The global credit panic is Russia's chance to reverse the status of colony

[Neilikka]

First, dear readers, let us establish why states through out history have established colonies in far away and not so far away places. The reasons are varied and defense, expansion of populations and outlet for ambitious men, imperial or missionary drives are part of the answer, however, these are all "cost" centers of sorts. Only one reason exists that actually benefits the bottom line of a nation: economics.

Colonies, specifically economic colonies, serve a dual purpose. The first is as a source of raw resources, be they common resources in greater abundance in the colony or rare resources found no where or in few other places. The second, equally important duty is as a dumping ground, a closed but yet extended market, for the excess production capacity of the home country.

For this reason, the Tsars moved east into Siberia, even as the British, French, Spanish, Portuguese, Dutch, Swedish and Danes moved to the Americas (also to be followed by the Russian Empire at a later date), Africa and eventually the rest of the world. This is what the original 13 British colonies of the modern USA were built upon. This is what China with the various zones of economic control was used for. This is what the US passed the Monroe Decree in it's attempt to block off the Americas only for itself. History is full of such instances and they go back to the ancient Greeks and Philistines, over 4,000 years ago.

Unfortunately for Russia, and the former states of the Soviet Union, that is also the exact position that they found themselves in 1991 and have continued to be in various and to various degrees since. Only Russia to a greater extent has started to truly throw off the mantel of Western colony and reassert itself.

Soviet enterprises and what passed for businessmen were simply not ready for the onslaught of the West and to a smaller degree of the east Asians. Coupled with corrupt and drunken government puppets, they and the people as a whole, fell quickly prey to the schemes of the imperial powers. Not since the Polish invasions of the Time of Troubles (Smuta) have foreign powers held so much power and sway over the lives of all the Rus peoples.

Raw resources, industrial equipment and even the brain power of the former Soviet Union have been drained and captured and pulled out, while masses of manufactured goods of foreign make dumped on the Russian market at below production costs, making sure that no local competition could ever surface. Even food, was pushed in as one Russian and Ukrainian farm or kolkhoz (a collective farm) after another failed and whole villages cleared out. All the while, corrupt oligarchs and politicians played to the tune of their Western (and Eastern) masters.

[Neilikka]

Russia's first break came when the ponzi scheme that was the Yeltsin economy collapsed in 1998. Though at first seen as a total calamity, it in truth held the final opportunity for Russia. This was the final point that would determine if Russia would survive or if the Third Rome would fracture and dissolve away forever. It survived, by the Grace of the Heaven and by the economic short sightedness of Western corporations.

With the collapse, profit margins of Western companies shrank fully and they fled Russia like rats off of the Titanic. With the pressure gone, even momentary, Russia's companies came roaring back and in the few years that followed, before the Western return, they had made their move to grow and grow quickly. With their growth, the empty service economy model of the West (to the ever wise exclusion of Germany) collapsed, just like it is now collapsing in the rest of the West. Russian companies provided Russians jobs and greater spending monies, but they provided something much more valuable: they provided hope for the people, for the future and a strong drive to buy Russian to make Russia powerful.

Are you listening America? This is YOUR only hope for salvation, to follow the Russian model of success not the Service Economy model of debt and failure.

So Russia had thrown off the yoke of the economic colony for over produced goods, but it has still clung to its other economic colonial designation: the source of raw resources. No society will ever get rich by digging up its lands and shipping them off at low commodity prices to foreign factories, nor will it ever gain respect or a strong enough foundation for true national defense. Only through strong economic industrial growth, will Russia stand taller than the rest. While this process is under way, it must be accelerated and an environment made appealing enough to first draw back the vast Russian diaspora with their experience from abroad and two to draw the brightest and best from the rest of the world and make them want to be Russians. Drawing the poor and uneducated is not the solution.

This Great Bank Panic is Russia's chance, a chance to stand on strength due to the wise prudence of Putin and Medvedev and Russia's firm financial base and push its goods through to the Near Abroad and than to Europe and Africa and eventually Asia and the Americas. At the same time, its export of resources should be curtailed through heavy taxation. Vast and cheap energy and raw resources in Russia itself will help stimulate growth of the key value adding industries that will provide the world with finished quality goods.

It is paramount for the government through policies and the modern businessmen and reformed and now patriotic oligarchs to seize this moment and like the eastern powers of Japan, S.Korea, and Taiwan, work together to plan the nation's course to economic success. For when the dust finally settles from this financial collapse, the only powers sure to stand are Japan, S.Korea, Taiwan, China, Germany and Russia, for the Third Rome will never get another opportunity like this one.

