It is difficult to overlook the rising cost of everything when you look at it in the Groceries, Christmas giftsThe, Tab at the fuel pump. It’s not just an American issue. Inflation can also affect many other countries. Turkey’s inflation is a prime example. Here, people rush to use or convert their wages in Turkish liras so that it doesn’t lose more of its value. Officials want to You can get independent cryptocurrenciesEven better! Stop anonymous cashIt’s a stark warning about the dangers of allowing governments to manipulate our money.
“The Turkish lira’s rapid slide—13% in one day this month and about 38% since the beginning of the year—resulted in a wave of Turks exchanging their liras for dollars, euros and other currency,” The Wall Street Journal reportedLast week.
Foreign-exchange trader have a lot more to do than just be curious about the value of the currency. It’s the value of people’s wages, the money they receive from their stores, as well as the company payments for their goods or services.
It was the worst thing I have ever experienced. When I get up, the price of oil has gone up. It cost 40 lire to buy a 5-liter can of cooking oil. “I went back and it was 80 lire,” I said to a widowed mother with two children. According to the APThis November. We don’t merit this nation.”
In Turkey, official inflation is at around 20%Although independent economists believe it is, Mehr than twoThat is the figure. This means that the lira cannot be used for purchases but is not a value store. It is like putting money aside to save for the rainy days. Turks aren’t the first to have unreliable cash. That’s why they developed the long-standing habit of keeping some of their savings in more stable currencies.
“About 59% retail bank deposits now have foreign currency, up from almost 57% the previous week,” The Wall Street Journal added.
The lira can be purchased in dollars or euros, but not only.
“Turks traditionally saved gold and may have as many as 5,000 tons ‘under mattress’,” Reuters reports. reportedLast year was even better than the previous one.
It’s interesting that Turkish banks will accept foreign and gold deposits, but many people are reluctant to make such deposits out of concern about the possibility that the government could seize private resources for its bailout.
“Smart Turks save their money at home. They can invest in FX or gold.” The National Interest Not notedThis was earlier in the year.
People also turn to cryptocurrency when looking for safe havens. Although volatile, digital currencies that are independent of each other seem to be better than the lira which loses value every day. Bitcoin, like its rivals, can be also transferred long distances or across national borders.
“The country’s economic troubles have led to an increase in cryptocurrency trading. Investors are looking to benefit from bitcoin’s rally, and to shelter themselves against inflation.” reported The GuardianApril
Turkish government Rapidly removedThe use of cryptocurrency for payments is possible, but trading remains.
There is no mystery as to why the lira has plunged. Contrary to almost every other economist, Recep Tayyip Erdan, Turkish President Recep Tayyip Erdogan believes that low interest rates and easy money are the key ingredients of a strong economy that combats inflation. His claims—dubbed “Insane” in some quarters—don’t seem to have done much for the value of the currency. He sticks to his policies. Officials are firedThose who don’t agree.
But, instead, do what Erdogan It hasReally accomplished is: SurgingMoney SupplyThis has led to Turks despair and a reduction in the currency’s value. Of course, Turkey is not the only one affected by this. While the United States, Britain, and other countries in the eurozone haven’t seen an increase in the money supply as quickly as Turkey since the start of the pandemic, they have made similar stimulus efforts. dollars, eurosAnd poundsin circulation reclassified M1Last year The money supply increased as a result. Economists predicted that inflation would result.
Desmond Lachman resident fellow at American Enterprise Institute said, “The money supply growth rate is so much faster than we’ve ever seen.” cautionedReuters June. It’s hard for me to understand how inflation can be prevented.”
In its October report, the IMF confirmed this fact. World Economic OutlookAlthough it is hopeful for improvement in the next year, “Headline Inflation has risen rapidly since the beginning 2021 in advanced economies as well as emerging and developing markets and economies.”
Using printing presses in Turkey and other countries to pay their bills is a good example. The Economist BewareLast month, “Policymakers in both rich and poor nations face the huge economic and budgetary consequences of covid-19,” some might be tempted not to adhere to monetary and fiscal policies. Some places could experience inflation that is difficult to manage.
Turks are able, thanks to cryptocurrency and gold, to keep some of the wealth they have in these less volatile currencies. Alternative stores of value offer safe havens against irresponsible government policy that makes the lira unstable. However, the Turkish government has placed restrictions on cryptocurrency. Officials don’t like when their control is loosened and wealth becomes unattainable. All over the globe, governments are discussing replacing bitcoin with government-controlled digital currenciesAnd even more Traditional cash and coins can be eliminatedTo bring the economies under greater central supervision and management.
Eliminating alternatives to government-controlled currency was always a frightening idea to anybody who cares about freedom and privacy. This is evident from the plight of Turkey’s customers, savers and businesses. If successful, it could also lead to our collective impoverishment.