it's all calls now are mostly this is the grange britain watches closely as the mobile media most likely used to be grilled by m.p.'s over the phone hacking and bribery claims you could mud all accuse song of the seas film review case see a we're beyond some questions about the in the workings of the nelson function use of the well this. is where you come on days in a cave a ship carrying pro palestinian optimistic goals so you'll see another attempt to break the sea blockade of the region the vessel was boarded in international rules

and as it is now being taken out of the pools of mashed balls. russia and germany is me seeing how it's all we're told from the top of hero on the set of russian accounts and sounds as though my name's growing energy needs are libyan and syrian crises will sing praises home seem to be missed it's possible to find a compromise between kind of gadhafi and the rebels all of the leading intervention in syria. next the russians had chief tells all americans polls all i've been told is like you did all the big countries with. hello yellow welcome to spotlight baby and to shout artsy i love you our belts they play guest is i live see you cry to. the growing multi trolling us

national debt makes economists say the country's default is just a matter of time but the arguable hell outside of the us economy badly hit america's procedures including russia and the difficult times moscow discount think have great value and can't afford to lose billions it's like the washing. are the chances to see the dollar fail and the world's economies in dire straits get its money really talks is the nod to understand the language first step the dad i'll just in a sense although i did see a clock. rushing central bank says nutritional rates in russia will not exceed seven percent official say the economy is recovering g.d.p. is growing but next month the us to raise the multi-trillion national debt ceiling of worst refused to pay back their heads and declare a technical default russia holds

a hundred and twenty five billion dollars of american debt and risks losing business on an economic problems euro zone could also be that the russian economy. i'm going to look i thank you very much for coming in hello welcome thank you i well first question. is a statement by the u.s. federal reserve chairman ben bernanke he. addressed the congress saying if you fail to raise the u.s. debt ceiling by august the second the economic fallout could be. catastrophic end 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. in the speech if. you see this is a bit of policymaking in your way of legal legal framework to

over second that should be somehow solved. and no both sides certainly republican and democrats are doing their best interest somehow when this game is simply clear but i myself go think that's practically they will not be positioned to come to some agreement probably seventy agreement i mean to raise the dead. a couple of flying not so high as president obama asking. for some compromise. a compromise a lie just to win the time probably could be the real compromise but i would say that the chances to not have it is very close to zero but if even though be a kind of non agreement it means that for the government of united states and should be a choice what expenses could be cut it could be the service

and expenses but it could be some other expenses and some one else and the last last but not least point that what is meant technical default means that some just one obligations will not be fulfilled in time. theoretically a great place but i do not think it will really will influence dramatically markets it will influence for some limited scale but not for much of what do you think the united states may inflate the dollar diluted to decrease is that. that is the point so let's try this is the technical problem i believe it will be somehow was solved in law and not technical it's a political problem the united states have two big deficits fiscal deficit and

deficit of trade balance both have some correlations with the exchange rate or the currency of the dollar and. the investment in american national ticket will. who would wise you if you have seen the difficulties with play and service and your debt you can inflate it if you have to go you know a month reaction serial deal this is the way and historically we know that some countries were doing that so inflation for a different period of time. can happen that is what in economy will have to have in mind two points stalks and floats. you can solve the problem of stocks with inflation but what about floats if you will. have the same level of fiscal deficit it means that you inflate it stops

but you created new stocks with the floats of face cost so anyway even in this iteration of information the fiscal authorities have to make the serious steps on fiscal adjustment side so speaking about the probability of default well what about countries like greece or say portugal are they closer to default in the us much closer it is process of course. it it's much more realistic. or all the development of this creation in that countries not only technical about some kind of political economic reform i mean dangerous but the. it is dangerous but it could could be managed what do i mean by a managed it's not just i will not play and i there is me as you know of the problem in the country we'll talk with my creditors about the

solution what could be the solution some kind of forest arising on the debt but exchange of my obligation to some other obligations the conditions with some clear cut it means that it creators will lose some money but just sun ten percent fifteen percent twenty percent that is the point of discussion for 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 or for new developments are not used the chances go out. but the targets than before people start talking about withdrawal of some of the countries from the euro zone like greece for example leave believe this is possible for me it's a listing and usual social economical it would be this is politically i do not

