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The "R" in BRICs |
rffrydr
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 Posted: Mon May 21, 2007 7:44 am Post subject: The "R" in BRICs |
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Amidst various signs of cooling and excess ($4billion for Yukos office building) this convertilble shows powers-that-be (in Russia what's always important) see limits:
http://www.msnbc.msn.com/id/18724899/
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rffrydr
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| Posted: Fri Oct 03, 2008 1:36 pm Post subject: |
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As above we're at 138 Euro; $75 crude on the way and alerady we have "effects":
http://online.wsj.com/article/SB122303732369702041.html
| Quote: | | On Friday, Magna International Inc. said Mr. Deripaska had ceded his minority stake in the Canadian auto-parts maker, news later confirmed by Mr. Deripaska's holding company. |
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rffrydr
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rffrydr
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rffrydr
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| Posted: Sun Aug 03, 2008 9:03 pm Post subject: |
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More on Mechel from The Economist: never any pain for Yukos affair. But times are different. BP participated in the Rosfelt listing and now has practically been run out of the country. Yukos was a great buying op. Mechal post rally (if it comes) will be a great sell.
http://www.economist.com/business/displaystory.cfm?story_id=11848486
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Odysseus
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| Posted: Thu Jul 24, 2008 6:04 pm Post subject: |
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Thanks for the link to Natl. Geo. It brought back fond memories.
The Ukraina hotel is located on Kutuzovsky prospect just outside the inner ring and across the Moscow canal/river. I lived about 6 blocks from there.
I used to hop a bus and go to Red Square on Tverskaya Ulitsa where there is a TGI Fridays. The 'boys' used to park their big CC bikes (mostly Japanese) out front of a cafe with open air tables. I would purposely admire their bikes to strike up conversations.
What a mix they were. Semi thugs, mafia wannabes, computer programers and fairly high government officials. I even met a novitiate who had gone AWOL from the monestary at Sergiev Posod! He was close to taking his vows and wanted one last fling.
Russia is not a place I would want to invest for the long term. I was long from 96 to 98 and again from 2000 to late 04.
In my experience, Russians lack any concept of a balance sheet. Income and income statements they can navigate. They are trying real hard to mimic Western money thought but they hate the West so it may only be temporary. Could last decades though or until the commodities boom is over.
They have mimicked a form of French civil service and Greco-Italian business practices but with an overiding Slavic bent.
Of the BRICs Russia is the weakest brick. Just a thought.
If you want to understand Russia, you must leave the big cities and go to dacha. After a few liters, they will tell you what they REALLY think.
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rffrydr
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rffrydr
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rffrydr
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| Posted: Mon Mar 03, 2008 8:40 am Post subject: |
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Good overview of tranisitions into State-sponsored oligopoly. Of note: Russian oil reserves were increasing at a 9% rate under Yeltsin give-a-way; now, 1%. The problem with crude is the problem of nationalism.
http://www.economist.com/world/europe/displaystory.cfm?story_id=10765120
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rffrydr
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| Posted: Wed Feb 06, 2008 6:30 pm Post subject: |
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$75 dollar crude and 1.38 Euro will put a dent in this plan--lowwer borrowing rates and easy govt. credit will probably bring it back:
| Quote: | Credit crunch spreads eastwards
By Stefan Wagstyl
Published: January 29 2008 02:00 | Last updated: January 29 2008 02:00
The turmoil in financial markets is turning into a nerve-racking test for the economies of central and eastern Europe and the former Soviet Union.
Economists have said the fast-growing region faces a slowdown following the financial shockwaves reverberating around the globe.
But the precise impact is uncertain, especially on weaker economies. Even in the stronger countries there may be hidden dangers lurking within particular companies, notably banks, as the Société Générale debacle has highlighted.
"These countries will be hit," said Pradeep Mitra, the World Bank's chief economist for the region. "There is no way out of it.
"They are fundamentally strong enough to resist . . . but some are more vulnerable than others."
