August 8, 2008 — Contents

FRIDAY AUGUST 8 CONTENTS

(1) EDITORIAL: Russia, Imploding Once Again

(2) EDITORIAL:  The Day of Reckoning in Georgia

(3) Russian Society: As Sick as it Can Get?

(4) Latynina on Putin and Mechel

(5) Pasko on Solzhenitsyn

(6) Browder Speaks

(7) Vladimir Putin, Crybaby

EDITORIAL: Russia, Imploding Once Again

EDITORIAL

Russia, Imploding Once Again

As shown in the chart above, as the price of oil has plummeted to a three-month low and Russian “prime minister” Vladimir Putin has issued yet another crazy, unhinged attack on a major Russian business entity (last time oil major YUKOS, this time steel major Mechel) , in the last three weeks the Russian stock market has lost 18% of its total value, matching a drop in the price of oil (from $145 to $120) jot for jot. In the last six weeks, it’s down a shocking 25% from record highs around 2,400 on the RTS Index. The market was down 3.7% last Tuesday alone as it shuddered under the impact of falling oil prices.

The Russian stock market is being bled white. Indeed, one has to wonder if Putin isn’t somehow intimidated by growth in the market and the creation of wealth beyond his control that it implies, and whether he isn’t just as pleased as Stalin was to see a crippled nation groveling at his feet. After all, it’s so much more difficult to govern healthy, vigorous, wealthy people.

And yet, crude oil is still selling at stratospheric prices in excess of $100 a barrel, and crude oil is Russia’s bread and butter. If Russia had any kind of economic fundamentals, its stock market ought to be charging ahead. It’s not, and that’s because Russia has no economic fundamentals at all. It’s a crude, third-world dictatorship governed by a proud KGB spy, a relic of a failed state with no training or experience in business, economics or social policy (much less democracy). The Russian market tracks the price of oil so precisely because the price of oil is the only thing standing between the price of oil and apocalypse.

In short, if the price of oil were not artificially inflating the Kremlin’s economic performance, we could very well be witnessing a major depression in Russia, followed by the fourth major collapse of the Russian state in the past century. The recent spike price in oil is quite simply a disaster for Russia, because it has finally given the West the incentive it needs to aggressively seek out alternative fuels; the Kremlin’s rabid hostility to the West combined with the huge price surges has made the world wake up from its stupor and begin to wean itself from oil dependence. As time goes on, Russia’s oil stocks will both deplete and marginalize, and the Russian economy will degenerate into anarchy.

How could it be otherwise? By what twisted, neo-Soviet logic do Russians imagine that they can be successfully governed by the KGB? What possible credential or qualifications could Putin have to address complicated economic issues? Isn’t it clear that the priorities of a KGB spy are irreconcilable with the prosperity of a modern nation? Isn’t it obvious he will simply divert the nation’s resources towards oppression and world domination instead of dealing with pressing social issues and creating a vibrant economy, in other words that he’ll behave just as Stalin did, with the same results?

What is happening in Russia today is unprecedented in human history. Russians watched a KGB regime ruin their country, butchering millions of Russians, destroying the civilian economy and causing the collapse and dissolution of the USSR. Then, when the dust settled, they blithely turned the reins of power right back over to the KGB.

Below, we report that a Russian judge has recently ruled that not only is sexual harassment of female workers by male superiors legal in Russia, it’s to be encouraged. Russia is already one of the most corrupt societies on the face of the earth, as rated by Transparency International and a host of other international experts, and things are getting even worse. We then report on Russia expelling one of its leading investors, on the world-famous anti-Soviet dissident who supported Putin’s KGB regime and betrayed his whole life’s work, and on the barbaric antics of those who claim to lead but in fact act more like savage children. And that’s just one day’s news!

Russia is disintegrating before our eyes and, just as has been the case in the past, the people of Russia will not lift a finger to stop it.

Thanks for reading La Russophobe !

