Moon of Alabama Brecht quote
May 23, 2018

Turkey's Lira Troubles Threaten Erdogan's Rise To Full Power

In May 2016 Turkey elected a parliament dominated by the AK Party. At that time a prime minister and a cabinet were supposed to run the government while the Turkish president was supposed to be neutral. But Recep Tayyip Erdogan, AKP leader, former prime minister, then president was still the dominant figure and the government was practically chosen and run by him. Two months later a coup attempt against Erdogan failed. Since then Erdogan ruled by emergency decrees. More than 100,000 people were sacked or suspended and 50,000 arrested in an unprecedented crackdown. All independent media companies were taken over or eliminated.

A spring 2017 referendum, barely won, officially changed Turkey's executive into a presidential system. The government would no longer be elected by the parliament but picked by the president. The new system would come into full force by the next election in late 2019. The wannabe-Sultan Erdogan would thereby achieve near absolute power. 

In April 2018 Erdogan called for a snap election on June 24. He feared that a worsening economic downturn would otherwise diminish his chances to win. But the downturn has since accelerated. Today the Turkish currency fell rapidly and the presumed surety of Erdogan's reelection is now in doubt:

The Turkish lira has fallen more than 5% to hit a record low against the US dollar.

The currency has lost more than a fifth of its value this year as fears grow that the government might undermine the powers of Turkey's central bank.

Many investors want to see a rise in interest rates to bring down inflation, which is in double figures.

For consumers of foreign products in Turkey the effect of the currency drop is noticeable:


Tourists to Turkey will like the move, the Turkish people not so much.

The Turkish government is blaming, as usual, foreign powers:

[Erdohgan's] deputy Bekir Bozdag has implied that foreign powers were to blame for the lira's collapse.

"The people have seen the game and the player, the people have seen the puppet and puppeteers. They will not allow them or give an opportunity," he said.

Two weeks ago Melkulangara Bhadrakumar, a former Indian diplomat, also opined that foreign powers were causing the downturn in Turkey:

Turkey already seems to be facing an intensifying economic and financial storm originating from Washington. On April 30, the International Monetary Fund posted a warning that Turkish economy is showing “clear signs of overheating” (after expanding 7.4% in 2017 as against potential growth pegged at 3.5% to 4%.) On May 1, Standard & Poor’s dealt a surprise blow by downgrading Turkish economy to double-B-minus, on the specious plea that it feared a “hard landing.” Such things do not happen by coincidence.

I believe that Bhadrakumar is wrong. This is not a foreign induced crisis but has been coming for a long time. Already in 2013 I wrote:

Throughout the last years Turkey's economic boom depended on foreign investment -hot money that can leave overnight- and on an increase in consumer debt. With the Lira falling, credit tightening and interests increasing the Erdogan boom will become a bust.

The process took longer than I anticipated at that time, but it has now reached its critical point.

Turkey has a consistently high current account deficit of about 5% of the its GDP. It imports way more than it exports and needs a constant inflow of foreign capital to keep going. Over the last years Qatar was one of Turkey's biggest investors. It inserted huge amounts of money in exchange for Turkish troops protecting Qatar from a Saudi invasion. But even Qatar's capability and willingness to take risk is limited.

Internationally Turkish debt has been downgraded to junk, but not for political reasons. International lenders demand high interest rates from Turkey because they see a high risk.

Erdogan is an Islamist. He has an ideological problem with interests which are (on first sight) prohibited by Islam. The central bank has held the nominal interest rate at 8% even as the core inflation rate rose above 12%. Its primary lending rate is at 13.5% which is lower than the real overall inflation rate. The bank would like to hike rates and run a more restrictive monetary policy to a. lower inflation and b. lower the current account deficit. But Erdogan has bullied the central bank for years to keep its rate (too) low. He believes that higher central bank interest rates causes higher inflation rates. I am not aware of any economist who agrees with that theory. Erdogan has long threatened the political independence of the central bank. On May 14 he was most explicit:

[Erdogan] said the central bank, while independent, would not be able to ignore signals from the new executive presidency that comes into effect after the June polls. A self-described “enemy of interest rates”, Erdogan wants borrowing costs lowered to fuel credit and new construction.

“I will take the responsibility as the indisputable head of the executive in respect of the steps to be taken and decisions on these issues,” he said in the interview broadcast on Tuesday.

Turkey has called snap presidential and parliamentary elections for June 24 and polls show Erdogan as the strongest candidate to win the presidential vote. Turks narrowly backed a switch to an executive presidency in a referendum last year. That change is due to go into effect after the vote.

If Erdogan wins the June 24 election he will practically end the autonomy of the central bank. The bank will have to lower its interest rate and run an even more expansionary monetary policy. An already high inflation rate will increase further, the Turkish Lira will drop even deeper and Turkey will - in the end - default on its debt.

Since the beginning of the year the Turkish Lira fell 20% to currently 4.9 Lira per dollar. On January 1 4.5 Turkish Lira were needed to pay back a 1 Euro loan. Now 5.65 TL are needed. Turkish companies who bought European machinery on credit will get ruined by this fall.

Turkey has an external debt of about 450 billion dollars. While the government debt is relatively small with 23% of GDP, the total private debt is above 170% of GDP and constantly rising. With the drop in the Lira it will be very difficult for Turkish banks, companies and private households to pay back their foreign denominated loans. With interest rates lower than the inflation rate and an ever dropping currency new foreign investments in Turkey lack profitability.

Nominal growth is still high at about 7.5%. But even with that high growth the unemployment rate is still above 10%. Youth unemployment is about 20%. A lack of investment will cause the nominal GDP growth to come down, unemployment will rise and the crisis will accelerate. Consumer confidence, already in negative territory, just dropped further.

This was all inevitable under the expansionist Erdogan program of constant private debt expansion and an ever higher current account deficit. It is quite astonishing that the model worked this long. His public bullying of the central bank has finally destroyed the trust of the foreign investors his model depended on.

Turkey's economy long needed a cooling period to tame inflation and to weed out bad loans. Erdogan has managed to avoid such a period again and again. But that only increased the severity of the eventual downturn which may now end up in a full blown debt crisis.

There is no need to blame "foreign powers" or the "interest mafia" for this outcome.

Depending on how the crisis will develop over the next days and weeks Erdogan may be in big trouble. It is for now still likely that he will win the presidency but his AK Party may well lose its parliamentary majority. That would create a quite interesting "cohabitation" of an executive president with an opposing parliament.

Update - just during the final editing of this piece came news that the Turkish central bank increased one of its primary lending rates from 13.5% to 16.5%. The lira jumped from 4.9 to 4.63 per US$ but is still below yesterday's opening value. Even this relatively large move may have been too little and too late to stop the coming tide.

