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Despite Surprise Rate-Hike, Russian Ruble Crashes Most In 6 Years

Tyler Durden's picture




 

Yesterday's record-breaking surge in the Ruble appears, as we warned, to have been front-running today's rate-hike announcement... and despite its surprise size, it is disappointing the market. The 5%-plus swing higher in the Ruble yesterday has been notably retraced as the Russian currency plunges (biggest drop in almost 6 years) after the central bank hiked rates 150bps (expectations were broadly of a 50bps hike) but it appears the 'whisper' number was a 200bps hike and a shift in FX policy to more active intervention. The inituial rip rally instantly faded and despite low liquidity due to Russian holidays, USDRUB is back over 43 - which would be a new record low close if it holds.

Russian Central Bank disappointed...

  • *RUSSIAN CENTRAL BANK RAISES KEY RATE TO 9.50% (up from 8%) 
  • *BANK OF RUSSIA DOESN'T ANNOUNCE CHANGES TO FX POLICY
  • *BANK OF RUSSIA SEES SIGNS FOR SLOWING INFLATION IN MID-TERM
  • *BANK OF RUSSIA READY TO EASE IF EXTERNAL CONDITIONS IMPROVE

22 of 31 economists in Bloomberg survey forecast 50bps increase; 2 predicted move to 9%; increases of 25bps and 75bps forecast by 1 each; 5 economists projected no change

The reaction:

  • *RUBLE EXTENDS DECLINES, WEAKENS 2.9% VS BASKET

 

Biggest plunge in almost 6 years

 

Analysts react:

  • *RUSSIAN RATE RISE WON'T `SIGNIFICANTLY' SUPPORT RUBLE: NORDEA
  • *RUBLE WEAKNESS IS `BEYOND SPHERE OF MONETARY POLICY': NORDEA
  • *RBS: RATE RISE WON'T ELIMINATE FX SHORTAGE BEHIND RUBLE DROP

The weakness has prompted furtherremarks from the central bank:

  • *BANK OF RUSSIA CONDUCTS INTERVENTIONS IN LINE WITH FX POLICY
  • *BANK OF RUSSIA INTERVENES ONLY AT EDGE OF RUB FLOATING CORRIDOR
  • *BANK OF RUSSIA: TIGHTENING HASN'T YET OFFSET IMPACT OF WEAK RUB
 

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Fri, 10/31/2014 - 08:52 | 5397770 observer007
observer007's picture

Explostion at "Radio France" in Paris

 

Police have set up a security perimeter around the Radio France headquarters in Paris as authorities respond to fire - @radiofrance

Heavy smoke comes out of Radio France building in Paris as authorities respond to blaze -

Building burns

latest:

http://tersee.com/#!q=radio+france&t=text

Fri, 10/31/2014 - 08:58 | 5397816 SoilMyselfRotten
SoilMyselfRotten's picture

Did a burning snow plow crash into it?

Fri, 10/31/2014 - 09:07 | 5397844 Xibalba
Xibalba's picture

It's called warfare, bitchez

Fri, 10/31/2014 - 08:59 | 5397820 firstdivision
firstdivision's picture

No explosion, just a fire. 

Fri, 10/31/2014 - 09:21 | 5397853 ZH Snob
ZH Snob's picture

it will continue to hurt russia to try to live in a fiat-based economy while trying to move over to one founded on sound money.  they seem totally dependent on china for this move, and that brings up another question.  just how close are russia and china and their economic plans?  we all know about the BRICS, but we also know the centuries of hostilities between the two. 

does china have a behind the scenes kill date they share with russia, or is is all a vague plan for someday in the future?  from all appearances it would seem they are letting the current system follow its inevitable demise while they keep up a program of collecting, mining, building, drilling and buying.  all their actions speak loudly for valuing real assets in anticipation of the worldwide paper blizzard that they know will bury the world.

 

 

 

 

Fri, 10/31/2014 - 09:32 | 5397976 LawsofPhysics
LawsofPhysics's picture

The answer may be in Singapore.  Minimal trade with the East (pecans walnuts) so I am no expert.  South america is a mess, so the "B" in BRIICS is having it's own problems.  That's all I can say.

Fri, 10/31/2014 - 11:17 | 5398430 RaceToTheBottom
RaceToTheBottom's picture

Is anyone buying the Ruble?

Any players yet?

Fri, 10/31/2014 - 09:15 | 5397872 youngman
youngman's picture

I would give that song a 85..good beat and easy to dance to..and here is 5 gallons of gas to get the party started...