EDITORIAL: The Day of Reckoning in Georgia

EDITORIAL

The Day of Reckoning in Georgia

Under Siege

As was inevitable, the dispute between Russia and Georgia in South Ossetia has finally exploded. Georgia predicted this long ago.

Russia’s hypocrisy in the matter is truly mind-numbing.

Where Chechyna is concerned, Russia demands that the outside world not only refuse to provide any tangible support for the breakaway region, it insists that we not even offer any criticism of Russia because it is a “domestic” matter and none of our business. Yet, where South Ossetia is concerned, Russia feels it has the right not only to provide support for the rebels but to invade the region with regular Russian army forces in a naked act of territorial conquest. Apparently, Russia sees no inconsistency between these actions and its Chechnya policy whatsoever, a duality of truly Soviet proportions.

NATO had the chance to forestall any armed conflict by decisively admitting Georgia as a member, but it dithered and mumbled and put it off until later. Seeing this, Russia believed it had a free hand to invade with massive force, and did so. Georgia, of course, responded by seeking to liquidate the Russian forces, as any nation would do when its territory was invaded, and now Russia is seeking to use the Georgian response as an excuse to impose the same type of control over Georgia proper as it had during Soviet times.

The world must act immediately and forcefully to dissuade Russia from its fanciful notions of neo-Soviet imperialism. Russian forces have only barely been able to keep the lid on Chechnya (we’ve documented many instances of ongoing violence both there and in Ingushetia). Georgia is a far harder target than Chechnya and Russia’s imperialistic advances can only result ultimately in disaster in the long term. Russia’s stock market took a 6.5%, $57 billion loss on news of the Russian incursion. Even worse, Russia’s image is permanently destroyed now, as it has laid bare before the world its naked, bullying imperialist aggression — and in so doing wiped out any moral high ground it may have claimed to exclude the West from involvement in its own breakaway region.

But in the short term, the domino principle applies. Let Russia get away with annexing part of Georgia, it will take the rest. Permit that, and Ukraine is next. After that, who knows where the bloodlust of Russia’s KGB regime will end. Writing in the Telegraph Robert Parsons, international affairs editor of France24 TV, states: “This is no longer about a tiny country way off most people’s radar. Georgia’s fate is about the future world order, Europe’s place in it and persuading Moscow to desist from the brutish behaviour that has marked its recent foreign policy.”

U.S. Secretary of State Condoleeze Rice gets it. She stated: “We call on Russia to cease attacks on Georgia by aircraft and missiles, respect Georgia’s territorial integrity, and withdraw its ground combat forces from Georgian soil.” Former U.N. Secretary of State Richard Holbrooke gets it too: “They have two goals. To do a creeping annexation of South Ossetia and Abkhazia and, secondly, to overthrow Saakashvili, who is a tremendous thorn in their side.” Even Barack Obama gets it: “As I stated in April this year, I am committed to upholding the sovereignty and territorial integrity of Georgia. This commitment has long been a fundamental building block of U.S. policy, and it will not change under the Obama administration. I also affirm Georgia’s right to pursue NATO membership. This aspiration in no way threatens the legitimate defense interests of Georgia’s neighbors.”  Now it’s time for President Bush to be heard (he recently snubbed Putin by refusing to meet with him in Beijing at the Olympiad, a powwow Putin had bragged would occur).

Russia opposes even economic sanctions against Iran, demanding negotiation. But when Georgia is at issue, Russia is entitled to immediate resort to military action. This is neo-Soviet hypocrisy in its full horror.

It. Must. Be. Stopped.

As Poland did in World War II, as Czechoslovakia did during the Cold War, the valiant people of Georgia are painting an indelible image in blood of the monstrous KGB regime that wields power in Moscow. Now, at last, that monster is laid utterly bare before the eyes of the world.  The warning call has been sounded for many years now, but so many have paid it no heed.

We. Must. Act. Now.

Watch the President of Georgia discussing the Russian attack here on CNN.