Posted by b on May 23, 2018 at 17:29 UTC | Permalink


Thanks for this item, b, although I suspect there's plenty of currency manipulation occurring since it's an ongoing operation. Turk Stream's First Line was completed last month, although no date's provided as to when it becomes operational. When done, its transit fees will help Turkey's balance sheet. One obvious step to take to resolve this issue is full restoration of relations and commerce with Syria and nation's beyond as noted in your M-5 article. Continuation of good relations with Russia will also be helpful. Clearly Turks must begin providing domestic substitutes for imports and mend its fences with its neighbors and thus render Turk exports more attractive. Turks should be thankful they never entered EU as they'd likely be subjected to the Greek Treatment.

Posted by: karlof1 | May 23 2018 18:19 utc | 2

Thanks b.. I don't pretend to understand the dynamics involved here, but, the little voice of historical perspective in the back of my mind keeps whispering empire, empire..

Posted by: ben | May 23 2018 18:29 utc | 3

Freedom House Democracy Index

(with a name like 'Freedom House' they must be right)
Pet peeve of mine, U.S. hack NGO rates democracies ...

Both Turkey and Ukraine are rated higher than Russia.
Hmm ... Russia hasn't shot civilians or disenfranchised entire voting blocs but according to Freedom House, Putin is worse than Erdogan and more corrupt the Poroshenko.

Posted by: Christian Chuba | May 23 2018 18:31 utc | 4

One obvious step to take to resolve this issue is full restoration of relations and commerce with Syria

How is this supposed to happen when Erdogan occupies Afrin and maybe soon more of kurdish areas?
Yes, Erdogan could do all this to prevent a kurdish state by attacking all their areas including US held ones. Later he could give back all these areas to Syria. So the SAA wouldn't clash with the US forces and be crushed, instead a US ally defeats them without bloodshed to preserve the unity of NATO.
However, this would take a very long time and while Erdogan is busy conquering syrian provinces, Assad can't be seen to be friendly in any way towards Turkey or the game would be up. That means the big juicy rebuilding contracts for Syria would come way too late to save the turkish economy from the impending crash. If there are any at all then, since Syria wants to probably rebuild as soon as an area is freed from islamists. So all the contracts are already handed out when the time to return cleaned kurdish areas to Syria.

Posted by: nervos belli | May 23 2018 18:44 utc | 5

When the Russians came to the defense of Syria, all the money siphoned from the ISIS oil trade was lost. I'm sure that there was a lot of 'middleman' profit from logistical supply of terrorists that has dried up for Turkey in the last 3 years.

Posted by: Enrico Malatesta | May 23 2018 18:53 utc | 6

FX is highly manipulated, some small fishes went to jail, while big fish doing it daily.
Lira collapse is a US political stunt to discourage Erdogan fliration wuth Putin.

As far as inflation 5-10% it is good inflation makes loans cheaper to pay off overtime , collateral like house, car more valuable and hence worth investing by people with no potential loss. Low interest rates are to benefit bankers alone killing savings, destroying values of investments make existing debt more expensive and more burdensome since prices are not growing and wages do not increase but they are cut instead to keep profits.

This is a lie that low interest is good, it is not but the Issue that Erdogan faces is that he stole those foreign investments reinvested in the western financial instruments as any dictator and has nothing to show for but debt and entire economy dependent on western investments and particularly German trade as a part of global neoliberal project and not local economy which he help to destroy.

Global economic dependence is a loaded gun that every country pledging globalization hands over to Wall Street to shoot them in the head anytime since US holds all the keys and pulls all the strings.

Posted by: Kalen | May 23 2018 18:56 utc | 7

nervos belli @5--

Clearly, restoration of relations includes withdrawing from Syria. Seriously doubt SAA would "be crushed" by Outlaw US Empire forces; the opposite would be more likely. As b implies, Turkey's economic problems have long festered while Erdogan's only applied bandages or various sorts, several illegal, and has wasted vast sums supporting Syria's invasion by terrorists. As the situation currently stands, Turkey won't gain any reconstruction contracts regardless; what's to be restored are longstanding traditional commercial interactions. Nothing constructive will happen soon, however, as Syrian Deputy Foreign Minister Faisal Miqdad explains.

Posted by: karlof1 | May 23 2018 19:03 utc | 8

"With interest rates lower than the inflation rate and a dropping currency new foreign investments in Turkey lack profitability." Money today is always worth less than tomorrow. When interest rates are higher than inflation rate, you would have the opposite which can't happen because otherwise everbody would put their money at the bank, even banks at other banks.

What also might have helped Turkey economically is the war in Syria where to my knowledge it didn't pay a big price for. Most weapons and terrorist funding came from NATO and Gulf states. Next to stolen oil from Daesh held territories Turkey also hoarded a lot of machinery, antiqities and other spoils of war from Idlib, Aleppo and other cities.

USA rating agencies are a scam. Only days before Lehman Brothers went bankrupt dragging many foreign banks and financial instituation in its fall, the 3 major USA rating agencies S&P, Moody's, and Fitch rated Lehman Brothers AA. Many countries and foreign financial institutions get B or less from these 3 and have been thriving for decenia. Presuming Chinese rating agency Dagong Global Credit Rating is more trustworthy, it rates Italty (BB+) slightly better than Turkey (BB-).

Posted by: xor | May 23 2018 19:13 utc | 9

"I believe that Bhadrakumar is wrong." I believe he is right. This is standard procedure in cases of misbehaving. Even if your economic criteria are quite sound and indeed there is a homegrown problem at the heart of the matter, the Lira falling that rapidly is the result of deliberate action to have it to. The so called markets are full of adjusting screws you can turn this or the other way. Private sector debts are no reason for a virtually free fall of a currency. I sure do not like Erdo, but he isn't that stupid. If necessary in the end he will allow higher interest rates and this will probably stabilize the Lira but at the same time bring about the feared hard landing. So it's a trip between Scylla and Charybdis. He is trying to introduce some sort of semi gold standard but was probably not able to acquire enough gold to make a difference.

Posted by: Pnyx | May 23 2018 19:19 utc | 10

I concur that USA aka Goldman Sachs is obviously screwing Erdogan to get him back in line.

Posted by: fastfreddy | May 23 2018 19:23 utc | 11

USA should change its name to the United States of Goldman Sachs.

Posted by: fastfreddy | May 23 2018 19:26 utc | 12

ff @12--

Nah, too complicated. Sach's States will suffice.

Southern offensive's initial phase displayed. As b predicted, clearing M-5 is main priority. But to be of any aid to Turkey, the Northern portion will need to be cleared, which could be used as a bargaining tool. As the link provided in my earlier comment shows, Syria is ready to begin negotiating with Turkey.

Posted by: karlof1 | May 23 2018 19:46 utc | 13

I don't know that things are going to change.

Erdogan is not most importantly an Islamist, but rather a megalomaniac. It's all the dominant personality, which leads him to outrageous actions, such as attacking the Kurds who threaten his control, and by logic, Afrin.

