Would you blindly invest?

Russia's Rosneft, the state run oil company will be making an IPO this year by trying to raise money from Western sources. First, I believe in consolidating power in order to create stronger laws that will protect property, promote a market economy, establish standards for corporate governance, and a justly instituted legal systems with uniform procedures and standards. If these laws are fairly enforced then I would say invest. Second, this is all in preparation to allow an company to be driven by market forces and be indepedently run free from the government intrusion into the boardroom.

Stratocade, is absolutely correct to say allow capitalism and the market economy to drive corporations. It allows for greater freedom and decision making by allowing a CEO to determine what direction to take a company depending on the circumstances. Plus it allows for greater efficiency to have it lead independent of the government. When a company is run by the government it leads to great waste and corruption. This will also occur is Rosneft is not allowed to go truly public which will lead to inefficiency being run by a behemoth government in Moscow. The other problem is how much transparency will there be to allow people to truly evaluate the company. Under the Russian government, I would think very little but Western capital markets have not learn losing billions when Lukos was seized on trumped up tax charges and found guilty with given a chance to pay the fines. Western markets will always go after the greatest potential with the greatest risk and that great risk is the state control of Rosneft.

* Disclaimer most of my knowledge was obtain through many sources including the Wall St Journal article that reminded me of the up coming IPO.