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Politics : President Barack Obama -- Ignore unavailable to you. Want to Upgrade?

To: zeta1961 who wrote (142356)	3/7/2014 3:19:42 PM
From: zax	Read Replies (1) \| Respond to of 149317

Business Day Why Russia Can’t Afford Another Cold War nytimes.com A Soviet tank on a street in Budapest in 1958. The old Soviet Union was all but impervious to foreign economic or business pressure. Credit Agence France-Presse — Getty Images Russian troops pour over a border. An autocratic Russian leader blames the United States and unspecified “radicals and nationalists” for meddling. A puppet leader pledges fealty to Moscow. It’s no wonder the crisis in Ukraine this week drew comparisons to Hungary in 1956 and Czechoslovakia in 1968 or that a chorus of pundits proclaimed the re-emergence of the Cold War. But there’s at least one major difference between then and now: Moscow has a stock market. Under the autocratic grip of President Vladimir Putin, Russia may be a democracy in name only, but the gyrations of the Moscow stock exchange provided a minute-by-minute referendum on his military and diplomatic actions. On Monday, the Russian stock market index, the RTSI, fell more than 12 percent, in what a Russian official called panic selling. The plunge wiped out nearly $60 billion in asset value — more than the exorbitant cost of the Sochi Olympics. The ruble plunged on currency markets, forcing the Russian central bank to raise interest rates by one and a half percentage points to defend the currency. Photo Outside a currency exchange in central Kiev in February. The ruble has plunged in currency markets. Credit Yuriy Dyachyshyn/Agence France-Presse — Getty Images Mr. Putin “seems to have stopped a potential invasion of Eastern Ukraine because the RTS index slumped by 12 percent” on Monday, said Anders Aslund, a senior fellow at the Peterson Institute for International Economics in Washington. On Tuesday, as soon as Mr. Putin said he saw no need for further Russian military intervention, the Russian market rebounded by 6 percent. Mr. Putin seems to be “following the old Soviet playbook,” in Ukraine, Strobe Talbott, an expert on the history of the Cold War, told me this week. “But back then, there was no concern about what would happen to the Soviet stock market. If, in fact, Putin is cooling his jets and might even blink, it’s probably because of rising concern about the price Russia would have to pay.” Mr. Talbott is the president of the Brookings Institution, a former ambassador at large who oversaw the breakup of the former Soviet Union during the Clinton administration and the author of “The Russia Hand.” Russia is far more exposed to market fluctuations than many countries, since it owns a majority stake in a number of the country’s largest companies. Gazprom, the energy concern that is Russia’s largest company by market capitalization, is majority-owned by the Russian Federation. At the same time, Gazprom’s shares are listed on the London stock exchange and are traded over the counter as American depositary receipts in the United States as well as on the Berlin and Paris exchanges. Over half of its shareholders are American, according to J. P. Morgan Securities. And the custodian bank for its depository receipts is the Bank of New York Mellon. </snip> Read the rest here: nytimes.com