Windows to Russia

Hello,

Looks like the EU is having a temper tantrum. The EU is so worried that Belarus will approve recognition of Abkhazia and South Ossetia, that they have resorted to threatening. Maybe they need to hold their breath until they turn blue also.

The word is out that improving relations between the European Union and Belarus will be suspended if Minsk recognizes Abkhazia and South Ossetia as independent, an EU commissioner said on Tuesday.

The Belorussian parliament will consider recognizing the two former Georgian republics on April 2. Russia recognized the two states as independent on August 26, 2008.

Talk about flagrant manipulation of the outcome of Belarus government session by a bullying and threatening World Power Organization!

You know – Some things make wonder what is wrong with the world and this is one of them…

Kyle & Svet

comments always welcome.

It is that time of the year again in Russia. Svet wrote a fantastic article on this very day a year ago and I see no reason to try to better it.

This holiday seems to be losing steam so to speak but I think that it is an important holiday for all.

So take the link to the article and find out what this holiday is about in Russia!

Kyle & Svet

Hello,

I have been studying this gas project for a year now and this is an impressive LNG (Liquid Natural Gas) project to say the least. I have read about the plant in several of the magazines printed about the oil and gas industry but on line has been quiet about the Sakhalin-2 plant.

This is the world’s largest oil and gas project – Sakhalin-2. The huge Prigorodnoye (south of Sakhalin Island) plant will pump 5% of the world’s LNG to America, Korea and Japan.

It takes only two and a half days from Sakhalin-2 to these markets, compared with more than one month from the Middle East, so you will know the difference in price is huge.

“The technology doesn’t require traditional pipelines to transport gas. Natural gas turns to liquid at minus 160 degrees Celsius. That allows it to be shipped by tanker. When it reaches its destination LNG is heated back for use. The LNG liquefying equipment is called a “train”. Sakhalin’s two trains will make almost 10 million tons a year. By 2011 they could already start on a third train according to Shell CEO, Jeroen Van der Veer.” (Link)

The complex consists of:
# Two 100,000 m³ LNG storage tanks
# An LNG jetty
# Two LNG processing trains, each with a capacity of 4.8 million tons of LNG per annum
# Two refrigerant storage spheres, 1,600 m³ each (gross capacity) for propane and ethane storage
# A diesel fuel system
# A heat transfer fluid (HTF) system for the supply of heat to various process consumers
# Five gas turbine driven generators with a total capacity of around 129 MW electrical power
# Utility systems including instrument air and nitrogen plants and diesel fuel systems
# A waste water treatment plant to treat both sewage water and coil-containing water.

As you can see this is big news and I do not see this being spread by the Western press. What was spread was a lot of degrading information by several Western press publications. But that is another story.

Could it be because America is going to be a big consumer of Russian LNG? America stood in line jumping and waving their arms to get a signed twenty five (25) year contract for LNG from Russia.

Strange how the Western press is so controlled…

Hello,

I was drinking my morning cup of coffee and saw an article that caught my eye because it is about something that I use to do for 30+ years.

It seems that Russia made another Top 10 List in the world news.

The World Health Organization (WHO), which is an authority for health related issues has produced a report on the smoking capitals of the world.

The WHO report states that two-third of the world’s smokers live in just ten countries: China, India, Indonesia, Russia, US, Japan, Brazil, Bangladesh, Germany and Turkey. (In that order.)

Russia is part of an interesting group of countries. I see that America is just behind Russia. Of course China, India and USA have more people than Russia. So I think what I understand is that Russia has the highest per capita in the world of smokers but is only fourth on the list for total smokers.

Now with packs of Marlboro and Winston’s running at less than a dollar a pack converted rate. It reminds me of the old days in America, when cigarettes were cheap.

Russia needs to get a handle on this because all the young kids (20 to 30 years old) I pass on the streets in Moscow are smoking. Reminds me of the old Joe Camel days…

Kyle & Svet

comments always welcome.

RBC, 20.02.2009, Moscow 13:47:04.The development of small and medium-sized businesses must be supported to the maximum extent possible, Russian President Dmitry Medvedev said during an extended meeting of the State Council presidium on the support of the country’s real economy sector in Irkutsk today. He pointed out that the creation of new jobs in small businesses was a long-term solution for unemployment, the Vesti TV channel reported the Russian leader as saying.

