Friday, November 25, 2011

The Unburied Treasure of the Cairo and Rabat Genizas

From The Radio Times, Thursday, November 24th, 2011, with Marty Moss-Coane:

Sacred Trash: The Treasure Trove of the Cairo Geniza

 
 In the late 1800s, in a Cairo synagogue, a remarkable discovery was made – hundreds of thousands of Jewish manuscripts from the Middle Ages filled a small windowless room.  Letters, poems, trousseau lists, prayers, marriage contracts, and money orders were piled high, almost touching the ceiling.
Essayist ADINA HOFFMAN and MacArthur-winning poet PETER COLE have written a recent book about the find: Sacred Trash: The Lost and Found World of the Cairo Geniza.
[In this radio program] They tell Marty about the scholars who brought the long forgotten manuscripts to light and what the documents reveal about the people of the past.

Listen to the mp3


...and from the Jewish Review, 15 Nov 2011, by DEBORAH MOON: 

Grant to create multi-lingual online archive of Rabat Geniza


MOROCCAN GENIZA—When Oren Kosansky saw this pile of documents being collected for burial in a Rabat, Morocco, synagogue, he wanted to preserve some of the papers and books for future researchers.

A chance find of documents being collected in a Moroccan synagogue for sacred burial has evolved into a pilot project to create a multi-lingual online digital archive to make documents of a cultural history available to scholars and interested parties worldwide. Now an anthropology professor at Lewis and Clark College in Portland, Oren Kosansky was a Fulbright Scholar in 2005 when he chanced into the Rabat synagogue’s geniza, a storeroom for documents that might contain the name of God, which Jewish law forbids throwing away.
...Kosansky spent a feverish couple weeks sorting through thousands of old books, letters, invitations, raffle tickets and other scraps of paper before the synagogue buried the remainder in their cemetery. He donated the rescued collection to the Jewish Museum of Casablanca, Morocco.
Last year, Kosansky received a $50,000 grant from the National Endowment for the Humanities to create a digital archive of Morocco’s Jewish textual heritage from the 18th, 19th and 20th centuries as revealed by a sample of those rescued documents. A smaller grant this year from the Memorial Foundation for Jewish Culture will enable him to continue the project through next summer.
In addition to preserving a culture that has been dispersed around the globe in recent decades, the digital archive will also serve as a model for opening any culture’s textual heritage to researchers around the globe.
The first phase was to create archival quality digital photographs to be posted on the web. To date, about 75 percent of the approximately 3,000 documents have been photographed.
Digital archives of the much more extensive Cairo Geniza [see JIW posting above] are also available online—a very important research tool since the 300,000+ document fragments from that geniza are scattered in collections around the world.
...Formerly a French colony, Kosansky said Morocco’s Jewish population peaked at about 250,000 around 1950. Now, fewer than 100 Jews live in Rabat, said Kosansky, noting the population has declined across the North African country.......“The collection as a whole, not the individual books, are important,” said Kosansky. “If books are traveling, it also means people were.”
“The Rabat collection parallels the Cairo connection in that as the Cairo Geniza opened windows of a cosmopolitan Jewish world in the medieval period, the Rabat Geniza can help with understanding the same in the 19th century,” he added.

Russia's Medvedev and Iran's military adviser threaten US & Israeli missile defenses

From DEBKAfile, November 23, 2011:
Dmitry Medvedev

After deploying three warships in Syrian waters, Moscow continues to beat war drums against the United States followed closely by Tehran. 
Wednesday, Nov. 23, Russian President Dmitry Medvedev told state television: 

"I have ordered the armed forces to develop measures to ensure if necessary that we can destroy the command and control systems of the planned US missile-defense system in Europe..."
Iranian Supreme Leader's top advisor for military affairs Major General Yahya Rahim Safavi came next. He said:
"The Iranian Revolutionary Guards controls the identity and destination of every US warship which intends to pass through the Strait of Hormuz."
... the US missile shield's command and control systems which the Russian president spoke of destroying are linked directly to Israel's missile defense network against Iranian, Syria and Hizballah missiles and the X-Band radar station located in the southern Israeli Negev.
Medvedev's threat to American "command and control systems" ...referred not just to the US anti-missile shield facilities planned for Europe, but also ...in the course of  a possible American or Israeli attack on Iran or Syria - for striking the US missile defense systems in Europe before they can intercept Iranian missiles.

