This week; I returned to Ukraine for the first time since Yushenko was formally recognized as President, Kyrgyzstan, a country I have never been to, overthrew its post-Soviet, Soviet leaders and Putin announced a moratorium on (inter alia) the loans-for-shares privatizations. The temperature also crept above 0 on Thursday and the sun shone; unfortunately there is no tool to link the sun to the investment mood. Sitting in the traffic yesterday the two were indelibly linked.
Was Putin's announcement yesterday akin to false hopes of spring as we return to winter today (snow), or have the liberal economists in the convenient guise of Gref and Kudrin started to win the war? And are they winning battles or the war? And just where and on what issues were those battles fought? Does being humiliated in Ukraine (please notice the absence of the definite article) really have a positive economic effect in Moscow? After all in Ukraine the Orange Revolution is seen as the victory of Ukraine's millionaires over its billionaires. Please suspend any conversations about democracy until the pudding is on the table.
Is Putin's charm offensive PR-led, or is it reality? Being burnt by PR-led good news is second nature to investors in Russia's public markets. However, my broker friends tell me that their government relations people have been hearing good news for a while. I have blogged too often recently about failures of the 5th Directorate thugs to be anything but happy about their demise, however temporary.
Boy is this a difficult post.
So in the week that; another "friend of Russia" was toppled by dollar-inspired people power, that the hope of a new future permeated both Kyiv and Kiev and Putin publicly swung back to the liberals which is going to impact making money the most? Putin's announcement should top that list by some way. Ukraine is emerging from the dark ages, Kyrgyzstan is still feudal and there is no obvious link between democracy and wealth creation - ask the Chinese.
For all the carping about progress in Russia over the last 6-9 months it is still a country mile ahead of its nearest neighbors. Retreating rapidly to an area where I have some opinionated knowledge rather than just opinions; technology. IP laws here are mostly well-drafted if yet to be enforced. Academia is increasingly being funded. In none of Russia's neighbors is this the case. If your trade is short-term it may be better to buy Ukraine than Russia, something to do with buying the rumor selling on the event. If however, investment time horizons are slightly longer than tomorrow; Russia seems a better bet.
And all this in the week that "Old Europe" defeated the Services Directive. How long before we read the first comparisons of Russia's liberal economy compared to Germany and France's restrictive model?
This is either the first week of spring or another false dawn in an increasingly long winter. The weather outside is not promising; something tells me that Russia's economy is going to be rosier.
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25 March 2005
Revolutions; Rose, Orange, Kyrgyzstan and Russia
This week; I returned to Ukraine for the first time since Yushenko was formally recognized as President, Kyrgyzstan, a country I have never been to, overthrew its post-Soviet, Soviet leaders and Putin announced a moratorium on (inter alia) the loans-for-shares privatizations. The temperature also crept above 0 on Thursday and the sun shone; unfortunately there is no tool to link the sun to the investment mood. Sitting in the traffic yesterday the two were indelibly linked.
Was Putin's announcement yesterday akin to false hopes of spring as we return to winter today (snow), or have the liberal economists in the convenient guise of Gref and Kudrin started to win the war? And are they winning battles or the war? And just where and on what issues were those battles fought? Does being humiliated in Ukraine (please notice the absence of the definite article) really have a positive economic effect in Moscow? After all in Ukraine the Orange Revolution is seen as the victory of Ukraine's millionaires over its billionaires. Please suspend any conversations about democracy until the pudding is on the table.
Is Putin's charm offensive PR-led, or is it reality? Being burnt by PR-led good news is second nature to investors in Russia's public markets. However, my broker friends tell me that their government relations people have been hearing good news for a while. I have blogged too often recently about failures of the 5th Directorate thugs to be anything but happy about their demise, however temporary.
Boy is this a difficult post.
So in the week that; another "friend of Russia" was toppled by dollar-inspired people power, that the hope of a new future permeated both Kyiv and Kiev and Putin publicly swung back to the liberals which is going to impact making money the most? Putin's announcement should top that list by some way. Ukraine is emerging from the dark ages, Kyrgyzstan is still feudal and there is no obvious link between democracy and wealth creation - ask the Chinese.
For all the carping about progress in Russia over the last 6-9 months it is still a country mile ahead of its nearest neighbors. Retreating rapidly to an area where I have some opinionated knowledge rather than just opinions; technology. IP laws here are mostly well-drafted if yet to be enforced. Academia is increasingly being funded. In none of Russia's neighbors is this the case. If your trade is short-term it may be better to buy Ukraine than Russia, something to do with buying the rumor selling on the event. If however, investment time horizons are slightly longer than tomorrow; Russia seems a better bet.
And all this in the week that "Old Europe" defeated the Services Directive. How long before we read the first comparisons of Russia's liberal economy compared to Germany and France's restrictive model?
This is either the first week of spring or another false dawn in an increasingly long winter. The weather outside is not promising; something tells me that Russia's economy is going to be rosier.
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