals etc etc."

      Remember slow and steady won the race.

      V

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    4. V:

      According to this article there are 16 Bil. euros worth of projects in the pipeline. I see no "patience is a virtue" applicable here but the exact opposite of "speed wins the race".

      http://www.ypodomes.com/index.php/special-editions/oikonomia-xrimatodotisi/item/46474-ependytika-sxedia-ypsous-16-dis-evro-tin-epomeni-tetraetia

      Dean.

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  8. Who cares? Globalization stutters and we enter a period of higher interest rates. As we all know debt hasn't been touched, it was the creditors that were bailed out rather than the debtors, and imbalances haven't been corrected in any meaningful manner. Trickle-down economics rule the world, but they don't trickle down anymore. As for me, I don't care at all if the global economy blows up, that's how disillusioned I am.

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  9. I am not sure if this means anything but Greece is #3 in ranking for public-private partnerships:

    http://www.ypodomes.com/index.php/special-editions/news-in-english/item/46371-greece-excels-at-ppp-projects-on-a-worldwide-level

    Dean.

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  10. Valatsas describes the problem exactly. Greece does not offer large enough enterprises for foreign investment. US capital can't find something big enough to invest in Greece in a manner that diversifies risk:

    https://www.youtube.com/watch?v=3E3_jqvjzUQ

    So the rest about political instability and institutions is far less of a factor.

    Greece is a country made by small SMEs and that's a fact. Small SMEs don't grow economies; they only sustain them.

    Dean.

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  11. This might be a good benefits project for the Thessaloniki economy:

    http://www.ypodomes.com/index.php/special-editions/news-in-english/item/46471-sea2sea-mega-project-s-preparation-proceeds-with-the-assignment-of-technical-and-legal-advisors

    Dean

    ReplyDelete