Wall Street oligarchs at the helm of the Treasury

2024 Author: Seth Attwood | [email protected]. Last modified: 2023-12-16 15:55

Recently it became known that the Ministry of Finance signed an agreement with the American bank JP Morgan Chase on the provision of consulting services by the financial organization to the Russian department.

According to information that appeared in the media, the Deputy Minister of Finance Sergey Storchak has already clarified the position of the Ministry of Finance and the bank's responsibilities: the largest commercial bank, not only in the United States, but also in the world, will be responsible for the Ministry of Finance's interaction with rating agencies and contribute to raising the sovereign credit rating of Russia.

Storchak in one of his interviews emphasized that JPMorgan will adapt the Ministry of Finance documents for rating agencies, will explain incomprehensible places, establish a permanent connection: “”.

It is quite obvious that the American bank JP Morgan Chase will not be engaged in solving problems and overcoming structural imbalances., he should not do this - for this there is a government and a multi-million army of officials, to whom Russian citizens and entrepreneurs pay wages and ensure a comfortable existence through the payment of taxes and fees. And, he does not have the authority and tools for this - he was involved in conducting informal and, presumably, behind-the-scenes negotiations with the leadership of the largest international agencies so that the latter increase their assessments of the creditworthiness and solvency of Russia as a sovereign borrower.

It is completely incomprehensible why Russia should fight to improve its credit ratings at all. And even more so to involve, for this purpose, as a consultant and lobbyist for Russian interests, a representative of the financial oligarchy from Wall Street, who, among other things, is one of the largest shareholders of the US Federal Reserve System - a private financial corporation that acts as the Central Bank in the United States.

At the moment, Russia's sovereign credit rating is at a very good level - BBB on the S&P and Fitch scale and Baa on the Moody’s agency scale. Yes, this is not a rating of the USA, France, Germany, Great Britain, Japan, Belgium, Canada or other economically developed countries. However, this does not in the least prevent the Ministry of Finance and the Government of Russia from pulling the Russian economy into the debt loop of foreign loans. According to the official estimates of the Bank of Russia, the total external debt of Russia for the period 2001-2013. grew by more than 22 times - from 31 to 684 billion dollars. This is 20-22% higher not only the size of Russia's international reserves ($ 535 billion), but also the total external debt burden of the Russian economy in autumn 2008. on the eve of the acute phase of the crisis.

Somewhat earlier, information appeared in the media that the Ministry of Finance is planning by 2016. raise Russia's long-term credit rating to 'A' on the Fitch and S&P scale and 'A3' on the Moody's scale. Apparently, the officials of the Ministry of Finance understood the decrees issued by them “from above” literally, took them “under the hood” and are now working hard to “improve the investment image” of Russia. As befits liberals, they work “on paper” - they hold conferences and meetings, participate in forums and symposia, and now they also involve American banks so that they, apparently, will help them “negotiate” with international rating agencies on the revision sovereign credit rating of Russia.

It is quite indicative that Deputy Finance Minister Sergei Storchak told the media at the end of May that one of the international rating agencies would begin work to confirm or revise Russia's rating. Despite the fact that the profile deputy prime minister Igor Shuvalov stated that he saw no reason to revise the rating. In this case, the arguments and theses of the Ministry of Finance become, in principle, incomprehensible -?

And the global financial and economic crisis of 2008-2009. clearly demonstrated the full degree of bias, bias, commercial motivation and unprofessionalism of the three largest American rating agencies, whose artificial underestimation of the risks on derivative financial instruments (i.e. derivatives: MBS, ABS, CDS, etc.) became an incentive for blowing bubbles on financial markets in 2002-2007. (primarily in the housing market and mortgage-backed securities) and a trigger for the collapse of financial markets in 2007.

Credit ratings assigned by the “big three” US rating agencies (S&P, Fitch, Moody’s) are a big fiction and a tool to manipulate public consciousness - they practically have nothing to do with assessing the creditworthiness and solvency of securities issuers and borrowers. Rating agencies play a fundamentally important role within the existing international monetary and financial system and the ongoing process of financial globalization. They act as regulators of the international movement of capital - direct investment, “hot” speculative capital, foreign loans and borrowings, deposits, etc.

They determine the directions of cross-border movement of financial capital - indicate where and in what assets can be invested, whom to lend and at what interest rate, under what conditions to provide financing, in what securities and in what currency to store international reserves, etc. In fact, the rating agencies determine who and on what terms in the global economy will receive funding and who will not. Apparently, JP Morgan has much more serious motives and goals that it pursues than to curry favor with Russian officials.

It is quite indicative that the Ministry of Finance was not the first to take this road - a couple of months ago it became known that the Government Dmitry Medvedev signed an agreement with another heavyweight from Wall Street (investment bank Goldman Sachs), according to which one of the most influential financial institutions in the United States and also one of the largest shareholders of the US Federal Reserve will fight to improve Russia's investment image among foreign investors.

