Wednesday, September 17, 2008

Russia Shutters Financial Operations

While America's attention is on the re-ordering of some large financial concerns that were operating with broken business models, the Russian Czar has closed that nation's stock market for a second day. In fact, Russia says their financial markets are "closed indefinitely." Not much notice is being paid outside Russia, mainly because this is a direct outcome from Putin's aggression against Georgia and the Western press never quite figured out if Czar Putin was the "bad guy" there. After all, he was angry at George Bush's Rotten America and that usually is a good thing to our press. It's all so confusing for the valiant scribes out there trying to promote Barack Obama's efforts to improve America's prestige in the world. Report news events? That's so pre-Woodward/Bernstein, you fool!

The fact is that lots of folks around the world who had invested in Russian businesses began to take their money out after seeing the Russian tanks roll into a sovereign neighbor. The provocative alignment with Hugo Chavez has given investors pause as well. And, of course, it doesn't help Czar Putin that his major source of ongoing wealth, crude oil, has dropped in value by 40% in just a couple months. Like a silk-stocking brokerage house that collapses under the weight of new economic realities, Russia is suddenly struggling with a new investment calculus.