TR Economy & Updates

[Saithan]

if i am guverner i would cancel interest to the zero or close to it, that is only long term remedy to go out of the clutch from speculative financial markets and be truly idenpendent, if ebrd can have close to the zero interest rates for more then year, turkey should do that to.

To do that you would need to pay off all your nations debt to foreign investors etc. which is the bloody problem we've been pointing out!

You cannot talk about zero or close to zero interest if you are so much indebted!

Here look at the interest in Denmark and try to understand why RTE can't match it!

 

[mulj]

To do that you would need to pay off all your nations debt to foreign investors etc. which is the bloody problem we've been pointing out!

You cannot talk about zero or close to zero interest if you are so much indebted!

Here look at the interest in Denmark and try to understand why RTE can't match it!

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I am sure you could do that under certain conditions and readiness to pay price which exits scopes of oridnary economy, altough this cat and mouse play will go for while where everybody lose some bits but structure remains the same, it is frustrating for ordinary people but it is like it is.

 

[Saithan]

I am sure you could do that under certain conditions and readiness to pay price which exits scopes of oridnary economy, altough this cat and mouse play will go for while where everybody lose some bits but structure remains the same, it is frustrating for ordinary people but it is like it is.

Pay with what, sell of Turkish lands ?

The issue here is that RTE and AKP has been spending money without budget discipline, even overspending, and add to that screwing up the economy. So the first step to 0 interest is, you clear off your debt, and then you build up stockpiles of valuables amounting to 1,5 times GDP. Lastly you only spend money when you have it in your treasury, but never overspending and sticking to budget discipline, yet never going beyond 0 (balance economy).

That would effectively mean an end to RTE construction projects, even Canal Istanbul would die.

Add to this if you stopped construction projects you'd have unemployment en mass.

Back to the issue, who the hell would lend you money for 0 in interest!

 

[mulj]

Pay with what, sell of Turkish lands ?

The issue here is that RTE and AKP has been spending money without budget discipline, even overspending, and add to that screwing up the economy. So the first step to 0 interest is, you clear off your debt, and then you build up stockpiles of valuables amounting to 1,5 times GDP. Lastly you only spend money when you have it in your treasury, but never overspending and sticking to budget discipline, yet never going beyond 0 (balance economy).

That would effectively mean an end to RTE construction projects, even Canal Istanbul would die.

Add to this if you stopped construction projects you'd have unemployment en mass.

Back to the issue, who the hell would lend you money for 0 in interest!

You are in rollercoaster anyway, simple budget restrictions are not solutions, so you just confirmed what i wrote, you have enough internal resources to clear of your debt easily and that is political and strategic decision as option.
Todays itntrest rates are closer to zero then to 2...

 

[Ardabas34]

They've burned them to hold the lira......mostly.
Turkish economic advisers actually bragg about these useless policies, like this guy....even though the lira is at 7.92 anyway

Erdoğan adviser says Turks sold more than $7 billion for liras | Ahval

Yiğit Bulut, a senior economic adviser to President Recep Tayyip Erdoğan, said Turks sold more than $7 billion for liras since yesterday.

ahvalnews.com

Ahval news is a UAE funded Gulenist media foundation. I am not disputing whether the news is right or wrong but please come up with alternative sources next time.

 

[Turko]

İf you cut interest rates even half , USD will be double. İ can't imagine how much USD would be if you made interest rates zero. US Federal reserve can make it zero since they print the banknotes.
This year Turkish economy urges to pay debt of 250 billion USD which we dont have.
Currently İnterest rate is the mere instrument for seducing foreigners to buy Turkish Lira . However current rates seem not have lured foreigners.

İt would be ultimate solution if foreigners directly invested in Turkish economy opening new factories but unfortunately we don't have reliable juridical environment for capital while the president founding new anti-democratic regime. Turkish courts make decisions by the order of regime.
Which kind of crazy personal would in Türkiye.

Ferit Şahenk one of the richest people of Türkiye , declared 5 billion TL financial losses in Türkiye while he founded investment bank in UK. Rich people are spiritting money away to UK.

 

[Costin84]

İf you cut interest rates even half , USD will be double. İ can't imagine how much USD would be if you made interest rates zero. US Federal reserve can make it zero since they print the banknotes.
This year Turkish economy urges to pay debt of 250 billion USD which we dont have.
Currently İnterest rate is the mere instrument for seducing foreigners to buy Turkish Lira . However current rates seem not have lured foreigners.