Fri, 10/31/2014 - 08:54 | 5397787 SickDollar
SickDollar's picture

The Tribe is trying everything to hurt the Bear

Fri, 10/31/2014 - 08:57 | 5397808 El Hosel
El Hosel's picture

The US is manufactoring Deflation, sending it Overnight Express to Vladi.

Fri, 10/31/2014 - 08:58 | 5397811 LawsofPhysics
LawsofPhysics's picture

Yes, from our perspective the ruble is "crashing".  Now the question is, what currency do the majority of the people in the world use for everyday purchases?  That's all that matters.

Fri, 10/31/2014 - 08:58 | 5397812 eddiebe
eddiebe's picture

Currency wars are heating up. Keep fucking around boys and the nukes will fly.

Fri, 10/31/2014 - 09:00 | 5397822 ZoroAustrian
ZoroAustrian's picture

It's got nothing to do with Russian rates. This is a full frontal faith attack for Anglo Saxon finance today. Kill commodities, surge ponzi equities and turn the screws on anyone not playing along.
Total war bitchez

Fri, 10/31/2014 - 09:01 | 5397830 kowalli
kowalli's picture

all worlds finance rigged by banksters.

Fri, 10/31/2014 - 09:05 | 5397837 LawsofPhysics
LawsofPhysics's picture

Yep.  Central banks control currencies, period.  It's what they do. Central banks in the west are pushing those currencies to their limits.  Start paying attention people, timing is everything now.  Eventually this sailboat is going to have to come about.

Fri, 10/31/2014 - 10:49 | 5398325 Gazooks
Gazooks's picture

hold fast

Fri, 10/31/2014 - 12:36 | 5398717 Bankster Kibble
Bankster Kibble's picture

and duck

Fri, 10/31/2014 - 10:03 | 5398117 Kirk2NCC1701
Kirk2NCC1701's picture

How do you say "Wollt ihr den totalen Krieg?" in Hebrew or Kenyan?

Fri, 10/31/2014 - 09:08 | 5397848 JustObserving
JustObserving's picture

Look at gold and silver crash with increased QE.  Everything is manipulated.  If the US can illegally collect over 100 billion pieces of intelligence a month, how difficult is to manipulate a few financial markets?

'We're an empire and when we act, we create our own reality'  Karl Rove

This new reality does not have to be consistent with economic theory or common sense.

Fri, 10/31/2014 - 09:10 | 5397857 LawsofPhysics
LawsofPhysics's picture

"This new reality does not have to be consistent with economic theory or common sense."  ---  Well, might makes right is certainly nothing new, neither are the eventual outcomes.

Fri, 10/31/2014 - 10:19 | 5398187 Kirk2NCC1701
Kirk2NCC1701's picture

One eventual outcome is that Russia will HAVE to sell its hydrocarbons for Rubles or Gold.

This is piece meal WW3, boys.

Fri, 10/31/2014 - 09:10 | 5397852 headhunt
headhunt's picture

Putin for all his machismo makes the critical mistake that there are other types of wars other than physical wars. Russia is a big military bear but a relative weakling in the financial arena.

He said 'F' you' to Europe and USA and they have responded; 'F' me?! - No - F' you!'

Fri, 10/31/2014 - 09:18 | 5397891 LawsofPhysics
LawsofPhysics's picture

Perhaps, but they still control vast amounts of real resources.  With 7+ billion people (and growing) all competing for the real resources (especially energy) required for a better standard of living things will get very interesting.

The problem for America is when you are on top (and I for one know the power of real american innovation, when capital is properly deployed), is that you are on everyone's hit list.  Well that and massive fraud and and an average sheeple that is a complete fucking idiot (see detroit/fergurson).

Fri, 10/31/2014 - 09:50 | 5398053 SteveNYC
SteveNYC's picture

A recent experience in the Land Down Under: iron ore dropping like a stone, yet AUD$ holding up (dropping, yes - but relatively slowly in comparison to iron ore drop). All the news was screaming that if the AUD$ could drop just a bit further, it would offset the iron ore price drop and all will be well.

We had a similar experience here in the USA: smacking the dollar like a bitch for years to improve the manufacturing/export base, cheapen exports to make them more competitive etc.

So, Russia is a significant net exporter and a major exporter of hydrocarbons. Hydrocarbon prices are dropping, the RUB is dropping just as fast.

Is it really that big a problem for Russia?

Fri, 10/31/2014 - 09:57 | 5398095 headhunt
headhunt's picture

Yes - Mother Russia depends on high oil (like the Oil Cartels) for cash-flow. Weak Ruble good for manufacturing exports but bad for oil exports.

