Sunday, February 8, 2015

Beware of Misunderstandings About the Primary Balance!

I have received quite a bit of flak from commentators of late. Essentially, some feel that they have unmasked me for being only interested in numbers and not in people and for only caring about creditors' interests and not about a suffering people. I list below the 3 major articles which I have written about Greece's primary balance between 2012-14. Hopefully, they will help my critics to understand what my position is.

23 Dec 2012: Beware of the primary surplus!
30 Jul 2013: Primary surplus - the end of a process or the beginning of a challenge?
6 Apr 2014: Beware of Greeks bearing primary surpluses!


  1. The problem is not you, Herr Kastner, not either your blog and the posts about this and that, but the problem is that there is more clarity about the situation in Greece outside Greece than inside Greece. And therefore you get problems with Greeks who still consider the Greek media as reliable. Why?

    Not any journalist, TV host, and hardly any professor on the Greek TV, explains the case as it is. A lot of scientists and those who might know something talk, and do not answer anybody: nobody listens. One only talks. Shouts. Argues.
    Before any answer is completely there, the other one already "answers" on that what he thinks the other one is talking about. Sometimes four till six people talk all at the same moment, as chickens (again a chicken, sorry) as we say in Netherlands: without a head.
    At least without ears.

    These meaningless TV programs create more and more misunderstandings. All media btw "talk" in the same way and therefore all and everybody is against Europe, and make their leaders and with that the European peoples ridiculous. Blaming them, you, me, all in Europe, for all what is bad.

    All is allowed in Greece. But, oh lala, when somebody sends their boomerang back, or is there with stories that they cannot understand because they are not informed. They consider it as anti propaganda. Filled with hatred finally they fight against all what is not "Greek" or "Greece".

    Herr Kastner, it is very polite that you offered links to other posts, to prove what you did, it is helpful at least for me, and I am sure for a lot of others so: it is meaningful, but it does not help any Greek. their minds are brainwashed with other info, and you will be seen as a liar.
    Of course, they do not know better.

    What can be done about it? Just going on, with raised head and the same inner values, which are excellent.
    Maybe your blog is even so important that the Greek political parties read it in secret to learn from it. They cannot find that information within Greece itself, so: go on, with your observing the Greeks and Greece, it is very helpful and creating balance within the madness.

    Btw: I saw the tweet of the Greek woman, where she promoted a very humiliating photo with Jeroen Dijsselbloem and out of hatred born, untrue text on it.
    The blindness creating hatred of Greeks against Europe is huge.
    Only the reality will wake them up, and as my mother always said (she was so wise): even when the lie is there in an extremely high speed, the truth will run finally faster, and win.

    URL to the tweet of @yiota143

    I consider the used photo as a personal attack of Yiota into the direction of the European peoples, including myself, as if we, Europeans, are just marionettes, not able to think, blind followers. She does not realize (she cannot, impossible when living in Greece or only having contact with the by the Greeks created "news") that we are able to get informed by neutral excellent high standard media and journalism, that are going into details where she cannot even dream about. Impossible! She does not know it. We live in the free (disputable, but anyhow a kind of) democratic Europe (excluding Greece here) and Greece has a (my theory about it because it is the answer on all questions and why's) by the state controlled media system, not democratic at all, only there to confuse more and more by talking about nothing. Only those who talk in the way they, those who rule and control Greece (the Greek mafia maybe) want (so, about nothing), have a job in the media. Of course!

    1. I consider your post to be unacceptable, because you have no comprehension AT ALL of what is going on in Greece, none of economics, and none of how the EU has created a disaster zone -- with Greece as one of the victims of it.

      The fact that there have always been serious problems with the Greek economy and polity was well known to all in Europe, if they cared to look. They pretended otherwise, tor their own purposes. The Greek people now understand this, and are very angry. The fact that you do not understand it is your own problem.

    2. Oh yes, I am very well informed, have a very excellent intelligent born in Greece source, who speaks the language, who speaks almost daily with the Greeks he has contacts with because of business he wants to start there, who has info about what happens there, what he meets there on banks and with judges, lawyers, the Greek way of working with money, advices (incredible!), and, he knows how it WORKS outside of Greece, by own experience because he lives, worked and works in "Europe". A pity that he does not have the time to argue here with you. You would be at the end of argues within some seconds. Not because he overrules you but because your way of thinking cannot reach the height he has and can explain you. but then you need to have learned to listen and since you are a Greek you do not have that capability.

      During the years time has learned me that this Greek speaks and sees truth. Because things happen as he sees them. We talk much about all what is going on.
      Also what is going on on this blog. In the past also what was written on Varoufakis' blog, but I do not follow that anymore.

      Your comment is not a comment but again a what I know in the meantime Greek way of talking and throwing everything out of the window what might become a real discussion.

      In fact all in the world is about common sense, and Greeks do not learn that in Greece. It is dead.

    3. @Antoinette: I am not a Greek. This issue came up several times recently here, and the fact that you are not aware of it shows quite clearly that you are not engaging in discussion. You do not read the debates here. Does this mean that you are trolling? This would, indeed, be my conclusion.

