TURKEY’S LIRA PLUNGE LEADS TO RARE ANTI-GOVERNMENT PROTESTS

…from SouthFront

[ Editor’s Note: Erdogan’s high wire act of spending like a drunken sailor during a bad economy is bringing on the inevitable, a crash in the lira, 20% over the last week, 15% of that just on last Tuesday. At times like this, the coup plotters make extra coffee to stay up late preparing for what the dawn might bring.

Those on the sidelines have to gamble on picking a side or just keeping their heads down to save them. Overseas trips are also fashionable during these times. The last failed coup, an American one according to some sources, brought on thousands of arrests and serious jail terms for both plotters and those caught following orders from above.

As panic sets in, Erdogan has pushed the banks to cut interest rates despite inflation at 20% and on the way to 30%, and possibly 50% if the lira slide continues.

Currency reserves have gone from $30 billion positive to $30 billion negative, kind of a hint that some serious looting has been going on so someone can live happily ever after if Turkey implodes. Azerbaijan might inherit Mr. Erdogan.

The credit rating agency, S&P Global, is estimating that over the next 12 months close to $170 billion of mainly dollar-denominated foreign currency debt needs to be refinanced.

That is almost 23% of GDP and far more than reserves could cover. In the face of this gloomy situation, Erdogan puts on the good face, “We know very well what we are doing with this policy, why we are doing it, which risks we face and what we will obtain at the end”.

He of course is bluffing. The big players who like to put countries down the toilet and then buy them at rock bottom prices wait patiently for these opportunities every five years or so. They are Super-Santa Claus events for those with big stockings… Jim W. Dean ]

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Erdogan does so love to play Sultan

First published … November 25, 2021

Turkey is evidently slipping into a crisis, as the lira hit record lows on November 24th. The currency dawned on exactly 13 lira against the US dollar, after President Recep Tayyip Erdogan defended recent sharp rate cuts. Turkish currency crashed by eight percent on November 23rd alone.

Lower rates will help spur economic growth and create jobs, Erdogan said, as people took to the streets to protest the dire situation. Hundreds of people took to the streets in Turkey, calling on Erdogan’s government to resign.

Videos on social media showed police forces intervening and blocking the path of protesters gathered in Istanbul and the capital Ankara.

Erdogan has applied pressure on the central bank to pivot to an aggressive easing cycle that aims, he says, to boost exports, investment and jobs.

This happens against a backdrop of inflation soaring to near 20% and the currency depreciation accelerating, eating deeply into Turks’ earnings. Many economists called the rate cuts reckless while opposition politicians appealed for immediate elections.

After a meeting between Erdogan and central bank Governor Şahap Kavcıoğlu, the bank issued a statement saying the selloff was “unrealistic and completely detached” from economic fundamentals.

It doesn’t help the situation that Erdogan has replaced three central bank governors in the past two years, undermining investor confidence.

The current protests and calls for resignation could have potentially been avoided if Ankara hadn’t missed its window to focus people’s attention on a military operation in northeastern Syria.

Forces were deployed, positions were reinforced, attempts to escalate the situation were carried out. It all led to nothing, as both the Syrian Arab Army (SAA) and its allies, and primarily Russia carried out the necessary steps to largely deter any large-scale hostilities.

As a result, Turkey’s population is now focused on what is happening internally, and it is expected to blindly follow Erdogan’s plans that seem to make no sense, as a massive share of people’s savings are being eaten through.

It is expected that protests will continue in the following days, and it is likely that clashes with police will increase in severity as well as in frequency. Few were detained in the first two days, but protests were quite small-scale.

The lira continues to plunge, and promises to lead to an even the harsher crisis. The signals for the catastrophe were detectable for months, but little was done to avoid the crash.

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6 COMMENTS

  1. More recently, a map of the future Turkish empire was shown in Turkey. On that stupid map, part of the territory of the Russian Federation up to the Urals was painted green (pan-Turkic). Erdogan is walking on thin ice. I think Erdogan has played too much in a lot of directions. Several countries can knock the ground out from under his feet. If desired. I have often been to Turkey, a beautiful country in a tourist area. But if the Ottoman ambitions go too far, sooner or later Turkey will face difficulties. They were spared by the Russian tsars several centuries ago. They were spared by Stalin after the WWII for their alliance with the fascists. No one will flirt with them this time. For my country, this region (the Black Sea and the Mediterranean) is very sensitive.