Knocking out the European shield would leave Israel completely exposed to Iranian missile attack.
In a very few terse words, the Russian president has made it clear that the Kremlin will not allow Iran and its Middle East allies be prevented from missile retaliation in the event of war.
That threat also explains why at least two of the three Russian naval vessels moved into Syrian territorial waters last week were equipped for surveillance and electronic warfare, exactly what is needed for a Russian operation to destroy US missile shield command and control centers near the Syrian border, such as the one stationed in Turkey.
...The Iranian General Savavi's assertion of the IRGC's exclusive control of the Strait of Hormuz was in direct response to the crossing of two US carriers, the USS Stennis and USS Bush, through the strait to take up position opposite the Iranian coast...

Thursday, November 24, 2011

Antisemitism: The Suicidal Passion

From The Weekly Standard, Nov 21, 2011, Vol. 17, No. 10 • By RUTH R. WISSE:
 Who is damaged more by anti-Semitism — Jews, or those who organize politics against them?
...What if Arabs had recognized the State of Israel in 1948?” asks Abdulateef Al-Mulhim in a recent column in Arab News: “Would the Arab world have been more stable, more democratic, and more advanced?” His affirmative answer emphasizes how much better off the Palestinians and their fellow Arabs, as well as non-Arab Muslims, would have been had some Arab leaders not used the Palestinians “for their own agenda to suppress their own people and to stay in power.”
...Arab leaders did not oppose Israel because it displaced the Palestinians; they displaced Palestinian Arabs in order to sustain opposition to Israel, creating a refugee time bomb. At Arab insistence, the UN cultivated a network of refugee institutions and an industry of welfare workers with a stake in maintaining refugee dependency, feeding the grievance of generations by insisting on their “right” of return – as if the Displaced Persons at the end of World War II had been continually maintained as such in the heart of Europe. Shutting down UNRWA is the only way to begin repairing the lives of Palestinian Arabs.
...In the current political climate, it hardly matters whether one is among the prosecutors or defenders of Israel, as long as Israel is in the dock. Many well-meaning people fail to appreciate that the prosecution prevails once it makes Israel the defendant. Some ask naively, “But aren’t we allowed to criticize Israel?” or even boast that Israel is being held to a “higher standard,” ignoring that the war against the Jews is won by charging them with the crimes being committed against them. The point of the “trial” is to keep Jews at its center.
...Yet the early benefits of organizing politics against the Jews are inevitably outweighed by the ruin that overtakes its practitioners. Why inevitably? Because anti-Semitism attributes real problems to a phony cause. Putting off problems tends to compound them.
...Strategies of blame may temporarily camouflage corruption, channel dissatisfaction, and redirect aggression, but societies that resort to them collapse under the weight of their negativity. Palestinians – once considered the ablest Arabs – are now in strong competition with Germans of the last century in the sweepstakes of self-destruction...

Wednesday, November 23, 2011

A TOUR OF PALESTINE in 1695

(Translated from the Hebrew by Nurit Greenger.)
... I am visiting Mr. Hobber old books store in Budapest, Hungary. ...The Jewish section is a room full of antiquity books ... sometime, one can find there real culture treasure. Many of the books are Holy Books that may have been stolen from synagogues' archives: Talmud, Bible, Mishnah, old Ashkenazi style Siddur, and others.
...Sometime one can find a bargain such as the book Palestina by Hadriani Relandi -- its original professional name Palaestina, ex monumentis veteribus illustrata, published by Trajecti Batavorum: Ex Libraria G. Brodelet, 1714. One can find such original books in only few places in the world, also in Haifa University.

