“Ruble Hits New Low-Putin Can't Keep His Promise To Russian People”, - Paul Gregory for Forbes

Paul Gregory, Member of KSE International Academic Board, Professor, University of Houston, USA tries to outline Putin’s social compact with the Russian people in his new article for Forbes.

Russia’s central bank waited until the early morning hours to raise its interest rate from 10.5% to a whopping 17.5% to encourage citizens to hold rubles and foreigners to buy rubles. Rather than building confidence, markets interpreted the move as panic. By late afternoon, it took an unprecedented 80 rubles to buy one dollar. Despite its vaunted reserves, the mighty Russia gives the appearance of a Latin American banana republic, dependent on one product, with a collapsing economy and declining living standards that can no longer support Vladimir Putin’s expensive foreign adventures or keep alive his social compact with the Russian people.

Putin has not held up his end of the bargain he made with the Russian people. Let’s see what their reaction will be. We must assume they can put two and two together.

Read the whole version of  the article here