• Steve H. Hanke
    05/04/2016 - 08:00
    Authored by Steve H. Hanke of The Johns Hopkins University. Follow him on Twitter @Steve_Hanke. A few weeks ago, the Monetary Authority of Singapore (MAS) sprang a surprise. It announced that a...

Russia Crashes Into Bear Market As Europe Drops Most In 9 Months

Tyler Durden's picture


Broad European stocks dropped 3.3% on the week - the biggest fall since June of last year. Despite a late-day surge on the back of surprising relief from Lavrov's comments on not invading Ukraine (well, he's hardly going to pre-announce) Germany has seen its worst 2-week drop in 28 months. Sovereign bond spreads rose 10-13bps on the week for the peripheral nations (which is actually notable given how tight they trade now). Russian stocks have plunged 22% from Feb 18th highs and Russian 10Y bond yields surged to near 10% yields. Ukraine's short-date bonds remain at yields around 50% and the Hyrvnia is losing ground.

Germany's DAX is back at 5-month lows and this is the worst 2-week slide since Nov 2011...


Russia enters a very fast bear market...


As Russian 10Y yields surge...


Charts: Bloomberg

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Fri, 03/14/2014 - 12:52 | 4548494 PartysOver
PartysOver's picture

Puty Putin don't care.  He is all about the big picture.

The warm water Port at any cost.  The Russian market will bounce back.

Fri, 03/14/2014 - 12:55 | 4548517 HedgeAccordingly
HedgeAccordingly's picture

Swamp Donkey's http://hedge.ly/NdXYJP 

Fri, 03/14/2014 - 13:03 | 4548552 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

ZH hit it on the head the other day. We do anything that ticks off Putin and he will drop the economic bomb, seize western assets and default on western banks. Done deal. 

Fri, 03/14/2014 - 13:22 | 4548639 LawsofPhysics
LawsofPhysics's picture

Correct, from the balance sheet perspective, the Russian government is doing okay, Russian private equity is not. (Just the opposite in the U.S.S.A).

Fri, 03/14/2014 - 18:18 | 4550010 LMAOLORI
Sat, 03/15/2014 - 00:41 | 4551193 mkkby
mkkby's picture

Let's embargo their oil.  Ooops, gas at $10 a gallon might piss off voters in an election year.  Guess we can't do shit to Russia.  And they know it!

Fri, 03/14/2014 - 12:53 | 4548499 fooshorter
fooshorter's picture

Russia in a bear market ... theres gotta be a pun in that...

Fri, 03/14/2014 - 12:54 | 4548512 McMolotov
McMolotov's picture

The US is in a bull(shit) market.

Fri, 03/14/2014 - 13:02 | 4548543 disabledvet
disabledvet's picture

that'll be 25 bucks for your Bic Mac in Mother Russia. "fries and drink extra."

Fri, 03/14/2014 - 13:57 | 4548791 Glasnost
Glasnost's picture

No actually it's about $1.25 for a pita bread sandwich with tomatoes, lettuce, and sour cream from McDonalds in russia.  Drink about $1.00.  Coming from a person living in Russia right now.  And it's pretty tasty.  Also healthier than the shit in America.  By the way, coca-cola and sprite etc here in Russia are made with real sugar.  Sugar is bad for you yeah, but High-fructose shitsyrup is even worse for you.  And it's what is in most American colas.

Fri, 03/14/2014 - 14:16 | 4548881 Freddie
Freddie's picture

True.  I talked to a lady the other day who said she spends extra to get Coca Cola from Mexico at Costco because it does not have high fructose shit.  Russia has it's act together compared to imploding USSA.  The USSA is joke and Obama, the Clintons and Bushes are a prime example of what a disgusting farce Amerika is.

Fri, 03/14/2014 - 14:43 | 4549001 DoChenRollingBearing
DoChenRollingBearing's picture

Coca-Cola in Peru is made with real sugar as well.

