1€ - 4 Lira, 1$ - 3 Lira is a good and middle value.Iam not in favour of a low lira
Iam just sharing a perspective that is all
However, most of the time, Robert brooks used to be really pin point on the fair value of the lira
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1€ - 4 Lira, 1$ - 3 Lira is a good and middle value.Iam not in favour of a low lira
Iam just sharing a perspective that is all
However, most of the time, Robert brooks used to be really pin point on the fair value of the lira
It would seem that the government is trying to pull a China. It's a sound strategy, but for the consequences for the common worker. Since government has refugees to feed into the machinery I assume they don't give a rats ass.
Central bank has lowered the interest rate. Mind-blowing stuff.
It is not a sound strategy at all. Doubly more so with this I/R decrease just done. I'll tell you what it really is a bit later.
Lowering the interest rate is a good idea if we have stable and relatively strong currency. Actually all Central Bank lower the interest rate, including Indonesia, in order to stimulate the economy and lower the burden of businesses during this Pandemic situation
This is one layer below the inflation (fever) for TR. Studying its import and export basket, the % of those reliances in the economy, and how "elastic" they are (and basically how much investment and reform they need....i.e training and rest).I dont know why Turkish currency is still weak that make them cannot implement this policy without getting negative effect from currency market. Trade deficit is one of the reason of weaker currency but countries like Bangladesh which has quite big trade deficit still has stable currency until Today. It could relate to much less exposure to foreign investor on BD stock market.
It is nutty what TR govt is doing (you are looking at the surface and you are right....but looking at deeper level it gets worse).I also know Turkey has high inflation currently and this then relate to foreign investor and currency market. Currency with higher rate of inflation must be backed by high interest rate since the value is less than currency with low interest rate, thus decreasing the interest rate will also make people and businesses which hold Lira to sell it and buy USD
They have gone into a mode where they will shake down turkish domestic entities (refer to earlier reply I gave in thread). i.e keep bumping up the mandatory forex saving ratio.To make Turkish economy stable then dont ever tried to go against the financial market like what happened previously. Currency depreciation can lead into higher burden to the business sector who has foreign debt ( which include foreign denominated bonds ), foreign investors in Turkish stock market would also sell their investment in Turkey to avoid further loss, and this can give second blow for the currency.
If the depreciation is too extreme, it can create a catastrophic damage on the economy like what was happening in Indonesia during Asian Financial Crisis
The main issue is the policy should be really made by the Economist, Erdogan should understand that his understanding on economy is not as good as Turkish professional economist. From what I understand Erdogan only has real sector understanding and his understanding on financial sector and monetary policy is so limited. Indonesia economic crisis started from the financial sector that later effect the real sector so badly.
Private sectors should also be asked and there should be discussion with Turkish business association whether they can really bear Lira devaluation policy ?
This I bring Indonesian Data on Interest Rate policy and real Inflation
View attachment 32028
If successful TR will increase exports hugely and will replace China in some fields as Turkish national products will be very competitive in price
If successful TR will increase exports hugely and will replace China in some fields as Turkish national products will be very competitive in price
Erdogan blamed the economic woes on 2001.
These guys had 20 years to fix shit up.
Seriously man Erdogan has become like Arsenal!!! Please retire and let somebody competent come in or at least let the people do their shit.
He has become like a control freak who feels the need to control everything.
For people abroad for sure they are celebrating as they get to travel and enjoy Turkiye while the common people suffer.
Let me guess its easier to resort to conspiracy theories.
Even if the Turkish economy grows or records growth it will just stagnate as usual.
In any case I have harped on about the GFCF to @VCheng probably the most I know of anyone....here he can see its application to another country/perspective.
Who is that person who will do better than Erdoğan did?
he has no clue about what he is doing!! you can not increase your export number as much as decrease in the dolar rate!! how much increase we had in exports in last 2 years, or lets say in the last 10 years compared to increase in dolar / tl ratio??Erdogan is trying to increase the dollar to 10TL and decrease the interest rate to %15 as step 1 and lira to 12TL and interest to %10 as step two. Workers will pay a huge price for this policy. Turkish workers will be cursed with poverty for at least a decade. If successful TR will increase exports hugely and will replace China in some fields as Turkish national products will be very competitive in price and after the covid-19 pandemic, most countries will be left with small coffers.
our people will go on suffering more and more day by day, dolar will increase in leap and bounds. Central bank will require to increase rates more than they decreased now. we will end up same things like happened last year!!