Follow these links for more information about the book and how to buy a copy:



The author Relandi[1], a real scholar, geographer, cartographer and well known philologist, spoke perfect Hebrew, Arabic and ancient Greek, as well as the European languages. The book was written in Latin. In 1695 he was sent on a sightseeing tour to Israel, at that time known as Palestina. In his travels he surveyed approximately 2500 places where people lived that were mentioned in the bible or Mishnah. His research method was interesting.
He first mapped the Land of Israel. Secondly, Relandi identifies each of the places mentioned in the Mishnah or Talmud along with their original source. If the source was Jewish, he listed it together with the appropriate sentence in the Holy Scriptures. If the source was Roman or Greek he presented the connection in Greek or Latin.
Thirdly, he also arranged a population survey and census of each community.

 

His most prominent conclusions
1. Not one settlement in the Land of Israel has a name that is of Arabic origin. Most of the settlement names originate in the Hebrew, Greek, Latin or Roman languages. In fact, till today, except to Ramlah, not one Arabic settlement has an original Arabic name. Till today, most of the settlements names are of Hebrew or Greek origin, the names distorted to senseless Arabic names. There is no meaning in Arabic to names such as Acco (Acre), Haifa, Jaffa, Nablus, Gaza, or Jenin and towns named Ramallah, El Halil and El-Kuds (Jerusalem) lack historical roots or Arabic philology. In 1696, the year Relandi toured the land, Ramallah, for instance, was called Bet'allah (From the Hebrew name Beit El) and Hebron was called Hebron (Hevron) and the Arabs called Mearat HaMachpelah El Chalil, their name for the Forefather Abraham.
2. Most of the land was empty, desolate, and the inhabitants few in number and mostly concentrate in the towns Jerusalem, Acco, Tzfat, Jaffa, Tiberius and Gaza. Most of the inhabitants were Jews and the rest Christians. There were few Muslims, mostly nomad Bedouins. Nablus, known as Shchem, was exceptional, where approximately 120 people, members of the Muslim Natsha family and approximately 70 Shomronites, lived.
In the Galilee capital, Nazareth, lived approximately 700 Christians and in Jerusalem approximately 5000 people, mostly Jews and some Christians.
The interesting part was that Relandi mentioned the Muslims as nomad Bedouins who arrived in the area as construction and agriculture labor reinforcement, seasonal workers.
In Gaza for example, lived approximately 550 people, fifty percent Jews and the rest mostly Christians. The Jews grew and worked in their flourishing vineyards, olive tree orchards and wheat fields (remember Gush Katif?) and the Christians worked in commerce and transportation of produce and goods. Tiberius and Tzfat were mostly Jewish and except of mentioning fishermen fishing in Lake Kinneret -- the Lake of Galilee -- a traditional Tiberius occupation, there is no mention of their occupations. A town like Um el-Phahem was a village where ten families, approximately fifty people in total, all Christian, lived and there was also a small Maronite church in the village (The Shehadah family).
3. The book totally contradicts any post-modern theory claiming a "Palestinian heritage," or Palestinian nation. The book strengthens the connection, relevance, pertinence, kinship of the Land of Israel to the Jews and the absolute lack of belonging to the Arabs, who robbed the Latin name Palestina and took it as their own.
In Granada, Spain, for example, one can see Arabic heritage and architecture. In large cities such as Granada and the land of Andaluc√É­a, mountains and rivers like Guadalajara, one can see genuine Arabic cultural heritage: literature, monumental creations, engineering, medicine, etc. Seven hundred years of Arabic reign left in Spain an Arabic heritage that one cannot ignore, hide or camouflage. But here, in Israel there is nothing like that! Nada, as the Spanish say! No names of towns, no culture, no art, no history, and no evidence of Arabic rule; only huge robbery, pillaging and looting; stealing the Jews' holiest place, robbing the Jews of their Promised Land. Lately, under the auspices of all kind of post modern Israelis -- also hijacking and robbing us of our Jewish history.

