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    Will the credit expansion continue?
    Fatih Özatay, PhD 23 May 2010
    I have previously shared my growth estimates for 2010. If the assumptions in my basis scenario hold, growth rate in 2010 was expected to be between 3.8 percent and 4.9 percent. The indicators announced in the last couple of years stated that growth rate can even go above the upper limit of this interval: data reveal real credit expansion, exports tend increasing and the confidence in the economy has been recovering substantially. [More]
    Only an equation?
    Fatih Özatay, PhD 20 May 2010
    I believe that the recent developments in the European Union should have thought us that fiscal rule is not only an equation. In the Eurozone member states cannot exceed a certain threshold of public debt and budget deficit in proportion to their GDP. However the mentioned thresholds have already been exceeded and the only cause of this is not the global crisis for some countries. As in the case of the Greece example, the threshold had been exceeded even before the global crisis. What is more, this was enabled by manipulating budget figures. [More]
    Exchange rate and exports in the last two crises
    Fatih Özatay, PhD 17 May 2010
    Many economists argue that the problems facing Greece can no longer be solved via fiscal discipline and foreign credits. The underlying justification of such views is that even if the announced plan is implemented, Greece's economy will contract in 2010 and therefore the ratio of the debt to the national income will increase further. Therefore, economists argue that the debt of Greece will eventually be restructured. [More]
    Exchange rate and GDP in the last two crises
    Fatih Özatay, PhD 16 May 2010
    I am going back to the "in the last two crises" commentary series. Today's topic is the exchange rate movements. I want to analyze how much the Turkish lira depreciated in real terms and to what extent this was translated into export gains and therefore GDP growth. [More]
    Dilemma of the President of ECB
    Fatih Özatay, PhD 13 May 2010
    Would you like to be in the shoes of the President of the European Central Bank (ECB) Mr. Trichet? I believe the answer of those who follow the recent developments would be no. Do you know now many times he retracted from a statement he made and even had to do the exact opposite during the crisis?  I do not know exactly, but it certainly is a lot. [More]
    Great EU 'leaders'
    Fatih Özatay, PhD 10 May 2010
    European Union (EU) is suffering from a severe leadership problem. They are doing everything contained in the 'not to do list for a financial crisis'. They still could not put into practice the economic program which will relieve a member country with high budget deficit and debt. First they announced in public that they are against bailout plan arguing that it will set a bad example for countries which lived within their means. They said that the EU legislations do not allow bailout operations. On the other hand they also rejected the idea of one EU member country signing an agreement with the IMF. [More]
    Which EU?
    Fatih Özatay, PhD 09 May 2010
    For a while how I have been writing a series of commentaries with the theme 'in the last two crises'. I will continue with this series. But I am not sure what the 'last two' refer to anymore.  Are they the 2001 crisis and the global crisis as was used in the previous commentaries or are they the 'old' global crisis the 'new' global crisis? In fact, there probably is no old and new; they are most likely continuous. Thanks to the great and genius leaders of EU who did/could not make any decision for months and 'managed' to put the global system into trouble, we are now lucky to have the opportunity to chit-chat about this issue. [More]
    Interesting developments
    Fatih Özatay, PhD 06 May 2010
    The global financial system is facing a tough challenge. On Tuesday significant drops were seen both in European and US stock exchanges. It is doubtless that such sharp movements were also observed in the near past, so remaining calm might be a good thing to do. However a rumor about Spain is addressed as one of the reasons behind the fall in stock exchanged. Web pages are occupied by numerous scenarios pertaining to the budget deficits, debt repayments over the years ahead for Greece, Portugal, Spain, Ireland, and Italy and the European countries which hold the Treasury bills issued by these countries. And we should note that his happened despite the announcement of a bailout plan for Greece. [More]
    The two crises and confidence
    Fatih Özatay, PhD 03 May 2010
    I will continue 'the story of two crises' series. My target is to draw some prospective lessons. The lessons to drag will be shaped on the basis of the answers to these fundamental questions: What are Turkey's main vulnerabilities in the second decade of the 21st century? What can we do to overcome these? [More]
    Is it contagious?
    Fatih Özatay, PhD 02 May 2010
    We first became the expert of the US economy, and now Greek economy. We cannot stop writing a commentary on the state of affairs in Greece occasionally. The last commentary was also on Greece, but I am willing to add another one to the list. This time I want to focus on the dimensions of the Greece case that frightens Turkey as well. The question is; will the crisis in Greece transmit to EU member countries and Turkey? [More]