The head office of the Central Bank of the Russian Federation, which is known as the UFA is based in Moscow. The views expressed by the bank’s leader, Kirilenko, on a possible return to the US Dollar are rather interesting. The head of the bank, Kirilenko, said that he considered the US Dollar a leading currency which was weak and had high conversion risk. He went on to say that Russia was considering the use of the US Dollar for its forex trading.
The views of this gentleman are rather interesting indeed. He is very much part of the economic team at the Central Bank of Russia. He is also considered one of the three members of the board of directors of the bank. He is therefore quite knowledgeable on matters relating to the forex market and the economic indicators that it brings. His comments on the US Dollar and the impending cap hit by the Fed have caused quite a stir in the financial community here in Russia.
In fact, on a more serious note, Kirilenko stated that the re-signing of the balance sheet of banks is a necessity for banks to be able to make loan repayments in the future. Apparently, he is of the opinion that the current credit crisis will force the Federal Reserve to re-introduce its free agency policy. Such a move would certainly help banks to continue their operations. In that context, he said that such a move would help the Russian economy to recover from the recent credit crunch.
On another note, he believes that it would be better to allow the free agents to negotiate on reduced contracts. According to him, allowing the free agents to negotiate on smaller contracts would be preferable because the revenues of smaller companies would not suffer much loss due to the contract termination. On the other hand, there are some big players in the market that do not want to let go of their huge contracts. They are in fact, reluctant to terminate their existing contracts which have helped them to enjoy profitable returns over the past few months.
Looking at the scenario, Kirilenko believes that it would be advantageous for players to receive an unconditional ufa when signing new contracts this season. He says that such an offer would give all players the opportunity to negotiate on the salary and the terms of the deal. The players themselves can simply walk out of the contracts without worrying about the consequences of quitting. However, such a scenario does not work out very often. Players do quit anyway after missing several days of training camps in the off season.
At times, a player may find himself unable to get out of his contract. This is mainly because of the large amounts of money involved. Usually, the highest ufa that a player can demand is $1.75 million per annum. Once the player becomes eligible for free agency, he can look for other offers from clubs offering better packages. These offers could be more attractive than the amount the player is being offered by his current club. This scenario plays out most of the time.
In addition, another advantage of receiving a ufa is that players will be able to travel overseas whenever they wish to. Most players in Russia do not have the financial means to travel to international tournaments. Such players have the option of receiving ufa to help cover the travel costs. It is worth noting that both the ufa and the bonus money are NOT transferable between clubs. Players cannot choose which team to play with once they reach the age limit.
One other exception to the no trade clause is when a player transfers to another club during the course of his contract. There are two exceptions to this rule – the first is when a player is traded to a new club before the expiry of his current contract. The second exception to the no trade/exception is if the player is traded back to his previous club by the same transfer agent. In this case, the player would receive the same payment as the corresponding player on his old team would have received, but the exception would only apply to the first transfer.