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Samogon index to be barometer of Russia’s economy
03-10-2019 16:24
Samogon index to be barometer of Russia’s economy
Samogon index to be barometer of Russia’s economy

Experts in different countries invent informal methods of evaluating a state of affairs in any economy. However, there is a grain of truth in every joke. Let’s take for example the Big Mac index which is published by The Economist annually to measure purchasing power parity (PPP). The Borscht Index was devised as a metric of inflation in Russia. Alexey Zubets, a pundit from the Financial University under the Russian Federation Government, developed his own out-of-the-box indicator. The Samogon index was created as a result of the research which reveals the direct link between consumption of strong home-made alcohol and economic conditions of the population. Isn’t it a clever idea? As long as the domestic economy gets stuck in more trouble, the population cannot afford to buy quality legal beverages and shifts focus towards cheap home-made alcohol or fake alcohol sold in the black market, Alexey Zubets explains. In other words, growing consumption of home-made or illegal alcohol mirrors a decline in personal income, the economist concludes. From his viewpoint, this indicator is going to be a precursor to an economic crisis in Russia. Believe it or not, this unconventional tool signals the winning streak in the domestic economy nowadays. Samogon production rates and sales remains low this year. At present, samogon is distilled by only 4.5% of the polled people from cities with the population of over 250,000. The separate survey shows that such a drink is mostly produced in Saransk, Astrakhan, Ulyanovsk, Lipetsk, and Novorossiysk.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

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