    • Personally, I liked Antalya the most. They have so many migrants there now from Syria, the crime rate has spiked. Antalya is no longer what it once was.

      You missed all of the live map parties during the second Nagorno Karabakh conflict. There were some very interesting conversations between me and the Turks on there. Some of them are dumber than dumb and refer to everyone not Turkish as a racially inferior ‘Iran-roach’ or something. However, some of them I found to be rather intelligent. One Turkish engineer living in Scandinavia even took math classes in finite element analysis. That’s higher than the ODE I stopped with. However, at the same time, he loved to make music videos over and over of Armenians getting blown to pieces by drone strikes and posting them on youtube. Bigboss was his name. Kind of like the Orc ‘bigboss’ right.

      Anyways, I told all of them, if you ever invade actual Armenia, you will be crossing the line. Russia will respond. They will honor their pledge to defend the CSTO. Now, are the Turks overall going to test that pledge? It remains to be seen. The Nationalism over there has reached a fervor pitch.

  2. Holy flashback, this reads like GWs admin…and the outcome of his economic policies that culminated in the 2008 giveaway to the banksters. Tax cuts while launching a war, economic bubble formed due to really bad ‘advise’ (read that ‘windfall plan’), election fraud, fake patriotism and last, but not least, crawling deeper into bed with the global pariah. Now the expectation that Turkey’s economy will tank and take Erdo with it? How many forecast an economic collapse here? It didn’t happen, did it? The manure just got deeper as they doubled down and the people took their lumps. Since it looks as though they are using the same playbook, I wouldn’t give him the 10 count yet.

  3. Without the billions in constant bailouts from Qatar, it would be in far worse shape.

    Qatar itself is largely a concentration camp. You have 15% of the population that is ‘Qatari Arab’ and among the wealthiest people on the planet. None of them work. They are lazy and arrogant. Then you have the ‘other’ 85% of Qatar, which is largely Indians, Bangladeshis, and Filipinos living in heavily guarded ‘male labor camps’ they are not allowed to leave except when traveling to construction sites. Basically, a nice way of saying ‘prison camps’, because all their papers are taken upon arriving in Qatar.

    Besides handouts from the Qatari Arab Concentration Camp State, Turkey has few friends. They have done this to themselves through Erdogan’s constant invasions of other countries and sponsoring ISIS. Egypt warned Turkey last year that if they were to invade Sirte in Libya, Egypt would go to war with Turkey. Every Arab country has a dislike for Turkey, except Qatar, and maybe a few generals in Pakistan Erdogan is trying to bribe to get pilots. However, NATO told Turkey a big ‘No’ on that one. So, now Turkey is turning their attention back to invading more Greek islands under Erdogan’s ‘greater caliphate’.

    • I have suspected that his chaos creation via his Turkic expansion was all a populist diversion while he was looting the country. The only way he can save himself not is to blame an economic collapse on someone else, which will be hard to do with him as the autocrat ruler. So me may try to shake down the EU for money to buy his debt or he wil flood them with refugees, but not really feasible in winter by boat. I fear it will get worse before it gets better.

    • I don’t see him trying to shakedown anyone. That’s not his style. Qatar gives Turkey money for ‘favors’ like military hardware, use of Turkish Millî İstihbarat Teşkilatı (MIT) detention centers for their own ‘political dissidents’, political and military muscle to have on standby against their long-time nemesis Saudi Arabia, etc.

      If anything, he’ll just continue adding on to the MIT fortress in Ankara. It’s as bad right now as the NKVD ever was in the USSR. Even MIT operatives are not safe in Erdogan’s Turkey. If they do anything to piss off anyone, even a promotion too quickly, or simply carry out too many Kurdish hit jobs, and they get sent themselves to the MIT ‘special interrogation campus’ in Ankara. That’s how Erdogan keeps a lid on things. He sends his own MIT operatives that either ‘knows too much’, or were ‘involved in such and such false flag operation in Syria’, or were involved in such and such laundering op… straight to the racks they go. It happens quite often. Every high-level MIT operative in Turkey knows that Erdogan could send him at any given moment to the special interrogation campus. It’s a one-way trip there. The torture sessions on former Turkish MIT operatives last for months. Nobody leaves, Kurd or Turk, ….at least not in one piece they don’t.