QE será, será
I always dismissed arguments that the eurozone’s time as an economic power was up, pointing out the strengths of the common currency area. But I finally realized that I have been wrong all along.
I start my latest Hurriyet Daily News (HDN) column by explaining why the Europeans do not know how to conduct monetary policy:)- I guess humor is the best weapon against repression:) I then discuss the impact of the European Central Bank’s quantitative easing (QE) on the Turkish economy and Turkish assets. As always, you can read the whole thing at the HDN website.
I don’t have much to add, except that I wish that all those over-jubilating over QE would have spent some time to look at the impact of a weaker euro on Turkish exports. Not that I expect a plunge in exports. If nothing else, I just don’t see the euro weakening much more than its current levels, and the negative price affect should be counterbalanced by a positive income effect, as the Euro Area economy improves. I would show you a graph to that effect, but for some reason, my data program Turkey Data Monitor is not working properly in my replacement laptop. But I didn’t really try it very hard, as I will be formatting (and upgrading) this laptop in a couple of weeks. Anyway, I am just surprised that everyone mentions the capital flows, but no one exports…
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