Stacy Summary: I recall so well last autumn when so many mainstream journalists and their favourite bloggers were so so certain Russia would run out of reserves; they were so certain (this was clearly a line they had been sold) that, to this day, they still maintain that Russia’s international reserves are declining rather than rising. No evidence to the contrary will convince them to give up their sacred belief, but that doesn’t mean you have to be similarly berserk.
The article – from Bloomberg.com – goes on to explain how and why the international reserves are building and also the manner in which rainy day funds are being drawn down. And, here seems to be where the mainstream blogger/journo confusion seems to come from re: spending rainy day funds (the original Keynesian theory – ie that a govt should SAVE for a rainy day, at which time said govt could spend; most politicians in the West on the journalists who rely on access to them push for sunny day spending on credit):
I don’t want to spoil a good ghost story, we all love to be scared around the camp fire. It builds bonds. And I also know that it is a great way to establish communal identity and bonds within that community to hate one team in favour of another for no reason other than that “the blue team sucks! my red team is great!” Most analysts/bloggers/journalists, however, have Putin-derangement syndrome and so are unable to see the genuine economic situation clearly – that is, Russia, despite their wild assertions – has NOT run out of money. There is no chance of it ‘defaulting’ – despite their wishful thinking. I’m sure that is why the likes of Jim Rogers are investing in Russia – for the other players are clearly hallucinating. I can think of at least five or six other sectors or areas in which the mainstream is equally unhinged by popular political “you’re either with us or against us” mentality.