4 ms·

We were just starting a startup, and bought all computers, monitors, chairs, desks etc. when $/TL was around 8.5. Now one dollar is 12.5 TL. At least our rent f

by CSDude 5y ago

We were just starting a startup, and bought all computers, monitors, chairs, desks etc. when $/TL was around 8.5. Now one dollar is 12.5 TL. At least our rent for 140m2 is around 1000$ in a very good spot.

throwaway4good 5y ago
Is the cost of living (food, rent, price of a coffee at a bar ...) in lira going up at the same pace? Or is the inflation only felt in imported goods suchs computers, gasoline ...
- johaugum 5y ago
  Ostensibly, goods imported and bought with USD will have their prices inflated, while locally produced goods and services should remain more or less unchanged. This also means that exported goods are effectively cheaper for international buyers, so export volume goes up.
  - umeshunni 5y ago
    > while locally produced goods and services should remain more or less unchanged. What usually happens is that since oil is denominated in USD, the price of fuel and transportation rises when a currency weakens and that increases the price of locally produced goods as well.
  - mastax 5y ago
    This is felt especially acutely because most Turkish debt is denominated in foreign currency (~70%) and the vast majority of trade is as well (I remember 85% but can't find a source). So inflation is felt immediately.
  - mrtksn 5y ago
    > This also means that exported goods are effectively cheaper for international buyers, so export volume goes up. That's Erdogan's theory. However in reality nothing stays cheap because anything Turkey produces has large component of imports, be it energy, parts or machinery etc. because the country is not a petrostate. The only thing that can stay cheap is the labour but that labour can stay cheap only if it sees huge drop in life quality since the stuff the people consume(petrol, cars, electronics etc.) see huge price increases. You simply can't keep the wedge of a worker at 5000 when the iPhone prices increase from 7000 to 11000, car prices jump from 200K to 300K and gas from 6 to 9.
  - can16358p 5y ago
    > while locally produced goods and services should remain more or less unchanged. This is not true for Turkish Lira because EVERYTHING is dependent on foreign currencies at some point. For example local agricultural goods shouldn't be affected, but all the machines in production line are imported, all their servicing equipment are imported. If one simply goes unofficial (e.g. Finding someone to service their machines totally in Turkey), even iron is based on foreign currencies as almost everything is either imported or owned by a foreign company (as the government sold everything to non-Turkish entities). Fuel is also imported and is directly correlated with foreign currencies. At the end of the day, everything, even local goods, is tied to foreign currencies.
    - pas 5y ago
      Sure, but the added value is local, which helps exports.
      - can16358p 5y ago
        Yup, it helps with exports but it simply can't outweigh the losses from devaluation and foreign dependency.
        pas 5y ago
        It's not a one time thing. It's a convergent process. It provides advantage as long as the currency is in that deprecated state. Basically the same work will cost less in the depreciated currency. This causes demand for that work, which causes appreciation of the currency.
    - Scoundreller 5y ago
      > For example local agricultural goods shouldn't be affected Why not? Unless they’re incapable of being exported
- randomluck040 5y ago
  A lot of things are getting more expensive but not at the same rate as e.g. electronics
- CSDude 5y ago
  It used to be OK. However, recent increase and the longer increase with start of Covid started to amplify in all goods. Even bread is now 1.5/2x more expensive, restuarants are 2x expensive compared to 1YR, because of cascading increases in every industry, mostly transportation and goods. For instance, the wood for the kitchen is increased almost 3x in 6 months according to our guy. Tech workers are mostly in good spot, (great if working remote). However, in Turkey, minimum wage is almost average wage. I feel very bad for most people, and try to give anyway I can. Car prices are ridicolous. I could almost buy a Tesla Plaid in US at the price of a BMW 320 here. But it's due to high taxes. These taxes were introduced in the '99 earthquake, meant to be temporary. But those taxes are everywhere, named like "Luxury Consumption Tax".
  - jopsen 5y ago
    > But those taxes are everywhere, named like "Luxury Consumption Tax". Are those taxes effectively targeting products that are imported? It's classic trick to improve the trade deficit.. I would guess that getting rid of them would only further crags the currency.
    - pasabagi 5y ago
      I think in general luxury goods taxes are underexploited. People normally want to buy expensive things so they can show off how much money they have. May as well make them more expensive, and divert some of that cash to useful purposes.
      - jopsen 5y ago
        Maybe... My point was that often these taxes are actually targeting imports, and not necessarily "luxuries". Well, that also depends on how you define luxuries :) I personally don't mind taxes, but consumption taxes, even on "luxury items" are generally likely to be regressive in nature. So maybe don't use them...
        pasabagi 5y ago
weird-eye-issue 5y ago
Sorry I'm a bit confused. Isn't that a good thing you bought stuff when the TL was worth more?
- CSDude 5y ago
  Yes, exactly. I just wanted to emphasize the increase amount and what we would pay if we were not fast. We saw the increase miles ahead and bought all the stuff out of our own pockets.
- Rexxar 5y ago
  Are people so used that everybody complain on everything that positive comments cannot be understood anymore ?
  - weird-eye-issue 5y ago
    They said "At least our rent..." after the statement which is interpreted as the previous statement being a negative. Like "I had a bad day. At least I got ice cream." is valid but "I had a great day. At least I got ice cream." doesn't really make sense
  - aloknnikhil 5y ago
    Well I was confused too. And for exactly the same reason as the other commenter. For a minute I assumed they were in the US buying furniture and equipment from Turkey and they were complaining about not waiting enough to get a better deal.

