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Strategies & Market Trends : Investment in Russia and Eastern Europe -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (671)	9/15/1998 9:23:00 PM
From: Rob Shilling	Read Replies (1) \| Respond to of 1301

I agree, re-nationalization is not likely. And that is the only thing that could make investing in Russian blue-chips a losing game (IMHO). The blue chips are so undervalued that if Russia does pull out of this crisis, the sky is the limit on these shares. The default on the external debt is possible I guess. What I do not understand is that Russia is saving billions on the GKO restructure and the 90 day debt moratarium. These two events were very recent. yet the only time I heard about a potential external debt default is after these two events. I guess everybody is assuming the ruble will be trading at 40 to the dollar or something. Anyway, once the economic plan is unveiled there may be a chance for a surprise bailout for Russia (if the plan is deemed reformist). Because any more defaulting by Russia could really hurt Europe. At least that is my opinion.

To: Real Man who wrote (671)	9/16/1998 12:48:00 AM
From: peter michaelson	Read Replies (1) \| Respond to of 1301

Vi: I'm no expert but it seems to me, ill-informed though I am, that nationalization of a single key industry would solve Russia's financial problems. That industry would be oil and gas. It would give the government a stream of hard currency sufficient to re-pay the foreign debt over time. I read that foreign debt is $200 billion. It is an industry that has been nationalized many times in many countries and is viewed as relatively acceptable, being a 'strategic industry'. It can be done by purchasing at current very low prices the existing companies including Lukoil, with purchase price to be paid in bonds. In one fell swoop it is a solution to the currency problems and it's politically acceptable nationally and internationally. It can be viewed by the Gorbachev contingent as a return to a path of gradual privatizing and capitalism, with some socialism remaining to protect the country. JMHO, peter