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President Dmitry Medvedev and Prime Minster Vladimir Putin of Russia’s United Russia party met before congress today to promise Russia would emerge stronger from a world economic crisis, one Putin purported was triggered by U.S. recklessness. Putin’s 45-minute speech, which trumped Medvedev’s much shorter opening remarks, provides further evidence that a return of Putin to the presidential “thrown” is highly probably.

Speculation about a possible Putin comeback first hit the wires on November 5th when Medvedev proposed extending presidential terms (not including his own current one) from four to six years, which Parliament approved on the second of three readings Wednesday. With the current constitutional limits of two consecutive terms, this recent reform will be used to justify holding early elections to return Putin back to his seat.

Tensions have escalated in recent months between Washington and Moscow over U.S. proposed instillation of 10 interceptor missiles in Poland to counter the likes of Iran. Further, the relative lack of response from US and EU officials to negotiate the remove of Russian troops following their invasion of Georgia in early August signals an increased inability of the international community to deal with dictatorial Russia.

Medvedev’s pledge of $200 billion in loans, tax cuts, and other measures might make a small dent in an economy that is expected to slow to 3% growth next year, but it won’t shore up the financial trouble of an economy levered to oil, which just touched a three and a half year low of $51.12. Putin, who stepped down in May, may use the current vacuum of both economic and political leadership to return to power sooner than anyone expects.

Daryl Jones
Managing Director

Matthew Hedrick
Analyst