For ordinary Russians, what they learned about the ruble’s collapse depended greatly on where they turned for information.

While independent media said the central bank should have intervened more directly, and that the increase of the benchmark interest rate to 17 percent could create a crisis in the banking system, state-run outlets steered any criticism away from President Vladimir Putin and portrayed the government as ready to take firm action.

Since coming to power in 2000, Putin has regained government ownership of every major television station. With TV serving as the main source of news for most Russians living outside major cities, that’s given the state incredible power to shape the news citizens receive.

“The state-run media has a totally different task,” said Alexei Makarkin, deputy head of the Moscow-based Center for Political Technologies. “Their job isn’t to inform people, but to carry out propaganda. And so they’re trying to reassure.”

The ruble plummeted into a freefall yesterday, losing as much as 19 percent in the biggest one-day drop in 16 years, as panic swept across Russian financial markets after a surprise interest-rateincrease overnight failed to stem the run on the currency. The ruble is being hammered as the global price of crude oil, Russia’s main export, plunged below $60 a barrel for the first time in five years. State-run Channel One didn’t cover ruble plunge at all, except for saying that the central bank increased the key rate.

Defending Ruble

Media owned by the state or allies of Putin focused on the government’s response to the crisis, if they reported on it at all. Rossiya 24 TV and Izvestia highlighted an interview with Russian Central Bank Governor Elvira Nabiullina saying she would act to defend the ruble. Rossiyskaya Gazeta and REN TV carried optimistic coverage that the ruble had strengthened after its decline.

In July, Russian state television reeled off almost every possible reason why a Malaysian Air passenger jet exploded over rebel territory in eastern Ukraine, denying some western military experts opinion that a Russian-made missile fired by pro-Russian insurgents. The cause of the crash is still under investigation.

Coverage on government-owned television is understandable in this case, said Yulia Bushueva, who helps to manage about $500 million at Arbat Capital in Moscow.

No Panic

“State television is having limited ruble coverage now in order not to cause panic among the people and make them run to the banks to swap their savings into dollars, which would harm the ruble even more, as those savings are pretty large,” she said. Still, that may not help as Russians remember the 1998 and 2008 crises, and don’t pay attention to what state TV says in such cases, she said.

Vladimir Rudenkov from Voronezh, a city about 500 kilometers (311 miles) from Moscow, was one of those ignoring the government-media assurances and taking action. Rudenkov transfered a portion of his savings into dollars yesterday and said he regretted that he didn’t exchange it all.

“The situation is catastrophic,” said Rudenkov, a 35-year-old manager. “I don’t believe that the ruble collapse is happening only due to the falling oil prices. The government is the one to blame as it didn’t defend the national currency.”

Influential Outlets

Newspaper Vedomosti -- owned by the Wall Street Journal, Financial Times and Finland’s Sanoma Oyj -- and Forbes Russia -- run by Berlin-based Axel Springer SE -- are among the most-influential independent media outlets in the country.

The two, which frequently publish editorials and opinions critical of the government, had extensive coverage of the ruble’s collapse, including analysis of the government’s handling of the crisis.

The future role of the outlets in the country’s media landscape is in question after Putin signed a law in October capping foreign holdings in media at 20 percent. Non-Russian owners have until 2016 to reduce their holdings.

Putin opponents took to social media to criticize his policies such as the seizure of the Crimean peninsula from Ukraine, which has brought economic sanctions from the European Union and U.S.

“Supporters of war with Ukraine must recognize that their backing” of Putin has “brought about the collapse of Russia’s economy and financial system,” Boris Nemtsov, a former deputy prime minister and now opposition leader, wrote on Facebook.

For all the government’s control of media, Nadezhda Kostenko, a 65-year-old pensioner from Volgograd, still wasn’t buying the message.

“We have a feeling that something bad will happen,” Kostenko said. “The prices are rising on the ruble’s drop and this bothers people a lot. And there’s a feeling that the government is guilty.”

17 December 2014, Bloomberg

ruble, dollar

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