think that. the euro system and the euro zone will be so easily divided into pieces a lot of rumors about about so-called core europe and painfully europe about possibility of divided within north and south and so on so forth but i do think that it's only a rumor a political it's a realist if you don't really believe in difference and if you if you say if you do believe that but they can be managed this week when it isn't the time to buy the bonds of these countries that are rated very low today or that is the business business points about it about that. business analytics so in our practice. we cannot you know starting the record on iraq with more on liquids here following us . ok now with the us 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 complaining. because frost was very difficult point then both u.s. dollar and euro well you know develop it in the time which are you know on one by one it's very difficult as a bet means that all the commodities but the prices of all the commodities will. arise probably once an article this is the first part of the second point. we. use the policy of inflation targeting and free floating of the. problem it's not the pure free floating but we are very close to it means we do not support this so that. the rate of exchange of the rubble not in nominal noise in real terms. means that we

will not be in a position to devalue value of the currency this is very much dependent on the market market for service of the progression of the supply demand so believe the market will pursue the flexible. policy so strong rule for usenet approach absolutely not a lot of speculations about that but i never. see the any and the legit and statistically a good group would drop some doubt about that today the share of them cleansing of total investment in. the real economy in russia is that seven percent why don't russian banks take a more active part in the investing process worried why is credit in russia so expensive i mean it's one of the most expensive in developed countries

. to two points the price and the amount the price of the critics is present but of course it's very much depends on the inflation ok when you lend money to somebody you have to fund it or you have to get some money money from somebody or you play the deposit rate and somebody pay your credit rate and this margin the credit rating that was a trade that is the ground for your financial return it means credit in any case the price can be cheap with the present price and that was a price very much dependent on inflation people will not give you money if you will pay less of the 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. of the magical of the credit trades will be go into the other part of the story is the amount how big could be learned now there are a lot of liquidity globally and in russia also but the they increase lending but the rates of of. of this increase is not very high so it's a very fast no it's around sixteen seventeen percent year to year june through june sorenson's and percent increase in nominal terms and therefore of my so. off the wall with that figure who says i didn't see or do cry of furze that you had of the russians and pulled back the spotlight will be back shortly at a small break so stay with us and get.

wealthy british scientists out some time to see the tightness of the. market. come to. find out what's really happening to the global economy with mike's concert for a no holds barred look at the global financial headlines tune in to cause a report on our.

six. her. welcome back to spotlight just a reminder my guest in the studio today is at least to look life in 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 and this is the the forecast for inflation this year it may be our year it won't be lower but the average deposit rate is six percent so slow then the inflation rate doesn't this discourage people to break them early it's a bearings. first

a certain percentage of progress target and will have to work with the heart to get it and then. we then we compare the inflation and depository it's we should have in mind that would be the expected information not today but expected inflation because the deposits were for free months six months up to three years normally so in that case you would have to compare that position from we really believe in free space because inflation would be a five percent it means that six for one because it's not but that is forty one years up to now have negative. negative for rate for for your presence in real terms. but that is very much the same as all over the wall unfortunately now in the period of very low globally very alone

rates because of the crisis of course and now have caused by the longer way of recovery after that after the motivation of all the tourists so i think that keeping in mind this three points now or the rate of growth was it's a small as comfortable and the reflection of this compatibility is the day nemechek do pause. and so both households and companies and the banks they grow in rather fast. yes this year two thousand and eleven it went so fast in two thousand and ten it's because people begin to spend money you know buying goods and so since then now not so much afraid about the future in the previous crisis time you said that your aim your girl seven percent inflation idea in the year. in the first six months of the year or so the inflation has already reached five percent so are you sure that in the in the remaining five votes or so it will be too.

