Calis Beach and Fethiye Turkey Discussion Forum
Information and Services in Turkey Section => Banks, Interest, Money Transfers, Insurance => Topic started by: Scunner on March 05, 2015, 23:22:30 PM
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Today, as the lira missed 4 to the pound by a whisker reminded me of how this long, steady decline affected us - and how we now realise how we were spared a far worse fate.
When we brought our money back to the UK we did so in two halves - we had sold our place when the lira was 2.76 and possibly quite ridiculous with hindsight had even thought we might make a little bit of an extra killing if the rate dropped back to say 2.45 and we then changed our liras to sterling and would have made maybe another 10%!
We had to bring half back immediately due to commitments here and were content enough at 2.76/£ (but would have waited for that 2.45 rate had we a choice!!). By the time we came to bring the other half back the rate had gone on a slow, painful slide which caused me to develop some sort of financial OCD - I was checking the rate almost obsessively - some days I would feel the pain as it weakened two or three times in a day, but recovered two or three times too. So in effect I was stressing all day long over a rate that ended the day exactly where it started!
I took plenty of advice - I have an email still where one banking character in Fethiye told me (at 2.93) that he had "discussed it with the bosses in Istanbul and they were sure it would never go over 3/£. By the time we made the decision, we changed at around 3.18 and I don't mind admitting that nearly killed me. You can always find bright horizons if you need to see them, but there were far more black skies and bad headlines in the news. At the same time, people were getting hugely excited about getting so many liras to the pound for their holiday spends and you can't help thinking good for you, you are going to save 10p on an Efes while my family's future is eroding away. Selfish, I do realise that.
In the end, looking back now, I think we moved it as much to put an end to the speculation and worries as much as wanting to move the money for a particular reason. It worked, once the money was in pounds my ritualistic refreshing of the exchange rate websites stopped, there and then. Something that occupied my mind almost always had just, that day, gone.
Today I look at that 3.9998/£ rate and my heart goes out to those who are still playing the game I played - although in some ways it's not a game and you aren't playing it - there aren't enough viable options for it to be played. You gamble by cutting loose or you gamble by staying in and hoping. There's no safe or educated answer when you are on the inside looking out.
Fair play to those getting 4+ to the pound perhaps for this year's holidays - I'm actually one of you now. Also those living forever out in Turkey - the number of lira to the pound is irrelevant to them, luckily. But for those who have property/savings over there (and property priced in pounds is getting more expensive daily for those buying in lira) who at some stage need to cash in and buy sterling, it is a pretty awful journey.
But I would say do it, if you can. Get it out and get on with enjoying your life.
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An interesting piece Scunner, particularly reflecting the emotional roller coaster of the FX rate when really you can only affect it in three ways, get in, get out or stay with it!! Never mind the issues of whether it is the £ or the TL performance that is driving the rate, or indeed the mighty $.
We moved the bulk of our TL savings back to sterling last year, and whilst at the time it was a painful emotional and financial experience, it now looks like we done the right thing. We did this after Reg drove down the TL rate last year in the run up to the elections held then. We still have some savings here but we are drawing that down for day to day use, rather than bringing in any 'new' sterling. Which I suppose begs the question of whether to go back into TL or not, and if so when and at what rate, including the interest rates offered... never say never, but under Pres. Reg it is unlikely to happen.
You cannot believe what this man, almost single handedly, is doing to the Turkish economy - not forgetting he done the same last year. So he is either very dumb or very corrupt. I suspect the latter, as no one, no matter how dumb, could repeat the mistakes he made with the economy last year..... and still amongst the Turkish electorate the dumb, the pious, the women and large numbers of Kurds will continue to vote for him and the AKP.
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I was stressing all day long over a rate that ended the day exactly where it started!
I took plenty of advice...
I remember, I remember...
Best advice was courtesy of two bottles of Barolo and big plate of Italian Prawns ;)
Which I suppose begs the question of whether to go back into TL or not, and if so when and at what rate, including the interest rates offered...
If you could answer that question correctly you'd be a very wealthy (or wealthier?) man.
JF
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Best advice was courtesy of two bottles of Barolo and big plate of Italian Prawns ;)
Very true that, coupled with the thoughts of Uncle John :D
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im still going threw this trauma, ive taken half out (wished id taken it all) ive now got myself blocked from my finans bank account so need to ring up and cant get any numbers to connect! help! if anyone has a correct number for finnans bank from England i would appreciate it
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Try +90 850 222 0 900 then press 9 for an English speaking rep. You'll need your passport number (the one used when opening the account) and have access to the telephone number registered to the account.