Equally remarkable is the fact that the head of Goldman Sachs (a source of personnel for central banks and finance ministers around the world) Lloyd Blankfein heads the foreign council on the creation of an international financial center in Russia. In other words, the head of the largest and untouchable American investment bank acts as an overseer and coordinator of the actions of the Russian Government, which must create the most favorable conditions for extra profits by international financial speculators and transnational capital in Russia. And further unimpeded export (i.e. repatriation) of capital abroad.

Most likely, both JP Morgan Chase and Goldman Sachs pursue several goals at once, hiding behind slogans about "charity". First of all, as far as can be judged, they are preparing Russia for a large-scale expansion of external borrowing and entry into international loan capital markets. This plan is clearly spelled out as in the law “On the federal budget for 2013. and the planning period for 2014-2015. "and in" ". Both documents imply a rapid growth of both internal and external borrowings by the Russian Government in the future 5-7 years. And American financial institutions, as far as can be judged, are called upon to ensure that Russia, as a sovereign borrower, is drawn into the orbit of influence of the American financial system through the imposition of borrowings in the United States.

By expanding borrowing abroad, Russia will create demand for the products of the US printing press - US dollars issued by the US Federal Reserve, which will allow the US financial and political elites to get rid of the excess money supply created over the past 5 years of unrestrained emission and the policy of "quantitative easing". And also to guarantee itself a stable income from servicing loans by Russia for many decades.

In addition, both transnational banks intend to participate in the planned in the Government and already begun large-scale privatization of state property. As practice shows, the sale of the largest and most tasty pieces of state property is carried out in the interests of transnational capital and international banks, which have access to practically unlimited and extremely cheap financial resources in terms of service cost. Neither ordinary citizens of Russia, 75% of whom per capita income falls short of the average level in Russia (24 thousand rubles), nor small and medium-sized businesses have access to long-term financial resources at an acceptable interest rate. Russian industrial enterprises cannot afford to attract loans even to finance working capital and replenish MTZ, let alone finance capital investments in fixed assets and participate in privatization.

Realizing this, American banks are trying to create the most favorable conditions for themselves and to provide privileged access to the most profitable and attractive state-owned companies and banks to be privatized. Moreover, these very same American banks and their counterparts from the Eurozone countries and Great Britain act as consultants and appraisers of Russian state property. There is a conflict of interest. However, the Government does not pay much attention to such "trifles" - in attracting such coveted foreign investors (and 92% of all foreign investments in the Russian economy come from loans and borrowings provided by foreign banks), the Government is ready to make any sacrifices.

The experience of privatizing 7, 58% of ordinary shares of Sberbank and 10% of VTB (with a 21% discount to the current price!) Clearly demonstrated that the main investors in strategically important enterprises are foreign financial institutions and international banks. To all appearances, it is precisely in order to create the most favorable conditions for penetration into the Russian economy and reduce the prices of companies and banks included in the privatization program of state property that American banks so actively agree to act as consultants to the Government and the Ministry of Finance.

The game is definitely worth the candle - an unprecedented one since the time of criminal "voucher privatization" and fictitious loans-for-shares auctions of the 1990s begins. "Distribution of elephants" and redistribution of the most delicious pieces of state property. For the sake of such a goal, one can agree to work as a consultant and for free - the potential profits and windfall profits, as well as the prospects of establishing control over the largest Russian companies and banks at preferential prices, outweigh all immediate costs.

Moreover, in a situation where money essentially costs nothing, interest rates on loans in the United States and the Eurozone are at absolute historical lows (in the negative zone, even taking into account official inflation), and key central banks continue to uncontrollably issue reserve currencies and flood the world economy "Hot" speculative capital. In this case, privatization, as the academician of the Russian Academy of Sciences correctly points out Sergey Glazyev, and completely acquires the character of surrendering commanding heights in the economy in exchange for worthless paper and credit money, which is associated with the loss of financial and economic sovereignty.

And the last … If we are to deal with the issue of raising Russia's sovereign credit rating seriously, and not by idle chatter and cutting budget resources, then it would be much more correct to start from the other end - not to hire major American banks as negotiators and lobbyists for Russia's interests abroad, who, using their authority, administrative resources and financial power can informally put pressure on rating agencies and thereby increase Russia's rating. We should have started by building a domestic system for assessing financial risks and determining the degree of creditworthiness of borrowers by creating a Russian rating agency.

It was on this path that China went, the leadership of which, unlike Russian colleagues, is well aware of the national interests of the country and the commercial interests of domestic capital and, instead of swearing love to foreign investors and crawling on its knees in front of foreign rating agencies, it created its own independent of interests the financial oligarchy from Wall Street; and the US geoeconomic interests rating agency Dagong. Yes, of course, when entering the international loan or equity capital markets, the Chinese government, as well as Chinese companies and banks, are guided by the ratings of American rating agencies.

However, in China 35-40 years ago, a course was taken to build a powerful and self-sufficient investment banking system and a competitive financial system capable of financing economic growth and modernization of production and providing long-term investment resources at a relatively low percentage (4-6% per annum, in contrast from 16-20% in Russia). And thanks to the presence of a nationally oriented powerful financial system aimed not only and not so much at financial speculation as at lending to the real sector of the economy and the population, as well as expanding investment activity and ensuring expanded reproduction, China is increasingly dependent on foreign investment and international markets. capital.

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