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Strategies & Market Trends : Russian Crisis - Is it a buying opportunity?

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To: Wallace Rivers who wrote (61)8/31/1998 9:12:00 AM
From: Jeffrey L. Henken   of 175
 
Russian deal falls through

MOSCOW - Casting a darker cloud over an already troubled Russia,
the leader of the Communist Party said Sunday that his members plan
to vote Monday against confirmation of acting Prime Minister Viktor
Chernomyrdin.

The 11th-hour announcement by Gennady Zhuganov threw into
confusion prospects for an early resolution of Russia's political and
financial crisis.

Just hours earlier, lawmakers had announced an agreement with
representatives of President Boris Yeltsin to boost parliament's powers
at the president's expense.

The deal had been designed to assure confirmation of the new prime
minister in time for President Clinton's arrival here Tuesday.

In Washington, the White House said only that the United States hoped
a new government would be in place "as quickly as possible."

U.S. and International Monetary Fund officials told Moscow Friday
that international financial support could be cut off if the new
government returned to the state controls of its Soviet past.

"What is crucial is not words at this point but actions the Russians are
able to take," Deputy Treasury Secretary Lawrence Summers said
Sunday on CBS's Face the Nation.

The Duma, or lower house of parliament, had been scheduled to vote
Monday on Chernomyrdin's nomination.

The Communists are the Duma's largest faction, but the rank and file
have defied their leader on similar leadership votes in the past. Still, the
move by Zhuganov marks an escalation in the struggle between an ailing
Yeltsin, who enjoys enormous power under the Constitution, and a
parliament that covets greater influence.

"His position is weaker," said Andrei Ryabov of the Gorbachev
Foundation, a think tank in Moscow. "That's why the left opposition is
trying to use this moment to realize their plans for change."

Yeltsin and his Communist rivals played a similar game of political
chicken in March over the last prime minister, reformer Sergei
Kiryenko.

Ultimately, lawmakers surrendered and approved Yeltsin's nominee
rather than face early elections, which they must do if a nominee is
turned down three times and the president dissolves parliament.

Though he has said he has no plans to resign, Yeltsin now is far weaker
politically. But lawmakers still are not eager to face the voters. So
further talks between the president and parliament are likely.

During the weekend, fears about the currency crisis eased as the ruble
rebounded from 15 to the dollar to about 9 to the dollar in unofficial
trading.

By David J. Lynch, USA TODAY

usatoday.com

Wallace, I'm glad you have started the new thread. I will post a URL here if you don't mind?

Regards, Jeff
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