Stanislav Mishin

The article reprinted with the kind permission from Stanislav Mishin and can be found on his personal blog Mat Rodina

[beezneesman]

It's always easier to blame 'evil external forces' for your problems isn't it! Certainly easier than holding up a mirror to yourselves and not liking what you see.

[Lucker]

The genuinely sad thing is that ordinary Russians have no idea what is going on in their own country . Financially they are in a big mess and if Oil holds or falls a little further to $70 , things will get very rough for ordinary citizens .
I can spell out details if any Federation member is in any doubt about the fragility of Russia's position and there is one guaranteed matter --- all the bluster about updating military spending is eye wash . The money just aint there any more .

[alpine-frolic]

Why global, i am not in panic mode.

[bucksbunny]

the russian model that a joke;..

The only model that russians are ussing is the gangster and mafia model close to the republican model in one word wild capitalisme or blind liberalism.

full of none ethical business.


BB

[beezneesman]

--- all the bluster about updating military spending is eye wash . The money just aint there any more .

It could be if they go back to the 'Guns Before Butter' philosophy - but they will find it costs a hell of a lot more to recruit, train, maintain, house, retain and equip a large force of what they call 'contract' soldiers than the conscripted rabble they had before.

[saprosky]

Are you listening America? This is YOUR only hope for salvation, to follow the Russian model of success not the Service Economy model of debt and failure.



Is it means than Russia will explain to America, and obviously the rest of the world, economics ??????

Is it our ONLY salvation ???????

:faint:

Some of our russian members, economist if possible, could explain us, in plain language please, HOW ??????

[Neilikka]

How smart you are, Saprosky! Yes, they will! Yes, they can!

[bobbyd]

Marina,

Western (Euro and N. America) investors are pulling out of Russia, this is fact not fiction. In a global economy no country can go it alone, it's impossible. So if the west is pulling out that leaves you with the Middle East and China. Are you prepared to base your future on relationships with Iran and Syria? Does this not make you nervous? It should because if I was in the same situation I would do everything possible to emigrate with my children elsewhere.

I know that you are aware of this and even the most patriotic person such as yourself (and be proud of that!) has to wonder when the bough will break. The Russian borders are getting closer and closer to shutting down permanently. I don't understand how I can see this and you can't...but then again maybe I am being hoodwinked by western media.

(I left out relations with Hugo Chavez on purpose as I did not want to embarrass the Russian people.)

[sliver]

well, what i see.. nothing has changed in LL kingdom even now, at crisis time )
poor economy discussion and.. usual ignorance from 'businessmen'

in fact VVP and our government was right to create the national welfare fund when oil prices had crazy rising. as crazy rising is risk factor too and should be taken into account. russia was preparing for crisis. sure, we all live and are integrated in global economy. and would be naive to think that the crisis started in usa won't hit anyone. but guys, just compare u.s. national debt and russia's one...

[kentuckydan]

Plunging Russian stocks remain an elite affair (http://www.iht.com/articles/2008/10/13/business/ruble.php)

MOSCOW: The stock market here has sputtered so often in recent weeks that regulators have repeatedly shut it down, as if Russia, which aspires to be a financial powerhouse, has become just another bumbling backwater.

The oligarchs, those Kremlin-connected magnates who once dazzled the world with their riches, are reeling. And Prime Minister Vladimir Putin is facing a threat to his long-sought legacy of bringing economic growth, stability and renewed swagger to this nation.

The global financial crisis has not spared Russia, wiping out about $1 trillion in wealth and impelling the government to adopt a broad rescue plan, signed into law Monday, to shore up banks. At stake is the Russian economy, which for the first time over much of the past decade has given many Russians a taste of comforts long enjoyed in the West.

For now, the damage has been largely limited to the Russian elite.

While the Russian stock market has plummeted by about two-thirds since May, more than markets in the United States and Western Europe, the country does not have a broad investor class, and most people have not put their savings into the market.

[kentuckydan]

Financial crisis spilling over into the real economy (http://www.theotherrussia.org/2008/10/13/financial-crisis-spilling-into-real-russian-economy/)


Russian Prime Minister Vladimir Putin warned today that the global liquidity crisis was quickly spilling over into the real sector of the Russian economy, the Newsru.Com online newspaper reports. Speaking before the Cabinet’s Presidium on Monday, Putin acknowledged that government efforts to ease the situation in the financial sector were not having the desired effect.

“All my contacts with representatives of the real sector of the economy describe how these businesses are starting to experience a certain financial hunger,” Putin said.

