It is not easy to save in Turkey, we generally live with debt management and a gift economy. This is the part I call debt management, by juggling credit cards, withdrawing money from one and depositing money from the other. control the situation.

The gift economy in general is “You do my job, I’ll do yours” logic, because it is not always possible to find the financial resources to solve something. Those who can put some money aside immediately ask this question: “What about the dollar?”

Yes, TL has historically been against the dollar continually lose value Buying dollars is one of the easiest ways to protect against inflation or depreciation of a currency and TL. So is this really the most logical investment instrument? Is it even an investment vehicle?

First of all: what is an ‘investment instrument’ and what is not?

The logic of the investment instrument is that the asset you purchase is intended for you. gotta make money. This could be a bond, a deposit account, real estate, there are several alternatives.

At this point, it is both right and wrong to consider foreign currencies as an investment instrument. The wrong situation is this: I converted my money into foreign currency, now it will increase in value. Yes, it is valued according to TL, but there is such a thing as dollar inflation. 10 years ago To reach the purchasing power of $100 today, you would need to purchase $133. there is a need.

Yes, if you say:I perform arbitrage trades, I can earn income from my foreign currency beyond the exchange rate change..”, then you can accept it as an investment instrument. Otherwise Foreign currency and of course dollars It is also a means of payment. Somewhere in the world someone pays dollars and buys waffles etc., it serves no purpose other than TL. If we understand this, we will benefit.

Now let’s look at dollar inflation with available resources:

Firstly, one of the oldest methods belowlater to the stock exchangeand after that to real estate We will compare their performance against the dollar. If you want to decide for yourself, you can compare the dollar with almost anything you want and whose price change chart you can find.

Let’s take a look at the underside first:

Right now our work is very simple, because XAU/USD We have a parity that shows how many dollars we buy the same amount of gold in different periods. Gold has fallen against the dollar over the past year 8.73% value has gained.

As we expand the time period in the table, the difference becomes more dramatic. Parity emerged Gold since 1833has gained 9730.2% against the dollar.

Let’s come to Borsa Istanbul…

The dollar will fully appreciate against TL in the five-year period. with 482.10% value gained. So if you bought a dollar that day with 10,000 lira, you would have 48,200 TL today. Do you think it’s a good profit? Minimum wage in the same period 8.4 times It increased. BIST100If you were to divide this money equally and invest it in companies, that would be your money 96,300TL It would pass.

What is the housing situation?

Of course there is a lot of variation in the housing market, from location to location and from building to building, but… Central Bank of the Republic of Turkey The House Price Index report we announced will come to our rescue in this regard.

Since the 2017 to 2023 comparisons are the last comparisons we have, we’ll look at that index change. In this case in Turkey In the period 2017-2023 homes are full on average 11.5 times is appreciated. So if you sold a house in 2017, invested the money in dollars and tried to buy the same house again, at best (If you buy dollars at the cheapest price and exchange them at the top), your money would increase 8.3 times. the price of the house For 28% You had to find money.

Bonus: tea brand

To drink tea before the pandemic, shop at the retailer’s teahouse Tea brands that were bought for 1 lira each now cost 10 lira. is given. We call it cheap if you drink oral for 10 lira.

As a result, while buying dollars partially protects us from inflation in TL, it does not protect us from dollar inflation. For investments to be truly meaningful, they must allow us to generate profits despite inflation.

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