Desperate Times: Erdogan’s Scheme To Avert A Bank Run

Desperate Times: Erdogan’s Scheme To Avert A Bank Run

"Never seen a day like this." That's how one EM veteran described Monday's rollercoaster ride in the Turkish lira. I long ago gave up on the notion that investors of any kind would ever admit the truth about Turkey under Recep Tayyip Erdogan. As I put it last week (and countless times previous), there's a lot of political utility in fighting a quixotic, never-ending battle against an amorphous cabal of purported conspirators, both foreign and domestic, both real and imagined. That's right out
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2 thoughts on “Desperate Times: Erdogan’s Scheme To Avert A Bank Run

  1. So the Turkish central bank will pay depositors whichever Lira amount they have lost relative to the dollar due to adverse daily USD.TRY moves…

    It sounds just like a stablecoin that “pegs” the value of your Chuck E. Cheese to the dollar. Check out the Titan/Iron crypto pair.

    Shorting the Lira sounds like free money.

  2. $/TL is around 12.30 today, down from 17.86. A friend who reads Turkish better than I do says that the regulations seem to say that the promise to make up losses is limited to one time, one account per depositor, plus the obvious, unstated limitation that the government can only do this so long.

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