Even by the turbulent standards of emerging markets, the past week was a master class in how quickly capital can vanish in the face of political dysfunction.

The immediate, violent reaction of the Turkish lira to the arrest of Istanbul Mayor Ekrem Imamoglu — President Erdogan’s most prominent rival — offered a stark reminder: Mr Market reacts faster, more brutally, and more truthfully than any diplomatic protest ever could.

What was intended as a political show of strength unraveled into a financial rout. The lira tumbled nearly 12pc in a single session before stabilising, and local banking shares cratered.

Offshore investors, already jittery, didn’t wait for statements or spin. They pulled out en masse, triggering a near-instant collapse in confidence. To stop the bleeding,

Turkish authorities were forced to pull all the usual rabbits out of the macro-emergency bag — raising the upper band of the interest rate corridor to 46pc, banning short selling on the Istanbul stock exchange, and selling a reported $14 billion in foreign exchange to hold up the lira.

What spooked the market was not just the arrest itself — autocrats jailing political opponents is hardly news — but the timing, the tone, and the........

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