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    Please fasten your seat belts
    Güven Sak, PhD 25 March 2010
    Everyone has their own problems. If you hear the parties in struggle, they have fantastic claims and they think they are right. They are telling with passion the unfair treatment they are facing. However, there appears an atmosphere where small losses in the way to victory do not count and where anything is serving to the end is lawful. The trick here is not to push the country to this mood. If the authorities responsible for the adjustment among institutions become a party, such occasions become inevitable. We have sensed this atmosphere before 1980, and it was not nice. But there is nothing we can do. If we cannot change the atmosphere fundamentally, we should deal with the steps that can be taken in the coming period to secure economic stability. Rule based fiscal policy has become more [More]
    Obama continues with the stimulus packages
    Güven Sak, PhD 23 March 2010
    Did our focus shift from the crisis toward the budget recovery? Did the crisis management measures have lost place on the agenda and the time to eliminate the damage of the crisis on the budget came? No, it did not; not yet. The administration of the United States of America (USA) continues to manage the crisis period. US Senate passed the Jobs Bill on March 17, 2010. The bill now waits to be signed by President Obama. Therefore, the administration accepted a new $18 billion economic stimulus package to manage the crisis process. US administration learns new lessons from the crisis and keeps on trying. They do crisis management there; they still do. But, we wait. Since we do nothing but wait, we do not feel that somebody is in charge. Have you thought why we are looking around with anxiety [More]
    Shifts to formal economy cannot be secured solely by the Ministry of Finance
    Güven Sak, PhD 16 March 2010
    This is the one inevitable discussion for Turkey. There exists a common belief that Turkey has high rate of informality. This belief is common though there are no comprehensive studies on this issue. If Turkey wants to get on a sustainable and steady medium term growth path, it should deal with the informality problem in a comprehensive manner. So, why is that the case and how can informal economy be eliminated? Let us talk about these today.  I personally believe that the shift from informal to formal economy cannot be secured and coordinated solely by the Ministry of Finance. [More]
    When will Turkey have a technology firm quoted in NASDAQ?
    Güven Sak, PhD 13 March 2010
    This is the exact question of today. This is where the key to turn the 2008 global crisis into an opportunity lies. There are more than a hundred Israeli firms quoted in NASDAQ. The sum of the firms from Europe, India, and China is also around a hundred. India is one of the countries that have recently sprinted while Turkey lags far behind in the competition. So, the question is: "How can Turkey have technology firms quoted in NASDAQ of the United States of America?" The answer is quite simple: When Turkish entrepreneurs get to enjoy an entrepreneurial government. Studies on this subject associate the progress made by Israel and India with the entrepreneurial government issue. But why is today the right time? Where does the opportunity lie? We will see. Let us first address the NASDAQ issu [More]
    Why credits to SMEs drop while bank credits increase?
    Güven Sak, PhD 11 March 2010
    For a while I am trying to call attention to the dual structure of the recovery process. At first glance it appears that positive growth it achieved. After the rapid contraction in 2009, economic activity seems to give signs of weak recovery. In total, bank credits appear to have risen. However, all of these are what we observe at first glance. There exists a milieu of unfruitful growth. Employment loss in industrial sector prevails. And considering the small and medium sized enterprises (SMEs), the story is more complicated. As per the 2009 end figures on bank credits, credits to SMEs head down while others rise. However, SMEs are of importance considering employment. During 2008 crisis, 45 percent of employment loss throughout the USA stemmed from SMEs. Nonetheless, we are told that this [More]
    “Turkish firms cannot easily receive bank loans until they institutionalize”
    Güven Sak, PhD 04 March 2010
    At the beginning of the weekend we examined why people saying "I actually am quite content with the current crisis" believed so. As we know, there is a group of businessmen feeling the same way in Turkey. What were their distinctive characteristics? Their either had a wide base of working capital or the potential to expand the base of the existing working capital. Bestowing God would have favored the enterprises which do not have sufficient cash to run the business or those who have limited access to liquidity. Then, today's question should be: how can the access of the corporate sector to working capital be improved? From this point onwards, there are many rumors. It is evident that the easiest way to access working capital is to have easy access to the banking sector. But, how can the ba [More]
    Why doesn’t Obama shout at the media?
    Güven Sak, PhD 27 February 2010
    The developments witnessed last week should be taken as an evidence for how the removal of basis for consensus in a country tangles the situation. The removal of the basis for consensus directs people towards looking askance at anyone else. This is bad; this climate is toxic. In such a climate, the responsibility does not decrease but increases for those who claim to provide resources and know the importance of not getting rid of the means and who are obsessed with making progress. Responsible agents should bring together all institutions make sure that the system functions. The public knows how to distinguish between those securing the progress and those hindering progress. For Turkey, the responsibility is undertaken by the Prime Minister under the current system of government. And for t [More]
    Please fasten your seat belts
    Güven Sak, PhD 25 February 2010
    Everyone has their own problems. If you hear the parties in struggle, they have fantastic claims and they think they are right. They are telling with passion the unfair treatment they are facing. However, there appears an atmosphere where small losses in the way to victory do not count and where anything is serving to the end is lawful. The trick here is not to push the country to this mood. If the authorities responsible for the adjustment among institutions become a party, such occasions become inevitable. We have sensed this atmosphere before 1980, and it was not nice. But there is nothing we can do. If we cannot change the atmosphere fundamentally, we should deal with the steps that can be taken in the coming period to secure economic stability. Rule based fiscal policy has become more [More]
    Why should the fiscal rule be different than that proposed in official arrangements?
    Güven Sak, PhD 23 February 2010
    I suppose it was a couple of years ago. Back then, I was of the opinion that "Turkey does not necessarily need the IMF. The way to get rid of the IMF is to take rapid steps in the direction of rule-based fiscal policy." However, then we had not experienced the 2008 global crisis or wasted the budget funds for the sake of elections as was done over the 2008-2009 period. The PIGS issue which substantially occupies the agenda nowadays, was not existent at all. Back then, I wrote many commentaries on this issue. Also TEPAV published policy notes. And then these times came. Today, let us make a contemporary contribution to the 'how must the fiscal rule be' discussion. Let me explain why I think that the fiscal rule framework the Treasury currently works on is wrong. Let me explain why the rule [More]
    Have you checked the survey by the Istanbul Chamber of Industry?
    Güven Sak, PhD 18 February 2010
    Turkey's economy has been demonstrating a dual structure for a certain time. There are 'well-off firms' on the one hand and 'firms the endurance of which are tested everyday' on the other hand. And this atmosphere is dangerous for the near future and measures to prevent it should be taken. Moreover, Istanbul Chamber of Industry (ISO) president Mr.  Tanıl Küçük is quite right in saying that the government has failed in the task of implementing measures. Along with 2008 and 2009, the government is about to waste 2010. Today let us first take a look at the state of the economy survey conducted by ISO which points to the dual structure in the economy. This way the data, which pleased analysts for signaling a weak light of recovery, would be located on the right perspective. [More]