Wouldn't a full-blown banking and currency crisis have certain sectors rubbing their hands in glee?
Well it is just not going to happen
The financial markets are as volatile as ether. Therefore, the speculation in the international press of a growing banking crisis, to be followed by a currency meltdown, are at best irresponsible and at worst, intrusive. There is no crisis in Russia, neither financial, nor economic, nor in the currency market.
The economic melt-down of 1998, when the banking system collapsed and the attempts to shore up the Rouble led to a currency crisis, hangs over the Russian markets like a specter. The scare-mongers sprang into action in May, when a small-sized bank had its license removed for money laundering and in June, another small bank and the medium-sized Dialog-Option ceased trading through lack of liquidity.
This created a crisis in confidence, never difficult to achieve in the financial markets, culminating in the larger banks ceasing to lend to smaller ones and leading to a full-scale panic.
In the last week, customers withdrew 70 million dollars from Alfa Bank, one of Russia's top 20, leaving ATMs dry, while Guta Bank, another large bank, closed its doors. The international observers were quick to point out that Moody's ratings agency had stated that 18 Russian banks were under review.
Even Vladimir Putin's advisor, Andrei Illarionov, was caught up in the wave of speculation, claiming that "It is obvious that there is a banking crisis" and that this was "the result of the authorities' actions".
However, there is no crisis. One thing is an endemic shortage of capital and while it is true that the Russian banking system is under-capitalised, it is also a fact that the system is working on solutions and that the central bank has the situation under control.
Guta Bank has announced that it is increasing assets and will reopen on 12th July - Monday morning, for business as usual. Alfa meanwhile also claims that it has sufficient assets in stock to survive the current run on money, slapping on a 10% commission to reduce withdrawals, while Fitch ratings agency has maintained Alfa's standing.
Slowly, the international reactions have been getting more and more optimistic, stressing that there is turbulence but no crisis, backing up the statement by Vladimir Putin last week that "there is nothing that would cause concern in the banking sector at present.
As usual, the world waits to hear disaster stories coming out of Russia.
However these days, there is more good news than bad.