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Lira Craters To Record Low After Erdogan Orders Central Bank To Slow Inflation By Cutting Rates

Tyler Durden's Photo
by Tyler Durden
Tuesday, Jun 01, 2021 - 05:47 PM

By now, even the shoeshine boy knows that central banks are one-print trick pony farcical joke, one which is exposed not just by cryptos which have emerged as a clear alternative to fiat currencies, but by central banks themselves who are adopting their own digital currencies knowing well that the days of traditional paper money are numbered.

And yet within the giant Venn Diagram of the "big farce", there is a smaller Venn Diagram, which is basically everything and anything Turkey-related, and whose farcical content is exponentially more concentrated because while central banks have become the laughing stock of the financial world in its twilight days before the upcoming great reset, nothing is as funny as Turkey's despotic ruler and one-man government-cum-central bank, Erdogan, inverting central bank orthodoxy on its head without a trace of sarcasm.

That's precisely what happened moments ago when the Turkish despot president, who just two months ago fired his central bank governor - the second such sacking in 3 months - for hiking rates too much, announced that he had spoken with the new Turkish central bank governor, and said that "we most lower rates" - read Erdogan's puppet at the CBRT now has a clear order - to, get this, slow inflation:

  • *ERDOGAN: `I SPOKE WITH CENBANK GOVERNOR, WE MUST LOWER RATES'
  • *ERDOGAN CALLS FOR LOWER INTEREST RATES TO SLOW INFLATION
  • *ERDOGAN SAYS RATES CAN FALL, CITING `JULY-AUGUST' PERIOD

That's right: Erdogan will fight Turkey's soaring inflation with... lower rates.

And no, he was not joking much to the shock of all those long-suffering lira longs who saw all of their hard-earned "carry" gains vaporized in milliseconds as the Turkish currency crashed to a new all time low.

And while we wait for Turkey to finally implode into a smoldering pile of hyperinflation rubble as foreign investors finally decide they have had enough with Erdogan's surreal circus, we now know why one month ago Turkey was among the first nations to crackdown on bitcoin when it banned cryptocurrency payments. Considering the coordinated campaign against crypto by all other central banks, we can only imagine the level of monetary insanity that is about to be unleashed by all other clown in charge.

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