enoch

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Turkey's top religious body continues to spend at record levels​

The Turkish Directorate of Religious Affairs (Diyanet) has spent 9.9 billion liras in the first half of 2022, which corresponds to 70 percent of its allotted budget for the year.​

Turkey's Religious Affairs Directorate (Diyanet) has spent 9.9 billion liras in the first half of 2022 -- 55 percent higher than the same period in 2021.

With this figure, Diyanet spent 70 percent of its allotted budget for 2022, the daily BirGün reported on Aug. 7.

Diyanet announced that 9.6 billion liras of this expenditure was made within the context of "Religious Services and Non-Formal Religious Education."

The personnel expense of the organization, which was 5.2 billion liras in the first half of 2021, increased to 8.1 billion liras in the January-June 2022 period.

Under the leadership of Ali Erbaş, the Diyanet has become one of the best-funded institutions in Turkey. The directorate was allocated 12.3 billion liras for 2021 and 13.1 billion liras for 2022, exceeding the budget of some ministries.
I bet he's spending it all on the poor 🤣
 

B&B

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Bit of a slide on right now. I wonder is this retaliation against russian deals. Or if not for the deals would it be far worse. Interesting times. Go shops stock up on popcorn.
 

Camden

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Are we really surprised when it helps him and makes some unsupervised cash for the country? he helped his other frenemy Iran avoid Western sanctions with the Reza Gold fiasco


Interesting article by the FT ...
What The Turkish President and Putin agreed in Sochi remains unclear. A joint statement talked of increasing trade and energy ties and deeper collaboration in sectors including transport, industry, finance and construction.
A Russian deputy prime minister said Turkey would begin paying for gas partially in roubles. Turkey’s president was later quoted as saying five Turkish banks would adopt Russia’s Mir payments system — a boon for Russian tourists in Turkey after Visa and Mastercard suspended Russian operations.

full article
...

Western capitals worry the Mir link could also be used to skirt sanctions, though there was no evidence Erdoğan had accepted supposed Russian proposals, leaked by Ukrainian intelligence, for deeper banking and energy co-operation that might help Moscow evade western restrictions.

Turkish President has good reason to woo Russian financial inflows as he tries to win re-election next year amid an escalating debt and currency crisis, caused largely by his own economic mismanagement. Inflation hit a 24-year high of 79.6 per cent in July and the lira has halved in value against the dollar over 12 months. Despite Turkey’s Nato membership, it has no legal obligation to impose US and EU sanctions against Russia.

Any deepening of economic ties with Moscow, however, is likely to inflame frictions with the west when Turkey is already dragging its feet over Sweden and Finland’s Nato membership. Erdogan’s position also provides a test of the western alliance’s ability to make sanctions stick globally.

Failure to prevent sanctions leakage via Turkey would make it all the more difficult to restrain other emerging markets such as China — which has so far been cautious about providing help to Russia. One senior official has suggested western countries might call on companies and banks to pull out of Turkey if Erdoğan follows through with the intentions he signaled on Friday.

But Turkey is simply too important geopolitically and for western businesses. Europe frets over Ankara’s ability to flood the continent with the 3.7mn refugees from Syria and elsewhere that Turkey is hosting.
 
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Kanga

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Fact remains that russia is running out of western supplied components for their arms industry.
Turkish banks can decline Mir and I'd expect the western part/owned ones like Garanti Bank to think twice before getting involved with dodgy cards.
 

Chasey

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Euro is gaining against the dollar go. What's happening in the US?
simple the economy is tanking faster then in the EU

Projections for the EU are actually not too bad and the figures are badly squed by the power issues imposed on them with Gas shortages and they don't relay represent the underlying trend.

The UK is OK-ish as well as our dependence on Russian gas is quite low (about 15% I think) and IMHO the energy price increases are not being canceled out against the cost of oil collapse. We should be down to £1.30 per ltr now but we are still charging way too much. Oil is 31 dollars a barrel (down from $101 in April 2022) which is good for us and bad for the USA as they earn a LOT out of Oil trading in the Dollar. It basically props up the currency.
 
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Saoirse

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Chasey in your estimation- and I am.very aware you can only give an educated guess but it will be well better than mine- at what point will the TL stop falling

There has to be a bottoming out at some stage

This isnt prewar Germany surely there is a point when it cannot drop further
 

IbrahimAbi

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Chasey in your estimation- and I am.very aware you can only give an educated guess but it will be well better than mine- at what point will the TL stop falling

There has to be a bottoming out at some stage

This isnt prewar Germany surely there is a point when it cannot drop further
Tassen't stopped falling since 1983 when I first came, why do you think it will?
 

