Three out of the four worst performing hedge funds in 2014 followed oil and the Ruble right down the rabbit hole. The leading funds Russian Prosperity, (Now called Russian Poverty?), Firebird-New Russia, (Novo-Russiya down in flames?), and Kaltchuga had all sold investors on the same myth that Putin built his power and popularity on. The uplifting spiral of energy prices over the last twelve years. All three funds hooked naïve and smart investors alike by staying away from the state energy giants and big banks, which they all thought would avoid he worst of any possible volatility but their crash this year shows that Russias economic crises is far deeper, structural and permanent than just sanctions and oil prices could impose. Russia cannot turn this around in two years no matter what happens to external factors affecting the ruble and the economy. And Russia cannot collectively hold its breath (oops! did I just use the C word? Sorry), for two years by freezing either its foreign currency reserves or the sure to come stagflation in my opinion.
Posted on: Mon, 05 Jan 2015 03:20:18 +0000
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