Skip to main content

Putin's "managed democracy"

The Financial Times is running an article series on Russia and its emerging political structure, described as a corporate state in an earlier article by Neil Buckley. Here is the latest article in the series, "The pull of power: how nothing is left to chance in Putin's 'managed democracy'".

The focus on Russia comes at an interesting time. The upcoming G8 summit in St. Petersburg has been prefaced by verbal sparring between American and Russian leaders over the state of democracy in Russia. This week, former Russian prime minister Mikhail Kasyanov appealed to G8 nations to confront Russia on its drift from representative democracy.

Meanwhile, preparation for Rosneft's IPO has refocused attention on how the Russian oil company snatched its main asset, Yuganskneftgaz, from the wreckage of Yukos' tax battle with Russian authorities. From the Toronto Star:

In a filing to the U.K. Financial Services Authority released yesterday, Yukos said its Yuganskneftegaz unit had been "expropriated from Yukos by actions of the Russian state in proceedings which were contrary to Russian law ... and under unlawful proceedings, which would not be recognized or enforced by the English courts.''

"There is a serious risk that the offering of shares ... would constitute the offering for sale of criminal property," Yukos said

Rosneft has apparently outlined some of the concerns and risks surrounding its IPO in a prospectus filing, but some seasoned investors did not need the written warning before expressing disinterest. From a June 13 Reuters article:

Mark Mobius, a seasoned emerging markets fund manager who runs $30 billion of assets at Templeton, was sceptical of Rosneft's IPO and the valuation of more than $100 billion which some have given the company.

"I don't know what they're smoking," Mobius told Reuters. "Frankly, we're not interested at all. We just don't see any reason why we should be owning a company subject to legal disputes."

As articles in the Financial Times and The Independent have pointed out, suspicion over recent political and business dealings in Russia seem to point us back to the original phase of murky deals, in which Russia's first generation of oligarchs took control of highly prized assets following the Soviet Union's collapse.

Popular posts from this blog

Nasdaq credit rating junked.

S&P cut Nasdaq's credit rating to junk status citing debt burdens and its questionable strategy to buy a controlling interest in the London Stock Exchange. Financial Times reported that the exchange's counterparty credit & bank loan rating were lowered fromm BBB- (lowest investment grade rating) to BB+. The change will increase Nasdaq's borrowing costs should it wish to pursue aquisition targets. For an earlier look at the exchange consolidation trend that brought about Nasdaq's push for a stake in the LSE, please see "Exchange fever" .

Jesse Livermore: How to Trade in Stocks (1940 Ed. E-book)

If you've been around markets for any length of time, you've probably heard of 20th century supertrader, Jesse Livermore . Today we're highlighting his rare 1940 work, How to Trade in Stocks (ebook, pdf). But first, a brief overview of Livermore's life and trading career (bio from Jesse Livermore's Wikipedia entry). "During his lifetime, Livermore gained and lost several multi-million dollar fortunes. Most notably, he was worth $3 million and $100 million after the 1907 and 1929 market crashes, respectively. He subsequently lost both fortunes. Apart from his success as a securities speculator, Livermore left traders a working philosophy for trading securities that emphasizes increasing the size of one's position as it goes in the right direction and cutting losses quickly. Ironically, Livermore sometimes did not follow his rules strictly. He claimed that lack of adherence to his own rules was the main reason for his losses after making his 1907 and...

Finance Trends 2019 Mid-Year Markets Review

Email subscribers of the Finance Trends Newsletter receive the first look at new articles and market updates, such as the following piece, sent out to our email list on Sunday (6/14).   Hello and welcome, everyone! If you received our last email notice over the July 4th holiday, you'll know that this weekend's newsletter will serve as a mid-year market update and a follow-up to issue #29, " How to Reinvest in a Rising Market ".   Ladies and gentlemen, without further ado, let's start the show...  Finance Trends Newsletter: Our Mid-Year Market Review When we last spoke, back in February, the U.S. stock market was rallying off its December-January lows. As the S&P 500 and Nasdaq reclaimed their 200 day moving averages in February and March, it became increasingly apparent that a lot of retail investors (and perhaps some institutional investors) were left under-invested while watching this recovery move from the sidelines.  The U.S. stock ...