Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: goldsnow who wrote (9785)	4/10/1998 6:00:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116897

the rules of economy cannot be defied...rather they can..for a price overfishing... FOCUS-Russia reels from overreliance on oil, metal 07:04 a.m. Apr 10, 1998 Eastern By Mike Collett-White MOSCOW, April 10 (Reuters) - Russia is in a commodity price crunch, with slumping oil and metal values severely hitting a non-diversified economy still heavily reliant on raw material exports for its wellbeing. Prime Minister-designate Sergei Kiriyenko drew a grim picture of Russia 's finances in a speech to the State Duma lower house on Friday, and outlined huge losses incurred from low oil and metal markets when the country can least afford it. He said two external factors were helping to bring the economy to its knees, the first being the Asian crisis, which had pushed up the cost of government borrowing. ''The second was the correction on the world markets in our main export products oil, oil products, gas, and base metals,'' Kiriyenko said. ''The price question means 30-40 billion roubles ($5.0-$6.7 billion) in lost income for the Russian economy, of which at least 10 billion has been lost from the federal budget.'' Russia's ranking in the oil and commodity ratings is impressive. It is by far the world's biggest natural gas producer and exporter, producing 544 billion cubic metres (bcm) in 1997 and pumping over 200 bcm abroad. And Russia is the world's third biggest oil producer at 6.1 million barrels per day (bpd), and the fourth largest exporter at 2.5 million bpd. It has the global number one nickel producer in Norilsk Nickel (NKEL.RTS), and leads the aluminium export table. Among the precious metals, Russia accounts for 60 percent of the world's palladium needs and a fifth of its platinum consumption. Russia also produces significant volumes of gold, copper, coal, oil products and minor metal cobalt. The problem for Moscow is that oil, oil product and metal prices are hovering not far above record lows. Oil barons and metal magnates have looked to export markets as a key source of hard currency during the post-Soviet financial turmoil, pushing as much material as possible abroad to compensate for non-payments and slumping demand at home. But they have become victims of their own success. Russian aluminium and nickel flooding the metal markets in recent years have forced values sharply lower. And while its influence on the world oil markets is less marked, it relies on the black gold more than on any other commodity for export earnings. Oil export revenues last year fell to around $15 billion from $16 billion in 1996. In 1998 that level is likely to be much lower. Global crude benchmark Brent averaged $19.30 a barrel in 1997. It is now worth only $14. The same is true for metals. Aluminium averaged $1,600 a tonne in 1997, valuing Russian exports at around $4.3 billion. Prices are now under $1,450. Nickel averaged at about $6,900 last year, meaning Russia earned roughly $1.5 billion. Values were below $5,400 on the London Metal Exchange on Friday. Kiriyenko was aware that the worst of the commodity price slump impact was yet to come. ''We still have not felt all of these difficulties. We will feel them in the second half of this year, but the process is taking part today.'' The response among key exporters to the crisis has been to consider cutting exports, taking Western markets by surprise. The government agreed with top oil producers this week to cut exports by 61,000 bpd, while Norilsk has said it would consider reducing deliveries to shore up values. Norilsk and several giant aluminium smelters in Siberia are also looking to develop domestic demand by mulling investments in industries producing semi-finished and finished products. The only market where Russia stands to benefit from commodity price trends is precious metals, where palladium hit 18-year highs in March and platinum recently reached a five-month peak. But Russia has failed to deliver one ounce of either metal so far in 1998, and the gains from sales when it does deliver will only make a small dent in huge losses on other markets. ((Moscow Newsroom, +7095 941-8520 moscow.newsroom+reuters.com)) Copyright 1998 Reuters Limited. All rights

To: goldsnow who wrote (9785)	4/10/1998 7:16:00 PM
From: Bobby Yellin	Read Replies (2) \| Respond to of 116897

hope some other people respond to your post...I know you are a feeling and thinking student on Russia and once again and I can't argue with your post which I know comes from depth of knowledge.. thank you so very much for providing me with a great deal of food for thought... Happy Easter and Passover to all

To: goldsnow who wrote (9785)	4/11/1998 12:31:00 AM
From: Alan Whirlwind	Read Replies (1) \| Respond to of 116897

Hey Snow, didn't I see you in Cheesehead land not long ago? I've heard this "Reagan ran up the deficit" stuff for years and find it highly misleading. We all know that Carter's deficits were much worse than Ford's, so the pattern of spiraling deficits was already in place before Reagan. The Carter dollar at the begining of his presidency was worth much more than at its end. The inflation of the Carter years spiked interest rates, and ran up the cost of government through inflation. Carter's own budget office projected some of the very deficits we blame Reagan for. Had Carter been reelected, we still would have had those Reagan deficits. Reagan began the process of bringing interest rates down, spurring the economy and making it cheaper for government to borrow to finance debt outstanding. This combination, after years unabated, allowed our present president to make the first claim of a budget surplus since Nixon. Reagan did outspend the Russians on war preparation which many consider a catalyst for the collapse of the Iron Curtain. Just prior to Reagan's first term, the Soviets invaded Afghanistan. A million people would die there and a third of the country's people would become refugees in other lands before the Russians would leave a decade later. A Chicago Tribune edition at the time ran with a headine story "Has W.W. III Already Begun?" Yet, we fought no major war under Reagan. Still, I didn't support Reagan, nor was he my hero until he uttered the famous words, "The Soviet Union has just been abolished--the bombing begins in five minutes." As for Reagan falling asleep in staff meetings, I once fell asleep in a literature class despite the professor opening by relating how appalled he was by a freshman who had the gall to fall asleep during his morning lecture.