His voter base is the Turks of Anatolia, mainly peasants. I don't see, in Trumpian style, that his voter base is threatened. Their production is mainly agricultural, and that is not threatened by the decline of the lira, as prices will simply rise, but they will live without problem.

The people who will suffer are the city people in Istanbul, whose salaries will lose value, but they didn't vote for Erdogan anyway.

In any case, this is not the first lira crisis. There was the new lira, and then some years later, the second new lira, they've all been through it before.

The situation is not nice in Turkey. All the intellectuals in prison - one of my students lost her job. But I'm not sure that Erdogan is at the end.

Posted by: Laguerre | May 23 2018 19:47 utc | 14

Well, whether this is partly self-inflicted or not - and in many cases, responsibilities are shared -, thing is, foreign powers and global banking will take the opportunity to plunder what can be plundered. That's actually one of the main reasons why it's best not to screw up totally your economic policies - for a starter, it gives the usual scumbag suspects the occasion to attack you sneakily, make things worse, collapse your economy and loot your country, when it would've been far more difficult without such an economic crisis. That said, Turkey is bigger than Syria, more powerful, and possibly a bit more internally stable.

Posted by: Clueless Joe | May 23 2018 20:15 utc | 15

Seriously doubt SAA would "be crushed" by Outlaw US Empire forces; the opposite would be more likely

The syrian army would be crushed by the US forces if the syrian army attacks any US soldiers. To put the currently kurdish areas again under syrian jurisdiction, this is exactly what they'd have to do: remove those current US bases there. So if soldiers from these bases show up in the US media at home as dead, the US would have to punish and "crush" Syria since the US population and its jingoism would demand it. And the US can crush Syria like a bug if they want to. Syria is not Iran, not too many important mountains but desert, great for those Abrams, no international oil trade to disrupt like Iran, etc. Russia wouldn't really help Syria since the foremost thing of russian intervention is: no direct US-russian confrontation. That goes for both sides of course but the US could work around it if they want to. It's totally pointless of course, but at that point it's not about reason anymore but keeping face and stupid national pride.

Posted by: nervos belli | May 23 2018 20:28 utc | 16

re Karloff 13

As b predicted, clearing M-5 is main priority. But to be of any aid to Turkey, the Northern portion will need to be cleared, which could be used as a bargaining tool.
I wouldn't rely on the idea of a negotiation between Syria and Turkey. Turkey, having implanted observation posts in Idlib province, is committed to defending the Jihadis, though I'd doubt that they'd fight, if it comes to a Syrian offensive.

Posted by: Laguerre | May 23 2018 20:30 utc | 17

@7 Kalen

You are absolutely right about FX manipulation. In fact, most corners of modern finance are manipulated. The main source of manipulation is in the paper markets, through derivatives, forwards and futures. Banks, large hedge funds (Citidel), and *especially* Central Banks are the biggest manipulators. You can see Central Banks fingerprints all over FX and gold. For example, look at times when 1 to 6 BILLION USD of paper gold contracts are dumped into the market: price drops. And there are specific times when this is done. You can see patterns in the data.

Now, ask yourself. If you were a money manager at a bank or hedge fund, and dumped this (claiming an “investment strategy”), how would you explain this to your clients/management? You can’t. The only entities with that much weight to throw around are central banks.

From my view at a G-SIB bank, this is a result of manipulation, not of natural economic function.

@b - Any kind of significant equipment manufacturer would have FX hedges, to hedge specifically against FX fluctuations against the base currency. So, the idea that a manufacturer would face ruin due to currency fluctuations is not true.

Posted by: Variance Doc | May 23 2018 20:40 utc | 18

The syrian army would be crushed by the US forces if the syrian army attacks any US soldiers. To put the currently kurdish areas again under syrian jurisdiction, this is exactly what they'd have to do:
Total failure to understand the situation, re nervos belli. There will be no "juicy contracts" to rebuild Syria. They will do it themselves. The Kurds are ready to be rid of the Americans; everybody is just waiting till they withdraw.

Posted by: Laguerre | May 23 2018 20:46 utc | 19

"USA should change its name to the United States of Goldman Sachs."

Maybe countries shouldn't invite the Vampire (squid) in.

Goldman Sachs, like every other investment bank, the IMF, World Bank, etc. has to be asked for loans, willingly. They can't force loans on countries.

Argentina is about to double down on stupid again, seemingly didn't learn anything from past mistakes acquiring $ debt. I bet the current leaders walk away with a pile of cash.

Foreign debt puts any country in jeopardy of a hostile take-over.

Posted by: paulmeli | May 23 2018 20:50 utc | 20

@b - sorry, I miss-spoke. I meant any large consumer would have FX hedges placed. They face both interest rate and FX risk.

Posted by: Variance Doc | May 23 2018 20:54 utc | 21

- Turkey is in a "Catch 22" situation. No matter what it does, it will suffer. Higher interest rates will reduce consumption but a falling currency will achieve the same. And a reduced consumption is needed to reduce the Current Account Deficit.
- Perhaps Erdogan will cancel the snap election, and stage a coup himself to grab all the (political) powers he still doesn't have yet.

Posted by: Willy2 | May 23 2018 21:25 utc | 22

I agree with both B and the Indian diplomat on this situation.

First, B is correct, the Turkish economy has for a long time hummed along an unsustainable path. Housing and mega-projects do little to increase the productive stock of a country. And with RTE, matters have only been made worse.

On the topic of companies, I've heard from a contact there that many companies have already been zombified, the only reason you don't hear about lots of bankruptcies in Turkey now are due to the fact that the courts are rejecting such filings until a later time (post election).

As for the companies, many companies that borrow in Euros weren't born yesterday and many of their work contracts are denominated in Euros as well. They are smiling on the one hand since a majority of the staff of these companies have lira denominated salaries. They are cringing on the other, as the costs of doing business have increased due to regional/political risks, and the pool for new work is shrinking fast. The SMB sector is what is going to get particularly hammered in the next downturn.

As for tourists, Turkey is scaring those away and has made it increasingly difficult over the years to reside in Istanbul. Now there are effectively quotas for tourists wanting to stay for more than 90 days. The rental markets in some of the formerly hottest markets in the city have been creeping downwards, a bit more civil unrest and the attraction of a falling lira will be overwhelmed. Turks living abroad are no longer interested in buying property there, waiting instead for things to really hit the fan and a new government to take power.

As for the ratings agency downgrades, the timing of the release/non-release of information from western monitoring agencies (financial, humanitarian, election, etc) is always political. Why not get another kick in?

Things, however, may turn out much differently than many expect. Some of the sectors hit hardest by the current slow down in Turkey are construction and engineering. Perhaps if there were a country nearby that they could help rebuild...

