Attorneys with the SEC’s Investment Management Division are exhorting
managers of registered investment funds, such as your mutual fund, to disclose
their holdings in Russia and warn of the risks associated with them, now that
the Crimean debacle has turned into a magnificent sanction spiral. “Several
people familiar with the matter” had been talking to Reuters.
The SEC is apparently fretting that the funds aren’t truthful with investors and
aren’t even thinking about how to respond to the possible outcomes of the
crisis.
Investment Management Division Director Norm Champ, when contacted by
Reuters, didn’t even deny it. “We want to be proactive,” he said.
The Division contacted asset managers on other occasions when civil unrest
erupted or when things threatened to blow up; it wanted to make sure managers
weren’t omitting or misrepresenting material information – for example, during
the uprising in Egypt in 2011, when the Cairo stock market simply shut down. But
this time it’s different: the lawyers at the Investment Management Division were
joined by another group of SEC lawyers who focus on risk examinations.
Would the White House be trying behind the scenes to give investors
second thoughts about plowing money into Russia? Would it be trying to demolish
Russian stocks, bonds, and the ruble? Naw.
The efforts by the SEC, which started “over a week ago,” were accompanied by
a White House announcement that 5 million barrels would be released from the
Strategic Petroleum Reserve. WTI tanked. Russia, a huge energy exporter, depends
on its oil and gas revenues, and knocking down the price of oil could wreak
havoc on the Russian economy. It was a declaration that commodities would be
used as
a weapon against the Putin Regime.
Then on Tuesday, White House spokesman Jay Carney launched another attack on
the Russian markets at a press
briefing. In light of the sanctions the US and the EU were slapping on
Russia, its economy would pay the price, he said. “I wouldn’t, if I were you,
invest in Russian equities right now, unless you’re going short.”
....
As Obama’s words were still echoing around the world, the Russian Foreign
Ministry shot back: nine US officials, including Speaker of the House John
Boehner and Senate Majority Leader Harry Reid, would be barred from entering
Russia. And it published the list on its website.
Delicious irony: that boring
list with nine names on it, issued by a Russian ministry whose website
rarely gets shared in the social media, lit up a mini-firestorm on VK.com, the second largest social network in Europe
after Facebook, and one of the most popular sites in Russia. The list got, as
I’m writing this, 538 VK “likes.” Not sure if Obama’s list got any
Facebook likes.
Not to be left out, Standard & Poor’s slammed Russia by lowering
its outlook to Negative from Stable. “In our view,
heightened geopolitical risk and the prospect of US and EU economic sanctions
following Russia’s incorporation of Crimea could reduce the flow of potential
investment, trigger rising capital outflows, and further weaken Russia’s already
deteriorating economic performance.”
The Sanction Spiral works in a myriad ways and performs, as we can see every
day, outright miracles. It spirals elegantly higher and higher and takes on
grotesque forms. And by the looks of it, no one at the top has a clue how to
back out of it. Yet stock and bond markets in the US and Europe, stuffed to the
gills with central-bank liquidity and intoxicated by free money, the only thing
that really matters anymore these crazy days of ours, are blissfully ignoring
the entire drama, and what may eventually come of it.
The first official warning shot was fired. Not by a Putin advisor
that can be brushed off, but by Alexey Ulyukaev, Russia’s Minister of Economy
and former Deputy Chairman of the Central Bank. A major escalation.
Read.... Kremlin:
If The US Tries To Hurt Russia’s Economy, Russia Will Target The Dollar
System
(Click link below to read more)
READ MORE
Sphere: Related Content
About Me

- Judy Chaffee
- This site is the inspiration of a former reporter/photographer for one of New England's largest daily newspapers and for various magazines. The intent is to direct readers to interesting political articles, and we urge you to visit the source sites. Any comments may be noted on site or directed to KarisChaf at gmail.
Saturday, March 22, 2014
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