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Free-Spending Turkey Hopes To Avoid A Fall

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http://www.nytimes.com/2011/04/26/business/global/26turkey.html?_r=1&ref=business

Is Turkey’s booming economy ripe for a fall? It certainly looks that way.

Stock brokers endure four-month waiting lists to pay as much as $150,000 for top-of-the-line Audis and BMWs — twice the manufacturers’ prices after taxes. A real estate developer recently laid out a record $33.3 million an acre for a 24-acre plot of land in Istanbul’s city center.

But the most striking sign that the economy here may be overheating comes from a usual suspect: the country’s aggressive banks. They have found a creative way to finance consumer splurges by providing quick loan approval via text message or A.T.M. machine.

Analysts and bankers say the explosive growth in consumer loans has fed a worrying expansion of the country’s current account deficit, estimated to be 8 percent of gross domestic product this year.

Turkey’s trouble in financing gaps of that size has been at the root of its past two busts, and some worry that history may be repeating itself.

We are again producing and consuming beyond our capacity,” said Atilla Yesilada, an economist at Istanbul Analytics, who has lived through Turkey’s last two busts, in 1994 and 2001. “We are financing our growth entirely through foreign credit, which is becoming more expensive. At some point life catches up with you, and you crash.”

There's nothing like a good old bubble.

I'm sure this time it's different, Turkey has found the magic formula, I mean what could possible go wrong?

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gordon nearly had the IMF job.I'm sure he'll find them soon.

Its a sad reflection of the human condition that we continually seek to pin collective blame, our blame, on this or that individual, whether it be gordon brown, bernanke, hitler, Ghengis Khan or Jesus H Christ.

Hitler might have been a monster but he only tapped into something monsterous that already existed.

Cultural obsession with money is a failing of us all including you based on your posts to date and you can't put it on one man or woman, which is the culturally cowardly approach which always rears its heads when we realise we have made a terrible collective mistake.

Wasn't me guv'nor!

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“We are again producing and consuming beyond our capacity,” said Atilla Yesilada, an economist at Istanbul Analytics, who has lived through Turkey’s last two busts, in 1994 and 2001. “We are financing our growth entirely through foreign credit, which is becoming more expensive. At some point life catches up with you, and you crash.”

So, Turkey has had 2 busts in the last 17 years, yet they still seem able to tap credit markets and loan lots of money that will never be repaid. Yet a lot of posters on here still insist it would be the death knell for a country if it defaulted on it's debts. Hmmm.....

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Its a sad reflection of the human condition that we continually seek to pin collective blame, our blame, on this or that individual, whether it be gordon brown, bernanke, hitler, Ghengis Khan or Jesus H Christ.

Hitler might have been a monster but he only tapped into something monsterous that already existed.

Cultural obsession with money is a failing of us all including you based on your posts to date and you can't put it on one man or woman, which is the culturally cowardly approach which always rears its heads when we realise we have made a terrible collective mistake.

Wasn't me guv'nor!

Hitler commited suicide, Saddam was brutally hanged, and Gordon/Bernanke are lined up for economic priesthood.

Thats the disgrace.

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Hitler commited suicide, Saddam was brutally hanged, and Gordon/Bernanke are lined up for economic priesthood.

Thats the disgrace.

No, I don't think they are. Even lefties can't wait to get daylight between themselves and Gordon.

If he can't get more than 40% support for a spot at the IMF in a statist lickspittle rag like The Guardian, he is finished.

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Turkey has found the magic formula, I mean what could possible go wrong?

Course they have. Join the Euro, get a bailout. Simples :rolleyes:

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  • 285 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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