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Strategies & Market Trends : Investment in Russia and Eastern Europe

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To: Rob Shilling who wrote (692)9/19/1998 3:01:00 PM
From: Real Man  Read Replies (1) of 1301
 
I don't know about the best investment - there is a lot of risk in
Russia which is absent in the US (the risk side was very well
described here by PTB). Russian market is not like US in the 30-s - the difference is , there was no economic boom, although there was
speculation. Valuations were not so high at the peak, now they
are trashed. It seems there are a few positive moments happening,
the most obvious is political stabilization (not that there is
stability). The market is dead. I don't know how it goes down - the
shares are not traded, probably because of highly liquid stocks like Lukoil or Rostelecom. It is like an option play with no expiration
date. If Russia comes out of trouble, you are likely to have very high
multiples of your initial investment. If not - you can loose it all.
Oil price jump should help Russia. I could buy a piece of Russian
corrupt industries for less than 10 billion overall market cap,
considering that it's a country of 150 million. What if US dollar
slides, the safe heaven of heavens (and an overpriced stock market)?
Russians have , what, $200 bln? in foreign accounts? $80 billion
in mattresses? What if they decide to invest some of that?
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