Video Commentary: Turkey on the Verge of Currency Crisis
economy-depression
[embed]https://www.youtube.com/watch?v=a7Wg_39ILKw[/embed]
Turkey on the verge of a currency crisis
- President Erdogan’s one-man, no-clue governance style brought Turkey to the edge of the abyss.
- Dolar/TL has gained about 20% in 2 weeks.
- It is likely to inch up to 9.00 (currently at 8.30)
- This massive and sudden devaluation will reverberate through a sickly economy like a nuclear aftershock.
- How? Inflation will soar as early as May. Overly-indebted companies will go into bankruptcy.
- Wait...This is not the worst.
- The devaluation-inflation spiral could trigger a bank run.
- Thank to rising US bond yields and Dollar Index all EM is in bad shape, which will make it harder to pull Turkey back from the abyss.
- What to do? Simple.
