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Expand chart
Data: FactSet; Chart: Andrew Witherspoon/Axios

The two major market horror stories in 2018 were Turkey and Argentina, with both economies sputtering toward recession and on the verge of currency crises.

The big picture: The two countries' policies to address the crises have played out like a strip from Goofus and Gallant, except that Goofus has emphatically triumphed.

Background: Investors have long urged countries to fight economic instability and currency falls by increasing interest rates, assuring central bank independence and relying on the IMF and international organizations for goodwill loans.

On one side: On Aug. 29, Argentina as Gallant asked the IMF to speed up payments of the $50 billion bailout package it had agreed to with the country. On the same day, its central bank, led by technocrat Nicolas Dujovne, raised benchmark interest rates to a stupefying 60%. (Interest rates had been as low as 22.75% just 4 months earlier.)

  • The Argentine peso fell that day to nearly 40 pesos per dollar, its lowest level on record and has not bounced back.

On the other side: Turkey as Goofus has defied economic experts and raised its interest rates only once since the lira fell to the weakest level in its history. The country hiked rates 6.25% to bring its policy rate to 24%.

The results: The lira has strengthened more than 20% from its Aug. 28 level. Argentina's peso has fallen more than 15%.

  • Turkey's annual inflation rate also has fallen, topping out in October at 25%, while Argentina's climbed to 47% in December.

The bottom line: "I'm puzzled because I don’t think anything has really changed in Turkey," Win Thin, head of global currency strategy at Brown Brothers Harriman, tells Axios. "Part of it I think is just that quest for yield, though I'm not sure why people would pick Turkey over Argentina. It's frustrating if you're following fundamentals."

Go deeper: The meltdown of emerging market currencies

Go deeper

In photos: Protests outside fortified capitols draw only small groups

Armed members of the far-right extremist group the Boogaloo Bois near the Michigan Capitol Building in Lansing on Jan. 17. About 20 protesters showed up, AP notes. Photo: Seth Herald/AFP via Getty Images

Small groups of protesters rallied outside fortified statehouses over the weekend ahead of President-elect Joe Biden's inauguration Wednesday.

The big picture: Some protests attracted armed members of far-right extremist groups but there were no reports of clashes, as had been feared. The National Guard and law enforcement outnumbered demonstrators, as security was heightened around the U.S. to avoid a repeat of the Jan. 6 U.S. Capitol riots, per AP.

5 hours ago - Politics & Policy

Trump to issue at least 100 pardons and commutations before leaving office

Photo: Mandel Ngan/AFP via Getty Images

President Trump plans to issue at least 100 pardons and commutations on his final full day in office Tuesday, sources familiar with the matter told Axios.

Why it matters: This is a continuation of the president's controversial December spree that saw full pardons granted to more than two dozen people — including former Trump campaign chair Paul Manafort, longtime associate Roger Stone and Charles Kushner, the father of Trump's senior adviser and son-in-law, Jared Kushner.

  • The pardons set to be issued before Trump exits the White House will be a mix of criminal justice ones and pardons for people connected to the president, the sources said.
  • CNN first reported this news.

Go deeper: Convicts turn to D.C. fixers for Trump pardons

Schumer's m(aj)ority checklist

Senate Minority Leader Chuck Schumer. Photo: Tasos Katopodis/Getty Images

Capitalizing on the Georgia runoffs, achieving a 50-50 Senate and launching an impeachment trial are weighty to-dos for getting Joe Biden's administration up and running on Day One.

What to watch: A blend of ceremonies, hearings and legal timelines will come into play on Tuesday and Wednesday so Chuck Schumer can actually claim the Senate majority and propel the new president's agenda.