Pipes on Solzhenitsyn, Traitor to Democracy

Writing in the Moscow Times Russia scholar Richard Pipes exposes the fraud that was Alexander Solzhenitsyn:

Alexander Solzhenitsyn, viewed as a political figure, was very much in the Russian conservative tradition — a modern version of Dostoevsky. Like the great 19th-century writer, Solzhenitsyn despised socialism and yet had no use for Western culture with its stress on secularism, freedom and legality.

Russia’s Neo-Soviet Class Crisis

Rich and Poor in Russia

The Moscow Times reports that the more things change in Russia, the more they stay the same. The nation still labors under the same appalling class inequities that provoked the Bolshevik revolution and persisted in Communist times:

Nikolai Nikitin by all appearances is Russia’s Average Joe. The 82-year-old retiree with blinking blue eyes supplements his monthly pension of 4,000 rubles ($170) with what grows in the garden in front of his small wooden house. His nephew Mikhail, 47, brings home another 15,000 rubles ($635) a month from his job as a security guard. Together they barely scrape a living. Nikitin may not be so average in having surpassed the country’s male life expectancy of 59 by 23 years. But in his neighborhood, he stands out for his poverty. Nikitin is encircled by wealth.

Russian Society: As Sick as it Can Get?

As if the world needed any more reasons to stay as far away from Russia as humanly possible, the Teleraph reports that sexual harassment is now perfectly legal in Russia. In fact, the judges are encouraging it!

The unnamed executive, a 22-year-old from St Petersburg, had been hoping to become only the third woman in Russia’s history to bring a successful sexual harassment action against a male employer.

She alleged she had been locked out of her office after she refused to have intimate relations with her 47-year-old boss.

“He always demanded that female workers signalled to him with their eyes that they desperately wanted to be laid on the boardroom table as soon as he gave the word,” she earlier told the court. “I didn’t realise at first that he wasn’t speaking metaphorically.”

The judge said he threw out the case not through lack of evidence but because the employer had acted gallantly rather than criminally.

“If we had no sexual harassment we would have no children,” the judge ruled.

Since Soviet times, sexual harassment in Russia has become an accepted part of life in the office, work place and university lecture room.

According to a recent survey, 100 per cent of female professionals said they had been subjected to sexual harassment by their bosses, 32 per cent said they had had intercourse with them at least once and another seven per cent claimed to have been raped.

Eighty per cent of those who participated in the survey said they did not believe it possible to win promotion without engaging in sexual relations with their male superiors.

Women also report that it is common to be browbeaten into sex during job interviews, while female students regularly complain that university professors trade high marks for sexual favours.

Only two women have won sexual harassment cases since the collapse of the Soviet Union, one in 1993 and the other in 1997.

Human rights activists say that Russian women remain second-class citizens and are subjected to some of the highest levels of domestic abuse in the world.

Thanks for reading La Russophobe !

Latynina on Putin and Mechel

Other Russia translates Yulia Latynina from Yezhedevny Zhurnal:

Last week, at a meeting in Nizhny Novgorod, Prime Minister [Vladimir] Putin came down hard on a company which was damaging Russia’s economy with its work.

It turned out this company was by no means Baikalfinansgrup, which bought Yuganskneftegaz at a non-competitive auction on credit provided by the government. And it wasn’t the Gunvor group, which belongs to a friend of premier Putin and receives 70 billion dollars annual income from the export of Russian oil. And not RosUkrEnergo, whose right to deliver gas to the Ukraine using non-transparent arrangements is whole-heartedly defended by Russian bureaucrats at the highest level.

It turned out to be Mechel, condemned for selling coal abroad at prices two times lower than domestic ones. The company’s owner, Igor Zyuzin, did not appear at at the meeting, citing illness. “Of course, illness is illness,” premier [Putin] said, then recommending a speedy recovery for Mechel’s owner. “Otherwise we’ll have to send him a doctor to clear out all these problems.”

