The Collapse of the Ruble?

[Lanurascielo]

I really hope Russia doesn't start lashing out because of this.

[The Seleucids (Ancient)]

Compared to Somalia? All of them.

That's hardly a reasonable comparison and you know it.

It was the comparison that was made, did you even read the post i replied to?
Aside from that, you obviously did not even read my post. It says "Russia is pretty good at", it doesn't say that those countries are doing pretty good which you blindly assume. There's a difference between the two you know.

[Novorobo]

Hoo boy, this one is gonna be rough.



Siggity Source

This one is gonna hurt people. We're looking at a 1998 style tumble of the ruble, maybe worse. The Russian economy may not be far behind.

Thoughts oh ye armchair economists of NSG? Is the ruble doomed? Will it recover? What's going to happen to the Russian economy?

Me? I'm a little scared. Putin has acted out when the economy has taken a hit before, and with him already taking a big old bite of the Ukraine I'm concerned that a serious hit to the Russian economy might end up with some seriously unforeseen consequences.

I am a little concerned for the vulnerable, like the poor and disabled. But thats the Price you pay for acting like a dog pissing on other dogs territory.

Perhaps we could offer them a free trip to Scandanavia?

[Vetalia]

Russia's got a pretty massive foreign exchange reserve, so it will likely be able to stabilize the ruble and recover from this situation without much long-term damage especially given China's interests in preserving a stable SCO and bilateral trade with Russia. That being said, it's also a major wake-up call to Russia; they can't sustain a superpower's military capabilities with what amounts to a developing-world economic model based upon export of raw materials so they will be forced to pursue structural economic reforms to reduce dependence on fossil fuel exports and increase income from other sectors.

However, it also depends on how long oil prices remain at these low levels; it's certainly possible it may be the case for a while but this also costs other oil producers quite a bit as well, especially OPEC countries that narrowly avoided major social unrest during the last oil price collapse such as Saudi Arabia or Bahrain. And, of course, US shale oil is not sustainable at these prices; fortunately the infrastructure is in place so any short-term industry collapse can revive after prices rebound but it will cause harm to the producers many of whom are very leveraged and need to generate cash flow from higher oil prices.

[The Serbian Empire]

The Ruble is just a b away from rubble. If Putin continues his aggression that is also what the Russian economy will be.

[Baltenstein]

Russia's got a pretty massive foreign exchange reserve, so it will likely be able to stabilize the ruble and recover from this situation without much long-term damage especially given China's interests in preserving a stable SCO and bilateral trade with Russia. That being said, it's also a major wake-up call to Russia; they can't sustain a superpower's military capabilities with what amounts to a developing-world economic model based upon export of raw materials so they will be forced to pursue structural economic reforms to reduce dependence on fossil fuel exports and increase income from other sectors.

Putin himself has been saying the same thing about Russia's economy for almost 15 years now. Little has been done to change it.

[Vetalia]

Putin himself has been saying the same thing about Russia's economy for almost 15 years now. Little has been done to change it.

Probably because Russia's been affected by a variant of Dutch disease; their exports of oil and gas overvalued the currency and made it more difficult for manufacturers and other industries to compete globally. Not to mention it's a lot harder to instigate reform when things have been going well, especially compared to the disastrous 1990s and this is the first time that Russia's gotten involved in an international crisis that provoked a real, serious response from their rivals.

Realistically, Russia hasn't been a major international competitor outside of raw materials exports in most major industries since the early 1970's.

[Baltenstein]

Putin himself has been saying the same thing about Russia's economy for almost 15 years now. Little has been done to change it.

Probably because Russia's been affected by a variant of Dutch disease; their exports of oil and gas overvalued the currency and made it more difficult for manufacturers and other industries to compete globally. Not to mention it's a lot harder to instigate reform when things have been going well, especially compared to the disastrous 1990s and this is the first time that Russia's gotten involved in an international crisis that provoked a real, serious response from their rivals.