Fri, 10/31/2014 - 11:02 | 5398292 SteveNYC
SteveNYC's picture

I get your point but the math doesn't support it, see:

Oil @ USD100 // USDRUB @ 30 = 3,000 RUB

Oil @ USD80 // USDRUB @ 42 = 3,360 RUB

 

More money to spend at home, but less abroad? As a net exporter, a bad thing? Serious question.....

Fri, 10/31/2014 - 14:46 | 5399293 headhunt
headhunt's picture

More printed currency but worth less

Fri, 10/31/2014 - 10:01 | 5398110 headhunt
headhunt's picture

Yes, future is bright for Russia if they do not let communism F' it all up for them but that does not help pay the bills now. Everyone wants paid - now.

 

Sat, 11/01/2014 - 11:50 | 5401552 Miketheterrible
Miketheterrible's picture

Wage's haven't changed.  They are still the same from last year and everyone is getting paid (A lower valued currency to USD does not mean that they cannot pay their own people or even people abroad).  Issue now is that because of what CBR did, Russian's are not gonna get their own loans and instead are now relying on China for long term, low interest rate loans.  While Ruble isn't the only currency dropping (yen dropped, Rupee semi dropped (very low compared to its value a decade ago), etc), none of these countries increased Interest rates at the rate that CBR did.  While Putin stated he will not rescue the Ruble, it appears that CBR is trying to do whatever they can (want) to fix it.  But the sad thing is, is that CBR has been doing the same method for years of trying to fight both inflation and devaluation of the ruble, with absolutely no success.  The definition of insanity is doing the same thing over and over again, and expecting something else to happen.  Ruble value being low is not the problem, it actually has done wonders for certain Russian companies (not oil and gas though).  Problem now is that the biggest issue Russia ever faced for businesses is the lack of long term low interest rate loans, and what CBR is doing is going against what they wanted to do (give long term low interest rate loans).  Since loans from west are no go now, all new loans are coming from China.

Here is something interesting: http://www.finmarket.ru/main/article/3851515

For those who cannot read Russian, it pretty much boils down that there is talk to bring QE to Russia, and have long term loans at 0% interest rates.  I dunno if this will work as I hear that it has quite a few cons with US.  But if that is what they have to do, then so be it.  Since majority of Russian consumer products come from China, and they have now agreed on a Ruble to Renmimbi transactions, the Renmimbi is worth 7 to 1.  So  not nearly as a major issue for Russian citizens as most of their junk comes from China.  But for future, it is going to be very difficult for them to afford european and US goods (Well, majority of US/EU goods is food, with Germany and US selling industrial goods like automotives).

As Ruble has not dropped nearly that of the Rupee, it sure seems like it is headed that direction.  CBR is technically not controlled by the Russian government as it is private.  But as much as people here call Putin a dictator, he has no power to get rid of the people in CB unless he had popular support over it.

 

Only options I have heard from others, that make sense, to bring Ruble value up, is to force trade of oil, gas and metals (major exporter to west), in Rubles.  But they are refraining from that for whatever reason.  Instead, it is direct sales between each others currencies (so for china, it will be Yuans coming in).  I don't know what they are doing, but these moniterists are the same as Kurdin was in his time, and his way of handling the economy was: "Trade and sit on the cash under a matress" (not literally, but pretty much a simili). 

Fri, 10/31/2014 - 09:22 | 5397904 LULZBank
LULZBank's picture

Chessplayers n all.

(opens in new window)

Fri, 10/31/2014 - 09:17 | 5397880 SoDamnMad
SoDamnMad's picture

Russian TV channel HTB just reporting it at 41.96/ Of course it does not say how many billion were shoveled it (perhaps all the Ukrainian pre-pay from the EU and IMF).

Fri, 10/31/2014 - 09:17 | 5397886 e_u_r_o
e_u_r_o's picture

time to buy ruble?

Fri, 10/31/2014 - 09:22 | 5397906 FreeShitter
FreeShitter's picture

Time to buy PM's. Fuck the ruble

Fri, 10/31/2014 - 09:20 | 5397896 venturen
venturen's picture

Putin doesn't get it! He needs to set the interest rate to -1% then his currency will be on fire....as the new postive is negative. The lower your interest the more wall street wants it!  The new green is RED!

Fri, 10/31/2014 - 09:21 | 5397900 juggalo1
juggalo1's picture

You guys at ZH must be so furious right now.  Rates for Russian bonds are screaming higher.  Inflation and shortages in Russia growing.  US and Japan at record market highs.  Rates at all time lows.  Manipulation or not, how can you tell who is winning the economic warfare?  Is this really what you think Putin envisioned victory would look like?

