About capital outflows

Dear friends! We all recently heard horror stories about the so-called "Capital flight." It is obvious why such a scolding hysteria and for what purposes. How, in general, and with the stories about the "no-one-not-built-factory", about the "mass-mortality-and-population-reduction" and so Naryaduk with them and there is quite a stereotype about the "capital flight . " "You-Know-Who in conjunction with the oligarchs displays of Mother Russia assets", etc. etc.

And so. It is the most that neither is a myth. , Stereotypes, and so on. Or, far more accurately characterize the Reference hysteria — a lie. About this site has already been written, but I'll try to provide some more detailed and thorough review.

There are many sorts of different "experts" (the "expert" that is difficult to assess, because no one knows, not who they are or what they have achieved in life.) And there are experts. More precisely — Experts. You can trust, if only because they are acting in the stock market. Ie, on the basis of their predictions buy or sell stocks. 

One of these people — Elvis Marlamov, fairly well-known in narrow circles of people. You can, as they say, Googling for more information. Let's just say that over the past few years, he has earned several thousand percent of the initial amount. 

So today, he posted an excellent article about the outflow of capital, which I venture to present here.


"In the last couple of weeks, apparently under the influence of the pre-election Hysteria Topics on the Internet a lot written about capital flight, even if it does not drain, but a real flight! Well, why is running capital? Because he was scared and uncomfortable in a corrupt thieves Russia. If you do not go into the political agenda of those who wrote it, and imagine that these people are accidentally mistaken because little is known in economic theory, it is for the benefit of domestic investors to dispel all fears and so far-fetched to say more thoughtful analysis of the situation. Maybe someone will benefit from it, and will bring to mind.

Very good magazine wrote about this "expert", and do not need to be a genius and Nobel laureate, to understand what processes are actually taking place in the economy. Take for example a situation where actual capital flows away. The second half of 2008, there is a mass sale of ruble-denominated assets, sharply rising exchange rate and foreign reserves pose.

And now we see an influx of. CB already tired to keep the level of 29 rubles. Many journalists and experts like to catch up on the panic and frighten citizens breakdown of the upper limit of the currency basket, forcing them to flee to the exchangers, and talk about the lower classes are not accepted. This defeatist syndrome is discussed with the score CSKA lose 4-0 or 3-0, with this approach, there is nothing on the market.

It is also important to understand that there is a flight of capital, there are outflows, and have the export of capital.

In our country, where since 2003, consistently dominates exports over imports, a so-called trade surplus.
The trade surplus in 2011 increased to 198.1 billion versus $ 151.7 billion dollars in 2010. According to the Central Bank, exports for the year reached 521.4 billion dollars, up 121 billion dollars more than in 2010. Oil had 180.8 billion dollars for gas — 64.6 billion dollars. Imports increased from 248.7 billion dollars in 2010 to 323.3 billion dollars.

If your fingers, you can see that trade is growing rapidly and steadily increasing surplus. This is very, very cool and dramatically increases the attractiveness of ruble assets and investments in Russian assets, and these investments are growing. No one certainly does not have a desire to call it capital inflows. Surplus countries very much, if we take similar in structure to the export / import, it is especially Australia and Canada. And there, too, there is the export of capital.

So where is the flight to 84,2 billion if we sold the oil, gas, diamonds, coal, steel, weapons 521.4 billion and imported new vehicles, electronics, machine tools, meat and clothing to 323.3 billion? The fact is that politicians can and should speak only with objective criticism of Russia's exports and talk about what it's like in such huge agricultural lands, we can not grow their own bull, but not scare the naive citizens of the capital outflow, suggesting that it is time would have something to take out).)

In the export-oriented economy, it is quite a normal situation. That is, formed by excessive money supply that the financial system can not digest. Due to the inflow of export revenues forced the Central Bank to conduct a constant currency appreciation as exporters bringing home dollars buys them rubles, which is in the final phase of the cheaper ruble price of a barrel of oil (at $ 100 and a 32 barrel date is 3200 rubles, and for $ 120, and the course 25, it is 3000), and calls cheaper imports (New BMV will be cheaper, but Ford Fokus expensive). This eventually leads to the bankruptcy of local manufacturers that have already happened many times in the world.

Therefore, exporters are forced to leave the part of the balance of the contour, and not leave it under the mattress, but in the form of investment, asset purchases, etc.
The growth of "churn" is the growth of the economy, and not flight of money, even difficult to imagine how this $ 80 billion

If we talk about the stock market, in the past year, according to EPFR even with the fall of the balance was positive, and this accounted for $ 1.4 billion

Another important detail is the situation with the external debt. Russia's foreign debt to GDP ratio reached a ridiculous size and its maintenance is no longer a problem to the envy of the Greeks and the Portuguese, unlike say from 1998, when everyone was laughing at us. However, there are debt of $ 0.5 trillion. the private sector to Western banks, Eurobonds, etc. this debt arose in 2006-2007, in the moment of greatest magnitude expansion of Russian companies (by the way when Mordashov buys plant in the U.S. is also classified as an outflow, although it does not drain, and the export of capital). So recently came payments on these loans and at the same corporation urgently in 2009-2011, replacing part of the foreign currency debt on a more predictable ruble actively perekreditovyvayas in state banks.

Then there is the scale effect. If at the beginning of the last decade, our company took out loans of $ 100-200-500 million, now it is $ 2-3-5 billion, and will soon account for tens of billions. According to the classification of the Central Bank taking a loan and its servicing is an outflow of capital!

Another excerpt from the article in the expert.

Perhaps the most meaningful differences between formal and statistical interpretations of transactions arises when describing the activities of enterprises, in fact Russian, but not on the passport. We are talking about companies with predominantly Russian production assets, but registered abroad and thus are formally non-residents. The examples are not far to seek — so are many of our largest manufacturing enterprises-exporters, such as a group of "Evraz" (its parent company Evraz Group SA is registered in Luxembourg) or retailer X5 (holding company X
5 Retail Group NV is registered in the Netherlands). Any investment or loan in favor of such a structure from a Russian resident will definitely be treated as a capital export statistics. So when the "Evraz" attracts Sberbank loan for the construction of a new plant or even just re-invests in the project's own profit, in the dead line of the capital account of the balance of payments of the Russian Federation will take the money with the "minus" — as the export of capital. But will it say about the low Russian economic conjuncture or nasty about the investment climate? Just the opposite.

Lord investors pay attention. As investments, as well as in politics and the economy need to think, and will listen to lay people remain without pants.

Happy Holidays! "


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