We’re just back from Moscow, join our Larry McDonald on CNBC’s Closing Bell today at 3:10pm.

Where are bond yields going with debt on the rise?  Click here for our latest report.

Russian Ruble has been the Top Preforming Emerging Market Currency in Q4 2016 

Republican Donald Trump won U.S. elections on Nov. 8 with a promise to improve ties with Russia, holding out the possibility of easing sanctions imposed after Moscow’s 2014 annexation of Crimea from Ukraine.   The ruble has been the big winner, dramatic outperformance. 

We visited Russia (Moscow) this month.  Russians are very excited about the prospects of the incoming Trump administration.  The 70 year relationship between NATO – USA – Saudi Arabia is coming to an end, Russia will be the big winner.

Big catalyst for Russian equity’s in 2017 will be rate cuts as inflation has finally gotten under control this year. Real rates are far too high and will come down.  Russia’s bonds are attractive as well, falling inflation will bring 150-200 basis points in official interest rate cuts next year. That will keep inflation-adjusted bond yields at among the highest in the world.

RSX (equities) are still 63% off their 2008 highs.  Inflows in December are the best in three years.

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