Today we start with the silly song, “Istanbul (Not Constantinople)”, which was recorded in 1953 by The Four Lads, a group from Toronto.
The lyrics were written by Jimmy Kennedy, who was born in Ireland, and worked in London’s Tin Pan Alley writing songs for 50 years. And the music was written by Nat Simon, who may have been born in New York.
It goes like this.
Istanbul was Constantinople Now it’s Istanbul, not Constantinople Been a long time gone, Constantinople Now it’s Turkish delight on a moonlit night Every gal in Constantinople Lives in Istanbul, not Constantinople So if you’ve a date in Constantinople She’ll be waiting in Istanbul Even old New York was once New Amsterdam Why they changed it I can’t say People just liked it better that way So take me back to Constantinople No, you can’t go back to Constantinople Been a long time gone, Constantinople Why did Constantinople get the works? That’s nobody’s business but the Turks
My verdict: silly lyrics, good music. I have the song on my iPod and I’ve played it eight times since buying it on iTunes a few years back.
But I also have the version that They Might Be Giants did in 1990, and I’ve played that one eleven times. TMBG, as they are known, consists of John Linnell and John Flansburgh, who met in high school in Lincoln, Massachusetts and formed the group after reuniting in Brooklyn in 1981. The name comes from the 1971 film of the same name, which took its title from the misperceptions of Miguel de Cervantes’ visually-challenged Don Quixote upon seeing windmills.
TMBG’s version of the song is a bit livelier, and includes their signature accordion, which always makes for a fun song. If you’re really curious, and have time on your hands, you’ll also check out the song James K. Polk, which is a painless way to learn a little American history.
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But today’s topic is Turkey, which is increasingly in the news as it battles Kurd separatists in northern Iraq.
Turkey, perennially at the intersection of Eastern and Western cultures, is bordered by eight countries, Bulgaria, Greece, Georgia, Armenia, Azerbaijan, Iran, Iraq and Syria.
The presence of these last three, of course, means the country is perennially at risk of destabilizing forces.
In recent weeks, the trouble has come from the Kurdistan Workers’ Party, or PKK, a Marxist organization of Turkish separatists based in the stable northern zone of Iraq. This minority group, which has been responsible for the loss of some 30,000 lives since 1984, has killed over 40 Turkish soldiers and kidnapped eight others in cross-border raids in the past month.
And now Turkey appears prepared to retaliate, an action that would pique U.S. forces that are trying to reduce violence throughout Iraq.
Normally, Turkey, which is an ally of the U.S., would have sat on its hands and tolerated the Kurdish attacks. But on October 10, relations with the U.S. became a little “frosty.” And why? Because on that day the United States House Committee on Foreign Affairs approved U.S. House Resolution 106, a bill that categorized and condemned the Ottoman Empire for the Armenian Genocide.
Which means a brief detour back some ninety years, to a time when The Great War was savaging Europe while the Ottoman Empire, a sultanate that had governed Turkey for over 600 years, was collapsing.
In the turmoil, particularly between 1914 and 1918, over 500,000 Armenian men, women and children perished.
And out of the turmoil was born modern-day Turkey, which was led by Mustafa Kemal Ataturk from 1923 until 1938, and which has been an increasingly important ally of the U.S. since.
Armenians, by the way, are historically Christian, while Turks are historically Muslim.
Turkish officials say that the deaths of the Armenians (which some sources number as 1.5 million) resulted from forced relocations and widespread fighting that accompanied the troubles of the time, not from official government policy or action. They note that hundreds of thousands of Turks also died in the same region during the same period.
Nevertheless, twenty-two countries have officially recognized the deaths of those Armenians as genocide, while the U.S. has notably refrained from doing so, for obvious political reasons.
So had the U.S. Foreign Affairs Committee’s bill passed, we might have lost a valuable ally. But it didn’t. At the last minute, the bill (spearheaded by Nancy Pelosi, whose district represents America’s largest Armenian population) was tabled after intense lobbying by the White House, the U.S. military and the Turkish government.
This action doesn’t solve Turkey’s problem with the Kurds, of course. There’s still strong sentiment in some Turkish quarters in favor of a major assault against the rebels. But it does keep Turkey on our side.
And as long as the Iraq-Iran-Syria problem goes on, that can’t be a bad thing.
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I’ve never been to Turkey, but I’d like to go. Of course, I’m happy to travel almost anywhere. But Turkey offers a terrific climate, antiquities that rival those in Greece, beautiful churches, beaches on both the Aegean and Mediterranean seas, and a growing tourist industry that’s eager to please. And it’s cheap compared to Europe.
Turkey’s GDP is over $400 billion, which puts it in the top half of all countries, worldwide. GDP growth for 2007 is expected to be about 5.2%. Per capita income is about $6,000. And 47% of that population is under 25 years old, which bodes well for the country’s economy in the years ahead.
Turkey has a strong agricultural tradition (including poppies, now legally grown and sold to the U.S. for morphine, codeine and other legal opiates), but today agriculture accounts for just 12% of GDP. The industrial sector accounts for 24% and service sectors account for 65% ... which sounds a lot like the U.S.
And there’s one place in which Turkey is very like the U.S. and that’s in its love of mobile telephones, which brings me to my stock of the day.
It’s the largest provider of cell phone service in Turkey, with a 60% market share, and it’s named, appropriately enough, Turkcell. The firm’s ADRs (American Depositary Receipts) trade on the NYSE under the symbol TKC.
With 32 million subscribers, Turkcell is the third-largest provider of GSM service in Europe. It has $5 billion in annual revenues; it’s expected to grow earnings 42% this year and 21% in 2008; and it pays an annual dividend of 3.8%!
The company also provides service in Ukraine, Georgia, Cyprus and Kazakhstan. Its debt is minimal. And its after-tax profit margins average about 20%.
Technically, its stock hit an all-time high of 24 a month ago. Since then the stock has corrected to 20, nearly kissing its 50-day moving average, and rebounded to 23.
I think it’s a decent buy here, but if you’re risk-averse, you’ll wait for another dip toward 20. Just note that third quarter results will be announced next Wednesday, November 7, and they’re likely to spark substantial movement in the stock, in one direction or the other.
In the long run, though, I expect great things from Turkcell. The mobile communications business has brought us many winners in developing countries, from India to China to Russia to Brazil, and Turkcell is a natural to continue that tradition.
Finally, as a contrary thinker, I like the presence of the ominous headlines about Turkey while this stock is climbing higher. When everyone loves it, it will be too late.
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