Russian companies have increasingly reported difficulties in obtaining credit, which has led to layoffs and shortages. Last week, Russian automakers GAZ and KamAZ announced that they were dealing with financial issued by cutting production and shortening the working week, respectively. Heavy industry, banks and retail outlets were also reportedly cutting staff and tightening operations.

[sliver]

yes, Dan, it's true that russian stock market doesn't reflect true state of russian economy. it damaged elite and investor class only, that is small yet.
and true that global liquidity crisis is spilling over into the real sector and not only russian, btw. it's the next step of crisis. we're seeing problems of real economy sector all over the world, especially developing economies. i hope our government was wise to save a lot of oil money instead of using inside country investing in infrastructure that will help to go through troubles (we've got from outside). many criticized finance minister for that though.

[dzerassa]

The genuinely sad thing is that ordinary Russians have no idea what is going on in their own country . Financially they are in a big mess and if Oil holds or falls a little further to $70 , things will get very rough for ordinary citizens ..

it's true that ordinary people hear about crisis on tv but don't yet understand how it can influence russia's economy. nor they understand why crisis in usa should somehow infleunce russia's economy at all. another thing i personally don't understand is how usa having such a crisis can give 500 mln. $ to georgia? do they really have crisis or want others to belive in it?

[dzerassa]

the russian model that a joke;..

The only model that russians are ussing is the gangster and mafia model close to the republican model in one word wild capitalisme or blind liberalism.

full of none ethical business.


BB

guess from whom we learnt it in early 1990-es

[dzerassa]

Marina,

Western (Euro and N. America) investors are pulling out of Russia, this is fact not fiction.


why is that?

and probably it is better and we will finally start to develop our own prodution and depend on our own economic without being so much tied to other markets?

[dzerassa]

Marina,

So if the west is pulling out that leaves you with the Middle East and China. Are you prepared to base your future on relationships with Iran and Syria? Does this not make you nervous? It should because if I was in the same situation I would do everything possible to emigrate with my children elsewhere.

(I left out relations with Hugo Chavez on purpose as I did not want to embarrass the Russian people.)

we have passed it in late 1980-ies beggining of 1990-ies when our leaders (though who can call gorbachev and yeltsin a leader?) did everything to please our western partners. satisfied all their wishes, gave up all russia's positions and what received? unannounced civil war in early 1990-ies? economy which u yourseld describe as corrupted? almost destoyed russia when every city was close to decare independence? completely ruined own industry and produxtion? empty villages with zero agriculture production? u know people who were doing it r pupils of american economists. to talk about global economy is easy, go and see what is happening in villages. kolhozes which were working well and giving food and job and money to the whole vilage r destroyed, youth is drinking or even better using drugs, people who were working all thjeir life lost all their money when our young reforners tought by western brothers started their reforms, on the other hand some smart guys did great money within couple of years not ;cause they did something really but 'cause they devided state property which was created by the whole country, now they can buy castles and youghts and those who was creating this state property is thinking how to live from pension to pension.

what we have in russia now is were we were lead by those reformers american-economy-lovers. and i do hope we start to restore our real economy, not night clubs and restaurants but machinery, planes production (why we buy boeings if we have Tu and IL), agriculture etc. I do hope yeltin's era is over and our present leaders think of the country. at least noone will teach putin what is good and what is bad like they did with b.y. and i am happy we have such leaders now after gorbachev and yeltsin

as for iran, syria, venecuela, etc. why not? they r the same countries as any others. if economically and politically it is in our interests why should we refuse from cooperation with them.? i think we should cooperate with any country especially those close to our borders

[sliver]

<<<Originally Posted by bobbyd4u View Post
Western (Euro and N. America) investors are pulling out of Russia, this is fact not fiction***

in the interim european companies are making way to russia to get real contracts...

[Lucker]

Esteemed ladies
Don't blame the Yanks historically for your mess .
The biggest mistake they made is NOT doing what almost all of you have been brainwashed into thinking they actually did .( Jurassic particularly )
Russians read the first few chapters of Free Market Operations in Democratic Systems and thought they understood it in five minutes .
How it was bastardised and used with blatant dishonesty is a matter of record -- see Yelstsin and the Family and relations with the mob and gangs all over the Federation .
The people who did not come in and run matters and take your assets were the Americans .
The most charitable explanation of Russian stupidity and "quick fixes" is that you allowed sophisticated individuals like Boris the Great to get you swimming when you should have just been dipping your toes into the water .
I imagine the US decided against invading you financially because they did not know how to handle the mob and gang structure and apparent total breakdown of effective central government .

