The Russian investment houses are of two minds these days. One camp wants to try to sucker as much money out of their clients as possible before the edifice of Russian society finally crumbles. They want to lie and talk about green shoots. Streetwise Professor exposes one such charlatan in today’s issue. Then there are those who are making a last desperate bid for reform in the hope of preserving some vague hope of long-term prospects. Chris Weafer, chief strategist at UralSib Capital, appears to be one of them. Here are his thoughts, from the Moscow Times:
When you are mired in a severe economic crisis, it is normal to get excited at even the smallest morsel of good news. It is therefore tempting to interpret the 0.5 percent monthly improvement in July’s gross domestic product and the smaller contraction in industrial output as an assurance that all is now well with the economy and that the stock market will imminently start the second leg of its recovery rally. Deputy Economic Development Minister Andrei Klepach fueled this optimism when he proclaimed Monday that “the recession is over,” commenting on July’s GDP results.