  2. The problem with the line" we must put people before numbers" is that numbers must add up otherwise people are kept happy only with lies and this always ends up badly. So first we get the numbers right and then move towards improving the peoples' lot. Balancing debtors and creditors rights is more tricky, but it must be remembered that the belief in easy money is a very dangerous thing. So, occasionally, very stroppy debtors (eg greeks not paying their housing loans when they have 3 time the loan amount in the bank, real case)must be squeezed.
    In the 6 Apr 2014 article I commented about the ECB having the power to suffocate the Greek economy by witholding liquidity. I think that I am vindicated. They will never actually force an outright default but they will keep the liquidity so low that no economic growth will be possible and the Greek government will oscillate between not paying salaries and not paying depositors. No government can survive for long like that.

    1. Sorry, but the numbers have never added up. We are all in this mess because of fraudulent and criminal activities by banks across the world, but especially the USA, which were allowed to do as they liked with uncontrolled credit creation and speculation via complex financial instruments. In others words, they deliberately made massive profits when they knew that the numbers did not add up.

      So, my question to you is this: who should now be made to pay for numbers not adding up? The owners and CEOs of banks, or the common people of Greece, Ireland, Portugal, Spain, Italy etc. The corrupt politicians of Europe, who are explicitly associated with banking, have decided that ordinary people should pay. Syriza has been elected to overturn that non-democratic decision. The question at this time is not about numbers -- because none of them add up anywhere -- but about democracy itself.

    2. Well put. But all blame should be put on banks but on politicians as well and strong advocates of globalization (corporations) and the people as well to a lesse degree.

      But in America there are many bankers who went to jail. Have any gone from EU?


    3. I agree. In Greece the numbers didn't add for a long time and the responsibility was on various bank CEO, politicians in Greece and the EU and similar others. I have my opinions as to how to make them pay (mainly about getting their bonuses back) but I don't think anybody will listen or that they will ever be applied.
      However this is not what my comment was all about. I was not specifically referring to Greece 2015, but to all similar situations be it England 1978, Alliende's Chile or Austria during the early 1920's. When a political group takes over during a serious financial crisis it has two choices: go to war against the evil foreigners or try to sort things out. The second choice has to follow a pretty specific sequence : a) sort out the numbers b) make sure people see and feel the improvement c) do reforms to make sure that the same problem does not occur again d) get those responsible to pay. If any other approach is tried (even if you change the order mentioned like you seem to suggest) it will result in an explosion. d) unfortuately is often impossible or very difficult and so ignored.
      By the way asking for punishment before anything else is a very Greek approach. Are you going native?

    4. @Athensdog: on your last point, I always felt almost more Greek than British, from the first visit I made to Greece in 1985.

  3. Dear Mr. Kastner,

    As greek living in Greece and not having read the specific articles, but following your blog for many months and as of late very actively, I never thought you to be a man only about the numbers. As a foreigner, i find you, your articles, knowledge and eagerness to learn to help in your own way, as a positive aspect. I know you are stern on some issues but i know just by reading your blog that you are man of good morals and ethic and you have proven it in your joruney in life, as you shared many aspects of your past with us as to teach us.

    I thank you for your great contribution to helping our country and Europe for that matter. I hold very high regard your work at this blog and appreciate your articles. I hope never cease to blog.

    I would like to also thank all the commenters even though we do not agree. You all contribute great knowledge and exchanging ideas will only bring us closer.



    1. Kind words. I just wish you prime minister would be as benign, agreeable and open-minded as you. As a person living up in the north of Europe I am appalled by his aggressive tone and style.

    2. Dear Seukel,

      I know many Europeans are upset with us. I am not quite sure what is being displayed as to what is going on in Greece to provoke such reactions in us. He is actually expressing a true self but in a political way. I find him to be quite honest versus the previous leaders of the last 20 years although he will have some white lies, he will strive to improve Greece. I believe it and him. And it is in Europes interests for Greece to take care of themselves in or out of the Euro. I have never believed in a politician till now. I know because i see transition in affect already. I can not divuldge any information but things are moving on the ground.

      I grew up in the USA, where poverty and homelessness is the norm. Coming to Greece and Europe as a child, i saw a huge difference of social and moral public understanding. I fell in love with greece and europe for that fact. We are a beautiful conglomerate of societies this Europe. It is all our duties to help each other even though it is offensive. When greece a european country have its poor people looking through garbage cans for food, people sleeping on benches and Nazis "party" Golden Dawn is at 10% approval, something is seriously going wrong.

      I find the northerns also quite aggressive with us but in many instances although my initial instinct is anger, many, many times I accept what they say as the northerners of europe bring us greeks, balance.

      And as the great zorba said, "You think too much....Clever grocers they weigh everything....A man needs to know when to cut the rope and be free."

      We need you to balance us, you need us to cut the rope.

      Take Care and Don't worry we will all find our way. I am sure of it.



  4. I very often agree with you, but imho you have been way too nice to the fuzzy headed commies of Syriza. The stories you linked prove that. You may have thought you were advicing rational people, but you only reinforced the lunatic belief of those unrealistic radicals that now the time has come to get rid of all reforms and ignore all concerns about economic growth, I'm afraid. Well, the road to hell is paved with good intentions, isn't it?