Читать книгу The crisis will be back. What is to be done? - - Страница 6

– Global, rocking the whole planet and entire civilised world. Such crises drop business activity through the floor in many countries. One such example is the global financial crisis of 2008 driven by bankruptcy of Lehman Brothers, one of the largest banks in the world.

– Nationwide, with the government suddenly and without caring about consequences deciding to exchange banknotes of certain denominations within a predefined volume, as was the case with the monetary reform of 1991 in the Soviet Union (also known as Pavlov reform), or to confiscate people’s life savings, freezing the money for years, or to prohibit import or export of certain goods all of a sudden.

– Industry-specific, with something suddenly going wrong in one or several industries.

– Business-specific, with certain businesses becoming hostage to political or administrative decisions.

The American financial giant Lehman Brothers, founded in 1850, had not raised the slightest doubt in anyone over its competence or resources before the crisis of 2008. Yet the storm cracked and the entire global financial system faltered.

Did Russia draw the proper lessons from it? No. Barely five or six years later, the Russian economy flew at full speed into a crisis of its own making. Needless to say, it was provoked by falling oil prices, yet the Russian economy was ultimately pushed off the cliff by its own Central Bank. It did all it could for the Russian rouble to lose more than 50% of its value within just a few days.

As a consequence, the capital of Russian companies depreciated, all foreign currency debts of Russian businesses doubled in rouble equivalent, the demand for every single type of goods and services dropped three- or fourfold. In an attempt to salvage their savings, people made an equivalent of their annual spend over just one month, and entrepreneurs faced a tricky challenge whether to procure or produce something to make stock for the next year at all.

Attempts at predicting crises remain worthwhile, but it is a lot more important to understand what needs to be done when dark clouds have gathered and there is a storm coming or, even worse, when you missed storm warnings and it has caught you unawares in the open ocean.