by CSDude 5y ago

throwaway4good 5y ago

Is the cost of living (food, rent, price of a coffee at a bar ...) in lira going up at the same pace? Or is the inflation only felt in imported goods suchs computers, gasoline ...

johaugum 5y ago
Ostensibly, goods imported and bought with USD will have their prices inflated, while locally produced goods and services should remain more or less unchanged. This also means that exported goods are effectively cheaper for international buyers, so export volume goes up.
- umeshunni 5y ago
  > while locally produced goods and services should remain more or less unchanged. What usually happens is that since oil is denominated in USD, the price of fuel and transportation rises when a currency weakens and that increases the price of locally produced goods as well.
- mastax 5y ago
  This is felt especially acutely because most Turkish debt is denominated in foreign currency (~70%) and the vast majority of trade is as well (I remember 85% but can't find a source). So inflation is felt immediately.
- mrtksn 5y ago
  > This also means that exported goods are effectively cheaper for international buyers, so export volume goes up. That's Erdogan's theory. However in reality nothing stays cheap because anything Turkey produces has large component of imports, be it energy, parts or machinery etc. because the country is not a petrostate. The only thing that can stay cheap is the labour but that labour can stay cheap only if it sees huge drop in life quality since the stuff the people consume(petrol, cars, electronics etc.) see huge price increases. You simply can't keep the wedge of a worker at 5000 when the iPhone prices increase from 7000 to 11000, car prices jump from 200K to 300K and gas from 6 to 9.
- can16358p 5y ago
  > while locally produced goods and services should remain more or less unchanged. This is not true for Turkish Lira because EVERYTHING is dependent on foreign currencies at some point. For example local agricultural goods shouldn't be affected, but all the machines in production line are imported, all their servicing equipment are imported. If one simply goes unofficial (e.g. Finding someone to service their machines totally in Turkey), even iron is based on foreign currencies as almost everything is either imported or owned by a foreign company (as the government sold everything to non-Turkish entities). Fuel is also imported and is directly correlated with foreign currencies. At the end of the day, everything, even local goods, is tied to foreign currencies.
  - pas 5y ago
    Sure, but the added value is local, which helps exports.
    - can16358p 5y ago
      Yup, it helps with exports but it simply can't outweigh the losses from devaluation and foreign dependency.
      - pas 5y ago
        It's not a one time thing. It's a convergent process. It provides advantage as long as the currency is in that deprecated state. Basically the same work will cost less in the depreciated currency. This causes demand for that work, which causes appreciation of the currency.
  - Scoundreller 5y ago
    > For example local agricultural goods shouldn't be affected Why not? Unless they’re incapable of being exported
randomluck040 5y ago
A lot of things are getting more expensive but not at the same rate as e.g. electronics
CSDude 5y ago
It used to be OK. However, recent increase and the longer increase with start of Covid started to amplify in all goods. Even bread is now 1.5/2x more expensive, restuarants are 2x expensive compared to 1YR, because of cascading increases in every industry, mostly transportation and goods. For instance, the wood for the kitchen is increased almost 3x in 6 months according to our guy. Tech workers are mostly in good spot, (great if working remote). However, in Turkey, minimum wage is almost average wage. I feel very bad for most people, and try to give anyway I can. Car prices are ridicolous. I could almost buy a Tesla Plaid in US at the price of a BMW 320 here. But it's due to high taxes. These taxes were introduced in the '99 earthquake, meant to be temporary. But those taxes are everywhere, named like "Luxury Consumption Tax".
- jopsen 5y ago
  > But those taxes are everywhere, named like "Luxury Consumption Tax". Are those taxes effectively targeting products that are imported? It's classic trick to improve the trade deficit.. I would guess that getting rid of them would only further crags the currency.
  - pasabagi 5y ago
    I think in general luxury goods taxes are underexploited. People normally want to buy expensive things so they can show off how much money they have. May as well make them more expensive, and divert some of that cash to useful purposes.
    - jopsen 5y ago
      Maybe... My point was that often these taxes are actually targeting imports, and not necessarily "luxuries". Well, that also depends on how you define luxuries :) I personally don't mind taxes, but consumption taxes, even on "luxury items" are generally likely to be regressive in nature. So maybe don't use them...
      - pasabagi 5y ago

weird-eye-issue 5y ago

Sorry I'm a bit confused. Isn't that a good thing you bought stuff when the TL was worth more?

CSDude 5y ago
Yes, exactly. I just wanted to emphasize the increase amount and what we would pay if we were not fast. We saw the increase miles ahead and bought all the stuff out of our own pockets.
Rexxar 5y ago
Are people so used that everybody complain on everything that positive comments cannot be understood anymore ?
- weird-eye-issue 5y ago
  They said "At least our rent..." after the statement which is interpreted as the previous statement being a negative. Like "I had a bad day. At least I got ice cream." is valid but "I had a great day. At least I got ice cream." doesn't really make sense
- aloknnikhil 5y ago
  Well I was confused too. And for exactly the same reason as the other commenter. For a minute I assumed they were in the US buying furniture and equipment from Turkey and they were complaining about not waiting enough to get a better deal.