The differences are registering in the financial markets. As investors reconsider their strategies, they are becoming more risk averse. Some have turned against emerging markets, including the ex-communist region. Others are discriminating more between countries. According to the European Bank for Reconstruction and Development, financing costs for less developed countries in the former Soviet Union and the Balkans have risen since last summer by far more than in the advanced states of central Europe.
As the chart shows, the spread on five-year credit default swaps (a measure of risk) has widened by 26 basis points for the Czech Republic since last June and by 44 basis points for Poland. But for Serbia and Ukraine the increase is 151 basis points; for Kazakhstan it is 218 basis points.
Erik Berglof, the bank's chief economist, said: "There has been a repricing of risk," with credit costs rising most sharply in countries that are perceived to be the most vulnerable to external shocks.
The bank has trimmed its forecast for the region's 2008 gross domestic product growth from 6.1 per cent to between 5 and 5.5 per cent.
Given the recent unprecedented credit-fuelled growth surge, this slowdown could be welcome in countries trying to cope with inflationary pressures, including Ukraine, Kazakhstan and Russia, and those facing labour shortages, such as Poland.
The benefits could be even greater in economies facing yawning current account deficits, notably the Baltic states, Romania, Serbia and Bulgaria. As Leszek Balcerowicz, the former Polish central bank governor, told a business conference this month: "We should welcome some amount of a slowdown, especially in the Baltic states, which have been growing the fastest . . . We don't have the information that would make us predict a hard landing. Based on the current information a soft landing in the countries which have been growing fastest is more likely."
EBRD economists argue that even though the Baltic states and some other countries have large imbalances by global standards, they are less vulnerable than other emerging economies because they benefit from the extra economic security offered by European Union membership. Investors assume greater risks than elsewhere because membership brings clear development perspectives and outside financial scrutiny.
However, things could still go wrong, either at the national or corporate level. Hungary offers a salutory warning of a country that ran into economic difficulties in spite of earlier establishing itself as a front-runner in economic reform. Successive governments allowed fiscal deficits to balloon to above 9 per cent of GDP in 2006 before Ferenc Gyurcsány, the prime minister, bit the bullet and ordered sharp cuts that have slowed GDP growth, with the loss of public sector jobs and more unemployment.
In the past year, attention has focused on the Baltics because of their particularly high inflation rates, headed by Latvia, with 14.1 per cent at the year end, the EU's highest. But they may be less vulnerable to shocks than they appear because they began to see trouble well before the global credit crunch and have taken action. As Ilmars Rimsevics, the Latvian central bank governor, said: "We have been tested constantly for the past 12 months."
The Balkans are also a concern. Bulgaria has the largest deficit, at over 20 per cent of GDP for 2007. Romania's inflation rate is lower than its two neighbours but economists worry its fiscal policies are looser - and may be relaxed further with parliamentary elections due this year. International investors have voted with their wallets and driven the currency down 20 per cent against the euro from last year's peak.
Farther east, the oil-rich governments of Russia and Kazakhstan run huge current account and budget surpluses and have public reserves to protect their financial institutions. But their international borrowing costs are rising and their stock markets suffering in the global battering.
Ukraine, an energy importer, may be more vulnerable. Even though it has kept its current account and budget deficits under control, it may struggle to cool the economy. A weak government may not be able to impose belt-tightening policies. Meanwhile, in spite of reforms, the large energy sector remains opaque and could provide cover for concealing bad debts. As elsewhere, the unknown threats to financial stability could be at least as dangerous as the threats that economists already have under watch. |
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rffrydr
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| Posted: Wed Feb 06, 2008 6:30 pm Post subject: |
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$75 dollar crude and 1.38 Euro will put a dent in this plan--lowwer borrowing rates and easy govt. credit will probably bring it back:
| Quote: | Credit crunch spreads eastwards
By Stefan Wagstyl
Published: January 29 2008 02:00 | Last updated: January 29 2008 02:00
The turmoil in financial markets is turning into a nerve-racking test for the economies of central and eastern Europe and the former Soviet Union.
Economists have said the fast-growing region faces a slowdown following the financial shockwaves reverberating around the globe.
But the precise impact is uncertain, especially on weaker economies. Even in the stronger countries there may be hidden dangers lurking within particular companies, notably banks, as the Société Générale debacle has highlighted.
