January 23, 2008 (LPAC)--Senior Russian officials and politicians are clinging to their illusions that somehow, the international hyperinflationary crisis will only have a passing effect on Russia. Following Russian presidential candidate Dmitry Medvedyev's statement last week that 2008 might not be so bad, yesterday, Gennady Melikyan, Senior Deputy Chairman of the Russian Central Bank, told the press that while the crisis will go on in the West, Russia can survive without great problems, RosBusinessConsulting reported today. Melikyan, speaking in Tula, said that the "current negative situation on world markets has affected the Russian Federation. It is too early to relax, but there is certainty that we will be able to survive this quietly. There is no fatal danger of a crisis" in Russia, which is protected, he said, by its high level of foreign exchange reserves.

Russian Finance Minister Alexei Kudrin is also apparently suffering from the "money is economy" disease, since he said today at the World Economic Forum in the Swiss ski resort Davos, that Russia will offer a "haven of stability" amidst the financial turbulence. Kudrin was quoted by Novosti, saying: "In the past few years Russia has managed to achieve economic stability piling up substantial international reserves, which play the role of an airbag. I believe Russia will soon be the focus of attention as a haven of stability.... As a country with substantial reserves, Russia could help soothe the global crisis."

It would be beyond foolish for the Russian leadership to continue to deny the systemic scope of the hyperinflationary crisis.  Hyperinflation is now the driving characteristic feature of the world economic system, and only a radical change in the supposed "rules of the game", could yield the potential solution.

Now is not the time for conventional, popularly accepted economic theory.