Putin’s promise to send Zyuzin a doctor cost Mr. Zyuzin 5 billion dollars — it was exactly this amount by which Mechel’s market capitalization collapsed that evening on the New York exchange.

The reason why Mechel in particular dissatisfied the premier was such: The largest Russian metallurgical giants, including the Novolipetsky [NLMK] and Magnitogorsky metallurgical complexes, buy up coal on the side, and as a consequence, are interested in long-term contracts for coal delivery during times of sharp price increases.

Mechel, which supplies them with coal, is a coal extracting company, and is accordingly interested in spot contracts for coal delivery, which allow it to maximize sales profit; And, should the opportunity arise, to use the deficit of coal as a lever to gain control over small factories (Gubakha, for instance).

It is clear that giants like NLMK and Magnitka are much closer to the Kremlin, and especially to Vice-Premier Sechin, who now oversees industry. It was precisely Sechin, who, with active participation of the metallurgical giants, prepared the report that has raised so much attention.

It sticks out like a sore thumb that this is already Premier Putin’s second attempt at direct interference in the economy. A week ago, high prices for jet fuel elicited his discontent. If earlier, during his presidency, President Putin underscored in every way that “the Yukos affair” was an exception, then now, it seems Premier Putin is making it clear to everyone that he is intent on directing the economy by hand.

Mechel, which was worth around 15 billion dollars just last week, recently laid out around 2.5 billion dollars for a controlling stake in two large coal companies –Yakutugol and Elgaugol –and in doing so, beat out the state-run ALROSA. Yakutugol has been online for a long while. Elgaugol is simply a section of taiga, and several billon dollars are needed to develop it.

It is obvious that in the near term, it will be hard for a company that paid money for non-operational assets in an open auction to raise the means to develop them. If Mechel goes bankrupt, and its assets are sold for peanuts, Mechel’s shareholders (I’ll remind you that the company had its IPO and lists its shares on the New York Stock Exchange), may well file against Premier Putin in the New York City court.

And if the Yukos shareholders, in filing their corresponding lawsuit, expect to prove that precisely Vladimir Putin or Igor Sechin are guilty for their misfortunes, then everything is available right here. It is hard to imagine George Bush, threatening to “send a doctor” to Bill Gates. One doesn’t speak to businessmen this way in the free world. Crime bosses speak this way to an out of line merchant. Usually, proof of these threats is obtained in a strategic way, wrapping oneself in microphones. Here the threats sounded right on the television.

One question –how much will this affair cost Mechel? Although in my opinion, something else is far more interesting –how much will it cost the Magnitka and Lipetsky [metallurgical plants]. What has happened comes out as the classic illustration of the proverb: don’t call a wolf to help you with the dogs. The metallurgical giants turned to Vice-Premier Sechin, to help him fight with inflation by forcing Mechel into long-term contracts. The general fall of the market has already cost Russia’s steel sector far more than the losses from spot contracts, by which Zyuzin sold coal. After all, zealous bureaucrats will now be checking everyone, not just Mechel. It is always this way with chekists and bandits: if you ask them for a favor, it’s uncertain if they will accommodate it or not. But you’re still certain to owe them.

But the most interesting part –how much will this affair cost Premier Putin? It isn’t a question of whether business will start to speak up in Mechel’s defense –no one has any illusions here. Business will be tearing chunks out of Mechel, and its mouth will be busy. But then Mechel will likely run for protection to President Medvedev, and there aren’t any reasons why President Medvedev wouldn’t provide it with protection. If nothing happens with Mechel, and prices for airline tickets don’t fall, this will mean that Premier Putin can’t regulate the prices of either jet fuel, or coking coal.

And this is very bad, when the premier sends a doctor every week, and the doctor just doesn’t arrive. This way one can quickly tumble down to the level of Premier [Mikhail] Fradkov, who every week would loudly censure [German] Gref, or [Alexei] Kudrin. But for some reason, he could never do anything to them.

Thanks for reading La Russophobe !

