...That's how long Russia can continue to bleed foreign currency reserves at its current rate.
After that, very, very bad things start to occur.
According to the Economist, Russia's currency reserves "have been falling by a rate of around US$15bn per week recently, but the decline accelerated alarmingly in the week of October 17th-24th , with reserves falling by US$31bn to US$484.7bn...For as long as the dollar continues its tear against [the Euro & Pound] and is pushing to move higher against the rouble, the pressure on currency reserves will remain. Russia still has a huge cushion, but the rate at which it is being depleted currently must be a cause for concern."
Meanwhile, the Kremlin has established a $50 billion bail-out fund to pay the Oligarch's bills through the end of the year. No word yet on how the Kremlin will pay for another $150 billion which is due in 2009.
But we're sure "Plan Putina" includes a solution.
1 comment:
According to Aleksei Miller, Gazprom has 6-8 months longer to deal with commodity price drops than oil companies have. Considering that Gazprom took a big bite by buying up Sibneft. Time is ticking...
http://www.robertamsterdam.com/2008/10/the_gazprom_report_card.htm
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