By Chrysostomos Tsoufis

“Today no one lost, we won 85 million as a whole” shouted with all the voice he had left, the Tayyip Erdoganfrom the balcony of the presidential palace in front of about 350,000 of his cheering fans.

The markets did not see the same eye on the result of the Turkish elections. The collapsing Turkish lira plunged to an all-time high of 20.1 against the dollar. Since the previous election in 2018, it has lost 80% of its value despite the fact that the country’s central bank, which is completely controlled by Erdogan, is “burning” its foreign exchange reserves in order to contain the fall. For the first time since the 2001 crisis, they are now negative and the liquidity comes from the petrodollars of its countries Gulfthe Chinese yuan and the Russian rubles. It is currently unknown with what future exchanges to these “friendly” countries.

Her way depreciation not finished. Common ground in all analyzes is that it will continue with Morgan Stanley estimating that by Christmas 1 dollar will be equal to 29 Turkish liras.

With currency in free fall, o inflation is out of control. In October it had reached a historic high of 85.5%, now it is at 43.6% but unofficially it exceeds 100%, which is why Erdogan admitted in the victory that it is the number 1 problem for the new government he will form.

Food inflation is at 54% while in November it had exceeded 102% even with the figures of the Turkish Statistical Authority which since 2019 has stopped publishing what percentage of their income Turkish citizens spend to meet their nutritional needs. Unofficial statistics indicate a 20% increase in people queuing every day to get a loaf of bread subsidized by the municipalities of Ankara, Istanbul and Izmir.

Even more pressure on her budget Turkey they are expected to exercise the pre-election gifts Erdogan. The “father” from Kasimbasa increased 45% salaries in the State, declared that natural gas will be free, promised to build 320,000 houses in a year in the areas affected by the earthquakes, promised early retirement to about 200 workers and increased the minimum wage 55%.

In March the country’s trade deficit was the highest since records began, to borrow Turkey has to pay outrageous interest rates, 16% for 3 months, 9.1% for 10 years, risk premiums have skyrocketed as markets see an 11% chance of default, foreign investors have fled the country. The message for Turkey is clear “change or sink”. The third way, that of the IMF, has been blocked by Erdogan himself who does not want to “rewrite” that chapter of history that mentions him as the savior of the Turkish economy from the shackles of the Fund.

Who would want to sit in their electric chair? Turkish Ministry of Finance; And to have his hands tied since he has to be loyal to Erdoganomics?

Erdogan said he is preparing a team of international prestige to take over the reins of the economy. Let’s see…