Got Inflation? Turkey’s Erdogan Has The Medicine!
If you have an inflation problem (and who doesn't these days, right?) Recep Tayyip Erdogan has the medicine.
The remedy is rate cuts. Take 100bps (or more) every month or two as needed to control runaway price growth. If symptoms persist, or worsen, take more medicine.
On Thursday, Sahap Kavcioglu, Turkey's beholden central bank governor, cut rates for the third consecutive meeting. This situation is positively ludicrous, and has been for the entirety of Kavcioglu's tenure.
I assume most read
Hey, look, as long as Turkey doesn’t buy anything from anywhere, it’s all fine… 🙂
He’s quite the autocrat. No one questions him, apparently. You’ve written about his radical approach to managing Turkey’s economy going back to SA days, as I recall. Erdogan has been taking this policy approach for so long, but he gets away with it. The guy persists.
Is it violence? Intimidation? Fear? Whatever it is, his modus operandi is the antithesis of common-sense economic policy. He’s a strange dude, and not a little scary for those who work for him, I reckon.
correlation vs causality, some people noticed a large police force in regions with high crime rate, in follows that the large police force causes the high crime rate, Erdogan operates in a similar paradigm, it must be the high rates that cause inflation
I was there last month (admittedly in a tourist zone) and everything is priced in $ or EUR. I guess commodities are being imported from Russia at huge discounts. Outside of tourism and the major urban centres it is generally subsistence economy. I guess you don’t want to risk buying a second hand car as replacement parts may cost more than the vehicle.
Yesterday markets weren’t down too much. They’re calling it a rally.
If something can’t last forever, it won’t-Herbert Stein
Sadly, it’s these types of autocratic stunts I expect if the Republicans find a way overthrow American Democracy and foist trump on us in 2024.