Due to the risk of financial/economic collapse in the near term, we might actually see RTE adopt a position much more congenial towards the Syrian and Russian governments. Nothing like a bunch of new German-backed, Turkish subcontracted reconstruction efforts in Syria paid for with Syrian oil from recently liberated oil fields in the east. I've even heard there are thousands of recent German-speaking educated Syrians that might be enticed to go back, with euro denominated salaries to help cement commercial ties, as most of the "useless" stock of Syrians that Madam Merkel didn't want were successfully held behind in Turkish camps.

Posted by: Out of Istanbul | May 23 2018 21:26 utc | 23

OT for thread subject but on topic for region:

Khamenei lists 7 Conditions for EU for Iran to remain in JCPOA. The comments to the thread show how closely it's monitored by Iran's enemies. Unlike Zerohedge, I don't think the 7 conditions anywhere close to being as utterly wrong as Pompeo's 12. Merkel was just passed the ball. Doubt May will play as she's too busy scoring an own goal. Macron will probably follow Merkel.

Posted by: karlof1 | May 23 2018 21:35 utc | 24

Posted by: Out of Istanbul | May 23, 2018 5:26:40 PM | 23

There are no "juicy" contracts in Syria, because the oil-fields haven't yet been recovered. Syrians might go back, because they want to go home, and they're in penury in Turkey.

Posted by: Laguerre | May 23 2018 21:37 utc | 25

thanks b and laguerre for the addtional commentary..

it is interesting how the conversation is mostly about economics - money.... funny how this topic with talk on central banks and etc, keeps rearing it's ugly head..

to me it suggests the monetary system as it presently stands, isn't working.. it is becoming more and more apparent too..

@20 paulmeli... as i recall it was the world bank and imf telling argentina and any other country they could influence - how they had to borrow this money to stay afloat... i would imagine they are doing this in any number of places too with their central bank planning...

bottom line - borrowing from some big investment bank, defaulting and then getting bailed out - is the number 1 game in town..this was the game in 2008, and it is still the game... imf, world bank and etc are all supportive of this, which ultimately is supportive of goldman sachs and etc and the game just continues on, until something changes in it all.. at present the world is one big ponzi scheme on a financial level anyway.. inflate, inflate, bust and bail out - etc. etc. very predictable...

@23 out of istanbul.. thanks for your comments..

Posted by: james | May 23 2018 21:46 utc | 26

ot - interesting picture selection...
some yahoo with a starbucks cup that says just how much they are into turkish culture...

Posted by: james | May 23 2018 21:51 utc | 27

We should assume that Erdogan's anti-Central Bank rhetoric was mere lip service. Likewise, his pro-Palestinian rhetoric.

His focus is dictatorial POWER.

He will win the June 24th election. Once the new Sultan is fully in control, we will see what he's really all about.

Posted by: Jackrabbit | May 23 2018 22:08 utc | 28


You are correct, those fields haven't been recovered -- yet. Such a recovery could only take place if not only the Russians were behind the Turkish initial movement into them, but also the Germans (due to French/American opposition). Unless RTE has a new pot of honey to stick his paws in, the armed Turkish factions in Syria will just stay put.

Doesn't one wonder what all the German/Turkish/Syrian diplomatic traffic to/between Russia has been about recently? They are certainly working out a compromise that secures all of their economic interests, sidestepping the haphazard/myopic American strategists of the Donald who have proven themselves to be unreliable to say the least.

And as for the benefit to Germany, they would get a hefty cut as has always been the case, doing 20% of the work and collecting 80% of the payments, the remainder going to Turkish engineering firms. Its a win-win for them, the only losers are the SDF, USA and France (and Israel). And that is only considering the upfront benefits. Once Syrians migrate back, commercial ties between the two countries will be very strong. This is one of the reasons why the Germans never launched attacks on Syria... they have always been able to play a much longer reasoning-game compared to their European partners. (excluding Russians)

Posted by: Out of Istanbul | May 23 2018 22:10 utc | 29

Posted by: paulmeli | May 23, 2018 4:50:47 PM | 20 with:
"Goldman Sachs, like every other investment bank, the IMF, World Bank, etc. has to be asked for loans, willingly. They can't force loans on countries.
What absolute tosh! The opinion makers of nations such as politicians, bureaucrats and media bosses are regularly bribed, blackmailed and extorted into accepting loans from amerikan entities. The instances where a nation's leadership stand up to these crimes inevitably end in the destruction of the leader and his/her nation. This means that such instances are kept to a minimum, but Ceacescu in Romania and Mugabe in Zimbabwe spring to mind but I'm sure other readers can supply alternative examples. A nation doesn't even have to quit the system even doing something to inconvenience the bullies on Wall St is sufficient.
For example with Iran amerika sorta hung back after the people took their nation back in 1978-9, it wasn't until the new leadership announced their intention to shift all assets from Chase Manhattan who were heavily implicated in SAVAK's bloody butchery to another amerikan bank that Carter the creep froze all Iranian assets and triggered the storming of amerika's CIA and torture training station aka the amerikan embassy in Tehran. The Rockefeller family would have been screwed without Iran's funds propping up their facade so dem Carter bailed out rethug Rocky's bank.
Iran never saw that dough again until the JCPOA forced amerikan prez oblamblam to do an extra print run on top of the 'quantitive easing' bailout of banks and drop some pallets of cash into Iran. That doesn't begin to cover the cost of what amerika stole, yet now they are trying to steal it back with all this fake news about Iran being bribed at the signing in an attempt to make return of the cash amerika stole an issue for the derps in amerika that cannot think for themselves. If the money did get returned it wouldn't make it back to the Fed or the government. Like the Iraq cash it would all end up in elite hip pockets as a bit of walkaround dosh.

So don't be repeating blatant lies and propaganda about nations queuing up to get into amerikan debt slavery, these loans happen because nations are extorted into them and there will be a 'settling of accounts'. Those who did it will walk away whistling while the mugs who lapped up the sort of rubbish you wrote will be flayed alive by the mobs of extremely angry humans who have suffered under the debt shackles.

Posted by: Debsisdead | May 23 2018 22:11 utc | 30

james @27--

When we visited Turkey in 1998, we tried not to keep too many lira on hand at any one time because of its radical fluctuations downwards. Greece still had drachma then, which was in a similar state. Greece got into EU and has greatly suffered, whereas Turkey was repulsed and won't likely suffer as much.

As Keynes admitted after Bretton Woods, the entire international financial structure was made for the sole benefit of the United States. 74 years later, that edifice is every so slowly crumbling under siege while a new system's being constructed. But what philosophy will guide the new system: The newly articulated Win-Win or the same old Zero-sum?

Posted by: karlof1 | May 23 2018 22:13 utc | 31

Turkey will recede from the North. Russian positive pressure on Turkey's economy, coupled with Erdogan's need for Intel protection from CIA and Mossad machinations (SVR and GRU working with Turkey's Intel and Mil) will be decisive. He will get to keep a small piece he has always desired (where Turkmen are dominant). And he will then get help against Kurds.