Protest rhetoric belies danger facing Israel

A Letter to the Editor of the Washington Post,Tuesday, November 22:
Regarding the Nov. 16 news article ‘Freedom Riders’ arrested on the bus to Jerusalem”: 
How ironic and twisted that the six Palestinians who rode Israeli buses from the West Bank to Jerusalem and called themselves “Freedom Riders” fashioned their publicity stunt after the nonviolent U.S. civil rights activists of the 1960s. Were it not for the terror campaign by militant Palestinians that killed countless Israelis and Arabs for nearly 20 years, the permits these six were asked to present would not be necessary. 

Who can forget murderous suicide bombings of buses in Jerusalem and Tel Aviv? 
 
It is security, not racism, that governs Israeli policy...

New Sanctions on Iran

From a Fact Sheet, Office of the Spokesperson, Washington, DC, November 21, 2011:

Today, the United States is taking a series of actions to confront the threat posed by Iran and significantly increase pressure on Iran to comply with the full range of its international obligations and to address the international community’s longstanding concerns regarding its nuclear program. 
These steps include: expanding sanctions to target the supply of goods, services, technology, or support (above certain monetary thresholds) to Iran for the development of its petroleum resources and maintenance or expansion of its petrochemical industry; designating eleven individuals and entities under Executive Order 13382 for their role in Iran’s WMD program; and identifying the Islamic Republic of Iran as a jurisdiction of “primary money laundering concern” under section 311 of the USA PATRIOT Act.
These actions underscore the Administration’s continued strong commitment – particularly in light of the IAEA Director General’s most recent report – to hold the Iranian regime accountable for its refusal to comply with its international obligations regarding its nuclear program. The Administration is also sending an unequivocal message to the Government of Iran today that it will continue to face increasing international pressure until it addresses the international community’s legitimate concerns regarding the nature of Iran’s nuclear program....

Identification of the Islamic Republic of Iran as a Jurisdiction of “Primary Money Laundering Concern” Under Section 311 of the USA PATRIOT Act:
The U.S. Department of the Treasury identified the Islamic Republic of Iran as a jurisdiction of primary money laundering concern under Section 311 of the USA PATRIOT Act (Section 311) based on Iran’s support for terrorism; pursuit of weapons of mass destruction (WMD); reliance on state-owned or controlled agencies to facilitate WMD proliferation; and the illicit and deceptive financial activities that Iranian financial institutions – including the Central Bank of Iran – and other state-controlled entities engage in to facilitate Iran’s illicit conduct and evade sanctions.
In issuing today’s Finding, Treasury has for the first time identified the entire Iranian financial sector; including Iran’s Central Bank, private Iranian banks, and branches, and subsidiaries of Iranian banks operating outside of Iran as posing illicit finance risks for the global financial system.
The Finding also creates a clear public record of the scope and depth of Iran’s illicit conduct, detailing the involvement of Iranian Government agencies and banking institutions in WMD proliferation, support for terrorism, and other illicit conduct. In particular, the Finding includes new information about the Central Bank of Iran’s role in facilitating Iran’s illicit conduct and Iran’s efforts to evade international sanctions.
Today’s action reinforces U.S. and international sanctions already in place against Iran and provides greater certainty that the U.S. financial system is protected from Iranian illicit activity...

To view the complete 311 Finding, please visit this link.

