[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]T[/dropcap]here is one significant fallout of the Khodorkovsky incident. His Yukos shares were passed on to Rothschild, the British billionaire,8 who has links with the Swiss-based Bank of International Settlements and who bailed out the US in 2008, when Timothy Geithner of the Federal Reserve offered to print as much money as was needed to save the dollar as an international currency. It is necessary to scrutinize this network at the top of the world pyramid, to understand global politics. Even though Russia may appear to be in turmoil, its currency is fully convertible and there are a lot of opportunities for the discerning investors.
Russia’s economy is in turmoil: its GDP fell by 3.7% in 2015…
– Peter Spence
As part of the smear campaign, Putin is blamed for Litvinenko’s death in Britain. Litvinenko publicly accused his superiors in the secret service, FSB, of murder. FSB used terrorism to bring Putin to power and to keep him there. The claim was that Putin “murders his opponents in Russia.” Two FSB agents, Andrey Lugovoy and Dmitry Kovtun, are wanted for Litvinenko’s death by the use of the dangerous Polonium, P-210. British High Court judge Sir Robert Owen concluded that Litvinenko’s death was “an act of state-sponsored terrorism by the Russian Government.” But the judge’s use of “almost certainly” allows the Russians to say that the conclusion is without evidence and is a “joke” and a “whitewash.”9
[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]R[/dropcap]ussian problems are not only on three main fronts, Ukraine, Syria and parts of its Muslim belt, but also with pressure from NATO. After Russia interfered with Ukraine’s eastern provinces in 2014, NATO increased its foot print in Europe. Russia saw this as a challenge and modernized its forces and armament. In the last year of his rule, Obama gained for the Pentagon an increase of $3.7 billion as a “European Reassurance Initiative” for 2017 onwards.10 The US escalated the pressure on a “resurgent” Putin. Putin’s reaction to these increased security threats was wide-ranging and calculated.
First, Russia’s finances. Peter Spence11 noted that Russia’s economy is in turmoil: its GDP fell by 3.7% in 2015, its growth was just .7% in 2014, oil, the mainstay of its economy, fell precipitously and US sanctions were meant to impoverish the nation for annexing Crimea. While these facts are correct, Russia managed its finances well. It allocated $1.7 billion for the real economy and anti-crisis spending.12
[dropcap color=”#008040″ boxed=”yes” boxed_radius=”8px” class=”” id=””]R[/dropcap]ussia used unspent 2015 money and readjusted distribution to take account of inflation for the poor. Its import substitution worked well for the country, but hurt several of its previous customers, like France, Eastern Europe, and the Balkan countries, who retrospectively opposed the sanctions. Russia used reserve funds to fund shortfalls and pay debt. Russia’s domestic financial market was stabilized though loans were expensive, even unaffordable. Russia even had money for modernization of its military hardware.13 After all these financial adjustments, Russia will have a debt-to-GDP ratio of just 6%. This alone should satisfy investors of its potential.
This is Part 3 of this article on Russia and while there is risk, Russia also presents excellent rewards for investors. For Part 1 and Part 2 click on the respective links.
Bibliography
Note:
1. Text in Blue points to additional data on the topic.
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