The US will be the target for IEDs. No need for SAA to directly confront the US bases. 4000 sets of legs to blow off at the 20 bases and along the roads in North and Northeast. It will be an insurgency of Arab tribals, Kurds, Syrians and other proxies who will work IEDs for pay. It happened in Iraq and Afghanistan and it is is already under way in Syria. You don't fight the US. You blow their legs off, blow up their vehicles, and use those UAVs with small bombs. China is mass producing them now. It will be raining bomblets on the al Tanaf and Hassake bases.

Posted by: Red Ryder | May 23 2018 22:14 utc | 32

DebsisDDead @ 30

"The opinion makers of nations such as politicians, bureaucrats and media bosses are regularly bribed, blackmailed and extorted into accepting loans from amerikan entities. "

So, they're hypnotized? Did you miss the "willing" part? It's choice.

Posted by: paulmeli | May 23 2018 22:20 utc | 33

I have to say that Out Of Istanbul's comment @ 23 makes the most sense at this time. Turkey may have erred in the past by following policies and starting up major infrastructure projects that among other things benefited President Erdogan's cronies and family members, in particular his son-in-law Berat Albayrak who used to be CEO of Çalık Holding and is now a Cabinet Minister. Albayrak has been involved in a scheme to set up offshore accounts in Malta to avoid paying millions in company tax.

Also past Turkish actions - such as shooting down Russian fighter jets flying close to the Syrian border - resulted in Russia imposing sanctions on the country that wrecked its economy. The tourism industry in Turkey suffered especially, Russia being one of Turkey's prime tourist markets.

At the same time actions such as those described by M Bhadrakumar, occurring almost all at once, could very well be punitive actions on the part of the US against Turkey for persecuting Gulenist supporters and pushing for Fethullah Gulen's extradition, and for not giving the US full support in its de facto invasion and partitioning of Syria. These could be leading up to economic and financial sanctioning. The timing of the announcements by credit agencies concerning Turkey's credit rating and by the IMF regarding Turkish debt might be no coincidence and could be intended to create uncertainty and panic among foreign investors, and encourage them to dump Turkish lira.

Timing and context are key.

Posted by: Jen | May 23 2018 22:20 utc | 34

Posted by: Out of Istanbul | May 23, 2018 6:10:29 PM | 29

You haven't got it right. The Syrian oil-fields on the Khabur are weakly held by Arab tribal elements of the SDF, supported by the US. If the US withdraws, they will immediately change sides, and join Asad. But they daren't, as long as the US is there.

In any case, Syrian oil was never much exported, nearly all was/is consumed within the country.

Posted by: Laguerre | May 23 2018 22:23 utc | 35

@31 karlof1.. we visited in 2012 and the currency was fairly stable.. here is the 10 year chart euro to lira..

obviously turkish people would have been better putting their money in the euro, but not everyone thinks or lives this way - fortunately too..

i am conflicted on turkey.. on the one hand they have a crazy person in power - a megalomaniac essentially and i agree with @28 jackrabbit - he will get in power again here so folks can see what they really have.. it seems the turkish people are easily duped by this guy.. i guess it is no different in any other country... some would say the same about being duped into voting for trump, trudeau and etc. etc...

what i don't like is erdogans support for headchoppers in syria from at least 2011 forward.. nothing much has changed.. the only way it all makes sense to me is via the concept erdogan has completely shut down the media - no opposition voice - and is hailed as some kind of crazed saviour for the turkish people... he is the consummate politician/liar as i see it..

i think keynes was right about the end result of the bretton woods agreement.. all financial roads start out of the us$.. i have no idea what hilosophy will guide a new system... we can't live by bread alone... as psychohistorian says - serving the god of mammon - is not the way to go... everyone seems to be forced into living just this way too..

Posted by: james | May 23 2018 22:28 utc | 36

Posted by: paulmeli | May 23, 2018 6:20:18 PM | 33

Sorry none of us have time for stupidly facile semantics round here holding a gun to someone's head is duress and isn't 'willingness'. Lift yer game or fuck off Paul Melli.

Posted by: Debsisdead | May 23 2018 22:28 utc | 37

Turkey has quite large economy and foreign trade, so pure manipulation is not possible. In my country we have a saying "goat climbs a leaning tree", speculators exploit existing weakness that can be amplified.

I would also remark that the importance of Syrian market is marginal, Iranian market is presumably more important, sanctions on Iran may ricochet into Turkey. Actually, Trump seems doing great job as a global economic wrecking ball. I just stumbled upon this tidbit: Rusal, the dominant aluminum maker in Russia recently was sanctioned by USA, while a while ago it gained control of a large portion of alumina production -- aluminum ore, bauxite, has to be processed into more pure feedstock for smelting factories, called alumina. Now aluminum producers in many areas, notably, Europe, have a shortage of alumina that may lead to mothballing of some smelters; the largest alumina facility in Europe is in Ireland and it is owned by Rusal. Perhaps great for American smelter owners, but there has to be some teeth gnashing in Europe.

Back to Turkey. The largest net backstabbing of Turkish economy could be the slowdown of investments from the Gulf, where Erdogan bravely sided with Qatar. Erdogan engineered de facto confiscation of media assets owned by tycoons sympathetic to the opposition, to be purchased by Qataris, now Qatar is to Turkey what Adelson is to Israel. Siding with Qatar would eliminate investments from KSA and UAE, and draconian treatment of Saudi princes and other tycoons probably led to their assets being under the control of the Crown Prince. This is not particularly recent, but financial markets tend to have delayed fuse. Add the effect of Iran sanctions -- it increased prices of oil and gas, but no associated increase the demand from the Gulf, on the northern shore there is a prospect of tightened belts, on the southern shore anti-Turkish policies, and Qatar alone is too small. Plus Erdogan himself promised to "pay more attention to Turkish central bank", and justifiedly or not, that is a very strong sell signal for the currency.

Posted by: Piotr Berman | May 23 2018 22:31 utc | 38

One other point. Sorry b but predicting a bust for any economy currently enjoying a boom as you did a few years ago with Turkey isn't prescient it is just 1+1=2. Capitalist economies are driven by boom bust cycles, they are the flywheel that keeps momentum in the cycle of rich getting richer.

Turkey's economy is being manipulated, and much as I loath the neoSultan, I'm certain he will come thru unscathed as the movers and shakers in Turkey's economy know that nowadays the sort of ructions Erdogan plans are priced in to the market long before the incident occurs.
That means there may be a big fall on announcement for a few days when short sellers collect, but the lira will go back to the point it was at pre-announcement.

Erdie's cobbers will be shorting everything to the fuck right now and will make big when he does take over the central bank, then things will stabilise and the arseholes on both sides will collect, then drink champagne and laugh. HaHa HehHa.