RBC, 20.02.2009, Moscow 13:19:16.Russian President Dmitry Medvedev has strongly criticized the country’s leadership for “very slow work, unacceptable in times of a crisis.” He made this statement in Irkutsk today during an extended meeting of the Russian State Council’s presidium on developing Russian industries and overcoming the negative effects of the global financial crisis, the Mayak radio station reported. Medvedev stated that the global financial turmoil was still ongoing and had yet to hit its worst point.

RBC, 20.02.2009, Moscow 12:47:05.Russian President Dmitry Medvedev has warned about the danger of the Russian economy hitting rock bottom, as he said during a meeting with the Irkutsk region’s governor Igor Yesipovsky. If the economy drops below a certain critical level, Medvedev stated, Russia may face a repeat of the collapse it faced in the 1990s. “This is absolutely inadmissible,” the Russian leader was cited by the Mayak radio station as saying. He pointed out that Russia must overcome its current critical conditions with minimal losses, so that it would not be forced to resuscitate industries as it had to do after the demise of the Soviet Union. “This scenario is unacceptable, and we must think of ways to keep production intact and save most jobs,” Medvedev stressed.

RBC, 20.02.2009, Moscow 11:59:34.External factors are having a mixed impact on the Russian stock market, experts say. On the one hand, the fall in U.S. indices to the 2002 levels and the ongoing decline on Asian markets combined with negative corporate profit forecasts are pushing Russian shares lower. On the other hand, the Russian market was supported by yesterday’s 5 to 10-percent rise in oil prices driven by a decline in oil and oil product stocks in the United States. At the same time, however, oil prices are correcting downwards after yesterday’s rally. On the whole, stocks are unlikely to maintain their previous levels today, and Russian shares are expected to fall before the approaching long weekend.

RBC, 20.02.2009, Moscow 09:31:28.Russia and Serbia are expected to sign an agreement on visa-free travel today, a source in the Serbian embassy reported to RBC. According to the document, the citizens of Russia and Serbia will be entitled to spend up to a month on the territory of the other country without a visa. Earlier, only Russians were permitted to travel visa-free for a maximum of one month to Serbia.

RBC, 19.02.2009, Moscow 15:38:48.Irkut Corporation’s annual revenue under RAS edged up 1.3 percent from RUB 30.8bn (approx. USD 845m) to RUB 31.2bn (approx. USD 856m), the Russian aircraft builder’s press office reported today. The company expects its revenue to climb 22 percent to RUB 38bn (approx. USD 1.04bn) in 2009.

RBC, 19.02.2009, Moscow 12:43:59.The number of unemployed registered may reach 2.2 million people on average in 2009, deputy head of the Health and Social Development Ministry Maxim Topilin said during a meeting of the Federal Migration Service’s board. He noted that the ministry expected the number of unemployed to increase considerably. The figure currently stood at 1.8 million, compared to 1.2 million people in October 2008. Russia has not seen such dynamics for many years, Topilin stated. He also said that the share of working Russians had fallen to the 2006 level. “This is a very alarming trend, which makes us review the policies we are implementing on the Russian labor market and the quota regulation policies in regards to foreign workers. We must address the issue of amending the quotas very seriously,” the deputy minister said. As of February 11, some 470,000 people received notice that they would be laid off, and another 920,000 people were working only part-time, according to Topilin.

RBC, 19.02.2009, Bishkek 12:19:23.The Kyrgyz parliament has voted for closing the U.S. military base in Manas, with 78 deputies voting in favor of the move, two voting against it, and one abstaining, the parliament’s press office reported today. The bill denounces Kyrgyzstan’s agreement with the United States on the deployment of its air base in Bishkek’s airport Manas. Once the document has been signed by Kyrgyz President Kurmanbek Bakiyev, the country’s Foreign Ministry will officially inform the U.S. government that the agreement has been cancelled, after which the United States has 180 days to withdraw the air base from Kyrgyzstan. Update: The document has been signed by the President.

Hello,

Something has come to my attention about the financial crises in Russia and while I was drinking my morning cup of coffee. There is another issue that is hitting people who have taken out loans for mortgages in Russia.

I call it “Currency Suicide”:

In Russia as in many countries it seems to be common procedure to take out a credit in another currency other than the home currency. This is an issue that I never had to face having been raised in the USA. I have never until coming to Russia to live long term ever thought about anything but dollars.