Fri, 03/14/2014 - 12:56 | 4548519 LawsofPhysics
LawsofPhysics's picture

The Russians have long since recognized the dangers of paper promises.  They really don't give a shit folks.

Now as for all those western sheep, not so much.

hedge accordingly.

Fri, 03/14/2014 - 13:05 | 4548562 disabledvet
disabledvet's picture

what do you think their war effort is running on you dipshit.
this is massively inflationary.

the USA never had any intention of taking and holding "Middle Eastern real estate."
What if these people put up a fight? Or worse...DEFEAT YOU.

You'll need more than tanks and NKVD here.

Fri, 03/14/2014 - 13:09 | 4548585 LawsofPhysics
LawsofPhysics's picture

So now all those vehicles are running on paper?  You really are a moron, and I don't think you are a vet.  Certainly not one that ever saw action or has been to Russia or done business with Russians.

Fri, 03/14/2014 - 13:19 | 4548626 Schmuck Raker
Schmuck Raker's picture

I'm starting to think he's a veterinarian that a horse kicked in the head.

Fri, 03/14/2014 - 13:41 | 4548713 smlbizman
smlbizman's picture

man, these trolls and their name calling...dipshits, morons, this veterinarian, payfone, and et.als...i guess when u cant compete with logic and reason you go with contempt...

Fri, 03/14/2014 - 14:02 | 4548818 LawsofPhysics
LawsofPhysics's picture

There are no attacks in my original post.  Do you actually have anything to add or not?


I do a lot of business with people in Russia.  What great insight do you have?


Fri, 03/14/2014 - 13:42 | 4548718 SDShack
SDShack's picture

Maybe he's John Kerry. That would hit ALL the criteria.

Fri, 03/14/2014 - 13:00 | 4548529 WarPony
WarPony's picture

It's not nice to fool with Mother Nature Fuckers (read: NATO/FED/GOLDMAN/ZIONISTAS).

Fri, 03/14/2014 - 13:01 | 4548539 order66
order66's picture

"I crush bear market like tiny clown car."  - V. Putin


Fri, 03/14/2014 - 13:02 | 4548541 TaperProof
TaperProof's picture

Economic warfare

Fri, 03/14/2014 - 13:04 | 4548544 joego1
joego1's picture

Putin know the west is bluffing. If the west starts sanctions then he will throttle down energy to Europe, play currency wars and wait it out. In the big picture he knows that the financial house of cards in the west will fall with any sort of serious external jolt. Russia has very little debt and is tough enough to go it alone. In the U.S. the population will wilt if the cable goes down for a week.

Fri, 03/14/2014 - 13:07 | 4548572 disabledvet
disabledvet's picture

What if the West isn't bluffing?
What if their goal is to secure those natural gas lines for themselves...and cut off natural gas from going TO Russia?

Fri, 03/14/2014 - 13:10 | 4548592 joego1
joego1's picture

The Europeans will yank Uncle Sam's chain if the heat goes off. If putin starts shaking the derivatives tree then you will have all sorts of stinky money types on the red phone to Zero.

Fri, 03/14/2014 - 13:11 | 4548595 PHantomofthemarkets
PHantomofthemarkets's picture

Then China will be very happy because they can buy more gas from a trusted partner instead of some crazy dessert states where they still live in the 10th century.

Fri, 03/14/2014 - 13:12 | 4548597 the not so migh...
the not so mighty maximiza's picture

Europe doens't pump gas into the russian fields

Fri, 03/14/2014 - 13:21 | 4548634 Schmuck Raker
Schmuck Raker's picture

"...cut off natural gas from going TO Russia?"


Fri, 03/14/2014 - 15:00 | 4549082 Freddie
Freddie's picture

The Russian businesses have $700 billion in debt with US and European banks.   If they decide to default then good luck to the banks trying to collect.  Russia will still have it's oil and gas fields.