Posted by: Debsisdead | May 23 2018 22:31 utc | 39

I see another son-in-law of Erdogan, Selçuk Bayraktar, is technical director of a family-run company that sells UAVs to the Turkish military:

"... Bilal Erdoğan [the President's son] is a former bank intern and part-owner of Turkish shipping group BMZ. Most famously, Bilal allegedly featured in a recording of a phone conversation with his father, purporting to show him seeking advice on how to hide money as Turkish police officers swooped on suspects’ homes during a corruption probe in December 2013. Erdoğan swiftly quashed the investigation, arresting police, judges and prosecutors, saying it was based on false allegations. Police work from the probe was also used in a New York courtroom to sentence a Turkish banker for illegally bypassing sanctions on Iran, a verdict blasted by Erdoğan ..."

Can that be the same Bilal whose companies were selling and transporting Iraqi oil stolen by ISIS to European countries to Japan?

Posted by: Jen | May 23 2018 22:36 utc | 40


I don't disagree with you, the aim of the Turkish incursion would be to collapse the SDF and to essentially push the US out by removing the SDFs support/existence as a justification for them staying. As for oil consumption, production will increase much faster than domestic demand, which will take at least a decade to return to former levels. And output increases will proceed even faster if one considers that some of that equipment would be new capital stock built/provided by Russian and (possibly Chinese) oil majors not simply refurbishing war-weathered equipment.

Posted by: Out of Istanbul | May 23 2018 22:45 utc | 41

But the other way (rising interest rates) will lead to his ruin too, because it would mean austerity for the working classes of Turkey. Just see Brazil and Argentina since the 1990s.

The long term solution for Turkey would be socialism, because, as Mao Zedong has already stated and demonstrated, only socialism can take up the basic development (i.e. national industrialization) tasks of capitalism in the Third World (i.e. periphery of the capitalist world). The First World didn't need socialism to industrize because in them the historical development of capitalism was organic, i.e. imperialism did the task of industrialization.

Note: industrialization is the only way to grow without inflation because it is the only way to amplify the productive base. There are, essentially, two ways of curbing inflation in the capitalist system: 1) making money (fiat money) more expensive, i.e. rising interests (the neoliberal/austerity option) and/or lowering wages (i.e. rising poverty, which lowers consumption) and 2) rising productivity (industrialization), thus making more goods with less money (the so-called progressive/center-left/keynesian option).

Posted by: vk | May 23 2018 22:46 utc | 42

PaulMeli @ 20: Argentina under Nestor Kirchner and his successor Christina Fernandez Kirchner followed a protectionist Peronist-style economic program discouraging imports that competed with local Argentine manufacturing and neoliberal economic policies.

See the link below for a review of the Kirchners' legacy over 12 years of leadership:

The current Argentine government under Mauricio Macri follows neoliberal economic policy characterised by austerity programs imposed on the general public, cuts in public spending and tax cuts.

Posted by: Jen | May 23 2018 22:57 utc | 43

Erdo surely could cash out and exile easily enough. With all his faults - murderous megalomania, he has proven himself to be a countryman - a Turk. He apparently wants to stay and MTGA.

Posted by: fast freddy | May 23 2018 23:00 utc | 44

Jen @40--

Your post reminded me of the description of Turkey's "family traditions" given in the Bond film From Russia With Love by the character Ali Kerim Bey, all of which was a perfect example of Orientalism in action.

james @36--

I found it rather odd that a Muslim nation would produce an excellent beer--Efes Pilsen. But then beer's been made there for millennia prior to the advent of Islam. If Churchill found Russia to be an enigma, what must he have thought about the Turks?

Posted by: karlof1 | May 23 2018 23:00 utc | 45


What did Churchill think about Turks?

Posted by: Jackrabbit | May 23 2018 23:56 utc | 46

I don't understand this article. From it, I gather that the IMF is a great and trustworthy institution, that our present mainstream worldwide economical theory and practice is very sound and healthy and that interest, which is basically usury and looked upon very negatively in any culture that has some respect for ethics, is a good thing.
I can see that there is a lot wrong with Erdogan, but contrary to what I have read from b so far, this article sounds like MSM. I am confused about what I am supposed to understand here.

Posted by: Levcek | May 24 2018 0:48 utc | 47

And the references to an independent central bank?? What on earth is that? Is Turkey's central bank not linked to the other central banks and IMF? Since when is it a bad thing if a president - no matter how bad or stupid or evil - tries to get the central bank under national control?

Posted by: Levcek | May 24 2018 0:56 utc | 48

@45 karlof1 / @46 jr... i am not a ''learned' person.. i have never been impressed with churchill.. he must demonstrate some british mindset that as person with highland scottish ancestry- i have always resisted.. i honestly think there is something fucked up in the british temperament, and the skripal affair, along with so much out of britian lately just reinforces me view on it.. they have been responsible for some great popular music the past 50 years - i will give them credit for that! they really ought to stick to music and skip with the politics and all else..

@47/48 levcek.. i relate to what you are saying to a degree.. i think what you are supposed to understand is that aside from whatever erdogan does, the financial powers that be will put the screws to turkey regardless, if it doesn't tow the nato western agenda.. well - that is what i think.. i think most outsiders view of erdogan is he is a megalomaniac that has shut down freedom of the press and alternative views on how turkey can move forward.. he has polarized the nation and is hoping that a good chunk of it will remain silent, unless they want to be silenced directly with loss of jobs, or worse - prison - on accusations of gulen ties and etc. etc... frankly i think erdogan is a very shady character.. so he has qatar money, but for how long and at what price? i think he is pushing turkey back into some kind of dark age with his headscarf, silence of opposition and etc. etc... something wrong about the dude..

Posted by: james | May 24 2018 1:35 utc | 49

Levcek @ 48: In a democratic nation, the central bank would be under the control of the government on behalf of the citizenry. The ultimate owners of the bank are the nation's citizens and the government oversees the bank's operations on behalf of the public.

The danger with President Erdogan bringing the Central Bank of the Republic of Turkey under government control is that he is becoming or has become the government and is ruling by decree. Given that his son and at least one of his sons-in-law seem to be up to their necks in tax evasion schemes, the danger is that Erdogan, his family and their cronies could pressure the central bank to pursue policies that favour them and their own bank accounts inside Turkey and outside.

From the rest of the article and the comments below about Turkey's economic policies, you can take whatever you believe resembles the truth or actuality.

Posted by: Jen | May 24 2018 1:47 utc | 50

Thanks Rowan @1. Considering all the digital ink spilt at MoA over the Skirpal Affair, I expected this news to be highlighted.

This Yulia quote struck me:

“I don't want to describe the details, but the clinical treatment was invasive, painful and depressing... Our recovery has been slow and extremely painful."

Goodness! Considering the US Senate just confirmed a known torturer to run CIA, I must ask what kind of “treatment” Yulia received. I presume the neck scar is the result of endotracheal intubation?