Middle East cannot be nuclear-arms-free zone without peace

From AP, 22 Nov 2011, by

VIENNA (AP) — In a boost to Israel, Russia joined the U.S. and Britain on Tuesday in backing the Jewish state's view that the Middle East cannot be turned into a nuclear arms-free zone without progress on regional peace.
The three nations — who are charged with registering new members to the Nuclear Nonproliferation Treaty — also blunted Arab efforts to get them involved creating such a zone, telling an International Atomic Energy Agency meeting that was the sole responsibility of countries in the region.
The three-nation statement was made at ... a meeting bringing Israel and the Arab states together for a discussion of how to work toward establishing a Mideast nuclear-arms free zone....
Organizers had warned against high expectations, and an official inside the closed two-day meeting said it ended Friday without bridging the differences.
Still the three-nation statement was significant. Russia is traditionally in the Arab corner and Moscow's decision to join Washington and London in the joint statement of support for Israel's view was a rare nod from Moscow recognizing Israel's security concerns.
"While Nuclear Weapon-Free zones improve the security of the entire international community, they do not exist in isolation from other security factors," said the statement to the closed meeting, which was shared with The Associated Press. Any such zone, it said must see "the states in the region united in their aspiration to provide for strengthened regional stability and security."
That dovetails with Israel's view that peace must prevail in the Middle East before it can be made into a nuclear free zone. But it clashes with the Arab position that the two issues are separate.
...Iran boycotted the meeting. But a decision last year by the 189 members of the Nuclear Nonproliferation treaty to convene a U.N.-sponsored conference on establishing a Middle East nuclear-free zone in 2012 was an incentive for Israel's Arab neighbors to come to the exploratory Vienna talks....
The three-nation statement .. said "zones free of nuclear weapons cannot be created counter to the will of the countries of the region by the efforts of extra-regional powers or international organizations." That was an rebuttal of an Arab push to get powers that are members of the Nonproliferation Treaty involved in creating a Mideast nuclear-free region...
Israel, for its part, restated its view: no discussions on a nuclear-free zone without peace in the Middle East.
"Experience shows that such a process can only be launched when normal, peaceful relations exist in the region, when the threat perception of all regional members is low, and only after basic confidence is established among states of the region," David Danieli, Israel's deputy nuclear chief, said in comments provided to the AP....

"NGO[s] ...which receive funding from the New Israel Fund (NIF) have been central in spreading this false apartheid analogy"

"NGO superpowers like Human Rights Watch (HRW) and Amnesty International, along with smaller NGOs like Al Haq and Adalah - many of which receive funding from the New Israel Fund (NIF) and European governments - have been central in spreading this false apartheid analogy," Steinberg adds. "HRW's Ken Roth was a key figure in orchestrating the Goldstone Report on Gaza - like this report, Roth is now completely discredited. Similarly, Goldstone's words answer B'Tselem's Jessica Montell, who has offensively stated that 'In some cases, the situation in the West Bank is worse than apartheid in South Africa.' She, along with the hundreds of other NGO representatives that have demonized Israel through the Durban strategy, are now exposed for their rhetoric that contributes to hatred and stands in sharp contrast to the moral foundations of universal human rights.
From NGO Monitor, on the New Israel Fund:
...In 2008, NIF distributed over $20 million to over 300 NGOs in Israel. Approximately 20% goes to NGOs that engage in political activities related to the Arab-Israeli conflict, including some that reject the legitimacy of Israel as Jewish democratic state, and are active in boycott and similar campaigns.
  • Examples:
  • NIF’s Shatil project provides Israeli NGOs with “consulting, training, coalition-building assistance and other services”, including a number of politicized groups.
  • A confidential US government cable (February 2010), released by Wikileaks, contained comments by NIF Associate Director in Israel Hedva Radanovitz that “she believed that in 100 years Israel would be majority Arab and that the disappearance of a Jewish state would not be the tragedy that Israelis fear since it would become more democratic.” In response, NIF claimed that “her comments...are her personal views. They do not reflect the policies or positions of the New Israel Fund.”
  • CEO of NIF-Israel Rachel Liel rejected an invitation to participate in a November 2009 Knesset conference on “Foreign Government Funding for NGO Political Activity in Israel.” Instead, NIF published a position paper, distributed at the conference, falsely charging that the “purpose [of the conference] is repression and silencing of voices.”
  • In February 2010, Israeli student group Im Tirzu launched a public campaign criticizing NIF for its grantees role in promoting the Goldstone Report and their involvement in “lawfare” cases in foreign courts. The campaign included personal attacks against NIF President Naomi Chazan...

