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Sunday, March 04, 2007

Russian Stock Market Tanks

As shown above, in the three days between February 27th and March 1st, despite the fact that oil prices have been surging, the Russian stock market lost 10% of its value, with the RTS index dropping from nearly 2,000 to below 1,800 -- yielding back half the gains it has acquired over the preceding six months in less than a week -- just because of turmoil in the Chinese market. The fundamental hollowness of the Russian economy once again revealed. As shown below, during the same three days the U.S. market (DJIA) dropped from 12,700 to 12,200 -- losing just 3% of its value, one third the loss Russia experienced.

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