İt would be ultimate solution if foreigners directly invested in Turkish economy opening new factories but unfortunately we don't have reliable juridical environment for capital while the president founding new anti-democratic regime. Turkish courts make decisions by the order of regime.
Which kind of crazy personal would in Türkiye.

Ferit Şahenk one of the richest people of Türkiye , declared 5 billion TL financial losses in Türkiye while he founded investment bank in UK. Rich people are spiritting money away to UK.

It doesn't take rocket science to know that even today, judging by the lira's chart, Turkey shovelled a few billion $ down the drain, adding to its debts just to propp up the currency.

 

[Nilgiri]

if i am guverner i would cancel interest to the zero or close to it, that is only long term remedy to go out of the clutch from speculative financial markets and be truly idenpendent, if ebrd can have close to the zero interest rates for more then year, turkey should do that to.

Might work if Turkey reduces its (largely inflation sensitive) imports to the same near zero....by people just not demanding those for consumption (tightening their belt extremely for things like fuel even).

Also Turkey would need to convince loan servicing repayments to take Turkish Lira instead of whatever forex currency was promised earlier.

Or simply refuse to pay them back (i.e default) and pretend its not a default and invent new autakric system without need for credit ratings etc... and have total resilience to sanctions by former largest markets that will automatically take that route to get their money back (as you formerly promised + guaranteed).

As all these have zero chance of happening, so all you would do is wreck country with inflation and BoP crisis and destroy Turkish economy for at least 5 years probably at the minimum.

Turkey is not a country that has developed its import/export and loan/investment profiles and capacities like that of Euro-zone (and how these reflect in consumption and other parameters in the end w.r.t monetary policy sensitivty), not even close....so comparing their (Euro area) 0 interest setting and QE there is something quite more than apples and oranges difference

 

[Saithan]

Might work if Turkey reduces its (largely inflation sensitive) imports to the same near zero....by people just not demanding those for consumption (tightening their belt extremely for things like fuel even).

Also Turkey would need to convince loan servicing repayments to take Turkish Lira instead of whatever forex currency was promised earlier.

Or simply refuse to pay them back (i.e default) and pretend its not a default and invent new autakric system without need for credit ratings etc... and have total resilience to sanctions by former largest markets that will automatically take that route to get their money back (as you formerly promised + guaranteed).

As all these have zero chance of happening, so all you would do is wreck country with inflation and BoP crisis and destroy Turkish economy for at least 5 years probably at the minimum.

Turkey is not a country that has developed its import/export and loan/investment profiles and capacities like that of Euro-zone (and how these reflect in consumption and other parameters in the end w.r.t monetary policy sensitivty), not even close....so comparing their (Euro area) 0 interest setting and QE there is something quite more than apples and oranges difference

I have serious doubts that he understands the difference looking at the comments.

I have previously stated defensive politics are not going to work. You’d need aggressive economic politics to cut down inflation and go at it for the next 5 years while keeping the politics stable.

 

[mulj]

I have serious doubts that he understands the difference looking at the comments.

I have previously stated defensive politics are not going to work. You’d need aggressive economic politics to cut down inflation and go at it for the next 5 years while keeping the politics stable.

What is there to understand, you are aware that what you wrote is not realistic to be done, your surroundimgs and geopolitic does not give you that kind of luxury.

 

[Sinan]

Meanwhile more bureaucrats in the central bank being replaced.

Merkez Bankası meclisinde değişiklik

Hazine'nin önergesiyle Türkiye Cumhuriyet Merkez Bankası (TCMB) Para Politikası Kurulu üyesi Ömer Duman banka meclisi üyeliğinden alındı. Banka meclisi üyeliğine Prof. Dr. Nurullah Genç ve Derya Yücel yeniden atandı

www.bloomberght.com

Erdogan is doing a very good job on how to destroy a country's economy.

 

[Indos]

Pay with what, sell of Turkish lands ?

The issue here is that RTE and AKP has been spending money without budget discipline, even overspending, and add to that screwing up the economy. So the first step to 0 interest is, you clear off your debt, and then you build up stockpiles of valuables amounting to 1,5 times GDP. Lastly you only spend money when you have it in your treasury, but never overspending and sticking to budget discipline, yet never going beyond 0 (balance economy).

That would effectively mean an end to RTE construction projects, even Canal Istanbul would die.

Add to this if you stopped construction projects you'd have unemployment en mass.

Back to the issue, who the hell would lend you money for 0 in interest!

If the Lira is just freed from monetary intervention, the consequence is the debt would be like doubled or something. I think some one in Turkey should hire Indonesian economist who have been dealing with Asian Financial Crisis.

