Totally, the lira has lost almost 30% of its value over the last month and more than 43% YTD. Annual inflation in November was 21.3%, reducing the purchasing power of Turks.

The fall in the lira was triggered by expectations of another 1pc cut in the central bank’s discount rate this week to 14%, which is seen by market participants as a continuation of President Recep Erdogan’s interference in the regulator’s policy.

Erdogan, who once appointed his son-in-law as finance minister, believes that lower interest rates are key to economic growth, DW explains.

He also argues, contrary to popular economic opinion, that high interest rates contribute to inflation. Most central banks lower interest rates to try to stimulate growth if inflation is low, and raise them if they think it is necessary to contain inflation.

International rating agency S&P Global Ratings responded to the central bank’s refusal to raise the discount rate and lowered its outlook on Turkey’s credit ratings to “negative.” The long-term ratings remained unchanged: B+ for foreign-currency liabilities and BB- for domestic liabilities.

“Since the publication of our previous ratings assessment of Turkey on October 22, 2021, the lira-dollar exchange rate has fallen 30% as the country’s central bank continues to lower its key rate amid rising inflation. In our opinion, the central bank policy easing and a significant weakening of the lira will contribute to further acceleration of inflation, which could reach 25-30% in early 2022,” – said in the report of S & P.

The fall in the value of the lira triggered the first mass protests in the country. Thousands of people marched in Istanbul on Sunday to demand a halt to the rise in poverty and an increase in the minimum wage.

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According to the Bureau of Labor Statistics, the Consumer Price Index rose 0.8% in November, an increase of 6.8% over the past 12 months, the fastest annual rate since 1982 (7.2%)

Bloomberg writes that the biggest contributors to overall inflation were increases in gasoline, housing, food and automobile prices.

According to economists, inflation is breaking records, in part because of the pandemic – it has become more difficult to produce and deliver products. In addition, the government supported the population, so households spent more.

Also, wages have risen substantially in recent months, but the rate of wage growth has so far lagged behind inflation.

As noted by the Financial Times, inflation has become a political problem for the White House, putting pressure on the ratings of President Biden, as well as the electoral prospects of his Democratic Party before the midterm elections next year.

The White House took a defensive stance before Friday’s report, and Biden issued a statement seeking to downplay the relevance of the incoming data.

“The energy information does not reflect today’s reality and does not reflect price declines in the coming weeks and months, such as in the auto market,” Biden said Thursday.

Gasoline prices in the U.S. have fallen in recent weeks, as have natural gas prices, with a senior administration official saying that this “relief” is not reflected in the November report.

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According to the prediction, in 2022, the U.S. Federal Reserve and its Chairman Jerome Powell will repeat the mistake made in the late 1960s, when too loose monetary policy resulted in the country’s consumer price index accelerating to 11.8% in February 1975. In doing so, the coronavirus pandemic encouraged workers to demand better working conditions, higher wages, and more flexibility in their jobs. The reason was the early retirement of some workers because of the crisis, and the reluctance to return to low-paying jobs after the substantial subsidies paid during the pandemic.

“Combined with continued inflationary pressures from manufacturing, the energy crisis, and labor shortages, this will lead to unprecedented double-digit annualized wage growth by the fourth quarter. As a consequence, by early 2023 U.S. inflation will reach an annual rate above 15%, the first time since World War II,” according to Saxo Bank.

U.S. midterm elections threaten a constitutional crisis

“After the 2022 election, several key Senate and House races will reach their limits and one or both parties will oppose confirmation votes, leaving the new Congress unable to form and sit on the scheduled first day, January 3, 2023,” the bank explained.

Thus, a full-blown constitutional crisis would arise in early 2023, which could also lead to instability of U.S. assets.

Another shocking forecast Saxo is that in 2022 there will be a major breakthrough in slowing the natural aging process. Thanks to this, the average life expectancy of people will increase by 25 years or more. “In the future, the age of 80 will become the new age of 50. The new remedy will be able to slow down aging and even rejuvenate already aged cells,” Saxo Bank suggested.

In this case, not only can the average life expectancy of a person be increased, but there will be a reduction of most diseases – from heart disease to neurodegenerative disorders, experts say.

According to their forecast, the breakthrough in quality and longevity could lead to ethical, environmental and financial crises of unprecedented proportions. In particular, there will be questions of food affordability, the humanity of restricting the “anti-aging remedy” for the population, and reforms of private and public pensions.

Hypersonic technologies will cause a cold war

The latest hypersonic rocket technology makes traditional and even nuclear military equipment obsolete, experts say Saxo Bank. In particular, in the summer of 2021, China tested a hypersonic vehicle that could enter low orbit and then enter the atmosphere and fly to the target.

In 2022, hypersonic and space will become a factor in the rivalry between the United States and China. They will be joined by other major powers with advanced military technology, which is likely to include Russia, India, Israel and the EU, foresees Saxo Bank.

Bank experts fear that hypersonic technology is a revolutionary threat to the long-standing military-strategic status quo because it carries new defensive and offensive capabilities capable of destroying established military strategies of recent decades. In particular, it is the destructive potential of hypersonic technology against the conventional attack capabilities of long-range bomber aircraft, as well as the so-called deep-water fleet of ships capable of striking anywhere in the world without refueling.

The new technologies could also shake the principle of Mutually Assured Destruction (MAD) in the event of nuclear war, according to which it made no sense to start a nuclear war while the enemy had time to launch an equally devastating counterstrike with a land-based or submarine-based intercontinental ballistic missile. “The speed and maneuverability of hypersonic technology engenders the belief that a superior defense can completely prevent an attack and even create new first-strike capabilities,” the bank explained.

Saxo Bank annually publishes “Shocking Predictions,” which are not official predictions and describe unlikely but potentially highly destructive events. For example, last year the bank predicted the desolation of megacities in 2021 because of the pandemic and the end of the era of

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