And since visual imprints are so important in perception management, I found it interesting that this young woman, who was last reported in good health sitting on a park bench, is filmed in her “coming out” video sitting on a bench in a park-like setting. And she’s writing what we must assume is the handwritten note released to the media - on a pad of paper sitting on the bench next to her! That’s a very awkward way to write, especially since that note is is such legible, neat script.

The BBC article goes on to state:

“Meanwhile, work to decontaminate the Wiltshire city is still under way with the highest concentration of the Novichok found at the Skripals' front door.”

Still decontaminating the town all this time later?

Posted by: Daniel | May 24 2018 2:15 utc | 51

Completely OT, but when I awoke a few hours ago luxuriating from sleeping in me own pit for the first time in a while, I thought I would flick on BBC news delivered via my android box as I felt optimistic enough to watch englander perfidy without it casting a pall on my day.

It was really weird. The segment I watched was about the havoc that saudi arabia had wreaked upon a clan of Yemenis in the south far from 'Houthi' hangouts.
The clan had the unmitigated gall to celebrate a wedding. Everyone was there having a fine old time as we saw thanks to the ubiquity of mobile phones plus contemporary humanity's propensity for recording such events.
We saw much dancing and joyous celebration being had by all. In the center of a circle of happy people a local drummer who was keeping the joint rocking danced and sent out the rhythm for all. Standing next to him was his apprentice, a 5 year old son who was also catching the groove. Suddenly outta nowhere a loud series of explosions, every thing gone black until we see the 5 year old desperately trying to wake up his now dead Dad. Yemen's nicest neighbours had dropped by with tonnes of bombers, to just say "hi y'all". I detest war porn in any form but there is a vid of the child who according to captions in the beeb copy the child is saying "Wake up Dad, wake up". Not much gets the old tear ducts gushing in my jaundiced old head any more, but I found myself crying this morning.
The kid was shown a few weeks later in the beeb story, his once sunny gregarious persona replaced by a quiet hollowed out damaged shell.
Here is an RT package about the raid.

On the BBC? Of course the talking head tried to play the story down with talk of Houthi rockets and Iran magically getting a kazillion tonnes of munitions and weaponry thru the tighter than a snapper's arsehole cordon which ksa, uae, and FukUS have around Yemen.

The standard 'newsreader' interviews journo stunt was set up and although the englander or welsher anchor did his damndest to discredit the victims with special emphasis on absolving england from any responsibility, the once house trained "BBC Arabic News Service" journo couldn't keep on script.

e.g. after the englander/welsher tried to claim this war crime was totally down to those saudi Arabs, she interjected with details of the englander domination of Air Force command and control back in Riyadh.
Then she dropped statistics into discussion that yes over the last 5 years the Yemeni troops had fired less than 150 rockets (most of which were garden shed jobs plus a few ballistic missiles left over from the previous regime's brown nosing of england); but in the same period ksa had launched more than 16,000 bombing sorties upon the citizens of Yemen.

The Arab journo back-pedalled just enough to keep her job, but given she was so well prepared one is left wondering if this bulletin really was a one-off by a renegade or if something larger is afoot. That the famed 'average Arab in the street' has completely had enough of the senseless slaughter to the point where even western propagandists - aka quislings are now en masse refusing to wear this shite any longer.

Posted by: Debsisdead | May 24 2018 2:29 utc | 52

Rowan @ 1, Daniel @ 51: Julia Skripal appeared to be reading or following a prepared script. For someone who's been in a coma for 20 days, she looked very well indeed and does not appear to be suffering PTSD.

How would a person in a coma know if the treatment she was receiving was invasive, painful and depressing?

Novichok is supposed to be an unstable substance that degrades quickly in humid climatic conditions or in conditions where it comes into contact with water. Is Salisbury being decontaminated one brick tile, one shrub, one pigeon at a time?

Hmm .. this is what endotracheal intubation looks like but I can't see that a shunt has been made beneath the throat and between the collar bones. I too was curious about that neck wound.

Posted by: Jen | May 24 2018 2:38 utc | 53

This is not a foreign induced crisis but has been coming for a long time. Already in 2013 I wrote:

Throughout the last years Turkey's economic boom depended on foreign investment -hot money that can leave overnight

That doesn't make sense. The hot money leaves suddenly, and it's not a foreign-induced crisis? Of course it is. The US is trying to discipline Turkey for it's friendship with Russia by causing a currency crisis.
By keeping interest rates low, Erdogan is laying the country open to this happening, but the foreign investors are doing it.

Posted by: Palloy | May 24 2018 3:51 utc | 54

Jen, I searched up the wrong term. Should have asked my wife (longtime critical care nurse). It would be a tracheotomy. This has a photo:

Yeah, I've had doubt that the event even happened. I was sort of playing on how the AZ Empire convinced Yulia to play her role now that we have a video of a living person.

Posted by: Daniel | May 24 2018 4:02 utc | 55

Nominal growth is still high at about 7.5%...Youth unemployment is about 20%

hmmm, I smell a rat.

Posted by: john | May 24 2018 7:56 utc | 56


Here's a tracheostomy scar before and after sprucing up by plastic surgery :

Posted by: Marko | May 24 2018 8:34 utc | 57

The Skripal daughter has better handwriting and writes better than most native English speakers. All the more impressive after coming out of a coma mere weeks ago after exposure to a deadly nerve agent.

Posted by: Qualtrough | May 24 2018 8:48 utc | 58

Julia Skripal's bizarre photo-up, theater props and all, stinks. The neck scar is prominently displayed as a sympathy/empathy device instead of being covered up by a high collar (see Marko@65. The texts she signs are not shown to us and seem to be written in block letters perhaps meant to suggest that her ordeal has left her somewhat impaired (see Qualtrough@58). What a curiously supercilious way to treat what we are supposed to believe is a serious matter. Really, get up and walk around for the camera as in movie/fashion show/whatever. I for one found the performance disturbing, deceptive, contrived.

Posted by: Quentin | May 24 2018 9:10 utc | 59

I agree with b's assessment that most of Turkish regime financial issues are domestic decisions and beliefs. The only possible effect of foreign "pressure" is the natural capital inflow and outflow, this time the capital outflow is leaving Turkey on the double and no one could blame an investor on that decision, sometimes of course there is little hand from main Banks/investors following country A or country B recommendation to cool down their positions in country C, but certainly this is not the route cause of the problem.
The next chapters of this turkish regime drama is well known thru examples around the world, Argentina, Brazil, Mexico, Venezuela, Greece, Zimbabwe, South Africa and the list goes on, with rare exceptions, the sequence will lead to default, high unemployment and social unrest, then Erdogan will ave his dictatorship he badly wanted, a de facto sultan.
The consequence for Turkey's neighbours is a huge unknown variable, with blind dictatorship comes military adventures to boost popularity, no need to debate the country that is champion to start a war to boost domestic popularity....yep US, nbr 2 Israel.

