• March 2024 (1)
  • December 2022 (1)
  • March 2022 (1)
  • January 2022 (1)
  • November 2021 (1)
  • October 2021 (1)
  • September 2021 (2)
  • August 2021 (4)
  • July 2021 (3)
  • June 2021 (4)
  • May 2021 (5)
  • April 2021 (2)

    Ill fate of the Competition Commission of Pakistan
    Güven Sak, PhD 02 October 2010
    What is the first thing that comes to your mind about Pakistan? For instance, it might be the destruction caused by the recent flood disaster. The picture after the disaster will most likely not be erased from your memories easily. Or, you might think about Afghanistan. If you hear the word Pakistan, you will immediately recall the name Afghanistan. Recent news in the media reveals that there is a dispute on Afghanistan between the US and Pakistani governments. First, Pakistan cut off the path of the NATO troops to the supply base setting forth the missile attacks by the US towards Pakistani military forces. Then the US media featured a film about how the Pakistani troops in Afghanistan killed unarmed Afghani civilians. All of these are sure important, but what I immediately think of about [More]
    There is nothing much that the Central Bank can do
    Fatih Özatay, PhD 30 September 2010
    Capital movements are free in many countries for long. Substantial FX trade is carried out every day. Purchase and sale of different currencies depends on the expected return on the financial assets denominated in the relevant currencies, which are planned to be held. [More]
    Is not having a star sector the end of the world?
    Güven Sak, PhD 30 September 2010
    Last Tuesday I began my words stating that Turkey does not have a star sector. The term 'star' referred to sectors exports of which grew with a pace above the average and which had a high share in global market. If the evidence to the presence of the cake is its being eaten, the evidence to the star sector would be its global competitiveness. As the global competitiveness increased, sectors gained importance for the country economy. Then, is a country's not having a star sector the end of the world? It is definitely bad. But is there nothing to do for Turkey? Are the foreigners that praise Turkey to the skies completely wrong? Let us give quick answers to these questions. [More]
    Why does Turkey not have any star sectors?
    Güven Sak, PhD 28 September 2010
    I recently heard that star sectors of Taiwan have been changing. While the ICT sectors used to be more important, these were recently replaced with solar energy sectors. Hearing this, what question comes to your mind? Do not you think "What are Turkey's star sectors, then?" After all, we cannot just sit down and wait while some try to specify the new normal for themselves. At least, we should not. But I took a deeper look at this issue and I want to advice you not to deal with comparisons. The reason for this is quite simple: Turkey does not have star sectors that fit into the definition.  And this is the exact issue we must be worried about. Then, why Turkey does not have a star sector? It is certainly impossible to answer this question completely with one short commentary. But well begun [More]
    Story of the interest on required reserves
    Fatih Özatay, PhD 27 September 2010
    The most striking one of the decisions the CBRT (Central Bank of the Republic of Turkey) announced the last Thursday was the abolition of the interest on required reserves in lira terms. Let me put a small note for those who are distant to the issue: [More]
    Why should intervening in foreign exchange be the responsibility of the Central Bank alone?
    Fatih Özatay, PhD 26 September 2010
    I have postponed and avoided writing about this issue for long. But since I have been talking about exchange rate issue and as the issue was featured on the morning news of business TV channels, it is the right time to talk about it. It is about the intervention in the foreign exchange market in Japan. You can find a number of featured stories on the Internet on this intervention as well as the earlier ones. I will quote from a banks news report dated September 15: "Japanese Ministry of Finance have intervened in the FX market for the first time in six years. Minister of Finance Noda confirmed the intervention and stated that they have also communicated with authorities overseas... It is declared that the Minister of Finance has sold one trillion yens... Shirakawa, President of Bank of Jap [More]
    Do you follow the developments in Kashmir?
    Güven Sak, PhD 25 September 2010
    What first comes to your mind when you hear the word Kashmir? For me, it is 'Bush the Second'. Or more precisely, it is a cartoon featured in The New York Times right after the first time the Second Bush was elected. It was times when it was commonly discussed that Bush knows nothing about foreign policy. But, he was elected as the President anyway. In the cartoon Bush and his mentor Chaney stand together. Bush the Second asks: Do India and Pakistan fight over a (cashmere) sweater? Chaney, trying to stay calm responds: "Kashmir is a region, sir." By the way, I would like to put a quick note:  Did you know that Chaney's heart does not beat anymore? His blood circulated with the help of a machine. Just like a vampire movie! I wonder if his image is reflected on the mirror. Anyway, today's to [More]
    How much the interest rate must be cut to increase the exchange rate?
    Fatih Özatay, PhD 23 September 2010
    My last commentary ended with the following sentence: What is behind this 'terrifying' purchase-sale traffic in the exchange rate market if it is not the need of foreign exchange purchase and sales required for exports and imports? Since international capital movements are at significant amounts, the primary candidate for the answer goes like this: the difference between the expected returns on domestic bonds (of the country to which capital flows) and the expected returns on the bonds of country where capital flows out of. Largest the difference, expected FX inflow to the country (domestic) increases. [More]
    What is the similarity between Sarkozy and Erdoğan?
    Güven Sak, PhD 23 September 2010
    President of France Nicholas Sarkozy kind of sabotaged the European Union summit meeting held the week before. He started to discuss with Barosso, President of the European Commission out of nowhere. The subject of the discussion was Sarkozy's decision to expel 700 Romans, who are citizens of EU member Romania and Bulgaria. Nowadays, everyone criticizes Sarkozy. In the meanwhile Sarkozy seems to have given an early start to the campaign for the general MP elections in 2012. In this sense, President Sarkozy is quite similar with Prime Minister Erdogan. They both are good at long term political planning. Let us see what the similarity between them is. [More]
    If it is about traffic, policy uncertainty can even cause death
    Güven Sak, PhD 21 September 2010
    While the referendum reduced political uncertainty, policy uncertainty has been increasing due to successive elections ahead. So, nowadays in advance we had better sit down and think how we can reduce the risk of policy uncertainty. I have written about this issue two times last week; so let me continue with this today. Policy uncertainty is not solely related with macroeconomic decisions. It is also about the traffic. Maybe it has escaped your notice: In July on the eve of the referendum, the fee for transporting passengers on foot in minibuses was cut. And then we started to see the results. Do not immediately ask what this has to do with the issue in question. Indeed, it has. Please hear me first. [More]