The inflation rate of the Turkish lira rose to 79.6 per cent in June. This is the highest rate since 1998.
The figures come from the Turkish statistics office TÜIK. In the Netherlands, it was mainly the energy prices that led to high inflation in recent months. In the Euro-Asian country, especially food, furniture and transport are significantly more expensive.
Inflation has everything to do with the country's monetary policy. The reason is the central bank, but also the long arm of president Erdogan.
Normally, when there is inflation, interest rates are raised. This is what the European Central Bank, the Federal Reserve and the Bank of England all started doing recently.
Erdogan chooses a less traditional policy. He keeps the interest rate as low as possible thanks to his direct influence on the central bank.
He wants to stimulate the economy: free money means more spending and consumption, which in turn should ensure a better economy. In the eyes of the president, high interest rates are the 'mother of all evil'. The Koran cites the charging of interest on debt (usury), which is haram (forbidden).
So all Turks who hold their savings in lira will see their value evaporate. In other words, of the 100 hours they worked a year ago, only 20 are left. Due to inflation, 80% of the work done (saved in money) is lost.
Many people see bitcoin as an alternative in such dire circumstances. In bitcoin there is no central bank to manipulate interest rates. New money is issued on a fixed, transparent and predictable schedule.
21 million bitcoin in total, currently 6.25 BTC per new block, which halves every four years. This gives bitcoin guaranteed scarcity, allowing it to hold its value over the long term. Despite price volatility, bitcoin's trend has always been upwards.