If you're 401(k) statement has got you down, just be glad you're not one of the 100 richest people in Russia.According to Forbes, the net worth of Russia's wealthiest elite fell an astounding 73% in 2008. Not a single business leader in the Golden Hundred increased his fortune in the past year," according to Forbes. The story hasn't appeared on Forbes.com yet, but Blomberg reports that "Deripaska, the first of the billionaires to cede secured assets to banks, dropped to 10th from first place after losing an estimated $25 billion in the past year. Forbes put his fortune at $3.5 billion now."
The financial crisis and falling commodity prices that hit the global markets were of course a major factor, but the weak ruble exacerbated the problem for Russians.
The 73% decline is right in line with the 74% decline in value delivered by the broader Russian stock market in 2008.
In a March 31st press release, John T. Connor of Third Millennium Russia Fund argued that Russia's stock market may be poised for a comeback and presents an interesting opportunity for international investors. "Overall Russia's macroeconomic strengths -- relative to others -- are evident: trade and payments surpluses, little government debt (at 6% of GDP among the lowest: Brazil at 55% and India at 50%), still big FX reserves and low interest rates."
It wasn't so long ago the media pundits like Jim Cramer were talking up the brilliant investment opportunities offered by the BRIC (Brazil, Russia, India and China) countries. But long-term, the competitive outlooks for those countries has probably not declined by as much as their stock markets have. If that's the case, this could present the buying opportunity of a lifetime.
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