Thursday, March 28, 2019

"How Turkey Committed Financial Suicide" (plus an Avenatti drive-by)

From ZeroHedge:
We have extensively documented the ongoing collapse of Turkey's financial system in the last few days as Reserves plunge, credit risk soars, and the currency plummets...
...but Bloomberg macro strategist Mark Cudmore warns this is far more than just a 'Turkey' issue:
"The extraordinary stress currently seen in Turkey’s lira funding market may appear to be a niche issue, but the repercussions will be far-reaching."
Via Bloomberg,
Many commentators expressed surprise or even disbelief that ructions in the lira swap market caused knock-on effects from Sao Paulo to Jakarta. Yet the transmission is real. And it will persist, thanks to value-at-risk (VAR) limits and volatility targeting

Due to recent policy measures making Turkish lira funding prohibitively expensive -- one-week lira implied yields closed at 280% Wednesday -- it’s become almost impossible for many foreign investors to sell the lira.
This isn’t just about making it too expensive for short-sellers to borrow the currency. The problem also applies to those who are long lira and wish to exit their positions; they are trapped as it’s too costly to unwind their FX swaps....MUCH MORE
Which is why we titled yesterday's post "Turkey: Just Try To Get Your Money Out (TUR)".

Also at ZH: 
Michael Avenatti, Pedophilia , & A Fainting Heiress: NXIVM Sex-Cult Trial Gets Kinked Up In Court
Seagram heiress Clare Bronfman had a dramatic day in court Wednesday where the accused NXIVM sex-cult financier fainted in response to being asked if she'd secretly retained lawyer Michael Avenatti....
We were again able to stay a half-step ahead of ZeroHedge with Monday's:
"Seagram heiress gave prosecutors the death stare during Nxivm trial"
but it is not easy, wherever fainting heiresses are to be found there also is ZH..