Fri, 03/14/2014 - 19:30 | 4550245 InvalidID
InvalidID's picture


 If they defaulted on that much debt the US would take the gas and oil.... Or at least try. You can fuck with Ukraine, you can't talk shit till you're blue in the face, don't fuck with the m,oney though...lol

Fri, 03/14/2014 - 13:09 | 4548583 PHantomofthemarkets
PHantomofthemarkets's picture

The cable down for a week?!?

WTF, you want to kill us all?


Fri, 03/14/2014 - 13:08 | 4548576 Dr. Engali
Dr. Engali's picture


Fri, 03/14/2014 - 13:09 | 4548581 ZeroPoint
ZeroPoint's picture

Somebody is unleashing HFT short machine on them. 

Fri, 03/14/2014 - 13:16 | 4548615 john39
john39's picture

money changers are going do whatever they can to try and stop putin.  crashing paper markets in order to create internal instability is probably one of their top strategies.

Fri, 03/14/2014 - 13:20 | 4548628 LawsofPhysics
LawsofPhysics's picture

Unfortunately for them, the only russians with a real vested interest in paper bullshit are very powerful oligarchs, so good luck with that.  Let me say it again, people define boarders, not the other way around.

Fri, 03/14/2014 - 13:16 | 4548613 abatis
abatis's picture

Are there any good funds/equities to play Russia? Love it when the US incompetents in charge (USIIC) are talking down the Russian people and supporting Ukraine facists. Did you see the map on ZH that showed the dependency on Russian gas? This is just talk, want to catch the pop.

Fri, 03/14/2014 - 13:37 | 4548670 SheepDog-One
SheepDog-One's picture

Of course everything remains just peachy here in trouble free US though, stawks r cheap, free moneys 4eva, etc etc.

Fri, 03/14/2014 - 13:36 | 4548694 The worst trader
The worst trader's picture

So whats keeping the us market afloat? POMO? or is this all just a charade?

Fri, 03/14/2014 - 13:48 | 4548717 TheRideNeverEnds
TheRideNeverEnds's picture

quick what is a product I can use to trade russia that has liquid options!  all I can find are leveraged etfs with shit volume and wide markets.


Fri, 03/14/2014 - 13:48 | 4548750 PHantomofthemarkets
PHantomofthemarkets's picture

What does not kill you makes you stronger.

Except for bears, bears will kill you.

Fri, 03/14/2014 - 14:22 | 4548912 icanhasbailout
icanhasbailout's picture

The stock market doesn't mean the same thing to Russia as it does here. The entire market cap of the Russian market is less than the value of 10 months' worth of oil exports alone (natgas NOT included in calculation).


That market could go to zero and Putin would be completely unfazed.

Fri, 03/14/2014 - 14:52 | 4549049 TheRideNeverEnds
TheRideNeverEnds's picture

but think of the children!  

why wont anybody think of the children!?!

Fri, 03/14/2014 - 14:29 | 4548938 The_Ungrateful_Yid
The_Ungrateful_Yid's picture

BTFD rooskie bitches

Fri, 03/14/2014 - 15:15 | 4549022 JuliaS
JuliaS's picture

Perfectly logical. It's not the concern over potential war, but worries of foreign investors that their assets will be frozen once the witch hunt begins.

Fri, 03/14/2014 - 15:00 | 4549087 HastaLaVista
HastaLaVista's picture

For sure, McDonalds is well known in Russia as the widest network of free toilets :) and for free WiFi, as well. It is also known as a place where you can get some shitty fast food for incredibly low price. Nobody cares if it disappears some day.

Fri, 03/14/2014 - 18:13 | 4549991 Yen Cross
Yen Cross's picture

     Putin has plenty of resources to sell and doesn't need to print rubles to do it. Russia has less then 1/2 the population of the United States and a whole lot more land.

     Putin will sell what he wants, where and when he wants...with Chinese help.

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