What a way to start a campaign. Dmitri Medvedev officially becomes a candidate for President of Russia and the stock market tanks. Probably not the soundtrack he would have chosen for his coming out party. The Russian press is screaming in terror. I’m sure someone will eventually blame it on the Americans.
The Russian stock market lost 7 percent of its value on Monday in what the The Moscow Times says is being called “The Massacre.” And a massacre it is. Recession is back. Locked and loaded. India “sank” to 11 rounds of percentage bullets. Today alone, Japan was “down” with 5. Australia had its “biggest fall” with 7 in the gut. Europe had its “worst day” with 3 logged in its arm. All you heard in the markets was “Bang! Bang! Bang!” The FT says that Recession will hit the US in the morning. The US is going down.
Yes, Recession is back. In the last two weeks sightings of Recession were reported everyday. He’s so badass that some papers won’t even mention his name. They call him the “R-word.” If you’re trembling in your boots, I suggest reading the Washington Post‘s fable “5 Myths About That Depressing R-Word” to bring some comfort to your sleepless nights. Apparently the R-word is good for you! “Americans get healthier as the economy gets worse,” writes Kevin Hasset. And unemployment is good for you too.
Unemployment tends to increase during recessions, but economist Christopher J. Ruhm of the University of North Carolina at Greensboro has found that a temporary one percentage point increase in the unemployment rate leads to a 0.5 to 0.6 percent reduction in the mortality rate, or about 14,000 fewer deaths per year.
So you can keep eating all that fast food from McDonalds, chomping on those big Family size bags of Dorritos from Walmart, and drinking the flat of 48 cans of Coke from Cosco. Keep filling up your yuppie tank. Keep feeding that credit card. Consume, consume, consume. Recession is not here yet. And when he does some dudes from the Business Cycle Dating Committee promises to let us all know. When Recession does come, they promise to get out all their “indicators” to start testing whether Economy’s personal income pressure is low or high, its unemployment is stable, and if its industrial production, sales volume, and manufacturing volume are at the right levels. All “to determine the health” of Economy. Man, sounds like Economy gets better healthcare than most people in the world. Hey, Recession might be healthy for Americans, but Economy is dying over here!
Well, those guys at the Business Cycle Dating Committee better bring some thick bandages with all their indicators because Recession is pumping Stock Market full of lead.
Russia is catching some good chunks of it. Some of Russia’s biggest companies were hit. The backbone of its economy. Here is the tally from Kommersant:
Surgutneftegaz stock, down 10.5 percent on the RTS and 9 percent on MICEX. On MICEX, Norilsk Nickel was down 7.7 percent, RAO UES of Russia 8.4 percent, LUKOIL 7 percent and Sberbank 7.5 percent. On RTS, RAO lost 8.8 percent, Norilsk Nickel 8.3 percent and LUKOIL 7.8 percent.
Vedomosti added Gazprom Oil, Tatneft (both 9 percent), and Gazprom (7 percent) to its list of Russian casualties.
There’s a word for this. Bloodbath.
When you’re in the capitalist gang, no one player gets shot. Recession uses some pretty high powered weaponry. His bullets spray. Sadly for investors Russia is no longer “a safe haven amid the global rout.” That’s the price you pay, Konstantin Sonin reminds Russia, for “keeping faith in the United States’ economy and democracy.” Dastardly Americans!
The convergence of Medvedev’s campaign and Russia’s stock slide didn’t escape Vedomosti. “Is the Bear full?” it asked. I wonder if Dima is thinking to himself, “Do I really want to take another bite? This Russian Presidency stuff is starting to taste kinda shitty.”