Now matters may go against you .
Putin has displayed expansionist and revisionist strategy which we do not like -- rightly or wrongly .
He can only pursue his dinosaur ideas if he has Gas and Oil wealth .
75 % of wealth lies in the hands of around 200 people .
Therefore in a period when prices are down ( NOW) and individual Oligarchs have been hammered , Russia is weak .
This is when the Free World should target specific Oligarchs and trade sectors and break defined people completely .

Small points .
Putin's "excess " Oil and Gas profits are a variant on reserves . All sane countries have the same provisions .
The sum of money to Georgia is small , relative to future borrowings . If it exists ( words are not actions) it may have been agreed a long time ago and before you invaded that country . It is rhetoric .

imo

[kentuckydan]

The sum of money to Georgia is small , relative to future borrowings . If it exists ( words are not actions) it may have been agreed a long time ago and before you invaded that country . It is rhetoric .

imo


500 Million against a 13 Trillion Dollar economy, big number relative to the whole small

Better it would be to ask how Russia affords what IT is spending/will spend in that area

That is of more immediate concern to Russians

[dzerassa]

500 Million against a 13 Trillion Dollar economy, big number relative to the whole small

Better it would be to ask how Russia affords what IT is spending/will spend in that area

That is of more immediate concern to Russians

yes i agree but for russia it is its borders, it is not somehwere in south america.

500 mln usd is not a small number even for the usa. but now i understand why u have crisis, if americal politicians have the same approach to numbers and classify 500 mln as small then probably the bailout is not even enouph.

[Lucker]

What's the matter with you Russians ?
The literal importance of borders has all but disappeared . Planes , electrical signals , drones .
The world is now one interacting whole .
What do you think is going to happen with your effing borders ?
Do you think we are all going to march over one dark and windy night and strangle you in your beds ?
Your words are from the last century . Get a 21 st century life .

[dzerassa]

Your words are from the last century . Get a 21 st century life .

r u quoting condoleeza rice?

and yes, ireland remained in 20th century

[Lucker]

r u quoting condoleeza rice?

and yes, ireland remained in 20th century

I never quote anybody . I need no script writer !

Ireland is a very complex subject . So complex that even I tread very warily .
Basically it had all to do with the price of Potatoes .
With you , this led in a complex fashion to Vodka and becoming an alcoholic nation .
With us , we had to deal with a very small bunch of religious bigots in a very kind way .They behaved as though they were alcoholics .
Now you know .

[my_darling]

Just curious - what will happen to european and us economics if such "poor" russians as Mr. Anysymov and others will take out their money from joint-stock companies and from western banks?...Once they have put money what they have stealed during communist period to western companies and banks...So (just a dream) one day they can take it out and to come it back to russian economics..:rolleyes:

[dzerassa]

I never quote anybody . I need no script writer !

Ireland is a very complex subject . So complex that even I tread very warily .
Basically it had all to do with the price of Potatoes .
With you , this led in a complex fashion to Vodka and becoming an alcoholic nation .
With us , we had to deal with a very small bunch of religious bigots in a very kind way .They behaved as though they were alcoholics .
Now you know .


russians at least get drunk from vodka not from beer

[beezneesman]

Just curious - what will happen to european and us economics if such "poor" russians as Mr. Anysymov and others will take out their money from joint-stock companies and from western banks?...Once they have put money what they have stealed during communist period to western companies and banks...So (just a dream) one day they can take it out and to come it back to russian economics..:rolleyes:

So that Putin can confiscate it from them?

Why do you think Putin is so friendly with the ruler of a certain European tax haven?

[my_darling]

I'm not about Putin or someone else. Actually for me doesn't matter is there crisis in US or in Russia or anywhere just because I don't have millions to do care about. I know prices go up crazy in all countries, included Ukraine. I know any of governments don't care about nations, about people. They do care about own wellet only and about interests of few big companies. I think all of you undertand this issue. So as for me, mature person, is very strange to read such topic "russian crisis", "us crisis" etc. Hey people! Whose money you are discussing here? During the time when regular people emotionally discuss big problem and make something alike competition here on forum between countries, other people who are our adorable mighty of this world they happily share money of nations for own success. So may be if we will not make stupid competition we can find a few really useful advices how protect at least our own money? doesn't matter who we are - american or russian or whoknowselse - the problem is common.

[sliver]

Russians read the first few chapters of Free Market Operations in Democratic Systems and thought they understood it in five minutes .
imo

wondering, how long will the man from the collapsed empire pronounce empty sounds and rubbish? do you know that the best math-minds and programmers are in russia and india?
as well, how thickheadedly greedy were 'free and democratic' u.s. gurus to plunge into crisis own country?