- huge dolar to tl ratio
-huge interest rate than 19 percent!!
-bigger inflation!!
the ones can not see this are total morons!
today, central bank does not decide according to logic but according to orders it receive !! ,
I agree with you. But Erdo thinks Turkish goods will sell very well. Like defense industry products, ships, automobiles, machinery, textile products, steel, chemical products, and refined petroleum products etc. Erdo also thinks if minimal wage stays under 300$ investors will invest in the real sectors. He wants to curse workers to poverty and try to construct an economy literally paying nothing to them. But we are not China he can't win elections with that attitude. People will riot. AKP economists also think Turkey will pay less for energy needs starting from 2024-2025 with the Blacksea gas coming into play. This year Turkey passed 200billion mark in exports. The 2023 target is 240 billion and Over %5 growth is expected for the next 3 years in GDP.Hate to be the bearer of bad news, but it wont.
You can have the same answers as someone else on the test.
Teacher can ask though, show your work.
In this case the work is the genuine underlying investment (quantity and quality) needed in these sectors.
Things like GFCF and FDI (and how they are further analysed sector and industry wise vis a vis labour and consumer profile).
That is the larger proof in the pudding to harness export competitiveness (by depreciating currency lever wise).
If it aint there, well you can see what happens for yourself.
While I agree that Turkish exports may soar to unprecedented levels as shown this year, I still think that throwing your ppl into poverty is just way too overkillI agree with you. But Erdo thinks Turkish goods will sell very well. Like defense industry products, ships, automobiles, machinery, textile products, steel, chemical products, and refined petroleum products etc. Erdo also thinks if minimal wage stays under 300$ investors will invest in the real sectors. He wants to curse workers to poverty and try to construct an economy literally paying nothing to them. But we are not China he can't win elections with that attitude. People will riot. AKP economists also think Turkey will pay less for energy needs starting from 2024-2025 with the Blacksea gas coming into play. This year Turkey passed 200billion mark in exports. The 2023 target is 240 billion and Over %5 growth is expected for the next 3 years in GDP.
While I agree that Turkish exports may soar to unprecedented levels as shown this year, I still think that throwing your ppl into poverty is just way too overkill
I mean, If you wanna go into full export overdrive, at least ensure that basic life necessities arent susceptible to change through 100% nationalisation while leisure products like make ups, phones, cars etc.... can have their values changed. However, in Turkey rn, it is the opposite! Turkey is producing cars, phones, trains etc yet its food supplies is dependent on abroad
If i was the president, for example, I would increase the lira's value to 1$=3 lira; take a loan and build massive food infrastructure. When I ensure that the ppl can feed themselves; then I can enter into full export overdrive
Idk how Erdo reached such a sudden conclusion of just plummeting the lira to the rock-bottom
how much increase we had in exports in last 2 years, or lets say in the last 10 years compared to increase in dolar / tl ratio??
Beside you decrease value of your products by doing this instead of increasing the value of every product you export!!
you export 200-210 billion usd while you sell more than 700-800 billion usd to your people!! the decrease in selling to your own people can not be compansated by export increase!!
Yeah your right but it just sounds nice when you cherry pick numbers and can say that exports are rising.he has no clue about what he is doing!! you can not increase your export number as much as decrease in the dolar rate!! how much increase we had in exports in last 2 years, or lets say in the last 10 years compared to increase in dolar / tl ratio??
Beside you decrease value of your products by doing this instead of increasing the value of every product you export!!
you export 200-210 billion usd while you sell more than 700-800 billion usd to your people!! the decrease in selling to your own people can not be compansated by export increase!!
erdogan and akp like every body says are doing wrong like the every thing they have done in the last 10 years!!
there is no logical explanation to this!! akp members and assigned morons do not know better than economists or past central bank presidents!!