Why is Ukraine getting closer to Russia? A sinking ship.
Top Banker Believes No Second Wave Of Crisis In Russia, [ BUT.....?]
KEY QUOTE: [BUT......The macroeconomic situation in Russia can get worse if commodity prices fall, he said. "Falling prices on raw materials, metals, oil, and chemical fertilizers will be bad for us. If the prices fall, we will find ourselves in a much deeper crisis," the head of Sberbank said.]
N.B......all these commodity prices continue to fall, just like in the 1989 financial crisis before the collapse of the Soviet Union, USSR in 1991. Remember 2 years ago now, ex-Russian finance minister A. Kudrin said Russia needs oil to stay at well above $100 per barrel for Russia to stay solvent, otherwise it's well on the road to bankrupcy--this will makes EU zone financial troubles look like loose change....Oil no where close to $100...Walter Derzko
Saturday, November 12, 2011
Text of report by corporate-owned Russian news agency Interfax
Moscow, 12 November: The head of Sberbank (Savings Bank) and former economic development minister, German Gref, believes that inflation in Russia will not go beyond 7 per cent in 2011. Gref does not think that inflation will accelerate in the first half of next year.
"So far we do not see any reason for high inflation early next year," Gref said. "It is difficult to say how the situation will develop in the second half of the year," he said.
He also said that so far he did not see an immediate threat of a second wave of crisis in Russia. "I would not scare people with a second wave of crisis. I think that if oil prices do not fall much, we will maintain the current growth rates, which are not very high for Russia, 3 to 4 per cent," Gref said.
The macroeconomic situation in Russia can get worse if commodity prices fall, he said. "Falling prices on raw materials, metals, oil, and chemical fertilizers will be bad for us. If the prices fall, we will find ourselves in a much deeper crisis," the head of Sberbank said.
"Now we have every reason to maintain stability going through this time period," he added. However, Gref said that "for next year's budget any fall in oil prices below 110 dollars will be critical". "And we think for ourselves that the price below 70 dollars a barrel makes it difficult to resolve current problems," he said.
World Financial Crisis Under Way, Economic Crisis Likely to Follow - Kudrin (Part 2)
Saturday, November 12, 2011
MOSCOW. Nov 12 (Interfax) - A financial crisis in the world is under way, and it is quite likely that a recession will follow, said former Russian Finance Minister Alexei Kudrin.
"Considering that the safety fuse has already been ignited and is burning, we are entering a crisis. We already have a financial crisis, and an economic crisis is likely to follow. It is so far difficult to understand its scope and depth," Kudrin said at a Sberbank business breakfast in Moscow on Saturday.
Russia is prepared for a crisis better than most economically developed countries, Kudrin said. "A state debt of only 12% of GDP and considerable gold and foreign currency reserves provide a good margin of safety," Kudrin said.
"However, we should understand that the challenges are about the same for us (as for the EU countries and the U.S.)," Kudrin said, adding that it would be unreasonable to expect high oil prices within the next 3, 5 or even 10 years.
The EU problems cannot be solved fully, Kudrin said. "Unfortunately, we have already lost the battle for Greece, and we are now in the process of battling for other, larger Eurozone economies," he said.
This phase will cost two to three billion euros, Kudrin said.
"The world has a chance to settle the crisis, but it is very slim. The crisis is likely to spread over other parts of the world and the U.S. We will be balancing on very low growth on the brink of another recession," Kudrin said.