Crypto News & ICO Reviews
Most people are well aware of the current living conditions in Turkey. Erdogan is making some very controversial statements which do not go over well. It now appears the country is suffering from dwindling credit and a Turkish Lira devaluation. The new plan by the government is to start confiscating gold assets. A radical step that will set a very dangerous precedent, to say the least.
It is never a good idea to start confiscating private assets without batting an eye. For some reason, the Turkish Central Bank feels that is their best course of action right now. While the institution aims to aid citizens with financial struggles, taking away gold assets is not the answer. In fact, this is a very dangerous precedent that can effectively cripple the country in a few years.
All Your Gold Assets Are Belong To Turkey
As one would expect, the bank is not doing this out of kindness. Instead, they aim to use these private gold assets for themselves to boost the Turkish economy. A very strange sentiment that will cause a lot of backlash and public outcry over the coming months. It has to be said, however, the bank is quite clever when it comes to confiscating private assets. In fact, they will launch two new investment opportunities, to mask their real intentions.
One of these options comes in the form of a new gold bond. The other option is a trading instrument for the loan of both gold and gold-based jewelry. While that sounds inconspicuous, the ultimate goal is far less innocent than people may think. On the surface, citizens who invest in these new opportunities will earn additional incomes. However, they are effectively turning over their private assets to the Turkish government, without there being any guarantee of ever getting it back.
Moreover, the Turkish government claims to provide a fixed interest rate during the term of the gold bond. That is highly improbable during these times of financial volatility. In fact, Turkey is suffering from a devaluing Lira, due to Erdogan’s recent comments. Moreover, the country has less credit than ever before, forcing the Central bank to look for other measures. In this case, going after consumers’ private assets seems to be their only option.
It is evident banks around the world are grasping at straws to remain afloat these days. Confiscating private gold assets in the form of a soon-to-be-defaulted bond is very dubious. Moreover, it remains unclear how the bank plans to pay these fixed dividends over an extended period of time. Since Turkey can’t borrow internationally, there will be no fresh capital coming in anytime soon. A very uneasy situation, that much is certain.
Header image courtesy of Shutterstock