JF
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thanks John, ive spoke to them , they want me to send a fax with an updated passport but my fax machine has got the + sign! any ideas?
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The + sign indicates use of the international dialling code. In this case replace the + with 00
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Thanks so much for your help fax now sent, hopefully will be able to log on soon and see what the rate from lira to pounds is, I'm not expecting good news!
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There does come a point where your "losses" are so great that hanging on for the long term may be more beneficial than jumping ship at the current rate. Not suggesting you do, just saying like...
JF
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That is possibly true. However things don't look like there's a big reversal coming any time soon. The decline seems to accelerate as time moves on. 2.52 to the dollar? It wasn't long ago it was 2.52 to the pound. And if it goes to 4.06 which is very possible, it will be double the old rate of 2.03 many of us remember clearly.
Hang on in there may be one strategy. Most people's experience in doing so has been disastrous and they wish they'd got out earlier.
I thought we'd got out far too late but history will show we were bloody lucky to get out when we did.
As I think I said previously - my heart goes out to all those still playing the 'trauma game'.
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Hang on in there may be one strategy. Most people's experience in doing so has been disastrous and they wish they'd got out earlier.
Exactly. If your investment is now worth so little in relation to the initial deposit then maybe, just maybe, it's better to write it off as a loss and see what happens a year, or two years or three years down the road. It'll still be accruing interest (well, thats a maybe also) so in lira terms, its increasing in value.
JF
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We bit the bullet in October last year..Daren't say how much we lost but not as much as if we had waited until this coming May when we can get out again... Now I am just looking how many Lira to pound to spend on our holidays.. We will re coup a bit that way. My heart goes out to them who have missed the boat now... I can't see it going back down any time soon especially if Erdogan has his way...
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It's all a very real problem for some and I can understand why but I can't help thinking that nobody (at least, nobody I know) ever stresses about the relationship their pounds deposited in UK banks has to the green back or Hong Kong dollar?
What I don't understand is that I meet people here who are not wishing or contemplating a return to the UK stressing out about this. I'm certainly no financial expert and please don't respond about the negatives of a weakening currency, I get all that but when the pound reached its low point in 2008, I don't recall very much talk of people buying wheel barrows to take the money round to Tesco's to buy a loaf?
Interesting alternative point of view regarding a strengthening currency can be found here: http://www.telegraph.co.uk/finance/economics/9404428/Strong-pound-is-UKs-weakest-link.html
I took some very good personal advice from Scunner on locating here, it has served me well and although I'm not going to discuss my personal financial circumstances, it's safe to say that if you are not sure whether a move to Turkey is your "forever location" then the old adage of eggs and basket applies.
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As ever more sound advice from Rimms
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It's all a very real problem for some and I can understand why but I can't help thinking that nobody (at least, nobody I know) ever stresses about the relationship their pounds deposited in UK banks has to the green back or Hong Kong dollar?
What I don't understand is that I meet people here who are not wishing or contemplating a return to the UK stressing out about this. I'm certainly no financial expert and please don't respond about the negatives of a weakening currency, I get all that but when the pound reached its low point in 2008, I don't recall very much talk of people buying wheel barrows to take the money round to Tesco's to buy a loaf?
Obviously people who have no plans to return to the Uk permanently ever should have no interest in how many liras they might need to buy a pound.
I'd suggest many perhaps do have a long term plan to return - but even those who don't are having to contemplate that their worldly wealth is eroding away if it is to be left to family who have no interest in Turkey and will convert it to pounds at the earliest opportunity and bring it back to the UK.
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It's all a very real problem for some and I can understand why but I can't help thinking that nobody (at least, nobody I know) ever stresses about the relationship their pounds deposited in UK banks has to the green back or Hong Kong dollar?
What I don't understand is that I meet people here who are not wishing or contemplating a return to the UK stressing out about this. I'm certainly no financial expert and please don't respond about the negatives of a weakening currency, I get all that but when the pound reached its low point in 2008, I don't recall very much talk of people buying wheel barrows to take the money round to Tesco's to buy a loaf?
Interesting alternative point of view regarding a strengthening currency can be found here: http://www.telegraph.co.uk/finance/economics/9404428/Strong-pound-is-UKs-weakest-link.html
I took some very good personal advice from Scunner on locating here, it has served me well and although I'm not going to discuss my personal financial circumstances, it's safe to say that if you are not sure whether a move to Turkey is your "forever location" then the old adage of eggs and basket applies.