Fri, 10/31/2014 - 09:27 | 5397923 SheepDog-One
SheepDog-One's picture

Before you preen away all your plumage to nubs, remember Russia thought nothing of 50 million dead in WW1-2.

Fri, 10/31/2014 - 10:13 | 5398160 headhunt
headhunt's picture

"Russia thought nothing of 50 million dead in WW1-2."

Not so - they had no choice they were backed into a corner and their only way out was forward.

All die or many die - the decision is easy.

Fri, 10/31/2014 - 10:20 | 5398189 Volkodav
Volkodav's picture

Stupid inane post.

Soviet was never a Russian construct

From 1917 thru Stalin was never Russians in control

Stalin was not a Russian.

Even Kruschev and Breznev were Ukrainian

And Gorby half Ukrainian

 

 

Fri, 10/31/2014 - 10:56 | 5398359 Gazooks
Gazooks's picture

all run from London

Fri, 10/31/2014 - 12:33 | 5398671 tarabel
tarabel's picture

 

 

So what you are saying is that Russians are too stupid to govern themselves and need experts from the outside?

Fri, 10/31/2014 - 14:18 | 5399164 petkovplamen
petkovplamen's picture

Well, the USA is run by a black community orginizser from Kenia right now so...

Fri, 10/31/2014 - 17:28 | 5399798 Volkodav
Volkodav's picture

No those are your words, goat...

 

Sat, 11/01/2014 - 12:00 | 5401569 Miketheterrible
Miketheterrible's picture

People are forgetting that majority of the economic policies still in place are from the 90's with the exception of the mineral tax.  CBR was privatized in the 90's and the rest of the country holds hostage economically to their policies.  They have been doing the same thing for over a decade, increase interest rates to try to fix the value of the Ruble and Inflation, and all those times, they have failed miserably.  Now they tried it again, at even more extreme rates.  But problem is, it failed again.  What they are doing is insane and it has to come to an end.  They need to either come up with a way of fixing the Ruble to something (like all future sales are done in Rubles, or its Gold reserves are tied to the Ruble, or all metals, oil, gas, etc...).  But instead, they want to free float, but then they are tyring to save it.....  What CB is doing is everything against what they want to do.  If the Ruble falls to that of the Rupee, so be it.  But increasing interest rates and hoping for a different outcome (compared to all previous attempts), is just ridiculous.

Russia may be a military power, but till they can sort this mess regarding interest rates and loans, they will be at the whim of the west and China.

Here is a kicker where people in Russia should be revolting against CB and getting those in charge there under a noose: CB owns over 50% of Sberbank, largest bank of Russia in terms of Forex (over $400B).  Technically, under the old laws, CB is not supposed to have control or stake in any bank, and only makes the policies regarding rules/regulations of banks.  But since the beginning of this year, they have canned a large number of banks (over a dozen) but Sberbank is untouched even though they been moving a lot of money out of the country.

Fri, 10/31/2014 - 15:12 | 5399405 TweedleDeeDooDah
TweedleDeeDooDah's picture

Yeah.... back when their country was actually growing, not in today's time of a declining population, which leads to immigration into Russia, and that's something they absolutely HATE.... whether it's Ukrainians, Moldavans, Kazakhs, or the dreaded Chinese.

They also had a lot of subhumans (to them) from central asia, mongolia, present-day 'stans, nd the Caucasus to throw under tanks then, too.

It's easy to see by their reaction what exactly the Nashis feel.

Fri, 10/31/2014 - 09:28 | 5397933 LawsofPhysics
LawsofPhysics's picture

"Inflation and shortages in Russia growing. "   --  Not for any of the Russians I know.  Most abandoned the Ruble in 1990.  Do tell, provide some data.  Anyone can pull shit out their ass.

Fri, 10/31/2014 - 09:57 | 5398057 my_nym
my_nym's picture

I thought that many learned to grow their own food and become more self-sufficient after seeing what could happen under the rule of Jewish Bolsheviks.

I could be wrong.

Many Russians to be saying of the centralized forms of power that seem to draw in secular versions of members of the messianic Tribe that fancy themselves as fit to rule the goyim, "America, we just learned that lesson.  What are you doing?"  Or they think that they learned that lesson.  Their cultural leaders like Solytzein or whatever his name was could hardly criticize the Jews for their leading role in Communism.  But if a Jew stubbed his toe thousands of years ago, that must mean that the goyim are about to blow his entire nation up.  Everything is an existential threat, etc.   

