January 6, 2009
You discuss the return of Russian dominance. I don’t know anyone who takes it seriously, except in Russia, of course. Russia’s recent dominance is a blip in time (sorry). Unlike the US, Russia has a very narrow economy that has mostly been driven by natural resources and was brought to life, for a short moment, by a global commodity bubble. If Russia did not have nuclear weapons and a large army, we’d spend as much time talking about it as an election in Mozambique.
Take high commodity prices away and you find … well, Russia today: limited property rights, corruption, bribery, semi-dictatorship, and government control of the press. Newspapers and television are controlled by the government, and journalists are dropping like flies.
No, Russia is not the United States. The United States has its problems, but these problems are not structural and time will heal them. Despite all of our problems, the US still has the best economic and most stable political system, period. We have peacefully elected our president every four years for over two centuries. I bet if every country in the world opened its borders to unlimited migrations in and out, you’d find the US population balloon and Russia’s shrink. People from all over the world want to live here.
Dear Mr. Ex-KGB, the Russian economy is crumbling. To divert attention from the internal problems (and more importantly from himself) Mr. Putin is redirecting attention to the “evil” United States. After all, we created the global economic crisis, sabotaged the oil market, and whatever else wrong taking place in the world, we must have had a hand in it. Now it is even a common belief in Russia that the CIA was responsible for the September 11th attacks.
Anti-Americanism is on the rise in Russia. You made an America-fall-apart prediction public almost ten years ago, but it was only recently picked up by Russian (predominantly government-owned) media. You are a superstar in Russia - you get two interviews a day. Unfortunately, predictions that would have been taken as lunacy by most Russians in the past are now turned into wishful thinking. And wishful thinking is what has forever disappointed the Russian public.
Sincerely,
Vitaliy Katsenelson, CFA
Central North-American Republic, formerly known as Colorado
Note: Here is a link to read the story of my childhood in Murmansk, Russia and emigration to the US.
Source: Wall Street Journal
Vitaliy N. Katsenelson, CFA, is director of research at Investment Management Associates in Denver, and he teaches a graduate investment class at the University of Colorado at Denver. He is the author of Active Value Investing: Making Money in Range-Bound Markets (Wiley 2007).
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