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Gullibility Knows No Bounds: Lira, Turkish Banks Stage Absurd Rally On Erdogan Promises

Turkey's Recep Tayyip Erdogan is ready to take his medicine. Don't believe me? Just ask him. "Turkey [will] implement bitter pill policies if needed,” he declared on Wednesday, while pledging to support his new central bank governor and finance minister, just days after firing Murat Uysal and accepting the resignation of his son-in-law. "We will not hesitate to apply the right prescriptions," he continued. "Even if it is painful." Read more: Erdogan Fires Another Central Bank Chief As Lira Falls For Eleventh Straight Week I'll tell you what's "painful." What's "painful" is watching market participants pile back into the lira and Turkish bank stocks despite knowing that Erdogan absolutely cannot be trusted on anything, including and especially respecting central bank independence. The lira came into Monday riding an eleven-week losing streak, which pushed Turkey back to the brink of a currency crisis. The irony of Uysal's dismissal is that he did everything Erdogan asked him to do. In his first 14 months on the job, Uysal delivered 1,575bps worth of easing. As for Berat Albayrak, he was naturally just a mouthpiece for Erdogan -- they're family, after all. Inflation lingered
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4 comments on “Gullibility Knows No Bounds: Lira, Turkish Banks Stage Absurd Rally On Erdogan Promises

  1. runamok says:

    Yeah, the poor Turkish people, having to suffer through a leader who dreams of being an authoritarian.

    I’m curious to see how costly the military operations in neighboring territory end up being for the Turkish economy. It’s not the bad old days where you go in, win the battle, loot, and take the booty home to the capital city to refill the treasury. Running tanks, firing artillery, training and feeding soldiers, it gets expensive.

    Hard to know how much of this recent plunge is related to military costs and how much to bad leadership at the top. Turkey can probably afford the military operations so far as they have a pretty large and diverse economy. A good portion of their problems seem to be at the top. Not including recent events, their economy has been fairly steady for the last 20 years or so.

    Regional powers, or, rather, potentially regional powers, such as Turkey, Argentina, and South Africa, are interesting. If South Africa can ever get their act together, one thing they have going for them is they probably won’t end up in hostilities with neighboring countries. Same with Argentina.

    • Maggi Tomatensosse says:

      I don’t know enough about internal Turkish politics to guess if this is co-incidental or ironic, but Erdogan’s political consolidation at the expense of the military does seem to dovetail with a massive expansion of the actual deployment of the military. Instead of shooting Kurdish civilians or vacationing in Northern Cyprus, now they are in Iraq, Syria, Qatar, Libya, Somalia, and causing mischief in the northern Caucasuses. Whatever happened to “No trouble with neighbors?”

    • Anonymous says:

      well, it is called as Jingoism. Turkish Governement didn2t aim to loot money, but keep its voter together. It is a historical fact that when there is a chaos, people tend to support status que.

      the government choice this path, since they have radical islamic background they cannot produce any lucretice policy just like any other bigot.

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