Realistically, Russia hasn't been a major international competitor outside of raw materials exports in most major industries since the early 1970's.

You'd think they would try to do something about this and fix it before trying to go full independent superpower in open rivalry to the West, but nope.

[The balkens]

Probably because Russia's been affected by a variant of Dutch disease; their exports of oil and gas overvalued the currency and made it more difficult for manufacturers and other industries to compete globally. Not to mention it's a lot harder to instigate reform when things have been going well, especially compared to the disastrous 1990s and this is the first time that Russia's gotten involved in an international crisis that provoked a real, serious response from their rivals.

Realistically, Russia hasn't been a major international competitor outside of raw materials exports in most major industries since the early 1970's.

You'd think they would try to do something about this and fix it before trying to go full independent superpower in open rivalry to the West, but nope.

But muh Language rights outside of russia.

[Rio Cana]

Someone wrote about the Russian currency when it was going down a few months ago.

Read this from Oct. 2014 - http://wolfstreet.com/2014/10/28/beyond ... rency-war/

[Vetalia]

You'd think they would try to do something about this and fix it before trying to go full independent superpower in open rivalry to the West, but nope.

It all depends on how it ultimately shakes out...Russia had an opportunity and took the chance. This might actually be the perfect window for reform; Putin is extremely popular in Russia and he now has a very real threat to bolster domestic support for any reform policies he wants to implement.

[Nordinia]

Putin is a competent leader. I'm sure he'd get the people through this.
And, if not... then he should go down with grace. Total war to take back lost lands of the former Russian Empire, or die trying. Literally die trying, that is. The difference between being a US puppet or being devided isn't really too big. Expansion might be a sollution if the Ruble cannot climb back.

[The balkens]

Putin is a competent leader. I'm sure he'd get the people through this.
And, if not... then he should go down with grace. Total war to take back lost lands of the former Russian Empire, or die trying. Literally die trying, that is. The difference between being a US puppet or being devided isn't really too big. Expansion might be a sollution if the Ruble cannot climb back.

Reminds me of a wannabe Bavarian Corporal.

[Arkolon]

u wot

Saudi Arabia = many oil

Saudi arabia wants to win the 'Oil Economic War' from Russia and all those other countries

--> lets price decline enormously

No, it doesn't want to win anything from OPEC members. It just wants to stay market leader by pumping out more barrels per day instead of doing the OPEC thing of restricting petrol supply. Saudi Arabia didn't want to let the prices decrease enormously directly: it wanted to increase production enormously, which caused prices to fall. The "war" very much is a shale v sheiks war, not Saudi Arabia v OPEC.

[Baltenstein]

Belarus announces that it doesn't want rubles anymore in its bilateral trade with Russia, demands euros and/or US dollar instead:

Belarusian President Alyaksandr Lukashenka has ordered his government to switch to U.S. dollars and euros in trading with Russia.

Lukashenka said at the Cabinet's session in Minsk on December 18 that "a task has been defined, which is to switch to dollars in trade with Russia, the way we pay for energy."

Lukashenka added that Belarus should have already demanded all payments from Russia in dollars and euros only.

Lukashenka’s statement comes amid a sharp decline in gthe exchange rate of the Russian ruble in recent weeks and less than two weeks before the Eurasian Economic Union, linking Russia, Belarus, and Kazakhstan, is scheduled to start functioning.

The ruble's fall has strained Russia's ties with its ex-Soviet neighbors.

Russia and Belarus have been at odds since late November, after Russia banned imports of meat and milk from Belarus, claiming it found traces of harmful substances. Minsk has also refused to follow Moscow's lead in introducing bans on food products from the European Union.

http://www.rferl.org/content/belarus-ru ... 50288.html

Of course this only proves that Belarus is a Russophobic Fascist Western puppet and that it's time for some local self-defense forces with weapons from the corner store in the streets of Minsk.

Still, not the best way to start the Eurasian Union in January 2015. All in all, it has been one hell of a bad year for Putin.

