(NYSEARCA:TUR) in the east and west, including Ankara.
The police response was overly heavy handed and this only incited more protest. While it is clear that Turkey has a very different (and superior) political structure to Egypt, there are some similarities in how the crisis has progressed.
First of all, the protests were not rooted in a park being closed in order to create a commercial structure. These protests were and are about a view that Prime Minister has become too autocratic in his rule.
There is view that some of his recent decisions have been less secular than many want to see from a government that has historically balanced a very complicated ethnic and religious mix in Turkey.
Social media has also played a major role in galvanizing the protesters in a case where this was not one specific opposition group or party that has pushed for protest. Social media has also played a major role where local Turkish media has been reluctant to tell the real story of discontent, or has been asleep at the switch.
Social media has allowed people to express their dissatisfaction with the Prime Minister as a whole, not necessarily the entire government. Social media has been a rallying point to discuss social injustices and a roll back of liberties.
Prime Minister Erdogan has created a sense if disenfranchisement within the younger more socially mobile population as his actions and rhetoric has been on non-consensual and polarizing. But Turks are angrier at Erdogan than they are the government.
The problem for protesters is there is no real opposition in Turkey. There is total dissatisfaction with the opposition parties to create change that is needed. There is no way to voice views that the current Prime Minister has pushed over a line.
Meanwhile when Erdogan addressed the discontent over the weekend publicly, his rhetoric showed no inclination to soften his tone. His disregard for the protests must be watched as there is little chance these protests can be carried into a normal parliamentary voting process where the populous can feel there could be change.
To this point, saying this is a one off event is to be very complacent. While Turkey is a highly civilized society and has sophisticated rule of law there is much discontent that was not borne out of one beloved park in Istanbul.
Turkey is a market that has been on a tear for the last year and a half. During that time the local ISE index move 85% before beginning a pullback that started last week (17.5% overall through today in TRY terms) and was -9% today. Turkey has rallied because they are an ideal beneficiary of the deflationary world we are living in with major commodity import needs, and an economy that is perennially overheating.
Turkey is an overweight market for many investors and thus a crowded trade. Global investors who have made money in Turkey and don’t need to be in this market will be taking profits now, beyond what they did today.
I am a big believer in the Turkish macro and know many of the local companies well but I would not be buying Turkey tomorrow on today’s weakness.
This article is brought to you courtesy of Tim Seymour from Emerging Money.