the biggest money economic problems the euro zone would also note that the russian economy. hello mr look i thank you very much for coming welcome thank you i well first question considers a statement by the u.s. federal reserve chairman ben bernanke he who addressed the congress saying a quote if you fail to raise the u.s. debt ceiling by august second the economic fallout could be catastrophic and quote according to your previous statements you don't believe that the u.s. may default on its debt what's your confidence based on. that in a speech if. you see this is quite a bit of policymaking anyway of course a legal legal framework up to august second that should be somehow solved.

and no both sides suddenly republicans democrats are doing their best to somehow we in this game this absolutely clear but i myself do not think that's practically they will not be positioned to come to some agreement probably seventy agreement i mean two or is the that. cut off why not so high. asking about but for some compromise. a compromise a line just to win the time probably could be the real compromise but so i would say that the chances to not have it is very close to zero but if even they will be a kind of non agreement it means that for the government of united states it should be a choice what the expenses could be cut it could be that service . expenses but it could be some other expenses one the political choice and the

last and last but not least point that what is meant technical default it means that. just one obligations will not be fulfilled in time. it can take place but i do not think it really will influence the magically markets it will influence for some limited scale but not all magically the thing the united states may inflate the dollar diluted to decrease its debt. that is the point so let's short on this is the technical problem i believe it will somehow be solved in law and not technical a political problem in the united states have two big deficits fiscal deficit and deficit of that balance both have some correlations with the exchange rate of the

currency of the dollar and a k d investment in a little cleaner channel tickle will. would wise you if you have seen the difficulties with pain and service and your debt you can inflate it if you have you know monetary agence if. this is the way and historically we know that some countries were doing that so inflation for a different period of time. in that case but in economy have to have in mind two points stocks and floats. you can have solve the problem of stocks with inflation but what about floats if you. have the same level of fiscal deficit it means that you inflate it stocks but you created new stocks we have the floats of fiscal so anyway even in this

iteration of deflation the fiscal authorities have to make the serious steps of fiscal adjustment side so speaking about the probability of default well what about countries like greece or say portugal are they closer to default than the is much closer it has problems of course. it it's much more realistic. or alist the development of this creation in that countries not only technical about some kind of. political economical default i mean interest that. it's dangerous but it could could be managed what do i mean by a managed it's not just i will not pay my debt is me as you know the problem the country will talk with my creditors about the solution

of what could be the solution some kind of arising on the debt exchange of my obligation to some of the better conditions with some haircut it means that the creditors will lose some money but just some ten percent fifteen percent twenty percent that is the point of discussion of a second so it's a lot of countries a lot including russia. you know by that situation and after that they have some chances for recovery for new developments some of them use the chances go out. but the targets then before people today start talking about withdrawal of some of the countries from the euro zone like greece resample do you believe this is possible for minutes quiet on realistic and usual social economical it would be this is politically i do not think that the euro system the euro zone will be so easily divided into pieces

a lot of rumors about that about so-called core europe and painfully europe about possibility of divided in north and south of france and so for but i do think it's only or more political it's a literalist if you don't really believe in difference and if you if you say if you do believe that they can be managed as you put it isn't it time to buy the bonds of these countries that are rated very little today or that is the business business points about it about that. business analytics so in practice. we did not you know focused on the tone of august more on liquidity and safety of. ok now with the u.s. dollar and you wrote rates falling maybe we see a situation when the russians central bank has to devalue the ruble to keep

russia's economy competitive. because first it's very difficult point and both you and your you know develop it into time. and one by one it's it's very difficult on us and that means that all the commodities of the process of all the commodities will. arise probably rise dramatically this is the first point the second point. we. will pursue the policy of inflation targets and free floating of the. problem it's not the pure free floating but we are very close to it it means we do not support this so that. the rate of exchange of the rubble not in nominal nor in real terms. that we will not be in

a position to devalue the value of the currency this is very much dependent on the market market for service of the correlation of the supply and demand so believe in market and we pursue the flexible. policy so strong ruble for use not a problem. not a lot of speculations about that but i never. see the any political and statistical is good good good drops about about that today the share of bank lending of total investment into. the real economy in russia is that seven percent why don't rush and banks take a more active part in the investing process worry why is credit in russia so so so expensive i mean it's one of the most expensive in developed countries. to two points the price and the amount the price the critics suspense of

but of course it's very much depends on the inflation. when you lend money to somebody you have to fund it or you have to get some money money from somebody or you pay the deposit rate and somebody pay you credit and there's margin the credit rating that was a trait that is the big ground for your financial return it means credit in any case kind of price couldn't be cheap of the deposit price and the present buyer is very much depends on the inflation the people will not give you money if you'll pay them less than inflation so that is very much the problem that is the reason for us to be very much concentrated focused on the on the inflation so. as soon as we will be in a position to cut inflation this year i will think about seven percent in

