Russia bleeding foreign exchange ... Bloomberg.com

News Type: Event — Seeded on Wed Nov 19, 2008 4:15 AM EST

Article Source: Bloomberg.com

Russia's foreign-exchange reserves are draining fast and may take almost a decade of economic stability with them.
Russia's international reserves, the third-biggest after China's and Japan's, have fallen $122.7 billion, or 21 percent, since Aug. 8 as the central bank tried to shore up the ruble. At the same time, President Dmitry Medvedev, 43, has pledged more than $200 billion of tax cuts, loans and other measures to maintain economic growth, threatened by plummeting oil prices and investor flight.(via Bloomberg.com: Europe)

Spirit is willing, but the flesh is weak ...

The Russian economy remains weaker than widely perceived. High oil prices of the last 5 years built up foreign exchange reserves - as did inflows in the Russians stock market. Russian entrepreneurs remain an endangered species. Large swathes of Russian enterprise have reverted back to the state - albeit in a corporate form. The world has not yet forgotten the Russian debt default.

Russia should get off its high military horse. Instead Putin-Medvedev should build alliances, sign agreements within the BRICS framework and rebuild the Russian system.

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3.1

{"commentId":4120516,"authorDomain":"2ndlook"}

2ndlook

Compare this position with India's depletion of only US$50 billion.

{"commentId":4120516,"threadId":"423022","contentId":"2127321","authorDomain":"2ndlook"}

1 vote

#1 - Wed Nov 19, 2008 4:17 AM EST

{"commentId":4120608,"authorDomain":"adouglass3"}

ABD3

Someone will have to feed the Bear soon. The wealth (therefore power) is not quite as centralized as it was ten years ago. Look for a snatch and grab move (eastern europe?, south america?).

They need natural resources and a worker class to exploit.

{"commentId":4120608,"threadId":"423022","contentId":"2127321","authorDomain":"adouglass3"}

2 votes

#2 - Wed Nov 19, 2008 5:16 AM EST

{"commentId":4120745,"authorDomain":"2ndlook"}

2ndlook

The Russian Bear is in trouble is in trouble ... no doubt ...

But if you look at post WW2 Russia, the USSR subsidized its allies with cheap oil. It was declining oil prices and a drop in oil production in USSR that unwound the 'evil empire'.

{"commentId":4120745,"threadId":"423022","contentId":"2127321","authorDomain":"2ndlook"}

1 vote

#3 - Wed Nov 19, 2008 6:27 AM EST

{"commentId":4124920,"authorDomain":"adouglass3"}

ABD3

That and their heavy investment in American securities and notes. They haven't been able to buy any real foothold. I expect antics from Hugo Chavez soon.

{"commentId":4124920,"threadId":"423022","contentId":"2127321","authorDomain":"adouglass3"}

#3.1 - Wed Nov 19, 2008 12:31 PM EST

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	Putin grabs spotlight, vows Russia will thrive	Associated Press	Wed Nov 19	0
	World Bank sees $50 bln cap outflow from Russia	Associated Press	Mon Nov 17	0

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Russia bleeding foreign exchange ... Bloomberg.com

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