Thursday 18 December 2014

Russian Financial Crisis: Keep Calm & Carry On

"Russia is never as strong as it seems, but at the same time, it's never as weak as it seems"
Thane Gustafson, Capitalism Russian-Style.

I think it is worth remembering this quote when considering the turmoil currently affecting the economy and financial markets in Russia.

In his 1999 book "Capitalism Russian-Style", tells how the Soviet system was dismantled and the new market society was born, and examines the prospects for a Russian economic miracle in the twenty-first century.  He describes Russian achievements in building private banks, companies, stock exchanges, new laws and law courts; and looks at the role of the mafia, the new financial empires, entrepreneurs, business tycoons, and the shrinking Russian state. 

Following the hyperinflation, economic dislocation and infrastructure collapse of the post-Soviet period in the early nineties, the Russian economy then survived the 1998 crisis, and again in 2008 following the global financial crisis.

Given the "windfall" oil receipts its has enjoyed over the last 14 years, I m sure Russia is better prepared than before to weather the current storm.

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