Russia Bans Casinos?

Russia may have just banned all of its national casinos, but that hasn't stopped ETF investors from gambling on the nation. The Market Vector Russia ETF Trust (RSX - commentary - Trade Now) has experienced a rally in recent months, but it is still a very volatile investment. The most recent moves by the Russian government seek to make the nation more economically stable.

Last Saturday, The New York Times reported that the economically distressed country was making good on the threat by Prime Minister Putin toward its national casino industry. Starting immediately, the government is demanding that every legal gambling facility be removed from the country in an attempt to make the country "clean" of vice.

Aside from the loss of 400,000 jobs, the cost of the anti-vice plan is estimated to amount to $1 billion in lost tax revenue. Because the plan seemed so far-fetched when it was first proposed, many failed to plan appropriately and are now facing tough choices.

All of this comes at a time when the Russian government is seeking to add stability to the country's economy. Late last week, word had surfaced that the nation was in talks to put together a bank bailout rivaling that of the United States.

Igor Shuvalov, the deputy prime minister of Russia has considered taking a stake in the nation's biggest banks to recapitalize the problematic system and protect it from nonperforming loans that currently make up a large portion of its balance sheet. Moody's(MCO - commentary - Trade Now) andStandard & Poor's warn that it could cost the nation as much as $40 billion this year to get the banks running again. If the proposed bailout does go according to plan, however, the government predicts that banks will be able to lend again in 2010.

Russia's government has taken some serious steps in the past few weeks to get its economy moving. However, investors may want to be careful jumping in as the government's decision may cause trouble for the country's markets. RSX may see bright times in its future, but investors should be prepared for some uncertain moments if they try to cash in.

Meanwhile, even if the Russian casinos are gone, that doesn't mean the country is vice-free. Smoking and alcohol consumption is still as present as ever in the nation. Investors looking for a taste of these and other guilty pleasures can look no further than the aptly named Vice Fund (VICEX - commentary - Trade Now) to add a little sin to their portfolio.