There is retired Indonesian Economist that has experienced in dealing with extreme lost of currency value. You can see our currency at 1997 is valued at 2500 and then up to 16.000 per USD only within a year in 1998


Biography
Prof. Dr. Anwar Nasution is a professor of economics at the University of Indonesia, where he specializes in applied macroeconomic theory, monetary economics, and international economics.

Over the years, Anwar has been published by ISEAS of Singapore, RoutledgeCurzon, University of Chicago Press, University of Michigan Press, Praeger, Maruzen, MacMillan, Lynn Rienner Publishers, OECD, and Oxford University Press.


Experience
From 1968-1975, Anwar worked at the Ministry of Finance, and from 1985-1994, served as economic advisor to the minister for Cooperatives of Indonesia. From 1982-1983, he was an economic consultant for Bank Indonesia, the central bank of Indonesia, and in July 1999 was appointed as senior deputy governor of the central bank, a position that he held until 2004. In October 2004, he was appointed chairman of the Audit Board of the Republic Indonesia.


He has been a consultant to UNESCAP, UNECLAC, USAID, ADB, the World Bank, IMF, and MITI of Japan; a member of International Advisory Group of Finance Forum of the Pacific Economic Cooperation Council (PECC), the Asian Economic Panel, and the Center for Pacific Basin Monetary and Economic Studies of San Francisco; an international associate member of the Ministry of Finance of Japan, the American Economic Association, and American Committee on Asian Economic Studies (ACAES); vice chairman of the Indonesian Economists Association; and country director of East Asia Economic Association.

 

[Indos]

Sory some typo, I mean during 1997-1998

 

[Indos]

Indonesia also uses very high interest rate during that time to go against people betting on USD. Just see Indonesian history in dealing with Asian Financial Crisis.

 

[Indos]

A New Political System and the Start of Recovery


Bacharuddin Jusuf Habibie, vice-president in Suharto's last cabinet and thus - by law - replacing Suharto as Indonesia's next president, turned to the economic technocrats to deal with the ongoing financial crisis. This resulted in a fourth agreement with the IMF. It was signed in June 1998 and allowed the budget deficit to widen further while new funds were pumped into the economy.


Within the time-span of a couple of months there were some signs of recovery. The rupiah began to strengthen from mid-June 1998 (when it had fallen to 16,000 rupiah per dollar) to 8,000 rupiah per dollar in October 1998, inflation eased drastically, the Jakarta stock exchange started to rise and non-oil exports started to revive towards the end of the year. The banking sector (center of the crisis) remained fragile as the number of non-performing loans were high and banks were very hesitant to loan money. Moreover, the banking sector had caused a sharp increase in government debt as this debt was primarily due to the issuance of bank restructuring bonds. But, albeit fragile, Indonesia's economy improved gradually through 1999, partly due to an improving international environment which caused a rise in export revenues.

Asian Financial Crisis - Cause & Effect | Indonesia Investments

The financial crisis in Asia in the late 1990s had a huge impact on Indonesia, evolving from a financial crisis into a social and political crisis.

www.indonesia-investments.com

 

[Tornadoss]

I'd like to learn the opinion of guys who can not find any mistake of akp about the last development in the economy.

 

[Nilgiri]

I think some one in Turkey should hire Indonesian economist who have been dealing with Asian Financial Crisis.

There is lot of talented economists in Turkey for what needs to be done...I have read couple papers by some myself.

The point is the leadership/administration not picking them to advise + run things (And letting them do their job unhindered after doing so) for last 10 years or so.

Fault lies at highest levels here....rather than if its local or foreign advisors/experience thats needed.

 

[Turko]

I'd like to learn the opinion of guys who can not find any mistake of akp about the last development in the economy.

"External powers undermined Turkish economy" " Türkiye is under financial attack of enemies of İslam "

But Erdoğan appointed vice president to central bank from Morgan Stanley.

 

[the]

https://twitter.com/i/web/status/1377018747781799938

Goldman Sachs lowered its 2021 growth forecast for the previously announced 5.5% Turkey 3.5%.

Bare in mind that GS expects around 6% growth in global GDP......

 

[Indos]

The rise in export IMO is more because the combination of Rupiah huge depreciation and Rupiah stability. Not just due to better external environment as the article said. It is because the industrialization has been quite good as well so many

There is lot of talented economists in Turkey for what needs to be done...I have read couple papers by some myself.

The point is the leadership/administration not picking them to advise + run things (And letting them do their job unhindered after doing so) for last 10 years or so.

Fault lies at highest levels here....rather than if its local or foreign advisors/experience thats needed.

I dont doubt that, but it is to convince Erdogan