On Russia's Abandoning the "Crisis"

Mark Perry at Carpe Diem has an interesting post about Russian state involvement in the press to manage the financial panic:

Instead, just as in Soviet times, Russians are told how bad everything is in the West. The US, Russians are told, is in irreversible decline, while desperate Britons are throwing themselves into the Thames. The Queen, facing imminent penury, has been forced to pawn her diamonds and, according to one tabloid front page, Brits can no longer afford to bury their dead.

I asked TPS friend, Dr. Pavel Yakovlev, a Soviet native now economist if he would like to comment on the story:

I think it is a fairly accurate post. When I talk with people who currently do business and live in Russia they say the crisis has really hit them hard. It is mostly a psychological or panic driven crisis for them despite the best attempts by the government to play it down as nothing serious and calm people down. The Russians remember the 1998 crisis, which has wiped out many businesses and are afraid that it could happen again even though the fundamentals are good. So, I think there is an unhealthy level of negative expectations and the government's desperate attempts to calm people down may surprisingly backfire.