After talking to my wife, I have come to the understanding that Russians look at taking a loan out in another countries currency as normal practice. The example I will use, is in the video that you see at the top of the article. In this video a woman has a credit for her flat financed in Yens. Now when she got the financing the Yen was weaker against the Ruble. Now the Ruble has weakened against the Yen.

Guess what? She can not make the payment any more because of currency exchange rates!

Why do they do this? The answer to that is multifaceted and has more underlaying reasons than I can put into one simple post, but the main reasons are.

1. Banks steer (turn) customers to a loan package that makes the bank the highest percent yield.

2. Customers see a few dollar savings on their total loan at time of taking out loan.

3. Knowledge of financial systems is lacking, so people do not know what they are doing.

4. A form of currency speculation. **

5. Culturally accepted practice of not keeping all your eggs in one basket.

6. Last but not least: Greed!

As one bank that has a very strong policy against these type of loans, Sberbank Senior Vice President, Denis Bugrov, says that wasn’t a very intelligent move by people.

Many Russians took out mortgages in foreign currencies – lured by exceptionally lower interest rates than on Ruble loans.

Denis Bugrov says, “This shows the level of financial education in our country. Having income in Rubles, people considered its right to have liabilities in other currencies. This was profitable when the Ruble was strong, now it’s the other way round.”

Sberbank says only 6% of their mortgage portfolio was in foreign currencies. Many other banks strongly promoted those loans and have as high as 80 – 90% in their portfolio, making huge profits by borrowing cheap and lending high. While knowing that their customers would suffer from currency fluctuations and speculations.

I remember ARM (Adjustable Rate Mortgages)*** loans in America. I learned my lesson about what I call “loans of stupidity.” (interest only mortgage, the negative amortization mortgage, and the balloon payment mortgage.)

I watch the video and thought about it this way: She would not be upset if she had her loan in Rubles because now compared to other currencies she would have a bargain on her loan payment. So there would be no story.

So now another huge issue of the financial crises has swung into view. People have set them selves up for “Currency Suicide”.

** Currency speculators, who buy and sell currencies to profit from fluctuations in the value of those currencies. Speculators have posted record earnings from such buying and selling since the crisis began last summer.

*** An adjustable rate mortgage (ARM) is a mortgage loan where the interest rate on the note is periodically adjusted based on a variety of indices.

Kyle & Svet

comments always welcome.

Hello,

While Svet was walking around Moscow she happened upon these buildings with some great art work on them. We like to take pictures of this type of art work because it is always of high quality. Here is a link to some more Pictures. (WOW : Moscow Utility Buildings!)

That is all for now!

There will be more pictures as soon. For a photo albumn of pictures from Russia just follow this link to our: Russian Photo Blog!

You will not be sorry.

Kyle & Svet

comments always welcome.

Looks Like Russia has figured out a way to cheaply transport Gas (LNG) with out a pipeline. It has been put into effect on the Pacific Coast and now Russia sees it as an answer to help bypass Ukraine. Ukraine has caused her own problems and now Russia is in full swing to forever keep Ukraine out of the gas delivery loop.

Japan, America and Korea have just signed contracts that last 25 years to purchase all the gas that is produced at the new world’s largest oil and gas project Sakhalin-2 has begun to produce Russia’s first LNG for the world market. The first deliveries will go to Japan, where Russian LNG will have a major impact.

The huge Prirodnoe plant will pump 5% of the world’s LNG to America, Korea and Japan.

Things that make you go Hummmm…

Kyle & Svet

comments always welcome.

Moscow authorities have refused to issue a birth certificate to a six-year-old boy, whose parents named him BOCh RVF 26062002, a records chief told RIA Novosti on Wednesday.

Registration officials refused to register the boy’s name, which translates into a Russian acronym for Biological Human Object of the Voronin-Frolov Genus (DoB) June 6, 2002, to “protect the boy’s own interests.” The parents have insisted on registering the name and have filed a lawsuit.

How would you like to introduce this person to someone…

Hello Andre,

Meet

Glad to meet you…

Kyle & Svet

comments always welcome.

PS: Reminds me of Frank Zappa and his kids (Moon Unit, Dweezil, Ahmet, and Diva Muffin),actually those names seem tame compared to the one above.

The English translation of this video is really good. The Russians seem to be getting better at this game of press releases.

I found this video was full of good information and Medvedev shows that he is on top of things.

Kyle & Svet