Lira Doomsayers Are Preaching to the Converted on YouTube

(Bloomberg) -- The audience that Turkey’s central bank most needs to break the dollar’s hold on the economy isn’t tuning in.

Instead, the attention of hundreds of thousands of Turks is on YouTube, where a cottage industry of self-styled analysts, economists and journalists has been broadcasting that the worst is yet to come for the lira.

The unwillingness by locals to part with their dollars is one reason that higher interest rates are back on Turkey’s agenda this week, when policy makers may deliver the Group of 20’s first hike of 2021. Despite winning over some skeptics abroad, the central bank’s embrace of more orthodox policies is proving no match at home for a narrative about what can and will go wrong for Turkey’s currency.

With a following that rivals Turkey’s biggest newspapers, the current crop of pundits is drowning out the largely state-controlled media and benefiting from appetite for alternative views about the economy.

Among the star purveyors of such content on YouTube is Murat Muratoglu, 48, who frequently sports Star Wars-themed T-shirts and introduces himself as “the dark lord of economics.” Formerly a finance industry professional, Muratoglu steers clear of jargon and has plenty of scorn for Turkey’s decision makers as he often questions official data.

“Looking at the economic situation, it seems we’ll be earning our money for bread from these videos for at least two more years,” Muratoglu said.

His carefully crafted videos rack up about half a million views when the prospects for the lira are in focus. Already well-known as an economics columnist at the opposition Sozcu newspaper, Muratoglu says Turks will be selling the lira whenever it strengthens to the psychologically important level of 7 per dollar.

It’s a view borne out by recent market jitters, with the lira among the worst performers globally over the past month after staging the world’s biggest rally since early November. The central bank’s pause from rate increases hasn’t helped, especially in the face of faster inflation.

Read more: Turkey Bulls Bet a Rate Hike Will Make Lira Carry Hard to Resist

Two rate hikes late last year tilted the market back in favor of the lira -- but not enough to change the minds of most Turks. Hard currencies still account for more than half of all bank deposits, which together with gold amount to just over $230 billion, equivalent to more than a third of the economy.

“It takes time to build trust, but it can be shattered quickly as witnessed over the last few years,” Rabobank strategist Piotr Matys said by email.

Meanwhile, on YouTube, warnings abound that capital from abroad can’t keep the lira strong for long.

“As long as we have high inflation, citizens won’t hold the lira,” says Evren Devrim Zelyut, an Istanbul-based economist whose prediction of an “economic armageddon in April” has almost 190,000 views. Zelyut was briefly arrested in December 2019 following a complaint about his comments.

Journalist Selcuk Gecer describes the current environment as “the calm before the storm” in a video watched about 150,000 times. In his view, policy makers will cut rates to stimulate housing.

“Make no mistake: 2021 will be a copy of 2020,” he says.

©2021 Bloomberg L.P.