"These countries will be hit," said Pradeep Mitra, the World Bank's chief economist for the region. "There is no way out of it.
"They are fundamentally strong enough to resist . . . but some are more vulnerable than others."
The differences are registering in the financial markets. As investors reconsider their strategies, they are becoming more risk averse. Some have turned against emerging markets, including the ex-communist region. Others are discriminating more between countries. According to the European Bank for Reconstruction and Development, financing costs for less developed countries in the former Soviet Union and the Balkans have risen since last summer by far more than in the advanced states of central Europe.
As the chart shows, the spread on five-year credit default swaps (a measure of risk) has widened by 26 basis points for the Czech Republic since last June and by 44 basis points for Poland. But for Serbia and Ukraine the increase is 151 basis points; for Kazakhstan it is 218 basis points.
Erik Berglof, the bank's chief economist, said: "There has been a repricing of risk," with credit costs rising most sharply in countries that are perceived to be the most vulnerable to external shocks.
The bank has trimmed its forecast for the region's 2008 gross domestic product growth from 6.1 per cent to between 5 and 5.5 per cent.
Given the recent unprecedented credit-fuelled growth surge, this slowdown could be welcome in countries trying to cope with inflationary pressures, including Ukraine, Kazakhstan and Russia, and those facing labour shortages, such as Poland.
The benefits could be even greater in economies facing yawning current account deficits, notably the Baltic states, Romania, Serbia and Bulgaria. As Leszek Balcerowicz, the former Polish central bank governor, told a business conference this month: "We should welcome some amount of a slowdown, especially in the Baltic states, which have been growing the fastest . . . We don't have the information that would make us predict a hard landing. Based on the current information a soft landing in the countries which have been growing fastest is more likely."
EBRD economists argue that even though the Baltic states and some other countries have large imbalances by global standards, they are less vulnerable than other emerging economies because they benefit from the extra economic security offered by European Union membership. Investors assume greater risks than elsewhere because membership brings clear development perspectives and outside financial scrutiny.
However, things could still go wrong, either at the national or corporate level. Hungary offers a salutory warning of a country that ran into economic difficulties in spite of earlier establishing itself as a front-runner in economic reform. Successive governments allowed fiscal deficits to balloon to above 9 per cent of GDP in 2006 before Ferenc Gyurcsány, the prime minister, bit the bullet and ordered sharp cuts that have slowed GDP growth, with the loss of public sector jobs and more unemployment.
In the past year, attention has focused on the Baltics because of their particularly high inflation rates, headed by Latvia, with 14.1 per cent at the year end, the EU's highest. But they may be less vulnerable to shocks than they appear because they began to see trouble well before the global credit crunch and have taken action. As Ilmars Rimsevics, the Latvian central bank governor, said: "We have been tested constantly for the past 12 months."
The Balkans are also a concern. Bulgaria has the largest deficit, at over 20 per cent of GDP for 2007. Romania's inflation rate is lower than its two neighbours but economists worry its fiscal policies are looser - and may be relaxed further with parliamentary elections due this year. International investors have voted with their wallets and driven the currency down 20 per cent against the euro from last year's peak.
Farther east, the oil-rich governments of Russia and Kazakhstan run huge current account and budget surpluses and have public reserves to protect their financial institutions. But their international borrowing costs are rising and their stock markets suffering in the global battering.
Ukraine, an energy importer, may be more vulnerable. Even though it has kept its current account and budget deficits under control, it may struggle to cool the economy. A weak government may not be able to impose belt-tightening policies. Meanwhile, in spite of reforms, the large energy sector remains opaque and could provide cover for concealing bad debts. As elsewhere, the unknown threats to financial stability could be at least as dangerous as the threats that economists already have under watch. |
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rffrydr
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| Posted: Mon Jan 21, 2008 6:53 pm Post subject: |
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Like fiscal stimulus? This guy says it's coming with stabilized oil money:
http://www.cnbc.com/id/15840232?video=626272170&play=1
The question is, is this the last leg of decoupling?...not.
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rffrydr
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