Pasko on Silent Solzhenitsyn

Writing on Robert Amsterdam’s blog hero journalist Grigori Pasko takes the late Aleksandr Solzhenitsyn to task for his shameful silence on so many issues of his day:

I recall how back when I was in the military-political college, I surreptitiously read «One Day in the Life of Ivan Denisovich», Alexander Solzhenitsyn’s forbidden tale about prisoners of the GULAG, hiding it from the company and battalion officers. At the college, they taught us how to be conduits of the ideals of the communist party in the armed forces. Solzhenitsyn’s story talked about how all around this party there was nothing but lies. And around the Soviet state – lies. I learned how to see these lies thanks, among others, to the works of Alexander Isaevich.
Then I experienced on myself all the «charms» of the Russian GULAG. One of those who allowed and allows the continuation of the existence of the GULAG – was and remains Vladimir Putin. All the stranger then was to me the almost friendly, problem-free and conflict-free, with only rare and insignificant criticism, relationship between the great writer and the not-great chekist and president.

Once I came to visit Alexander Isaevich. I wanted to speak with him about his attitude towards the spy-mania which had blossomed into full bloom in our country under Putin. The author’s wife, Natalia Dmitrievna, met me and said that Alexander Isaevich would not be able to meet with me. I asked her about his attitude towards the spy trials. She did not reply. And nowhere and not once did I hear the voice of the author speak out against these trials. I don’t know why he kept silent.

I express my deep sympathy to Natalia Dmitrievna. And for some reason I think that she will tell us about how Alexander Isaevich reacted to these or the other events in the country, while not making this reaction public.

In one of the last interviews for the television channel «Rossiya», Alexander Solzhenitsyn said that he considers that Russia has in many ways re-established its influence on the international arena, however its domestic spiritual-moral atmosphere is far from the ideal.

“In international relations, the influence of Russia is returned, the place of Russia in the world is returned. But internally, in our moral state, we are far from what one would like to be, as we organically need”, said Solzhenitsyn.

Probably, Alexander Isaevich was found under the impression of the Munich speech of Vladimir Putin – a speech aggressive in intonation, but nearly empty in content. By this speech the president, in essence, once again unleashed the cold war between Russia and the West. I will dare assert that the real authority of my country in the world, thanks to such figures as Putin, is very low. Western leaders hush up the problems in my country and exaggerate the role of Russia only because their countries need Russian oil and gas.

Surely Solzhenitsyn must have seen and known all this. But if he did see and know, then why did he keep silent?

Answering a question of the television channel as to whether he continues as before to consider “preservation of the people” to be the sole national idea acceptable today, Solzhenitsyn underscored that this is “not so much as the sole, as an accessible” idea.

In his opinion, society has not yet arrived at a long-term national idea. “When they started getting all worked up by a national idea, it was nauseating. Where are you going, why are you going there. You haven’t matured enough for it”, said Solzhenitsyn.

It is possible that the hysteria with respect to the search for a «national idea» stopped in the country thanks to Alexander Isaevich. Because some had already reached agreement to the point where the FSB – this is the intellectual heritage of the Russian people and its neo-nobility.

These «neo-nobles» could easily have reached agreement to the point where the «national idea» of the country would have become Khrushchev’s phrase «We’ll show ’em all!» Personally, I don’t think there’s anything much to show ’em. Besides oil and gas, naturally.

It is known that the writer continued working on the preparation for publication of 30 volumes of his works. Even «The GULAG Archipelago», which has not been republished in the last 16 years, recently came out in a new edition. The book is necessary and important even now, when the former GULAG once again is making its presence felt.

It is noteworthy that the writer also did not once express himself about the state of today’s penitentiary system of Russia, which is little better than the former GULAG, the presence in it of political prisoners and KGB methods. Why? Perhaps we may still find out about this later…

Or we may now never find out…

Thanks for reading La Russophobe !