now more than before because five for instance you know it's a brilliant it's a very good result i'm a so forth and could be your own five point two but. you see that is seasonal very much seasonal phenomena so normally international cornum it first not for the year generally like your own thirty percent of all the year all inflation really happened because i think 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 just from once a year general frost so it's a big jump in prices for us and the second yes because there are a lot of one of those. before before christmas before the year and they spend money

actively in general so it's. the standard but the thought what are the normally spirit a very low inflation partly sometimes it's a zero inflation and even this inflation so i myself personally believe that accumulated this five or six months we will have not more than zero point five june . several next three months july was. up to the beginning of the fourth quarter of the year we'll have not more than five point five and we still have about one point five percent for free not so the year it's surrealistic whizzer 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 they're pre-election time because they have planned some government spending is for the campaign or whatever you say frost i believe that the government will fulfil the

budget without a new expanded if even they will spend some additional money in not on the additional money supply will not influence critical it will influence the this year inflation it will influence next year two thousand and twelve no question ok this is the second point then the point of view they changed the course i mean in the very difficult for the great in french and a lot of inflation expectations this year and probably the government analytics were. too much sensitive to this to this very situation and they change their focus . russia is planning to introduce it's still national payments system which which sounds strange but because the whole world lives and these worlds master karen americans press and they're happy with it why does russia need it so

payments this way would be compelling and it's very sophisticated problem first 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 who use a visit must. agree with the war. yeah but for some reasons we'll have a proper probably. facility i mean network for us and banks and companies and households to organize to manage their permanent settlements in the way they're going to have it so the plus that is the business if somebody. in the business and invest in it that's ok that's ok because it will be the business of some banks including and the other of the big banks it's the deposition these but these existing payment systems visa press.

international i mean they're the truly international they don't belong to a country anymore i mean they belong to the world getting here and our bunks are members of the system and they will get them out of us that's absolutely different points you know but it's a patient and wall systems and you know some provided of your own system could work together well what you're saying about this national payment system this is it implying that it will give better possibilities some some good deals some better deals still to the clients then these probably yes there's the question mostly to the banks themselves but i believe the causation to probably do good to have better prices for for sources that now the sun so to compete with in the country do you expect this russian these are to be accepted by major banks around the world and in a matter of time 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 into this or is it is the ok 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 necessary why don't let the bank moscow done because this may be bad example for other russian banks were is an exceptional situation of course the. suffering like more than the three racial like in any situation of the nation of banks but you see there is the problem of so-called too big to fail. too for all in the wall and drew member of this edition of women brothers the great crisis began after that . day i mean fed decided not to support that theory until it was

a good reaction to practically. the worst followed by a very dramatic development of the situation so now all the latest you can buy this right ok but moscow is too big for a little bit for this is not a five in international banking system didn't consider it more than one hundred and thirteen billion the post of households and anyway there are guarantees that the system will have a special deposit guarantee religious lation and that was a guarantee. see in russia so it could be played in a way plus some government affiliated companies and institution and especially municipal usually of moscow keep their money then the bank of most or also and the amount of money is also very big even bigger than the household

of thousands 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 of it if you say so put him in the bank of moscow why would the flaws in the system discovered so late in the case is there is there problems in these super. the abilities of the central bank so i mean it's a long long story. that we talked just in on one on one talk with you but the concentration different program this is most of all the problem of the management previous management of the baton. and a lot of. some very specific operation provided in the interest of the top managers and they have the open side to the bad and closer to the band but it could be. information from that class sizes

a lot of problems the system it's not oh it's partly it's problem of the system but it's all trust is the problem of management such a law so you're working on it you know you are working on that is the only proving that the concept of this is a problem on the system and now we will have some demand from the president of the russian federation for us to make some proposals and most of the changes will be done. before very briefly i believe if the central bank of russia as a regulator supervisor has not their rights you have to have it's much lesser than the rights of other events in the war i mean to against the onus against the of my interests of the bad banks i mean to make some specific decision professional or professional or motivated decision about that so there are a lot of good practice in the world and we'll have to forgo all this 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 think see when you kind first deputy head of the russian central bank spoke like a movie back with more friends than common father was really going in and out of time until then they are party and take it it as .

in taiwan an o.t. is available in hotels friends to convince myself to tell bank all the new entries going from a normal hotel bunco switzer tell the cold cold ground of a coupon source a tell million dollars pounds from a golden so it's a new royal hotel then they have princess inviting come from the same hotel sankoh dream hotel buying coke so if you sell some time or a grand buying coke kind pacific otoh find cold room brands hotel bunco clothes i haven't even called a role in the region.