NIF Essentials:


Follow the link to NGO Monitor's page on the New Israel Fund for copious research material and links to other sources

Tuesday, November 22, 2011

China arms Hezbollah

Mugshot  
Illustration: China weapons by Alexander Hunter for The Washington Times

The following is an excerpt from “Bowing to Beijing” (Regnery Publishing, Nov. 14, 2011):
It doesn’t take a lot to exacerbate the broiling political crisis in the Middle East, and Beijing’s international arm sales pour fuel on the Muslim-Jewish fire. During the Second Lebanon War, a Chinese C-802 anti-ship missile struck Israel’s INS Hanit off the Lebanon coast. Four Israeli sailors were killed in the incident - Yoni Hershkovitz from Haifa, Shai Atias from Rishon Letzion, Tal Amgar from Ashdod and Dov Shtienshos from Carmiel. The oldest was 37, the youngest just 19...
...Fortuitously for the Hanit, a second C-802 fired at the same time flew over the ship, zeroed in on a small freighter 40 miles away, and sank it. A ship the size of the Hanit could never have taken two missile hits.
There was never any doubt about who fired the missiles. ... Hezbollah may have had its hand on the lanyard, but Iranian specialists manned the firing batteries, and Lebanon’s military radars provided the guidance for the missile.
...No one doubts that the Chinese have been and still are deeply engaged in illicit nuclear-weapons assistance to numerous countries. The bomb designs for the nuclear-weapon programs of Saddam Hussein’s Iraq, Moammar Gadhafi’s Libya and Pakistan were all Chinese. 
The People’s Republic of China (PRC) is trading nuclear-weapons designs to Iran for oil and, through front companies, has funneled dual-use nuclear goods bought by North Korea to Syria. Specialists in the field widely agree that China also secretly trades in other types of weapons of mass destruction (WMDs), ballistic missiles and advanced conventional weapons. ...Top Israeli security officials evidently thought, “Even the Chinese would not go so far as to arm terrorist groups with advanced conventional weapons.” They were wrong...
...The arming of Hezbollah, like most of the PRC’s illicit weapons trade, all boils down to money. Arms smuggling is highly profitable, and the Chinese Communist families that control Beijing’s end of the various arms-smuggling operations with the North Koreans, Iranians or the Syrians would have gotten their cut of whatever went down. 
As one expert recently noted, “Most remaining proliferation disputes don’t pertain to the actions of the government in Beijing, but to the practices of China’s state-owned defense industries. The country’s large state-owned enterprises (SOEs) are some of the world’s most prolific exporters of weapons and dual-use technologies.” These SOEs are dominated by the so-called Princelings, sons, daughters and grandchildren of high-ranking officials who founded and ran the Chinese Communist Party with Mao.
In a private briefing in Hong Kong, a Chinese arms dealer described the relationship between the Chinese Communist elite and Beijing’s arms-smuggling trade. According to him, this lucrative business was carefully divided so that each family received a share of the profits depending on where they are in the Communist Party pecking order....
*Brett M. Decker is editorial page editor of The Washington Times and a former Hong Kong-based editor and writer for The Wall Street Journal. William C. Triplett II is former chief Republican counsel to the Senate Foreign Relations Committee and bestselling co-author of “Year of the Rat” (Regnery, 1998).

Sunday, November 20, 2011

Egypt, Syria and Turkey: The Lepers with the Fewest Fingers

 
With the financial news focused on the unraveling of Europe’s state finances, the mounting economic catastrophe in the Muslim world has barely merited a mention. Egypt and Syria are about to go over a cliff, while Turkey, supposedly the poster boy for Islamic success, faces a nasty economic reversal — not a catastrophe of Egyptian proportions, but sufficient to destroy Tayyip Erdogan’s reputation as an economic wizard and make his fractious country hard to govern. The so-called Arab Spring will end with no winners, only losers.