Browder Speaks

The Times of London reports:

Bill Browder calls himself a value investor – it is fund manager-speak for someone who looks for latent value in stocks that are ignored, hidden gems – but value investment barely begins to describe what he does.

In common with other money managers, the chief executive of Hermitage Capital has a PowerPoint presentation that sets out his strategy, but if you know anything about Bill Browder, the rehearsed explanation is strangely unsatisfying; you wonder if you are getting the whole story.

All fund managers, barring those who follow indices and the weird ones who predict the future from lines on charts, call themselves value investors, but the Hermitage chief does something altogether different – he pursues value with a vengeance.

This is not about taking a stake in a dull family engineering company with a view to prodding the management out of slumber.

On the basis of past performance, Mr Browder’s strategy is to target a leading company with close connections to government and to conduct a forensic examination of its investments.

Upon discovering fraud and embezzlement, a very public campaign of exposure and denunciation ensues, followed by partial recovery of funds and huge stock price appreciation. It finally ends with Mr Browder being chased out of Russia.

Hermitage Capital’s campaign against fraud at Gazprom made enormous amounts of money for investors, including many who never put their money in Mr Browder’s fund.

He started with $25 million in 1996, achieving almost tenfold gains in 18 months and then raised $1billion from new investors. At one stage the pot totalled $4 billion and Hermitage became Russia’s biggest foreign portfolio investor.

However, Mr Browder offended someone with great power – he insists that he still does not know who – and in November 2005 was refused re-entry into Russia. He has not returned since.

Hermitage is shifting its focus to the Middle East, in particular the Gulf, where Mr Browder is investing the proceeds of a new fund. He raised $625 million in April last year and is targeting infrastructure companies in Kuwait and the United Arab Emirates.

His portfolio includes 15 investments at present after a lengthy selection process from a thousand companies worldwide. He reckons that the Gulf investment climate is a holiday compared with Russia. “Corporate governance is so much better [in the Gulf]. In Russia it was all about fraud. We have never seen anything like that in the Middle East.”

The parallels between Mr Browder’s Russian exit and the present rumpus at TNK-BP (the Russian affiliate of BP, where a power struggle has resulted in BP’s nominated chief executive running the company from somewhere in Central Europe) are obvious.

“If my experience is anything to go by, BP’s problems are only just beginning … They [BP] should fight back, use everything they have. It’s the only thing that these people understand.”

He ought to know. Although the visa denial put paid to his Russian strategy, it was trivial compared with what happened next.

In June 2007, while the Hermitage boss languished in London, a lieutenant-colonel in the tax unit of the Interior Ministry became aware of Mr Browder’s predicament.

Under the guise of a tax inquiry, his team raided the Moscow offices of Hermitage and its law firm, seizing documents, computer discs and corporate seals, in the process beating up a Russian lawyer who dared to protest.

Over the next six months there followed an elaborate fraud in which the ownership of several Hermitage companies was changed and new directors appointed.

A lawsuit was fabricated against the Hermitage companies, the bogus directors accepted the claim and “judgment” was awarded for $376 million.

Mr Browder has PowerPoint presentations that explain the fraud in minute detail and you almost sense that he enjoys pursuing the gangsters through the shadowy corridors of the Kremlin.

“Isn’t it amazing?” he says. It gets more amazing because the crooks failed to get the money – the Gaz-prom stock held by the companies had been transferred offshore.

Undeterred, the “police” then pursued another avenue. Having bankrupted the Hermitage companies with bogus lawsuits, they then demanded repayment from the Government of taxes legitimately paid by Hermitage, a total of $230 million, to the Russian Treasury. This was duly repaid to the crooks – a tax fraud perpetrated by tax inspectors.

Why does the Hermitage chief do it? “I went to Moscow hoping to find cheap stocks.” He was at the time a fan of Vladimir Putin, supporting the President’s programme of reform.

His first confrontation was with Vladimir Potanin, a Russian oil and metals tycoon, over shares in Sidanco, an oil company later acquired by BP. Hermitage bought 2 per cent, but the tycoon wanted to assert control.