Kanga

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Extract: Treasury and Finance Minister Nureddin Nebati said in a TV interview earlier this week that reserves were rising thanks to hefty transfers from another country without saying which one. His recent policy mix underscores how Turkey is juggling competing financial priorities.
 

Mushroom

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No bets from me. I see all of this ending in financial tears and the good people of Turkey bearing the brunt for many years, and that sickens me as once again, as in the UK, the politicians foul up while lining their pockets, but the public at large feel the pain.
 

enoch

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Exporters have told the government figures are going to be 50% less than first thought. That's not going to help things.
 

Chasey

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Chasey in your estimation- and I am.very aware you can only give an educated guess but it will be well better than mine- at what point will the TL stop falling

There has to be a bottoming out at some stage

This isnt prewar Germany surely there is a point when it cannot drop further


OH I wish my economist skills were that good. I'd be a very rich man.

Germany's problem was arguably one man Rudolph Havenstein who was basically causing trillion percent inflation by removing the currency from the gold market in 1914 (so you could no longer claim actual gold in return for paper money) and then printing govt backed money day and night. He was life President of the German Central bank

He errrrr died suddenly :unsure: and was replaced by Hjalmar Schact. His first action was to stop printing money and re value the mark against the dollar.

The figures are simply stunning. It was 4.2 TRILLION papermark to the US dollar?

Schact issued a new currency (The Rentanmark) at an exchange rate of 4.2 to the Dolla This stabilised the currency at that single moment, boosted confidence and allowed Germany to re grow from the ashes.

Turkeys problem is slightly different

Yes its stupidly printing money at a rate of 20% increase per year, (so every 20% it prints reduces the value of the Lira by 20% at least, a system referred to as quantitative easing) but its recovery is surely linked to its untapped resources due to sanctions. The mega cheep Lira should be growing exports, but it's not.

Turkey is not being allowed to prosper. US and EU sanctions are hurting



Rather than provide an end game for the collapse of the TL, id suggest the end game is the lifting of sanctions in a negotiated settlement and an immediate end to quantitative easing.

Now, this may be a racist comment (maybe it is as its a generalization) but in my dealings with Turks, when you put their backs against the wall they resist to the point of self-harm and beyond, which is in many ways an admirable trait. Stepping back involves not a wise and pragmatic feeling of doing the right thing, but instead shame and loss of face.

So IMHO we will not see a recovery until there's new leadership that's wise enough to choose the right side and free of history and able to negotiate a better deal without loss of face.

Then again I could easily be shocked by a move by Erdogan that has a significant impact. I did not see the money under the matrice recovery back in December, there has to be some level of investment from Russia in that they may have to top up to ensure. As Russia alienates the rest of the west, possibly Turkey represents a way to trade with the west stealthily. Again possibly the West will see this risk and take steps to make life in Turkey easier.

A lot is said about Erdogan's poor economic policy and failure to raise interest rates but a population struggling to cope with loan repayments is a high price to pay for foreign money investors trying to make a quick buck on a rising market.

Keynesian economics (Or New Keynesian Economics since the 70s) which suggests the state should intervene to stabilize the markets, has been the bedrock of capitalist democracy for many years, but there comes a point where the state runs out of the ability (money) to influence the markets, quantitative easing stops working, and this is IMHO where Turkey is at now.

As said, the only fix I can see (with my very very modest understanding) would be a new negotiated settlement with UK, US and EU. The problem with this being (in the event of new leadership) objection from the heavily invested Russia
 

Akasya

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RTE must decide only the USA can , if it wishes , help the YTL , Russia cannot invest heavily enough , therefore until RTE closes down on Russia the USA will undervalue the YTL . The trick is to expoert against the Lira by getting returns in dollars or remimbi , at present turkey can only do this at a very weak exchange rate ( 7 day bank rate ) is not readily available owing to currency swings , so Turkey must do spot delas and these tend to be poor . No one is prepared to hedge with or against Lira .
Steve
 

B&B

Member
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I think this is the prevailing wisdom however I sense a sea change. The USA got a very poor reception in Asia recently. The whispers are that its bullying like with Lithuania wont work here. EU and UK are vassell economies. I recently stayed in a little hotel in a little town on the german Luxembourg border but to my great surprise it had a whopping great USA military base. Who won who lost its not always obvious. My sense is the change is not always obvious but suddenly one day it all goes down. Best policy is to have popcorn ready 😂
 

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