Comments on: Russia and Georgia – An Economic Mistake http://chicagoboyz.net/archives/6133.html Some Chicago Boyz know each other from student days at the University of Chicago. Others are Chicago boys in spirit. The blog name is also intended as a good-humored gesture of admiration for distinguished Chicago boys including those pictured above. Fri, 25 May 2012 12:52:35 +0000 hourly 1 http://wordpress.org/?v=3.0.4 By: ElemBend http://chicagoboyz.net/archives/6133.html/comment-page-1#comment-265244 ElemBend Tue, 02 Sep 2008 16:49:23 +0000 http://chicagoboyz.net/?p=6133#comment-265244 It's not just the war with Georgia that is affecting investment in Russia. The shabby treatment of BP over its eastern oil development will soon run the company out of Russia giving it probably pennies on the dollar in compensation for their effort. Obviously, these treatment will serve as a stark warning to any who may want to do business in Russia in the future. The NYT had an article on the vast possibilities of commercial farming in Russia, as much of the land (some of the best in the world), is under-utilized, even fallow. Now, apparently foreign investors are being attracted to the possibilities. Were I interested in profiting from such large scale farming, I can think of many countries and continents that have a far more benighted view of property rights in which I'd prefer invest. Such the pity for world food supplies. Here's the article: http://www.nytimes.com/2008/08/31/business/worldbusiness/31food.html?partner=rssnyt&emc=rss Here is another highlighting the fact that capital is not the only thing Russia is lacking for development: http://query.nytimes.com/gst/fullpage.html?res=9B0CE4DB153BF93BA35754C0A9629C8B63 It’s not just the war with Georgia that is affecting investment in Russia. The shabby treatment of BP over its eastern oil development will soon run the company out of Russia giving it probably pennies on the dollar in compensation for their effort. Obviously, these treatment will serve as a stark warning to any who may want to do business in Russia in the future.
The NYT had an article on the vast possibilities of commercial farming in Russia, as much of the land (some of the best in the world), is under-utilized, even fallow. Now, apparently foreign investors are being attracted to the possibilities. Were I interested in profiting from such large scale farming, I can think of many countries and continents that have a far more benighted view of property rights in which I’d prefer invest. Such the pity for world food supplies.

Here’s the article:
http://www.nytimes.com/2008/08/31/business/worldbusiness/31food.html?partner=rssnyt&emc=rss

Here is another highlighting the fact that capital is not the only thing Russia is lacking for development:
http://query.nytimes.com/gst/fullpage.html?res=9B0CE4DB153BF93BA35754C0A9629C8B63

]]> By: Shannon Love http://chicagoboyz.net/archives/6133.html/comment-page-1#comment-265189 Shannon Love Tue, 02 Sep 2008 12:55:46 +0000 http://chicagoboyz.net/?p=6133#comment-265189 The free-market forces integrity. When you can't coerce people into investing or otherwise interacting with you, you have to allay their concerns and establish a reputation in order to succeed. Having said that, it is a mistake to think that autocrats will sacrifice their own power for the sake of a national economy. I think that Putin et al still possess a marxist disdain for all things related to business. They will view the injury of the Russian business class as a just fate for those driven by "greed". They will sacrifice what they see as the short term economic loss of the people in general for the long term benefits of their own rule. It's happened before. The free-market forces integrity. When you can’t coerce people into investing or otherwise interacting with you, you have to allay their concerns and establish a reputation in order to succeed.

Having said that, it is a mistake to think that autocrats will sacrifice their own power for the sake of a national economy. I think that Putin et al still possess a marxist disdain for all things related to business. They will view the injury of the Russian business class as a just fate for those driven by “greed”. They will sacrifice what they see as the short term economic loss of the people in general for the long term benefits of their own rule.

It’s happened before.

]]> By: renminbi http://chicagoboyz.net/archives/6133.html/comment-page-1#comment-265180 renminbi Tue, 02 Sep 2008 12:02:35 +0000 http://chicagoboyz.net/?p=6133#comment-265180 Didn't mean to post anonymously. Didn’t mean to post anonymously.

]]> By: Anonymous http://chicagoboyz.net/archives/6133.html/comment-page-1#comment-265179 Anonymous Tue, 02 Sep 2008 12:01:29 +0000 http://chicagoboyz.net/?p=6133#comment-265179 There is a price to doing business with criminals. JP Morgan said he lent money on someones character. Marxism, and the autocracy before it, was very destructive of people's character;we see this in the high rate of criminality among our "russian" immigrants. There is a price to doing business with criminals. JP Morgan said he lent money on someones character. Marxism, and the autocracy before it, was very destructive of people’s character;we see this in the high rate of criminality among our “russian” immigrants.

]]> By: toad http://chicagoboyz.net/archives/6133.html/comment-page-1#comment-265114 toad Tue, 02 Sep 2008 06:35:33 +0000 http://chicagoboyz.net/?p=6133#comment-265114 I have been wondering about how the Russian "business men" are going to react when they face travel restrictions, decline of in country asset value, and the possiblity of frozen assets out of Russia. I've heard rumour that more than a few of them were/are KGB/Rusian Mafia types. It might get noisy in some of the basements of the Kremlin and Lubyanka. I have been wondering about how the Russian “business men” are going to react when they face travel restrictions, decline of in country asset value, and the possiblity of frozen assets out of Russia. I’ve heard rumour that more than a few of them were/are KGB/Rusian Mafia types. It might get noisy in some of the basements of the Kremlin and Lubyanka.

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