perspective for two three years about five percent and that of the particular to much cicle of the credit. go into the other part of the story is the amount how big could be learned not there are a lot of liquidity globally and in the russia also but the they increase lending but the rates of of. of this increase is not very high so it's not very fast now it's around sixteen seventeen percent year to year june to june it's around sixteen percent increase in nominal terms and therefore i myself. comfortable with that figure says alex see first deputy head of the russian central back spotlight moving back to shortly after a small break so stay with us and we'll.

mission free couldn't take should free zones for charges free coming from and free is free stooge free. the old free blog template video for your media projects and free media and on to our teeth on top in. forty two thousand americans die each year from car accidents only a thousand. seven hundred thousand people. and thirty two thousand will kill themselves cancer in all its forms kills five hundred sixty thousand of us here part disease is even more devastating it kills over eight hundred seventy thousand americans every year.

download the official anti up location on the phone called touch from the cubans ops to. watch on t.v. life on the go. see video on demand on t.v.'s my old costs and r.s.s. feeds now in the palm of your. questions on the dot com. welcome back to spotlight algal love and just a reminder that my guest in the studio today is at least to look at if the first deputy head of the russian central bank mr because of you mentioned inflation mentioned seven percent this year well it's

a very interesting thing the inflation is seven percent this is this is the the forecast for lation this year it may be are it won't be lowered but the average deposit rate is six percent so it's lower than the inflation rate doesn't this discourage people to bring their money to banks. first the seven percent is of focus target and we'll have to work very hard to get it then. we then the comparator the inflation and depository it's we should have in mind that it could be the expected inflation not today but expected inflation because the deposits were for three months six months up to free years normally so in that case you have to compare that position if we really believe in free space for two years inflation will be five percent it means that six for one deposits not about.

a second thought one years up to now will have negative. negative for rate four for you pauses in real terms. but that is very much the same as all over the wall unfortunately now in the period of very low globally the law or eights because of the crisis of course and now have to pass by the long way of recovery after that after the motivation for all the greats so i think that keeping in mind these three points now the rate of deposits the smallest comfortable and the reflection of this conflict ability is the day nemechek of deployed. it's of both households and companies in the banks they grow in rather fast. yes this year two thousand and eleven it's not suffice it to fall isn't that it's because people begin to spend money you know buying goods and

services they're now not so much afraid about the future as in the previous crisis time you said that you're a mean girl seven percent inflation and the idea that the. in the first six months of the year or so the inflation has already reached five percent so are you sure that in the that in the remaining five months or so it will be two . now more than before because five you know it's a brilliant it's very good result i'm a so forth it could be around five point two. you see that is seasonal very much seasonal phenomena so normally in the russian economy the first month for the year generally get your own thirty percent of fall the yield inflation really what happened because i think if you will celebrate the new year away because of two friends first all the tariffs for for

a three city gas water supply and doubtless you know change transform once a year general frost so it's a big jump in prices first and the second here yes because there are a lot of one losses. before before christmas before the year and they spend money actively in january so it's quite understandable but the fourth quarter the normal the spirit of very low inflation partly sometimes is zero inflation and even there's inflation so i myself personally believe that accumulated this five percent for six months will have not more than zero point five june. several next three months. so up to the beginning of the fourth quarter of the year will have more than the five point five and we still have about one point five percent for the three months of the surrealistic

are listed as well but the government the russian government seems to be more pessimistic than you because they expect seven point five percent is it because is it because the pre-election time because they have planned some government spending is for the campaign or whatever you say frost i believe the government will fulfil the budget have without any you'll be expended if even they will spend some additional money in not on that additional money supply will not influence the listicle it will not influence the this year inflation it will influence next year the house into a militia ok this is the second point then the third point of the wind there they changed the their focus i mean in the have very difficult for school what are the great information pressure a lot of inflation expectations this year and probably the government analytics to

do much sensitive to this to this very situation and they change their focus. russia is planning to introduce it's still no payment system which which sounds strange but because the whole world lives in these. master card american press and they're happy with that what does russia need is some payment system and would be competitive it's very sophisticated problem for us i do not think that when you have your national system it doesn't mean the you do not use the other systems. ok of course. people will use a visit must like. everything going to wall. yeah but for some reason so half hour probably. facility here i mean network for arson banks and companies and households to organize to manage their permanent settlements in