[The balkens]

Belarus announces that it doesn't want rubles anymore in its bilateral trade with Russia, demands euros and/or US dollar instead:

Belarusian President Alyaksandr Lukashenka has ordered his government to switch to U.S. dollars and euros in trading with Russia.

Lukashenka said at the Cabinet's session in Minsk on December 18 that "a task has been defined, which is to switch to dollars in trade with Russia, the way we pay for energy."

Lukashenka added that Belarus should have already demanded all payments from Russia in dollars and euros only.

Lukashenka’s statement comes amid a sharp decline in gthe exchange rate of the Russian ruble in recent weeks and less than two weeks before the Eurasian Economic Union, linking Russia, Belarus, and Kazakhstan, is scheduled to start functioning.

The ruble's fall has strained Russia's ties with its ex-Soviet neighbors.

Russia and Belarus have been at odds since late November, after Russia banned imports of meat and milk from Belarus, claiming it found traces of harmful substances. Minsk has also refused to follow Moscow's lead in introducing bans on food products from the European Union.

http://www.rferl.org/content/belarus-ru ... 50288.html

Of course this only proves that Belarus is a Russophobic Fascist Western puppet and that it's time for some local self-defense forces with weapons from the corner store in the streets of Minsk.

Still, not the best way to start the Eurasian Union in January 2015. All in all, it has been one
hell of a bad year for Putin.

This is fantastic news.

[Sebastianbourg]

The Ruble is just a b away from rubble. If Putin continues his aggression that is also what the Russian economy will be.

Crimea and Ukraine have very little to do with this; Saudi Arabia and OPEC are the ones behind this.

[The Serbian Empire]

The Ruble is just a b away from rubble. If Putin continues his aggression that is also what the Russian economy will be.

Crimea and Ukraine have very little to do with this; Saudi Arabia and OPEC are the ones behind this.

The Saudis have a reason to take Russia out and that is being a US ally who also doesn't want Russia getting too involved in Syria.

[Sebastianbourg]

Crimea and Ukraine have very little to do with this; Saudi Arabia and OPEC are the ones behind this.

The Saudis have a reason to take Russia out and that is being a US ally who also doesn't want Russia getting too involved in Syria.

Even then, Russia is a secondary cause; the Saudis are facing competition from an enhanced energy sector in North America and quite understandably they aren't pleased at all.

[Valaran]

The Saudis have a reason to take Russia out and that is being a US ally who also doesn't want Russia getting too involved in Syria.

Even then, Russia is a secondary cause; the Saudis are facing competition from an enhanced energy sector in North America and quite understandably they aren't pleased at all.

They basically jsut saw it being able to do several things with one move. (two birds one stone)

Also, Western Sanctions did have an impact; Putin in his annual address put it at 20-30% of the decline was due to them.

[Korva]

Belarus announces that it doesn't want rubles anymore in its bilateral trade with Russia, demands euros and/or US dollar instead:

Belarusian President Alyaksandr Lukashenka has ordered his government to switch to U.S. dollars and euros in trading with Russia.

Lukashenka said at the Cabinet's session in Minsk on December 18 that "a task has been defined, which is to switch to dollars in trade with Russia, the way we pay for energy."

Lukashenka added that Belarus should have already demanded all payments from Russia in dollars and euros only.

Lukashenka’s statement comes amid a sharp decline in gthe exchange rate of the Russian ruble in recent weeks and less than two weeks before the Eurasian Economic Union, linking Russia, Belarus, and Kazakhstan, is scheduled to start functioning.

The ruble's fall has strained Russia's ties with its ex-Soviet neighbors.

Russia and Belarus have been at odds since late November, after Russia banned imports of meat and milk from Belarus, claiming it found traces of harmful substances. Minsk has also refused to follow Moscow's lead in introducing bans on food products from the European Union.

http://www.rferl.org/content/belarus-ru ... 50288.html

Of course this only proves that Belarus is a Russophobic Fascist Western puppet and that it's time for some local self-defense forces with weapons from the corner store in the streets of Minsk.

