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Sancho Panza

Turkish Finance Minister Denies Capital Restriction Plans

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Yahoo/AFP 1/2/14

'Turkey's finance minister said Saturday (Shenzhen: 002291.SZ - news) the government has no plans to limit capital flows to stop the slide of the lira, pledging market-friendly policies regardless of recent currency woes."In recent days, there has been unwarranted speculations about possible changes in Turkey's macroeconomic policies.... Let me make it clear again... Turkey is an open economy. We'll maintain market-friendly, prudent, and sound macroeconomic policies," Finance Minister Mehmet Simsek said on Twitter (NYSE: TWTR - news) .

"There'll be no restrictions on capital movements and we've no plans to impose additional taxes on FX (foreign-currency) deposits or other financial instruments."

The lira has lost about a third of its value in six months because of the US Federal Reserve's moves to curtail its easy-money stimulus programme, which has led investors to pull money out of emerging economies -- including Turkey, which to make matters worse has also been hit by instability brought on by a massive corruption scandal.

Turkey's central bank doubled its key interest rate to 10 percent Tuesday, momentarily halting the lira's fall, but a further Fed stimulus cut hit the currency again later in the week.

The central bank decision also irked Prime Minister Recep Tayyip Erdogan, who said it risked putting the brakes on economic growth.

Erdogan said he was ready to jump in with a "plan B" or "plan C" if needed to boost the lira -- raising market concerns he might move to restrict capital flows.

But Simsek sought to downplay those fears.

"Central bank's credibility and its independence is vital to the future of the Turkish economy. My government is committed to maintain this," he said.

The government has left its 2014 economic growth forecast untouched at four percent despite mounting warnings from analysts that it will fall short of that target.'

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How can they make capital controls work when people can move wealth over the net, irrespective of arbitrary lines drawn on maps?

These are the actions of dinosaurs, oblivious to their impending extinction.

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Given, the world over, the 'history' and track record of the exact opposite happening not long after government/senior finance bods usually start spouting these sorts of reassuring statements......it is a wonder that these statements don't actually now act as a sort inducement and de facto guarantee of public panic and resulting attempts to get ones money asap.

Now that the official denials have begun shall we start the timer to see how long, in this particular case, it is before we DO see restrictions?

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what we have seen before is...denials...followed by collapse....this could get interesting!

Exactly. Again and again. What is it exactly with public officials and their seemingly universal inability to face facts for themselves? What was the name of that Iraqi militray spokesman who would appear daily on TV denying any setbacks for the Iraq regime right up to the point where the American were almost on top of him?

Why cant we, just one day perhaps, have a public official go on TV and tell us to sit down and listen as he/she tries to explain, in detail from the beginning, the nature of current problems, how they arose, how they intend to solve them, etc - and so treat us like adults. Instead we all get the simplistic ' Don't worry be happy' line........

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Given, the world over, the 'history' and track record of the exact opposite happening not long after government/senior finance bods usually start spouting these sorts of reassuring statements......it is a wonder that these statements don't actually now act as a sort inducement and de facto guarantee of public panic and resulting attempts to get ones money asap.

Now that the official denials have begun shall we start the timer to see how long, in this particular case, it is before we DO see restrictions?

It's the nature of the beast.

Some public officials can't tell the truth. Imagine Merv saying RBS was probably going to go bust in 2008. The working assumption must be that central bankers lie. They couldn't do their job otherwise. Same can be true of politicians. They're permanently playing cat & mouse with markets. One slip up and they're f*cked.

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It's the nature of the beast.

Some public officials can't tell the truth. Imagine Merv saying RBS was probably going to go bust in 2008. The working assumption must be that central bankers lie. They couldn't do their job otherwise. Same can be true of politicians. They're permanently playing cat & mouse with markets. One slip up and they're f*cked.

But the Efficient Market Hypothesis to which the central bank mafia subscribe suggests that share prices either already reflect all the information available, both private and public, or will quickly adjust to new information in a way that no excess returns can be gained from trading on that information.

Surely, the real 'truth' that Mervo the Clown and Benny the Bubble can't admit to is that their academic qualifications are worthless and they haven't the first f***ing idea what they're doing.

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But the Efficient Market Hypothesis to which the central bank mafia subscribe suggests that share prices either already reflect all the information available, both private and public, or will quickly adjust to new information in a way that no excess returns can be gained from trading on that information.

Surely, the real 'truth' that Mervo the Clown and Benny the Bubble can't admit to is that their academic qualifications are worthless and they haven't the first f***ing idea what they're doing.

I don't think anyone believes in EMH. What a crock of sh1t that turned out to be.

Central banks are participants, significant ones, and participants perceptions and actions affect future outcomes.

Of course nobody can 'control' the future. That would be insane. But they can and do influence it.

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