[forvelin]

It has nothing to do with religious beliefs, its all about gathering capital on his side. He is just abusing peoples' religious beliefs. Everybody knows the new savings scheme he introduced is essentially increasing interest rates.

Contrary to popular belief, I do not think that Erdogan will continue to mold Turkey's future. So far Turkey always had 40-50% opposition which could not unit, but now they are all united and next time it is certainly going to tip the scale in the right way. He will do everything to delay the elections or call them at the right time -like now ?- but his plans don't always work out -not far, look to recent Istanbul elections he lost.

[costac]

> Everybody knows the new savings scheme he introduced is essentially increasing interest rates.

This is not true. Raising interest rates would mean raising the cost of funding for the banking system. Under the new saving scheme, since the Treasury pays depositors the extra yield, the cost for banks remains unchanged. As does the marginal cost of borrowing from the central bank.

The new saving scheme is a free dollar call sold by the country's Treasury to depositors. And it will pay it out by printing money.

[howmayiannoyyou]

> printing money

Something it cannot do without increasing its own borrowing costs, and reducing the import purchasing power of its currency. This has been tried and doesn't work: https://en.wikipedia.org/wiki/Black_Wednesday

[Reichhardt]

The ruling regime/Edrogan are not interested in the general wellbeing of the country, only of looting it.

I've come to realize that there are a significant number of politicians who will happily oversee 100 units of 'destruction' if it means they are able to generate 1 unit of personal profit in the process. When applied to an entire nation state, the results are significant. Look at the corrupt wealth generated by the current US Speaker of the House, for example.

[selectodude]

Anybody with even a cursory knowledge of macroeconomics knows it won’t work. Erdogan just doesn’t happen to be one of those people. It’s tragic.

[mghfreud]

Borrowing cost for both companies and individuals increased substantially this week. Yes, it is true.

[costac]

Borrowing costs increased independently of the new savings product. They were rising well before it was announced and increased further because the market priced in a higher level of inflation following the sharp depreciation.

The higher rate on deposits that the new saving scheme offers doesn't increase funding costs for banks in anyway. The Treasury literally pays the depositors the extra yield, not the banks.

[mghfreud]

Does it matter if it is direct result or second order?

BTW, this week, the interest on private loans increased substantially, not gradually.

[costac]

Independent is very different from second order.

And, yes I know interest on loans increased substantially but that has nothing to do with the new saving product and everything to do with the meltdown in the lira that preceded.

Edit: And in any case why would banks raise loan rates if they don't have to bear the cost of the new product?

[mghfreud]

You are asking the correct question, it does not matter if the cost is financed by banks or public. The cost of borrowing increased substantially, even though exchange rate decreased in the last one week.

Access to TL got harder by the actions of the government. This is why interest rates increased.

[1cvmask]

He lost all three of the biggest cities of Istanbul, Ankara and Izmir. Yet his coalition actually increased their total votes in the municipal elections by getting more votes in other cities.