Still, not the best way to start the Eurasian Union in January 2015. All in all, it has been one hell of a bad year for Putin.

My sides can't handle this anymore.

[Herargon]

Belarus announces that it doesn't want rubles anymore in its bilateral trade with Russia, demands euros and/or US dollar instead:



http://www.rferl.org/content/belarus-ru ... 50288.html

Of course this only proves that Belarus is a Russophobic Fascist Western puppet and that it's time for some local self-defense forces with weapons from the corner store in the streets of Minsk.

Still, not the best way to start the Eurasian Union in January 2015. All in all, it has been one hell of a bad year for Putin.

My sides can't handle this anymore.

Then you may need to handle it. Everyone has to do that at some moment in his, her or shis life.

[Galloism]

Thus, your original post was wrong. "Total yearly income", to any reasonable person, is gross income before expenses and offsets.

This figure, for the federal government, is about 2.77 trillion dollars.


Hence my statement: your complaint is either totally and hideously wrong, or an absolute truism which no one should be excited about.

I pay out more in interest in a year than the US government's net income. So the fuck what?

Look, There are 2 kinds of numbers: (actually, There are many kinds of numbers, but all rational and irrational numbers can be categorized into these, except for 0)
Positive.
Negative.

When your "Net Income" is positive, you make profits.
When your "Net income" is negate, you lose money or aquire debt.

The US has a huge Negative net income, or a huge loss, Each year ranging from Trillions Hundreds of billions. Now, when we talk about a big negative number, It means that its absolute value is big, not its relative value, which should be clear to any reasonable person.

It is true that somali pirates have more net income then that, in fact the US government has the lowest net income on the planet. It needs Shiploads of money every year to stay afloat and to pay off interests... Its pretty clear that rates will rise soon for the US as people stop buying US bonds and using the dollar, which is already happening. Oil trade is increasingly done using Chinese, Russian and EU currency + the Fed is printing money like there is no tomorrow. If it wasn't for china and Japan buying US bonds, Us interest rates would skyrocket while the dollar collapses due to the massive trade deficit that built up in the last decade (along with the reckless money printing).
More:
Even Though I hate this site

Basically, The US Imports a lot of things and exports little. It pays for the imported stuff with dollars, which are then traded on the financial markets for other currencies and somehow end up in the hands of investors who then buy Treasury bonds. If the cycle breaks, the value of dollar deflates and Interest rates must go higher to get new investors to buy the bonds.

You've gone wide of the mark, and bizarrely tried to explain how profits and losses work to an accountant. My beef is with your original claim: the interest accrued during the year was "greater than" the amount you described as the "total yearly income" of the United States.

If you are referring to gross, you were hideously wrong. I already showed this. It's also the most reasonable interpretation of the claim you made.

If you are referring to net, I could say that regarding literally any government expenditure, as the net income of the fed is negative. "Soldier, that screwdriver cost more than the total yearly income of the United States government!" "Congressman, that piece of paper you're writing a memo on costs more than the total yearly income of the United States government!" "You bought an electric pencil sharpener? That costs more than our total yearly income!"

Do you see the point yet?

[Baltenstein]

As a sidenote, out of poor adventurism, I changed 100 € into some 8000 Rubles today. I'll wait and see if the Ruble manages to recover over the next two years and I'll be able to make a profit out of my investment.

So Vladimir Vladimirovich, I did my part to support the Ruble and save Russia from evil Fascists. Now you better deliver, or else, I'm holding you personally responsible!

[United Marxist Nations]

As a sidenote, out of poor adventurism, I changed 100 € into some 8000 Rubles today. I'll wait and see if the Ruble manages to recover over the next two years and I'll be able to make a profit out of my investment.

So Vladimir Vladimirovich, you better deliver, or else, I'm holding you personally responsible!

Cue Zyuganov overthrowing the Russian Federation and setting up a command economy, thereby making your investment completely useless.