Decryption of the letter from the embroidery letter to the boss / alarms Which markets sound?

According to Tejaratnews, it seems that Khandouzi wanted to warn by publishing a public letter that it is not possible to cover the budget deficit by selling surplus property and the government should look for other solutions. Solutions that may either cause more losses to stockholders or increase inflation.

Now, Khandouzi wanted to acquit himself of the next problems by publishing his letter publicly, saying that the budget deficit and non-sale of surplus property was due to the failure of agencies and other institutions, not the Ministry of Economy, and he even warned about it.

Especially since Khandouzi was recently accused of failing to get the stock market out of a critical situation, and some media outlets even raised the issue of his impeachment.

It was at this time that MP Mohammad Hassan Asfari tweeted: “Mr. Khandouzi was tweeting before the permanent ministry and was giving a solution to get the stock market out of the crisis situation. Now they should implement the same solutions that they were tweeting.”

The meaning of a family letter is that either the government is forced to sell government bonds, which has a negative impact on the stock market. Or it has to borrow from the central bank and print money, which has a negative effect on inflation. After all, a family message to a boss is not very pleasant for the economy and markets.

Broken family project!

In a letter to Ebrahim Ra’isi, Khandouzi stated that in the first six months of this year, only 473 billion tomans had been transferred to the treasury account from the sale of surplus property. Meanwhile, according to the budget law of 1400, the government’s revenue from the sale of its surplus property was to be 45,000 billion tomans.

Now the letter from the Minister of Economy to Raisi shows that only one percent of the total projected revenue for the sale of surplus property has been realized. Therefore, securing a budget deficit of 300,000 billion tomans from this place is impossible.

This is despite the fact that the Minister of Economy has repeatedly said that the best way to compensate for the budget deficit is to sell the government’s surplus property. The way, according to Khandouzi, “has the least inflationary effect and also generates assets.”

But the contents of the marriage letter say the government cannot cover the budget deficit by selling the surplus property. The 15 bans mentioned by Khandouzi are not such that they can be lifted quickly by direct and immediate order of the president and the government can sell the property and pour the money into the treasury.

Probably, the Minister of Economy did not see the situation of income and the realization of budget revenue sources at the time of announcing such a promise, and did not know about the sale of one percent of the government’s surplus property!

Which markets are sounding the alarm?

But apart from announcing such a promise without statistical and budgetary support, the next question is how is the government going to cover its budget deficit?

One way to cover the budget deficit is to issue bonds. But the problem is that, according to capital market experts, the sale of bonds was the main cause of the stock market decline in the past month.

That is, just in the days when experts predicted that the stock market index would enter the channel of 1.6 million units, the government issued bonds in the market, and this was one of the reasons for the decline in the stock market index.

Now, despite the budget deficit and the government’s inability to sell surplus property, the government probably has no choice but to sell bonds. In this case, the alarm will sound for the shareholders and the whole stock market index may fall again.

But the government certainly can not cover the entire deficit through bonds. So another way might be to borrow from the central bank. A solution that results in increased inflation.

Government game with dollars?

But there is another way and that is manipulating the exchange rate in the free market. Some time ago, when the dollar rate reached 28,000 tomans and returned to the 26,000 toman channel, Eghtesadnews wrote in a report that the government has offset part of its budget by increasing the exchange rate.

The same strategy that Mahmoud Ahmadinejad did in the early 1990s. Now, last week, the price of the dollar reached above 28,000 tomans and went back again.

Perhaps the government is playing with the exchange rate on the eve of the final negotiations. Because he knows that the start of negotiations will definitely have a declining effect on the price of the dollar, he will try to make up for part of the budget deficit by fluctuating the price of the dollar.