Posted by: Canthama | May 24 2018 11:56 utc | 60

@ DebsisDead @ 37

Someone forgot to take his meds

Posted by: paulmeli | May 24 2018 13:10 utc | 61

given rating agency and IMF have come out in tandem peddling essentially the same line this is classical financial warfare by Washington
Both institutions are puppets of Washington.
Simply a response to Erdogan not doing as told.

Posted by: Nick | May 24 2018 13:24 utc | 62

What we are seeing in Turkey is a sideshow of the Israeli-US-NATO plans for the Greater Middle East. These plans have been shaped by current geopolitics (resurgence of Russia, increasing influence of Iran in the region, and real or imagined, present and possible future threats to Israeli security). Added to the mix are some crucial economic interests, namely the control of vital energy resources and their supply routes, and the objective of disrupting Chinese and Russian economic initiatives in the region. These plans have been formulated and will be put into effect despite some disagreements with the (European) partners. Their implementation will inevitably entail changing alliances, and even changing existing borders. We have witnessed much of the former lately, the latter is yet to come. They foresee the creation of a Sunni republic comprising parts of Iraq and Syria, to act as a bulwark to the Shiite crescent, and an autonomous Kurdish region comprising areas of Syria, Turkey, Iraq, and maybe Iran, if the regime change operations fare well. Turkey will pay the price for it's strenuous opposition to these plans, and for diverging from the script in it's attempt to safeguard what it sees as vital interests. These are it's territorial integrity, and plans for economic and political expansion. We can expect the pressure on the Turkish economy to intensify, even sanctions to be imposed, before the Turkish elections. These are Turkey's last chance to re-align with the west, and comply with the PLAN. If Erdogan, who has too much to lose now, is re-elected, I have no doubt that another coup or assassination attempt will occur, the economy will be in shambles, the Kurds and a myriad of other opposition groups will revolt, and the civil strife which is already in progress shall rage hot. If he is not re-elected (the preferred US scenario), a more compliant government shall ensue, but the script shall be followed, without deviation.

Posted by: SPYRIDON POLITIS | May 24 2018 14:06 utc | 63

SHARE THIS. Zerohedge is censoring it.

Worse than the bankers rigging gold and silver prices and not having the gold that they sold you (or selling gold that they don't have via fraudulent LME unallocated paper spot contracts or COMEX Futures contracts) is the fact that we don't even have MONEY today.  Therefore all financial transactions and economic numbers predicated on the existence of money are FRAUD and FORGERIES presently.

Electronic digits and paper fiat currencies in use today are NOT money, according to the law of the country that issues the reserve currency of the world, the US Dollar (Article 1, Section 10 of the US Constitution); or by the tenets of the science of Economics (i.e., fiat currencies are not money because they are not a store of value nor a unit of account due to the fact that NOT ONE fiat currency's value is actually determined or stipulated in concrete legal terms).  Dollars and Euros and Yens are not even lawfully DEFINED as to what they all are exactly; what their economic worth and transactional value is.  Hence, fiat currencies simply cannot constitute the legal foundation of any lawful contract!

 (Also, there cannot be either inflation nor deflation in the ABSENCE of money.  Both inflation and deflation are monetary events which cannot take place where there literally is no money.)

What we have today is massive GLOBAL FRAUD mascarading as a monetary system based on the (fraudulent) US dollar because all fiat currencies are basically only a derivative of the US dollar, including the Euro, the Yen, the Yuan, the Rouble, the Shekel and the Riyal.  Furthermore, why do a few people get the right to print fake fiat money out of nothing and buy your goods and services with it whereas you have to WORK to obtain the same worthless money created out of nothing?  THAT is the question at the heart of the matter.

That the bankers manipulate interest rates or the price of gold via fraudulent Futures trading (by selling gold that they don't have) with fiat money is a moot point.  To put it differently: why do the bankers get to have anything that they want without working for it and you, you don't?  All this talk about market rigging, monetary theory and fraudulent (paper) gold trading is a cover-up for INJUSTICE.  The US Constitution FORBIDS the use of debt as money; the US Constitution proscribes (debt) notes which is what the US dollar is presently.  

Think, all other currencies are just another name for the US Dollar.  What passes for money today is a CRIME, no more no less.  

People, you are all aiding and abetting this crime every time you buy, sell, pay or get paid.  And then you ask, Why our leaders, the politicians, the bankers, and our military men and women are EVIL?  The answer is, because they are just like YOU.  They are your sons and daughters.

Posted by: Art | May 24 2018 14:46 utc | 64

I agree with Out of Istanbul - "both b and the Indian diplmat" are right.

Wannabe dictators ("populists"?) like Erdogan (and Trump) overheat national economies to make things look better in the short run; the blowback shows up as inflation. OTOH, the IMF/USA/etc often use currency manipulation as a tool of diplomacy/war.

In related news, the population of Turkey has doubled since 1977. Turkey was a net exporter of people (mostly gastarbeiters?) until Syrian civil war; since then, they've seen about 300K immigrants per year. That probably exacerbated the unemployment problem. Turkey is big on ethnic identity; they're likely to have a big problem with all those Arabs, no?

Posted by: elkern | May 24 2018 15:51 utc | 65

Many have thrown cold water on my suggestion that Syria will soon enter into reconciliation discussions with Turkey. Here's some more info to bolster what I provided yesterday. Adam Garrie puts his oar in regarding this issue in which he says this along with other observations:

"The fact of the matter is that the low Lira is only a problem for currency speculators and for Turkish international purchasing power. For every other economic indicator from exports to job creation and economy growth the low Lira is actually a good thing so long as inflation is brought mildly under control over the next several months."

Posted by: karlof1 | May 24 2018 16:38 utc | 66

Good article which may come true. Only thing I would disagree about is the coup. That was not real it was staged to give him the legitimacy to take the actions he has without the rest of the world condemning him.

Posted by: Mark | May 24 2018 16:46 utc | 67

Debs, @ 30: Absolutely a descriptive and truthful post Debs.

Comply, or we'll destroy your country, isn't much wiggle room for some leaders..

Posted by: ben | May 24 2018 17:22 utc | 68

it was extremely unlikely for Erdogan to win fair and square, and knowing this he made changes to the electoral and voting procedures before the election decision to make ballot stuffing easier.

Now the wind is blowing against him even more strongly and his people would start to think stuffing ballot boxes might not be a good idea for their own interests as the very possibility of losing vote and failing that a real popular uprising against election fraud would put all of them in jail for a long time along with their dear leader.

Posted by: kemerd | May 24 2018 20:31 utc | 69

Prior to the recent currency speculation there was some social media manipulation targetting Mr. Erdogan. Now that's a bit too much. Unless some guys want more votes for Erdogan, it's the wrong strategy.

Posted by: ConfusedPundit | May 25 2018 21:17 utc | 70

I can't imagine Erdogan would allow himself to lose the vote. If by some chance he does lose the "errors" will be corrected.

Posted by: Fidelios Automata | May 29 2018 0:13 utc | 71

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