the way they're going to have it so and plus that is the business if somebody believe in the business and invest in it the that's ok that's ok because it will be the business of some banks including. of the big banks that position but these but these existing payments system is reason to press their international i mean they're the truly internationally don't belong to a country anyway i mean they belong to one of the euro and our banks are members of the system and they will be the members it's absolutely different points you know but it's a patient and well systems and you know some provide enough your own system could work together well what you're saying about this national payment system does it imply that it will give better possibilities some some good deals some better deals still to the clients than these probably yes this is the question

mostly to the banks themselves but i believe they have some position to probably do to have better prices for four for sources than the sun so to compete with in the country do you expect this question of these are to be accepted by major banks around the world and in a matter of time of well why not why not if you will will work hard to get some results why not it will need a major advertising campaign of course of course billions put into this project is the ok and now the central bank is currently bailing out the bank of moscow with a john sum of two hundred. ninety five billion rubles why is it necessarily why don't let the bank of moscow die because this may be bad example for other russian banks were is an exceptional situation of course the us something like more

than that ration like in any situation of a nation of banks. but you see there has the problem of so-called to big to fail or to important of all in the wall during member of this edition of women brothers the great crisis began after that. day i mean fat decided not to support that thirty call it was a good reaction but practically it was followed by the very dramatic development of the situation so now all the regulators skipping might this point ok bank of moscow is too big for a little bit to fail this is number five in russian by the system and it considered it more than one hundred and thirty billion the post of households anyway there are guarantees that this system will have a special deposit guarantee religious lation deposit guarantee.

say in russia so it could be paid in a way plus some government affiliated companies and institution and its special municipal decisions of moscow keep their money then the bank of most of all also and the amount of money is also very big even bigger than the household deposits so there's a risk for that money too if we keep all the risks which can be materialized in that the development of the situation with. have to find some some balance so that if you say so put him in the bank of moscow why would the flaws in the system discovered so late it is is there it is their problem isn't the super. it's an ability of the central bank so i mean it's a long long story. of it talked just didn't. want to talk with you but there are considerations different problem this is most of all the

problem of the management previous management of the battery. and a lot of. some very specific operation provided in the interest of the top managers and the have the open side to the bad and close to the bad but it could be. information from that clause so there are a lot of problems the system is it i know it but this problem of the system that it's all trust is a problem of management such a low so you know working on it you know your way is the only proving that the sec of this is a problem of the system and now we'll have some demand from the president of the russian federation for us to make some proposals on what should be changed what should be done. before very briefly i believe if the central bank of russia as a regulator supervised have not their rights have to have it's much lesser than the

rights of other waste in the walled i mean to against the onus against the managers of the bad banks i mean to make some specific decisions professional professional in the divided decision about that so there are a lot of good practice in the ward and we'll have to fall though it is good practice thank you thank you very much for being with us and just to remind you that my guest on the show was i like see where you kind first deputy head of the russian central bank spotlight will be back with more first time comments on what's going on in and out time pressure until then they are party and take it it as .

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go and. read this and the colonel was toto retreat. and exit news of the world a journalist who was the first to name names in the phone hacking scandal. the latest twist in what's. a political crisis going as far as the prime minister david cameron. the russian security forces up for a major terror attack on the transportation system which could have resulted in a huge loss of life. and violence continues in afghanistan with three more nato soldiers killed after the assassination of. president karzai last week just as it begins handing over control to local forces. and we'll bring you more about the u.s. strategy in afghanistan and the alyona show in our washington d.c.

studios that's coming up. for the full story we've got. the biggest issues get cuban voice ceased to face with the news makers. welcomed a lot of show we'll get the real headlines with none of them or say we're going to live in washington d.c. now today we'll ask if murdoch's fall is inevitable the nations that are there katrina vanden heuvel will join us also look at the afghanistan that general david petraeus leaves behind as he officially hands over command of the war today and we'll tell you about the most important geo location company that you've never heard of they've got a technology that governments all over the world are trying to buy up we're going to have all of that and more for you tonight including a does it happy hour but first let's take

a look at what the mainstream media has decided. well the debt limit talks still holding the country on the brink of a default and with america's longest war coming under a new command there was one story of the mainstream media made sure to cover first this morning we're going to begin with casey anthony a free woman today her whereabouts a secret for the first time in three years casey anthony is no longer behind bars yesterday morning she did this you know a lot of people were surprised they didn't sneak around of the back door to see anthony walked right out of the front door at this point she has biased she's gone underground and those surrounding her trying to protect her think it was for the short term that was the best thing for casey anthony. can you believe that you just walked right out of the front door with all of those vultures waiting outside for her weight those involved.