Are you aware of the danger in the economy?

This week, capital markets were shaken by a liquidity shortage caused by the default of certain funds. The crisis, which began with a statement by Pusula Portföy, spread to large-scale companies like Tera Grup and ultimately led to the liquidation of 130 funds. Despite extraordinary decisions taken by authorized boards, Borsa İstanbul closed the week with heavy losses. Moreover, concerns have not been fully alleviated.

Questions such as what these investment funds are up to, how small investors are affected, and whether a healthy audit mechanism will be established from now on are the first to come to mind. The most important question is whether those who made manipulative gains will truly be pursued! A bizarre aspect of the incident is that despite the long-standing distortions in these funds and the guided transactions aimed at inflating certain stocks being known and even voiced, harsh measures were only taken after a warning from the international index provider MSCI. As always, the ones who suffer are the small investors, namely the citizens who lose their meager savings to 'casino capitalism' in the hope of getting rich quick.

The problems we have discussed so far are related to financial markets. However, this is just the tip of the iceberg because the truly dangerous trend in the economy is occurring in the real economy, and specifically in industry, while we are talking about finance! Before moving on to this, it is necessary to well understand the finance-production balance in the economy and current global developments. For forty years, the world has witnessed the syndrome of the financialization of economies. I call it a syndrome because the earth was practically abandoned to the dominance of finance capital. Finance ceased its fundamental function of supporting the real economy and was turned into a world of its own. Finance capital strengthened its power through massive funds, thanks to the liberalization of both domestic regulations and cross-border monetary flows. It changed the socio-economic structure with a multitude of financial products that have inflated volumes and no benefit to humanity. So much so that in many places it took politics hostage and transformed societies. At the center of the system, of course, were the Anglo-Saxons (London City, New York, and their extensions in places like Dubai). Ballooning virtual assets crushed the real economy. A Surreal Reality (GÜG) had practically been constructed.

This bubble was bound to hit a wall at some point. The 2008 crisis was a turning point. The trillions of new deposits transferred to the markets through the subsequent quantitative easing acted as a band-aid but did not offer a permanent solution. The cascading debt crises indicated that the problem in economies was much more structural. The power centers that initiated globalization and financialized economies began to sober up after the 2008 crisis. Indeed, at the end of the day, they had lost production and industry to China and other Asian countries. This is why abstract globalization fairy tales gave way to concrete reindustrialization moves!

Yes, these circles, which for years belittled industry and production, outsourced them to others, and focused on finance, had woken up, albeit late. So much so that the US began to use all kinds of threats, including additional customs tariffs, to attract industry from other countries. It did not distinguish between friend and foe on this path. It even forced the famous industry of Germany, which they made politically dependent and which entered a crisis after losing its cheap energy supply over the last 5 years due to the war in Ukraine, to relocate to the US. The essence of the matter is that the rules of the game in the economy have now changed. Finance capital has begun to lose altitude. The economic security paradigm, with industry at its core, has become dominant! Countries that do not rely on national economic dynamics and cannot grow their industry no longer have a chance to develop.

In this context, considering the fundamental trends in the world, the Turkish economy, known for interesting events in the capital markets in recent years, controversial indicators, and the service sector, is under a much greater danger than the fund crisis: Deindustrialization! Consider what even a liquidity shortage does to an already fragile economy. Moreover, while financial losses can be recovered despite the pain suffered, once you lose industry, it takes years to rebuild it.

The phenomenon of deindustrialization is widely discussed all over the globe. Turkey's situation fits the concept of premature deindustrialization in the literature. This concept refers to the manufacturing industry beginning to contract before reaching full maturity in an economy that is still in the development stage. Turkey was already a country that started industrialization late and made some breakthroughs, but abandoned this effort in the 80s before reaching the necessary point to move up to the next league, and tried to advance with banking, construction, and tourism by establishing an import-based consumption economy through the 'ingenuity' of Özal. While the privatizations carried out in the last 25 years reshuffled the deck, industry regressed rather than developed. Just as large companies gradually withdrew from industry, the public sector generally stayed away from new investments anyway. Industry was belittled in popular culture. 

However, despite all this, a certain industrial power was still preserved until recently. This limited power has also taken a major blow in the last three years. With an economic approach that applies so-called 'rational' neoliberal prescriptions, which are actually outdated in the world, the existing industry was also put into a liquidation process. According to the latest data for the July 2026 period announced by TURKSTAT, industrial production in Turkey decreased by 0.3% on an annual basis and declined by 1.0% on a monthly basis. The share of industry in national income has fallen below 20 percent, and the share of the manufacturing industry has dropped below 15 percent! 

Due to the failed inflation targeting and the TL being kept overvalued as a result of the managed exchange rate, national producers struggled to compete. In addition, as energy inputs began to become increasingly expensive, production ceased to be profitable in a poorly managed country that offers one of the highest interest rates in the world to roll over debt. The outcry of the industrialists reached the heavens. Almost every branch of industry was blocked. For example, domestic mobile phone production crashed, and sector giant companies like 'Orta Anadolu' closed down. Those who resisted began making plans to flee abroad. In summary, while the world is heading in one direction—that is, towards reindustrialization—we are going in reverse, towards deindustrialization!

What a coincidence that the country's Minister of Economy, presented by some as a savior, comes from a professional background in investment banking and fund management. In other words, he is someone associated with the now-outdated global finance capital circles. Economics, however, is a much broader field than these, and it is clear that Şimşek himself is quite foreign, not 'local', to this field. In this environment, we are talking about the fund crisis but missing the real major danger. Deindustrialization, the problems of which will be felt more severely compared to the fund crisis, will bring about a massive rupture from production to employment, and from imports to the social structure. As people who stop producing seek refuge in financial gambling, social inequalities will increase. The public will become thoroughly accustomed to handouts and then be taken hostage by debt. This adventure, which begins with deindustrialization, will even affect the political existence of the country. Are you aware of the danger?