Skip to comments."Russia will be spared by the crisis" (Barf!)(Barf!)(Barf!)
Posted on 09/05/2009 8:43:10 AM PDT by Vincent Jappi
(My translation) Growth in Russia is not dependent on international financial markets. The Russian banking system has not been involved in speculation in derivatives from the U.S. mortgage market. Even if some Russian banks may have faced losses when their counterparts failed there is nothing that can compare to the losses suffered by the Swiss bank UBS, the big U.S. banks or some European banks. Finally, the countrys financial reserves are considerable.
The situation of the Russian economy is healthier than in August 1998, but also healthier than that of many European countries. Household debt is low whereas it exceeds 100% of GDP in Great - Britain and Spain, and 93% in the United States. Public finances show an impressive surplus which will not be put into question, even if the price of oil barrel should temporarily fall to $ 80.
As for growth, although it should decline from 8 to 7% this year, it would continue to make all European leaders dream.
Jacques Sapir is an economist. He is one of our best experts on the Russian issue and one of the most prolific economists on the financial crisis ["it is all the fault of free market deregulation gone wild"]. He has just published "Le nouveau XXI° siècle du siècle américain au retour des nations", (Seuil, eds).
I don’t know when that piece was written, but I haven’t noticed oil being above $80 lately.
Russia has been hit hard by the financial crisis. About the only thing the article points out that is certainly true is the fact that Russia does have considerable cash reserves.
Russians are NOT spending money though. Attendance at various trade shows that normally draw huge crowds are down 35-50% this year.
The Russian people know how to “hunker down”, they are masters at it. That being said, I suspect the Eastern European economies including Russia will be the first to recover. Capitalism is rampant and the people are hungry for what they consider the good life.
Investors who put money in Russia with no understanding of how to do business there may have it stolen from them. It is not however inevitable.
Possible inaccuracies or anachronisms of the main article aside, where is the “barf alert”? How about “wake up call”? If Americans, for all our inherent political, social, and economic advantages, are losing ground while Russians gain ground, maybe we should look at the utter lack of political, social, and economic discipline we’ve shown since the collapse of the USSR. Borrowing money we can never pay back to live lives of illusionary luxury, maybe we could take some pointers from the Russians about how to hunker down in difficult times, while building on instead of dwelling on, our inherent political, social, and economic advantages.
If you think there is anything believable in what this professional liar is saying maybe you might have a peek at this blog: http://larussophobe.wordpress.com/
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.