Ask me whether inflation represents longer-term problem. I think there's a potential there for excess reserves to create problems.
In this age of electronic money, investors are no longer seduced by a financial 'dance of a thousand veils.' Only hard and accurate information on reserves, current accounts, and monetary and fiscal conditions will keep capital from fleeing precipitously at the first sign of trouble.
I got a call from a group saying they'd like to have a roundtable with the reserve next door, and would I help to set it up. I said, 'Sure, what's the name of the chief?' I asked, 'Do you know any members of the band council?' They didn't.
The Central Bank is constantly purchasing, purchasing and selling and vice versa - this is their job.
There is always the potential for a central bank to engage in discretionary monetary policy and to break the one-to-one link between changes in foreign reserves and changes in the money supply.
Our criteria is that it's okay to invest in companies so long as they stop lobbying in Washington, stop exploring for new hydrocarbons, and sit down with every one else to plan to keep 80 percent of the reserves in the ground.
We can tell the general public that the gold and foreign currency reserves of the Central Bank are not designed to finance the economy, but rather to ensure foreign trade turnover. Therefore, we need this level to be able to provide the necessary foreign trade turnover for such an economy as Russia's for a period of at least three months.
