In the event of a global crisis, there is a risk of a collapse in oil and gas prices
A special month for the country is approaching, which once became a symbol of all sorts of upheavals. Today, when asked whether you believe in the mysticism of August, the majority of Russians will answer negatively: generations have changed, and memory does not have the ability to retain negativity for long. As for the economy, August was marked, in fact, by the only global shock — the default in the now distant 1998. The consequences of which, however, were quite global and, one might say, shook the foundations of the state.
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At least twice during the 1990s, August became «black» for Russia — in 1991 and 1998. In the first case, the famous GKChP putsch and failed attempt at a coup d'etat took place, in the second — bankruptcy, when the state refused to fulfill its financial obligations. It is precisely the highest degree of emotional shock experienced by millions of people at that time that explains such a bad and such a persistent reputation.
Well, and then the popular rumor only added arguments to the thesis about the unhappiest month of the year for the country. The tragedy of the nuclear submarine «Kursk» is also August, 2000. As well as: the beginning of the second Chechen war (1999), the explosion in the underground passage on the capital's Pushkinskaya Square (2000, 11 victims), the death of a military helicopter Mi-26 in Chechnya (2002, 127 victims), terrorist attacks on board passenger planes Tu-154 and Tu-134 (2004, 90 victims), the terrorist attack at the Rizhskaya metro station in the capital in the same year, which took the lives of 10 people, the beginning of the armed conflict with Georgia in 2008…
In general, it has become a kind of tradition, which has been going on for more than a quarter of a century: to expect some troubles from the last month of summer. Well, let's not break with tradition… Although, from the point of view of economic and financial realities, the coming August is expected to be absolutely ordinary. It is only with a big stretch that we can talk about serious risks that could materialize during this period. In any case, as the experts interviewed by MK assure, there will be no devaluation of the ruble (supposedly needed by the authorities to improve the budget situation), no large-scale banking crisis (due to the increase in the key rate), no collapse of the economy (due to sanctions). So what will happen?
«I don't expect anything catastrophic in the coming month — neither in the economy nor in any other sphere. The last serious tragic event that happened in August was the accident at the Sayano-Shushenskaya hydroelectric power station in 2009, when 75 people died. There will be no new sanctions in the near future — in June the European Union adopted the 14th package. However, there is one risk associated with the overheating and volatility of the American stock market. Theoretically, its sharp fall could be caused by political excesses in the USA, some steps by Trump. In 2008, Lehman Brothers «burst», and today the bankruptcy of some other company could lead to a global liquidity crisis. Of course, due to the sanctions, Russia is completely cut off from external markets, it seems that this should not affect it. However, we should not relax: if the global recession of 2008-2009 is repeated, oil and gas prices could collapse, and this is critical for our budget. The federal treasury also depends on export money, as in previous years. Its problems have always been solved by devaluing the ruble, since the early 1990s. But even if the ruble starts to weaken in August, it is unlikely to be a shock.»
“I don’t have the feeling that something bad will happen this August, especially comparable in scale and consequences to the 1998 default. Yes, there are risks of a strong weakening of the ruble, but they go into the longer term — by the end of the year. As for the situation in the economy, everything there is also more or less normal. The budgetary impulse continues, the state has money, I do not yet see any prerequisites for serious upheavals. There will not be a banking crisis either: the system is stable, banks have enough liquidity. August is a wonderful summer month, we will go through it calmly, so you can relax without worrying about the economy at all.”
«Nothing terrible should happen globally, but as for the exchange rate, it now depends to the maximum extent on the balance of imports and exports. The balance on these scales is too precarious, although the authorities have a gap to stabilize the rate in the event of any serious problem — in the form of raising the threshold for selling foreign exchange earnings of exporters. At the same time, «black swans» always fly in unexpectedly. On the other hand, there are no grounds for a geopolitical shake-up yet: even the authorities in the West are increasingly saying that we need to make peace with Russia.
August is indeed not the best month in the modern history of Russia, but exactly the same can be said about, say, February-March, if we recall the «nuclear» sanctions after the start of the Cold War or the start of the COVID quarantine. Moreover, any historical period is marked by a lot of negative phenomena that have affected the lives of millions of people — if desired, you can make a convincing selection of events for each month. Therefore, you should not perceive August as some kind of curse for the Russian economy. The dollar by the end of the year can still easily approach 100 rubles, but this will not mean that August is to blame — the process of accelerated devaluation can begin in any month.»
«August is usually associated with various financial catastrophes — the older generation remembers, in particular, the default of August 17, 1998. For many, this date resulted in the collapse of hopes and capital. But now are completely different times. It is easy to assume that in the coming month, the real estate market will continue to cool — due to the end of preferential mortgages and the lack of demand for family mortgages, after the May and June excitement. The business lending market will feel sluggish — rates of 18-20% call into question the profitability of many enterprises. Against the background of the lack of demand for loans, banks will probably intensify the issuance of credit cards (today, over 2 million are issued every month), including through the policy of «going to the people.» Thus, in large cities and regional centers, such plastic is distributed by employees right on the street. However, there is no need to fear a debt collapse: Russia has created a financial cushion — the National Welfare Fund, which currently holds 12.5 trillion rubles (in 1998, it was nowhere near that). Despite the growth, the size of the national debt is under the control of the state and, in relation to GDP, is inferior to the indicators of most European countries — all this speaks to the stability of the domestic financial system.»