Taxes, Inflation, And Now The Military: Turkish Stocks & Currency Re-Tumble

Tyler Durden's picture

With tensions remaining high, the brouhaha over the 'probe' of government corruption daring to find actual corruption rolls on and now the military is complaining of bent judges in their own 'coup' trial:


Add to this the hike in consumption taxes and fears over inflationary surges and the Lira has re-collapsed back to record lows against the USD and Istanbul stocks are re-tumbling.



The Military involvement (via Bloomberg),

Turkey’s Armed Forces asked the prosecutor’s office to open a case against what it said was a plot targeting it in trials of retired and active duty officers for alleged coup planning, Hurriyet newspaper says, citing a defense lawyer in one of the coup plot cases, Haluk Peksen.


Evidence against members was fabricated to target the Turkish Armed Forces: Hurriyet


Security officials, judges and prosecutors ignored defense of members and manipulated evidence: Hurriyet


Hundreds of military officers, including top generals, have been convicted in a series of cases on charges of plotting to overthrow PM Recep Tayyip Erdogan’s govt


On Inflation and Tax Hikes (via Goldman),

The government hiked various consumption taxes and surcharges on tobacco and alcoholic products, cars and mobile phones, effective from January 2.


We calculate that these tax hikes will add roughly 1.0pp to headline CPI, eradicating almost entirely the favourable base effect (roughly 1pp) set by last year’s administered price and tax hikes. This means headline CPI will be stuck at around the 7.5%-8% range through 2014Q1.


Sustained FX pass-through, pent-up electricity and natural gas price adjustments and possible unprocessed food price shocks (owing to unseasonably warm weather conditions) will likely continue to exert upside pressure on headline (and core) CPI. We continue to see end-2014 CPI at 8.3%, well above the 6.7% consensus. However, the risks to our forecasts remain on the upside.


We continue to expect the CBRT to hike (the policy relevant) O/N non-PD lending rate by 225bps to 10% in 2014. More aggressive rate hikes will probably be necessary to anchor inflation expectations, given the large imbalances undermining the TRY.

BofAML also believes the bullish trend in USDTRY is set to continue...

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Millivanilli's picture

All they need to do is give immunity to the banksters, pour billions into their market through, and rally.   The occasional tear gas cannister and water cannon may come in handy, though.

Leonardo Fibonacci2's picture

Nuke that useless country that rip off tourists for their persian carpets.  

Wile-E-Coyote's picture

Bought a "Persian" carpet did we? Got home to find a made in china sticker............ohhh that hurts.

knukles's picture

Nothin' to see here, move along.

It's Just a Turkish Spring

Dr. Engali's picture

Quick find a boogie man to blame it on, and start a war to distract the masses!

Sudden Debt's picture


tony wilson's picture

stop picking on turkey this is just anti semenism.

erdogan is not a traitor or a filthy dog.

calling him a lump of septic decaying manure gets us nowhere and is hurtful.

he has not helped rape the industrial base of syria and has never touched any syrian children.

turkey is not trading children with paedos in the cia and un.

zero syrian organ trading is happening.

erdogan believe organs should not be4 ripped out of living syrian men and woman.

he is happily married and is not jewish.

any suggestion that he is a mossad tool is very damaging calling a man a rapist is one thing stories of jewish ness ness an outrage.


dpr10's picture

noone is picking on Turkey just the scum that is in power. you should do some research before you comment, Erdogan is sending guns to al queda in syria and he has got blood on his hands.

superflex's picture

It's called sarcasm.

If you read any of Tony's posts in the past, you would know he holds the Jewish power brokers in high esteem.  

Right up there with syphillis.

Hammurabi's picture

the governement of Turkey is helping creating Al Kaida in Syria with the Saudi Arabia and the US, this is very clear every single donkey in the midle east knows that. the weapons and money coming from the Saudi and the turkish, the US training and giving logistic help. no body is with the dictator Bashar or with the Iranian regime. but not long all the countrys helping Al Kaida, Turkey, saudi, will be divided, same like Irak. there turn is coming in the next 10 years.

Jack Burton's picture

Turkey is a NATO nation. It is home to Obama's Al-Qaeda Terror Army which invaded Syria to kill non-Sunni Muslims, all religious minorities and to overthrow a secular government. Turkey houses the Sunni Jihadist bases, training camps, weapons dumps and American pay masters. i.e the CIA. Now Turkey is in serious crisis, America must sabilize it's Sunni base camp and insure the Turkish Military retains full powers to operate and to influence government policy. How they wil do this is where it gets hard. Assad across the border must watch Turkey going to the dogs and say "thank god". The USA now has a bigger problem. Turkey is a key NATO agent in the encirclement of Russia. America now has a huge problem on it's hands, while they crowed about liberating Syria for Al-Qaeda, their back door was being kicked down by Turkish people sick of the corrupt government. A Turkish Spring will force America to back another military take over, just like in Egypt. SO we see what passes for democracy in America's foreign policy. Military dictatorship for allied nations and militant Muslim terror for our enemies. The bombs are already going of in Souther Russia. The very bombs Price Bandar threatened Putin with. When the Olympics are over, then Putin has a free hand to engage the source of terror in Russia, that source is in Saudi Arabia, the very same nation and people who carried out 9/11. It was inside Germany that the Saudi terrorists lived and planned 9/11. Funny how no drones fly over Germany. Wonder why?

Anybody's picture

Jack Burton -

"It was inside Germany that the Saudi terrorists lived and planned 9/11. Funny how no drones fly over Germany. Wonder why?"



johnconnor's picture

I wish a could give you 1000 upvotes, great post

JustObserving's picture

I am sure that the NSA has enough intelligence on Turkey to determine if the army planned a coup or not.


Quinvarius's picture

In the West, all currencies are managed.  Don't bet on a tail event in the TRY.  Expect an interventin for all those who outsmarted the bankers, FOREX dealers, Turkish government, and Swap dealers.  This is small taters compared to the radioactive island printing money into oblivion with a sovereign debt crisis, collapsing economy, and about to host the Olympics.  A tail event in the Dollar managed Western paper markets will not be allowed.  Paper is all rigged and all meaningless.  FOREX rates are set and enforced by CB and Gov agreement.

forrestdweller's picture

Erdogan is just another dictator. And it will go as it goes will all dictators. They want more and more power, can't share it, then the ruin the country ans the people just to stay in power, then they get killed and somebody else takes over.

hugovanderbubble's picture

Turkey is a freaking chaos. Sell

kenezen's picture

Erdogan's early writing display how devotedly Sharia Law and Sunni he really is. The secular military is in jail for life so he feels free to dispose of minor governmental skirmishes and proceed to form a caliphate with Qatar and Saudi Arabia which is already underway. Erdogan if he succeeds will be the next Caliph of the new combined Sunni nation and then will look to annihilate its primary enemy for the last roughly 1900 Years, the Shiites!

Look only to Beirut to see that this is true! 

Uncle Remus's picture

Hmmm. I don't see the House of Saud taking a backseat to anyone Muslim in a New World Caliphate unless it's a puppet caliph.

I'm also unconvinced as to the depth of the Sunni/Shia divide at it's core (meaning rank and file) and anything else is a political convenience, misdirection and provocation.