The key to understanding Turkey is really simple – Erdogan has lost the confidence of his people and the world. The free-fall in the Turkish lira should be no surprise. After years of rampant dollar borrowing, running large current account deficits in the face of both a lack of domestic military hardware production along with the lack of domestic oil production, throw in an autocratic-dictator with aspiration of empire building who then appoint a family member to bring down interest rates that he thinks is the source of inflation, and presto you get an economic cauldron that is impossible to survive.

Erdogan may be a dictator who rigs the elections, but that does NOT mean he can dictate that interest rates should be lower. Interest rates are not the SOURCE of inflation, they are the PRICE of inflation. He thinks that he can order interest rates lower and that will stop his economic crisis. Qatar should just kiss its $15 billion good-bye for there is NO HOPE of saving Turkey without a replacement of Erdogan. He will blame absolutely everyone BUT himself. His attempt to hunt down and prosecute anyone who speaks against him as treason is just a normal reaction of a dictator who has lost his mind. What comes next? Purges as with Stalin?