Couldn't agree more on the eggs and baskets line. Even though we have no intention of leaving Turkey, you can never predict what's round the corner and we still need to go back to the UK sometimes. We definitely like to keep our options open. :)
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I came across an interesting statistic today - well it interested me anyway. I was looking for information on whether Turkish people hold their money in lira, or in dollars and euros. What I found instead was about the importance of gold. Figures from 2012. Turkish commercial banks holding of gold = $8.67billion. Turkish Central Bank holding = $11billion. Turkish citizens holding gold in their own homes, estimated at ..................... $300billion. Wow!
http://www.ibtimes.com/turkeys-govt-wants-citizens-store-gold-banks-not-homes-428720
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Gold has always been the preferred saving method in Turkey That's why there are so many jewellers. ;) It's not just to satisfy the tourist market. It's amazing the amount of gold on show if you're lucky enough to be invited to a Turkish engagement party or wedding.
I think we often forget that the Turkey the majority of us see is just the Western, commercialised edge of a huge country and, although the USD, Euro, or £ might have an effect on the economy, most Turks's have a far better understanding of the value of gold than a currency they've never seen.
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At the moment anyone who is drawing an British pension is better off than they have been for quite a while.. However they are probably watching the interest rates as a lot of people went to live there when it was 20% and above.. If Erdogan has his way there will be a lot more worried people.. Rental prices were in the region of 500tl for a good place.. Now it is 900tl for anywhere of quality.. I know that some will be worrying that you if it came to selling their properties they will be a damn site worse off.. Either when they change it to sterling to return or to keep it in lira and live on falling interest rates..
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Gold has always been the preferred saving method in Turkey
I knew this in a general sort of way but $300billion-worth is a huge amount of gold. Rather a lot for shoeboxes under the bed!
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I was looking for information on whether Turkish people hold their money in lira, or in dollars and euros.
A recent estimate on where Turks keep their money put it at 64% in hard currencies. From experience, I suspect that is a conservative estimate even though it was made in Dec 2014 on the back of another fall in the lira. Of course everyone has a lira account, but most folks have a USD or EUR to back it up - those of a certain generation will also have harsh memories of devaluation and the rampant inflation of a few years ago.
I knew this in a general sort of way but $300billion-worth is a huge amount of gold. Rather a lot for shoeboxes under the bed!
Keeping a wedge in gold is common in many countries, especially in Asia. A quick wander round the gold section of the Kapalı Çarşı will let you see how much weight (no pun intended) the Turks place on gold. The most recent estimate I seen was that folks were holding approximately 48 tonne of gold, about $168 billion at todays prices.
I know both figures sound a lot, but when you factor in the traditional element of keeping gold and the population of Turkey (80m or so) it only works out at a couple of thousand dollars worth per head - if I've done my arithmetic correctly!
JF
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When I got married in Turkey to my Turkish husband I thought it strange that all guests were handing out gold bracelets etc. This is normal there and of more value to the new couple as opposed to buying them a toaster or kettle etc :)
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JohnF, know you have frequently posted along the lines of "Why do expats want to hold their savings in lira accounts when Turks don't do that?". I believe you to be right about this but wanted some statistical measure of how important it is to the economy. Similarly, I don't question your arithmetic on gold holding per head but I would suggest a different measure. If we assume children aren't the actual holders of gold, and nor - in many parts of the country - will women hold the wealth, I think a gold per household measure is more appropriate. There are about 20 million households in Turkey. So $300, 000 divided by 20 million = (I hope) $15,000 of gold per household on average. That does strike me as a really substantial wedge spread across the population.
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You're probably right Colwyn, I didn't give it a great amount of thought.
However, the only fact both of our posts prove is that we are unlikely to be members (if we were eligible of course) of the AKP as neither of us is confident when dealing with numbers with lots of zeros at the end. I mean, how could we make sure our baksis was correct?
JF
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It is a pity about AKP; seems a lucrative career choice. But, accepting the numbers cited, we have a picture of the "average" Turkish family holding $15k of savings in gold and, of the cash, 2/3rds in foreigner currency. Not much interest in lira saving accounts.
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I also suspect that there'll be an east/west split in relation to finance (not dissimilar to the literacy split). Those in the east are more likely to keep savings in gold and lira whereas those in the west more likely to keep there savings in hard currency and gold.
No facts to back it up, just my feeling. Unlikely to be breakdown held anywhere, or at least anywhere my Turkish can read!
JF
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Turkish families I am on close terms with buy gold, unsure of the amount, on an almost weekly basis.
I would imagine there are some lumpy mattresses in Turkey.