Posted on 08/11/2018 3:50:34 AM PDT by GonzoII
ISTANBUL (AFP) - Three, four, five, six? What next?
Turks have over the last half decade counted the rapid depreciation of the Turkish lira on the screens outside doviz (exchange) booths with a mixture of bewilderment, alarm and ironic amusement.
The currency had spent much of 2014 hovering at just over two to the dollar but broke through the three mark for the first time after the 2016 failed coup bid and then slid to four earlier this year.
But the haemorrhaging reached an unprecedented intensity in the last weeks as Turkey's ties with the United States strained further and markets questioned their trust in Turkish policymakers, pushing the currency to five against the dollar.
A new bout of selling Friday on increased strains with the US forced the lira over six against the dollar for the first time, with the currency at one point shredding a quarter of its value in a single day.
Economists say that while the government may be tempted to muddle through the current situation in the hope the external and economic background improves, the lira's fall harbours considerable dangers for the economy, in particular the banking system.
- 'Tight grip on bank' -
President Recep Tayyip Erdogan's current dash for growth coupled with unorthodox pronouncements on monetary policy -- including that lower rates can bring down inflation -- have put him on a collision course with markets.
The central bank, nominally independent but never defying Erdogan, appears to have abandoned the conventional monetary policy of using rates hikes as a tool to support the currency and bring down inflation.
Erdogan's "tight grip" on the central bank and the fact "higher interest rates do no fit with Turkey's economic growth strategy" meant that the central bank has kept interest rates on hold...
(Excerpt) Read more at france24.com ...
Get used to that sucking sound!!!
Crush Erdogan. Crush him like the maggot he is.
FYI. Turks are the largest group of Muslims living in the USA.
His son-in-law is lined up and figured to take over in four to six years (provided Erdogan is still in power).
If the lira would drop down to ten to the US dollar....I might go and buy into several thousand dollars worth. In a couple of years, some coup will occur and things will be resolved....with the lira going back to 2 or 3 per dollar.
My Grampa fought the Turks in WWI in France. They were mean. Maybe we’ll fight them again.
Why does Trump have to be so mean to dictators? It is not fair!
/s
Could easily get wiped as well, or be significantly devalued to pay off Erdogan debt, or just barely go back up in value. It could be a decent speculative bet, but I wouldn’t bet money you need on it.
Ms. Ocasio Cortez could offer economic advice.
If the Turks get desperate they just might seize the rest of Cyprus. The Greek Cypriot side has a booming economy, and who would resist a Turkish invasion?
They may crucify Christians again as they did a century ago.
IMO, you will lose your shirt. The standard routine on a new govt taking over after an inflationary binge is to move the decimal point the required number of positions to the right and print the "new, improved" bills.
Didn’t Erdogan pass control of the Central Bank to a son, perhaps the one formerly dealing in black-market crude oil from ISIS captured oil fields?
They would be “new” lira. The old ones would not work anymore.
That’s how this works.
Why do you think they want to get rid of cash. They did that in India last year (different situation, but same result.)
The Greek side is the home of Russian Oligarch money.
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