Breakingviews.com - A Black Hole in Russian Banks - NYTimes.com

We know all about the US subprime and financial crisis. But what are the Russians struggling with? Are we going to see a meltdown of Chinese dollars invested in US as well? I think these questions need to be analyzed with bigger care. A week ago there should not be problems with European banks. Today the situation looks very different.

Breakingviews.com - A Black Hole in Russian Banks - NYTimes.com: "Nationalizing banks isn’t an option for the Russian government. It already owns the country’s largest financial institutions, and a string of smaller ones. But the global liquidity freeze has hit the country’s banks hard, and their problems have been amplified over the summer by capital flight from foreign investors who fear the Kremlin’s unpredictability. Russian exchanges have lost more than two-thirds of their value since their highs in May.

Sergei Ignatyev, left, chairman of the Russian central bank, and a banking executive, German Gref, at a meeting at the Kremlin.

The Russian government has spent tens of billions of dollars of public money and foreign reserves to assist markets and help the country’s banks — to no avail. In the latest twist, Dmitri Medvedev, the country’s president, said the government would extend $36 billion in five-year loans to the leading Russian banks, hoping the money would trickle down to the rest of the banking sector and the economy."