From the dissertation, it is clear that the effect of such a decline in the domestic stock market prices was accompanied by a sharp decline in the prices of stocks in other emerging countries possibly by the withdrawal of the investors from the other markets with a view to cover their losses incurred in the Russian market.
Another reason for such decline may be the expectations of the investors of a global recessionary trend in the world stock markets.
The immediate task in the aftermath of the financial crisis was the task for the policy makers to draw up programs for redefining the boundaries of an efficient market economy. This involves a thorough revamping of the institutional systems in operation.
In conclusion, before the corrections in the institutional frameworks could be attempted it was necessary for the policy makers to study and understand the factors and situations that led to the crisis of 1998 so that they do not repeat themselves. But it appears that this aspect had been totally missed by Russia with the entire concentration and focus directed towards the short-term measures. “At present, the mainstream diagnosis seems to be that the short-termism of the Russian programme was part of a necessary gamble which did not pay off: Russian stabilization has failed, on this view, because the time gained was not used to implement necessary reforms, especially in the fiscal field. In particular, dismay has been expressed at the failure of the Duma in July to implement a full set of emergency measures, which would have included a shift towards individual income taxation.” ...Show more