“He decided to issue shares to a group of insiders, including himself. I had to go into battle to prevent it being diluted.”

He cuts an unlikely figure as a caped crusader for corporate governance in this cloak-and-dagger world of post-Soviet corporate gangsterism but talks about “the good guys” and “the bad guys” in a way that brushes aside the amorality of Moscow business deals.

His grandfather was Earl Browder, one of the founders of the American Communist Party, who went to Russia in 1927 and became the party’s general secretary.

During the Second World War he was expelled for arguing in favour of co-existence with capitalism and during the 1950s communist witch-hunts he was interrogated by Senator Joe McCarthy but refused to incriminate his former comrades.

The younger Browder says that he has taken on the role of family black sheep, embracing capitalism and rejecting academia, the profession of his father, who is a respected mathematician.

The black sheep initially worked for Boston Consulting Group and got a taste for investing when he was sent to Poland to sort out a failing bus factory.

The Polish Government was privatising state companies by public flotation. “I took all my savings, $4,000, and applied for all the privatisations and made ten times my money.” He joined Salomon Brothers and traded Eastern European equities. In 1995 he quit to set up Hermitage.

The rebel has a suitably apocalyptic view of the financial world. The credit crisis has a long way to go, he reckons. “There is going to be huge attrition in the world of investment. We have been in a 20-year bull market.”

The fashionable emerging markets will continue to be hit hard. “The Chinese stock market was trading at 50 times earnings. As the bubble bursts in China, there will be a knock-on effect, it will be the de-Bric-ing of the world,” he says, referring to the acronym of Brazil, Russia, India, China that has became a buzz-word for emerging market dynamism.

The Hermitage boss has his own slogan: “Get off the financial grid.” By this, he means the world of financial markets, places where capital is consumed, rather than generated. “You don’t want to be in places where capital markets are active.

If you can’t borrow money, who will do badly? Those who need to borrow money.” That logic drives Mr Browder to the Middle East, where capital is in huge surplus and there is cultural disapproval of lending for interest.

Local Middle Eastern companies have yet to excite the investment banks, he says, and money is flowing into Middle Eastern coffers. The income of the big oil exporters totals $1.3 trillion at an oil price of $100 per barrel – and it is staying in the Gulf.

“It’s the biggest wealth transfer that has ever happened in the world,” he says.

Hermitage has 18 analysts, mainly Russian, because they are “some of the smartest people in the world trained in the one of the worst business environments”. He quotes Frank Sinatra’s song about New York: if you can make it there, you’ll make it anywhere.

But he has adopted Britain as his home. He acquired British nationality when he married and is a huge fan, recalling the support he received from the British Government when was trying to regain his Russian visa. “This is a good country. I like the rule of law.”

Thanks for reading La Russophobe !

Remembering the Horror of Soviet Russia

The Economist reports:

Paranoia and exhibitionism, two of the defining characteristics of the Soviet system, make a nasty mix. It was the Soviet Union’s desire to crow over depression-stricken America that encouraged it to let hundreds of workers, desperate for jobs and a new start in life, immigrate there in the early 1930s. Exactly how many nobody knows; almost all ended up in mass graves. Initially lauded as welcome refugees from the miseries of capitalism (and as useful specialists who might help replicate the bits of it that worked, such as factories) from 1935 onwards they became enemies of the people, infiltrators and spies. A tiny handful, such as Paul Robeson, a singer, were tolerated as propaganda trophies. The rest sank into a living Hades of torture, rape, slave labour, starvation, frostbite and death, shared with millions of others.

The horrors of the Gulag ought to be as well known as Auschwitz, but they aren’t. Tim Tzouliadis includes many of them in his sprawling narrative. His statistics are sometimes sloppy and he seems barely aware that for most of its people the Soviet Union was already a hell-hole, even when the American workers were happily playing baseball in Gorky Park.