Its the same mentality that makes people stare at car crashes. There's nothing to do. Just stay away.
Color me simple here.... .....but was there ever a time to buy Turkish stocks? Ya'll must be some sophisticated mother f'rs. You should make an IB commercial.
Personally, I think EM stocks rarely present good value plays in a crisis. Combination of the pilfering principals and the corrupt officials invariably leads to dilution of equity or worse, to a complete loss. If you really think that the country is hitting the rock bottom, you can buy property there instead, e.g. a nice apartment in Istanbul would hold value much better than a Turkish shipping company or whatever. PS. I am not an EM specialist, so take this with a grain of salt.
Fascinating history of Constantinople ( istambul) ! I saw a documentary on TV which revealed a lot of the old city right under the newer one. Miles of tunnels etc.
The news is that Quatar is looking to deploy $15B in FDI into Turkey, this will help Turkey build FX reserves and they become pretty much a de-facto IMF for them. the WH also said they will reconsider sanctions if the priest is released Looks like my post came at pretty much the bottom, I wish I had bought some instead of just considering it
$15B in investment (over what time period) in a $850B/year economy isn't really going to move the needle, and has pretty much nothing to do with FX reserves. Foreign direct investment means Quatar builds another worthless bridge across the Dardanelles or the hated and equally worthless Kanal İstanbul, or another port somewhere or a high rise or .... It doesn't mean they give a cent to the Turkish government. Or that they even invest in what the Turkish government wants them to invest in (they may realize that a canal that charges a huge toll isn't going to be used when a completely free one is next door, kind of like the Third Bosphorus Bridge that no-one uses and is a huge money sink). In short, all the structural issues with the Turkish economy and government remain unchanged. Dead cat bounce anyone?
I belive this matters to reserves. When you have a big current account deficit, you are exposed to foreigners dumping local assets to buy foreign currency. Quatar is doing the opposite move, this takes part of the burden of facilitating that transition (of panicky foreigners) from the Central Bank. The CB had $50B in reserves, IIRC. $15B is a lot of burden to take off them
Again I think you are misunderstanding how foreign reserves and direct foreign investment work. Qatar is saying they're going to (at some undefined point in time) "invest" $15B in Turkey. This could mean that they literally spend $15B to build the planned new canal (that coincidentally is about what it will cost). That $15B will go to equipment and cement and labor and bribes and buying out peoples homes. Not a dime will go into the central bank's reserves. Nothing says that when they buy Daal's house that sit's in the canal route he won't immediately use that money to daytrade shares of AAPL. Or that when they spend that money on Cat backhoes the majority of that money won't immediately go offshore to Caterpillar's corporate account. As I said before, all the structural problems with the economy and government of Turkey remain, and those are the reasons both foreigners and locals dump their Lira for foreign currency. Dumping an insignificant amount of money into an infrastructure project does almost nothing to change that.
I disagree. Current account deficits are financed through foreign capital inflows (by definition), this is a foreign capital inflow of large size. In the absence of large capital inflows, the domestic currency collapses and there is a run on the central bank reserves (like in Asia in the 90s). This investment helps offset that to some extent.