Turkish market not so valuable yet

When pounded at the right time a hammer can solve all uncertainties. The time relation between markets and investor functions just like a smart meter in power grids. Smart meters charge the highest price during a switchboard’s prime time and the lowest when the switchboard is not often used based on 24-hour power consumption. Losses on high-tension lines become gigantic in times of high consumption. Heating up due to a heavier burden on the grid means higher costs. Extraordinary consumption demand can force the transformers or even the main feed. All difficult processes of real life reflect themselves as risk in finance.

Economic warm-up ahead of 2008 had paved the way for the collapse of developed economies among the global systemic crisis. High demand for US bonds and the Federal Reserve’s balance sheet of $4.5 trillion has created a new balloon. Can the Fed start the normalization process with gradual rate hikes and steps to shrink the balance sheet? We will see. Markets in developed and some emerging markets overheated. And they reached risky levels when their balance sheets didn’t support such price increases.

What’s the case for Turkey? Let us first underline something: During the bankruptcy of Lehman Brothers, the extension of the Eu- ropean Debt Crisis to the whole continent and the failed 15 July coup attempt, we experienced some collapses in proportion with “cost/benefit” and saw recoveries afterwards. We significantly differentiated with US markets and still do. We have our own specific risks just like our opportunities: geopolitics and our applications regarding terrorism and investment are perceived as risky. And this is reflected in prices. Is the Turkish market cheap or expensive? The timing of entry and exit lies behind the answer to that question. The Turkish market is not so valuable yet and unfortunately, it’s not that cheap either. It’s all about the timing. In other words, it’s about to pound the hammer at the right time and at the right speed.