[sliver]

before i posted the link of "the Zeitgest" film (part 3 is about financial crisis)
еще могу порекомендовать посмотреть "деньги - пирамида долгов" на rutube
http://video.google.com/videoplay?docid=-1281393464747917080&hl=en

english version: 'money is debt', you can find on youtube
http://www.youtube.com/results?search_query=Money+as+Debt&search_type=&aq=f

[sliver]

Are you listening America? This is YOUR only hope for salvation, to follow the Russian model of success not the Service Economy model of debt and failure.


actually the real economy sector in u.s. is about 10-15%. the rest is services (financiers, brokers, realtors, lawyers, ... psychotherapists)))
due to WWII, when europe and su were destroyed, u.s. economy rised + bretton woods system (1944) + questionable idea of postindustrial society + unipolarity policy + ... = in fact, guys, the world works and makes goods and savings and u.s. consumes and spends much more than can afford, thanks to printing 'green papers' and WS machinathions with its irresponsibility and greedy. as result - huge u.s. budget deficit, crazy state debt.
russians say: жадность фраера погубит (something like: "greedy will kill a dude")

pity that the rest world also is suffering now because of this 'leader'

dear, we really worry about u.s. yet. too many citizens have the right to use guns. hope your government will bar from social explosion ;)

[kentuckydan]

Just curious - what will happen to european and us economics if such "poor" russians as Mr. Anysymov and others will take out their money from joint-stock companies and from western banks?...Once they have put money what they have stealed during communist period to western companies and banks...So (just a dream) one day they can take it out and to come it back to russian economics..:rolleyes:

While the US economy has taken some serious hits going from about 13000 to 8500

The Russian RTS since May has dropped about 70% from about in Rubles 13000 to 4500

RTS Index
History chart
(Java-version (http://www.rts.ru/?tid=690)


Dow Jones Industrial Average (http://moneycentral.msn.com/investor/charts/chartdl.aspx?Symbol=%24indu&CP=0&PT=5)

Right now the problem for them is to find a safe place to park their fortunes

[sliver]

it's true that ordinary people hear about crisis on tv but don't yet understand how it can influence russia's economy. nor they understand why crisis in usa should somehow infleunce russia's economy at all. another thing i personally don't understand is how usa having such a crisis can give 500 mln. $ to georgia? do they really have crisis or want others to belive in it?

нонна, кризис ликвидности (проще говоря, нехватка денег) имеет место быть. многие наши компании росли во многом благодаря и дешевым западным кредитам. отсюда и корпоративный долг. сейчас сия кормушка рухнула. это может повлиять на рынок недвижимости (многие девелоперы сидели на дешевых кредитах), снижается производство металлов (в т.ч. из-за снижения спроса), за ними потянутся машиностроители-строители, etc. в общем, все довольно таки взаимосвязано - глобализация, мать ее за ногу.. а это рабочие места и з/п. так что бравада ни к чему. а вот есть ли кризис в сша или это просто передел - вопрос ;)

[dzerassa]

нонна, кризис ликвидности (проще говоря, нехватка денег) имеет место быть. многие наши компании росли во многом благодаря и дешевым западным кредитам. отсюда и корпоративный долг. сейчас сия кормушка рухнула. это может повлиять на рынок недвижимости (многие девелоперы сидели на дешевых кредитах), снижается производство металлов (в т.ч. из-за снижения спроса), за ними потянутся машиностроители-строители, etc. в общем, все довольно таки взаимосвязано - глобализация, мать ее за ногу.. а это рабочие места и з/п. так что бравада ни к чему. а вот есть ли кризис в сша или это просто передел - вопрос ;)


уже какой-то коммерческий банк перестал выдавать депозитные вклады раньше срока, т.к. многие переводили вклады в государственные банки.

[sliver]

уже какой-то коммерческий банк перестал выдавать депозитные вклады раньше срока, т.к. многие переводили вклады в государственные банки.

в некоторых банках время от времени случаются паники.. на один-два дня (идет вброс дезы от каких-то "информаторов" путем рассылки СМС). банковским службам по связям с общественностью приходится объяснять, что согласно последнему указу их вклады до 700 тыс. гарантированы государством (а это около 80% всех депозитов). работает. пока что все спокойно.
на месте банковских вкладчиков я бы вкладывалась в акции 'госбанков', пока они дешевенькие.

[Lucker]

Russian women chatting about prices .
With inflation going through the roof and the Oil price putting the national budget in question , perhaps we should organise food parcels for them over the Christmas period .
It would be a nice touch to ask Georgian Economic Peace Keepers to help with their distribution . I could come over for a few days and act as an International Monitor .We do not want them fighting over the Christmas Puddings .