Wednesday, 19 February 2014

Step backwards in Turkey


As I always say, I don't aim to write a blog about politics or law in Turkey. But as a Turkish citizen, I will be sad forever what it's happening in Turkey about new internet law. So, I needed to say or write a little bit. After that the Parliament has adopted this law, to expect a different vision from the President, it would be irrational. If we think that all the authorities (as belong to the government, in these days... Just we need to see that these laws, these approvals, are such that step backwards. While they have already started with Turkish press (where we couldn't/can't see anything that the government didn't want/doesn't want). Now, they interfere in all our rights of information access. Just as a open letter to the all web browsers and to the all search engines... Help!!!

Thursday, 30 January 2014

money policy decisions at midnight

The situation in Turkey from December, 17 was continuing, with especially EUR/TRY and USD/TRY rates, (recorded highest rates as... 3.203 and 2.3335)
Then, Central Bank of Turkey decided to intervene as for controlling this high leakage of Turkish Lira.
Today I mean at midnight, they have announced that the interest rates and one week repo rate  in the interbank market and BIST Repo Repurchase-Reverse Repurchase Agreement markets, have been increased as: 

  • Overnight Interest Rates: Marginal Funding Rate from 7.75% to 12%, borrowing rate from 3.5% to 8%, and the interest rate on borrowing facilities provided for primary dealers via repo transactions from 6.75% to 11.5%.
  • One-week repo rate, from 4.5% to 10%.
  • Late Liquidity Window Interest Rates (between 4:00 p.m. – 5:00 p.m.): Borrowing rate is kept at 0%, lending rate, from 10.25% to 15%.

With these these announcements, EUR/TRY and USD/TRY rates followed a downtrend during the day. But, in the medium run, surely, a high inflation rate problem can be arisen.
On the other hand, tonight The US Federal Reserve reduced its monthly asset purchases by $10bn - as expected. But this reduction in the monetary expansion of USA, even it has been expected, in Turkey, can cause the expectations about increasing of USD/TRY rate. In the medium run, I think that Central Bank's interest rates decisions will be less effective on USD/TRY rate than EUR/TRY rate.

Monday, 6 January 2014

some corruption in these days

In these days, in Turkey... having a government which is on the news with some corruptions and bribery scandals. Actually, all Turkish people need more explications about this scandal, especially from prime minister. But, on the contrary, instead of making a detailed declaration, he defends his ministers and deputies.
We can just see meanwhile, how doesn't it work our law system... as the recent lawsuits (e.g Balyoz, Ergenekon)... But, these recent lawsuits won't be this post's topic.
How doesn't it work our law system, while the government can change all constitutional provision as they wish and while all prosecutors are accredited by the government as they wish...
We can see at the same time, how doesn't the government reach to the targets for exchanges rates.
As of the last friday of 2013, EUR/TL was 2.97 and USD/TL was 2.15, BIST 100 index was 63.885.
Also, we could see two kinds of TV channel, just as during the Gezi Park protests. Because, people protested this corruption and bribery scandal on the streets, in Istanbul, Ankara etc. Most TV channels do not show anything, while these protests are broadcast live by 2 or 3 TV channels.
At the same time, while the prime minister declares to the people which acclaim him at the airport, that the nation will decide at the elections whether these ministers and deputies are guilty or not. That means that if Turkish people vote for this political party, he can say then these ministers and deputies are innocent. However, it is clear that it's only the judicial authority which can decide.
Where the most powerful side of them is  "economic stability" according to them, it is not possible to see an economic stability situation with these figures of exchange rates and stock exchange indices. For foreign and domestic investors, Turkey  is on the way to not be a secure place. Happy new year and goodbye hot money...

Saturday, 14 September 2013

need of an economic theory

More than a statistical analysis... Before all that we will do, we need an (or more than one) economic theory (theories). That is true that statistics will always help us, but not will be alone to help. All results can be significant, but unless there is not a connection with an economic theory. 

So, an econometrician may not be a specialist on each economic theory, but at least has to know the recent literature of own research. But, in my opinion, to know a subject is more important than to do numerous analyses without knowing exactly the economic theory behind the research subject. 

It is clear that, while explaining an economic relation, ignoring the economic theory behind this economic relation, is not reasonable. 

Our knowledge about the theory is helpful and guiding about our expectations from our estimations. To know, to interpret and to use our findings, always there exists a need of an economic theory. 


gks


Monday, 2 September 2013

econometrics with a few words

I would like to start with Peter Kennedy's definition, "Economists are people searching in a dark room for a non-existing black cat; econometrician are regularly accused of finding one". Our interrogative pronoun is not "where".. we need a question more detailed, as "how we are far from the black cat, how much do we do mistake when we estimate the location of this cat, etc, etc..."

Sure, i have to talk about other definitions of the econometrics, after the origin of the word "econometrics".
e-con-o-met-rics; means "economic measurement" from its Greek etymological origin. 

Maybe a good definition is "the quantitative analysis of actual economic phenomena based on the concurrent development of theory and observation, related by appropriate methods of inference" from "Report of the Evaluative Committee for Econometrica" of P. A. Samuelson, T. C. Koopmans and J. R. N. Stone (1954).

Imagine a discipline which uses economic theory, mathematical economics, economic statistics, and mathematical statistics... and obtains estimation results. 

These estimations that we use to see the behaviors of our obtained model(s) and to interpret the economic theory. 

Obviously, the aim is not just to see... The importance of the econometrics starts at this point!...We need to see the future, when we are not the astrologists or something... we are not able to do this. 

We need to do the forecasts according to our findings and our model(s). 

Why these forecasts are so important...? To make a decision... And all this story starts from here, only for a decision... From a person's decision to a firm's decision, to a country's decision...

It was just a basic start point or a kind of definition of econometrics... 


gks