A Stockmarket in Freefall
Filed under: Russia
You might think that the chart above is following the recent progress of the U.S. stock market, whose Dow Jones Industrial Average has plummeted in recent days, leading the Federal Reserve to announce support for a major new stimulus package to stave off possible recession.
But it's not. It's a chart of the Russian stock market, which has lost 8% of its value in the last three days. Lost it, even though the price of oil has skyrocketed (one of the major reasons that the U.S. stock market has tanked, owing to the consumer price inflation that has resulted) and Russia is one of the world's leading oil producers. On Wednesday, the Russian market suffered its worst one-day loss of the entire year.
The Moscow Times quoted Harvey Sawikin, a founding partner of U.S.-based Firebird Management, stating: "I think the market has gotten a bit oversold. The Russian market is very vulnerable to correction. When there's a correction, it's very sharp and very fast." As the paper notes: "Russia had been largely insulated from the global meltdown. But the tumbling stock markets suggested that the country is not quite as decoupled from global economies as it would like to think."
Pointing out the insane tendency of Russians to reward failure by lunatics like Putin and Stalin, Blogger Streetwise Professor observes that Russia's economic fundamentals are non-existent, the reason it cannot hope to weather economic storms: "With respect to the economy, Russia's performance under Putin looks far less impressive when one sees that Armenia, which has in no way profited from the energy boom that has fueled the Russian economy, grew almost twice as fast (13.6 percent) as Russia in 2007." Just as in Soviet times, Russians are fatally overestimating their own potency, causing their mouths to write checks their fists can't cash (in a fit of crazed cold-war arrogance, the Kremlin recently shut down the UK's British Council cultural offices throughout Russia, seeming to invite Britain to do the same in regard to Russian cultural institutions in Britain, like Pushkin House; the result is that Russia finds itself encircled by European lawsuits and Ukraine is being allowed into the WTO before Russia, allowing it to sit in judgment on the Russian application).
When will the world, and especially the Russians (and the Saudis), learn that bringing down American power would have the effect of trashing the entire world's economy? Or do they hate America so much that they will happily destroy the entire globe if only they can "get" America in the process?
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