An exterior view shows the headquarters of the Central Bank in Moscow, September 13, 2013. Credit: Reuters/Maxim Shemetov
Russian Bank Run Could Be ‘In The Cards,’ UralSib Capital Says -- Bloomberg
The Russian economy may come to “a sudden stop” and a bank run “could be in the cards,” according to an analyst at Moscow brokerage UralSib Capital.
“A full-blown currency and financial-crisis scenario seems to be unfolding in Russia in what was supposed to a quiet week as we head into the holiday season,” Slava Smolyaninov, deputy head of research, wrote in an e-mailed report today. “There is a risk that the economy will come to a sudden stop, along with the banks and the overall financial system. Hence, we may have underestimated the level of financial risk in the event of a full-fledged panic. A bank run could be in the cards.”
Smolyaninov didn’t reply to a call or an e-mail seeking comment. UralSib Capital is a unit of a bank that is the 13th largest consumer lender in Russia, according to its website.
Read more ....
My Comment: I saw such runs on Russian banks in the 1990s .... it was not a pretty sight then .... and it will not be a pretty sight if it happens today. On a personal note .... I have an interest in my cousins real-estate/development company in Moscow .... and while I am no longer involved in operations, I am kept in the loop on what is happening. Bottom line .... current projects are being scaled back, no new projects are planned, all present cash holdings are to be held in foreign currencies (which for us has always been a 50% rule .... now 90%) .... and to prepare for lay-offs and salary cuts.
Sighhh ... thank God I now live in Canada.
4 comments:
http://the-mound-of-sound.blogspot.ca/2014/12/isnt-one-century-of-muddled-thinking.html?m=1
Thanks for the link Jay. The Disaffected Lib's analysis brings back the memories. Wow .... and I lived through all of that.
WNU,
This is an interesting view on the subject, I don't agree with his major premise, but like I said it's interesting.
http://www.interpretermag.com/its-not-just-oil-and-sanctions-killing-russias-economy-its-putin/
There are some good points in the article James. As to what is my own take right now .... the Russian economy is now facing a perfect storm. Loss of confidence, sanctions, oil price drop, no support from international institutions or countries.
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