Jun 26, 2009

Kremlin Inc: Now in the Bank Business?


Russia's state capture continues. However, this time it's the Kremlin that wants to consume vast sections of the economy. Under a new plan to "recapitalize the banking system," the Russian government intends take a massive stake in the country's largest financial institutions. Sounds familiar.

Now the catch:


FT: "Unlike the US bank bail-out, the Russian scheme would see the government take board seats and have veto rights."

So how much does it cost to place hand-picked men & women on the boards of the country's largest banks? $40 billion, according to S&P. Unfortunetly, the Kremlin doesn't actualy have $40 billion to spend at the moment, so the government will finance the whole thing with debt.

Russia's currency reserves, it seems, have gone the way of democracy and a free press.

3 comments:

LIVLIVS MAXIMVS said...

I liked your last sentence. Someone should say it to our government ;(

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