Egypt: Two Months Import Coverage, and Falling
Egypt’s foreign exchange reserves stood at $36 billion before the February uprising. The central bank claims that it still has $22 billion on hand, but an analysis by the Royal Bank of Scotland reported by the Financial Times puts the true number at just $13 billion, or two months’ import coverage for a country that imports half its caloric consumption. The central bank has lost $23 billion of the $36 billion in the past ten months, the RBS analysis concludes. Adds the FT:
Even that’s not the end of the story. First half 2011 balance of payments figures showed a deficit of $10.3bn in a period when the central bank actually lost $17.6 bn in liquid and other foreign currency assets, says Agha.
So hard currency is going into capital flight and into the proverbial mattress. Egyptians are even hoarding Egyptian currency, with the level of currency in circulation growing dramatically this year at an annual rate of 25 per cent, compared with 13 per cent previously.
By early 2012, expect to find the members of the Supreme Command of the Armed Forces moving into just-purchased mansions in South Kensington or Cannes, and bare cupboards in state warehouses. The military’s only response to the crisis was to fire all the independent directors of Egypt’s central bank, as I reported last month. That implies that they want a free hand to embezzle. By the end of next year, I predict, Egypt will become Somalia-on-the-Nile.

Assad Goes for Broke, Literally
Syria, meanwhile, plans to raise government spending by 60 percent, mainly in the form of salary hikes for state workers, while tax revenues plunged by 40 percent, Bloomberg News reported today. By my back-of-the-envelope calculation, that would put Syria’s government deficit about a third of GDP. Syrians were hungry before the uprising against Assad, which began with a protest over food prices. The Assad regime is betting the Syrian treasury on its survival, and the likeliest outcome is a collapse of the currency and chaos. It is hard to measure the economic misery of a country in civil war, particularly since the government has restricted food, energy and water provisions to areas of opposition strength. If the civil war continues, of course, the body count will take everyone’s mind off the economy.

Erdogan to Turks: “Let Them Eat Baklava”
The Turkish government seems to be losing its grip on reality.
Turkey, hailed as an Islamic economic miracle by credulous observers, is sitting on the the world’s biggest bubble. It imports twice as much as it exports, and the difference (the trade deficit) is greater than 10% of GDP, about the same level as bankrupt Greece. To aid his re-election efforts in the leadup to last June’s national elections, President Recep Tayyip Erdogan encouraged Turkish banks to increase loans to consumers at a 40% annual rate. Turks bought consumer goods on credit at high interest and Turkey borrowed heavily in the short-term money markets to finance the binge, as I reported some months ago in the Asia Times. Turkey’s central bank assured the world that the deficit would shrink; instead, it’s gotten worse, shredding the central bank’s credibility.

A vicious cycle is underway: Turkey has to borrow in the short-term markets to finance its deficit, which makes foreign depositors reluctant to keep their money parked in the weakening Turkish currency, so Turkey has to pay higher rates. Short-term deposits in Turkish lira now pay over 10%, against a quarter of a percent for dollars. High domestic rates squeeze over-leveraged Turkish debtors.

Erdogan’s response is to insist that “real” (that is, inflation-adjusted) interest rates should be at zero, citing Koranic injunctions against collecting interest. Bloomberg News reports that anyone who disagrees with Erdogan’s “vision” of zero interest rates winds up on an “enemies list”:
As Prime Minister Recep Tayyip Erdogan pursues his vision of an economy with real interest rates at zero, critics of Turkey’s monetary policies are increasingly being portrayed as enemies.
Trade Minister Zafer Caglayan says analysts who find fault with the initiative belong to an “interest-rate lobby” that wants to force Turkey to raise rates to help create higher returns. Erdogan says interest rates should be close to zero after inflation. He said during a speech in May to the Islamic business association Tuskon in Istanbul that Turks should earn their money “through work, not interest.”
The skeptics are seeking to “suck Turkey’s blood,” stop its growth and keep the country indebted to foreigners, Caglayan was quoted by state-run Anatolia news agency as saying in July. In a written response to Bloomberg questions on Nov. 3, Caglayan said the government’s view hasn’t changed. He declined further comment.
Erdogan probably is not as stupid as he appears: with the bubble about to burst, he is spinning a story about a conspiracy against the Turkish economy (just as he spun a story about a supposed military coup plot against his Islamist government). But the outcome will be no less messy for the spin.