I could be wrong about Russians rejecting their old culture and the way it was cultivated by Jews.  Culture is a tricky thing... so we come to the Frankenstein Monster of Victoria Nuland/Nudelman working with the neoNazis in the Ukraine, etc.  Not that the original Nazis had any problem working with Zionists either.   

I don't know.  People are dumb and...   Culture > Physical Reality in their minds.  So when they all jump off a cliff together, they may never even realize anything.  There could be whole fields of headstones and graves left as monuments to the stupidity of jumping off a cliff and many still wouldn't realize anything.  Indeed, they'd probably cultivate a culture of celebrating it.  Real. Dumb.

 

Killed by stupidity. 

Fri, 10/31/2014 - 12:09 | 5398638 Titus
Titus's picture

But if a Jew stubbed his toe thousands of years ago, that must mean that the goyim are about to blow his entire nation up.

This cannot be taken literally enough.

Sat, 11/01/2014 - 11:57 | 5401575 Miketheterrible
Miketheterrible's picture

http://naturalhomes.org/naturalliving/russian-dacha.htm

 

Dacha gardeners feeding 40% of russian nations food.

Fri, 10/31/2014 - 09:45 | 5398028 my_nym
my_nym's picture

Invest in freedumb and lies for the "Win."  Mission Accomplished.  Etc.

It's not right.  But it's the way people are in general, something that the Tribe seems to have generally realized collectively a long, long time ago. 

 

The internet may be an interesting wrinkle just like the ideas and inventions of the Founders that it has some good synergy with, though.  A bankster once said, "Not one man in million will figure out this scam."  And who are they going to tell, the "media"???   But what if it only takes one in a million or a few in millions and they can tell the entire world?  So I'm not sure that you're correct.  The world or the goyim/tribes from a Jewish perspective are already "waking up" to the nature of globalism more and more, seems to me.  But it's like watching an American election where people at the base of each political party may almost want to criticize the Tribe.  "You first... no, you first..."  Because they all jockey for position against each other within their own "parties"/tribes and races. 

So then the question is, how bad will they let their servility and domination by the Tribe (the so-called "1%" at Goldman Sachs, etc.) get because they want to "win an election" or jockey for position against other goyim while making more false profits for themselves and their political party/tribe financed by the Tribe?  The apparent answer?  They'll let it get pretty God damned bad.  Seriously.  But with the whole, "You first... no, you first..." thing. Well, apparently Russia is going, there are thousands of people behind Putin ("another Hitler).  Generals, intellectuals, chess players, the Orthodox Church, the hundreds that signed on to a letter condemning Jewish hatred, Jewish tribalism and Jewish incitment ("hate speech") that became thousands of leaders that signed a petition.  Etc.  It seems unlikely that they signed on because they thought it would actually work.  They probably signed on to point out the hypocrisy of the Tribe incessantly trying to organize to police the goyim based on "political correctness" while failing to deal in an organized way with their own tribalism, hate speech, incitement and racism first.  

Logs and specks.  As someone once put it.    

Fri, 10/31/2014 - 11:24 | 5398461 RaceToTheBottom
RaceToTheBottom's picture

All this does is force Putin to move faster to a PM based and backed economy.

Unintended consequences and all that....

 

Fri, 10/31/2014 - 12:32 | 5398664 tarabel
tarabel's picture

Kleptocrats love gold-- for them.

And they love fiat money-- for you.

Why on earth would they want to give you gold when you are willing to accept paper instead?

Do you think they are actually idealists out for the betterment of mankind?

Fri, 10/31/2014 - 17:41 | 5399839 RaceToTheBottom
RaceToTheBottom's picture

Not too sure of the balance of payments, but they sell oil and natural resources, right?  Why not for gold, to assist in their goal of increasing their gold amounts?

 

Fri, 10/31/2014 - 09:21 | 5397901 Bill of Rights
Bill of Rights's picture

Personal consumption expenditures (PCE) decreased $19.0 billion, or 0.2 percent

 

( Crickets chirping )

Fri, 10/31/2014 - 09:27 | 5397931 Schmuck Raker
Schmuck Raker's picture

Japan is trying to save itself by weakening the Yen.

Western CBs are attacking Russia by weakening the Ruble.

Bizzaro world, or what?

Fri, 10/31/2014 - 09:44 | 5398021 FreeShitter
FreeShitter's picture

BRICS vs NWO.....

Fri, 10/31/2014 - 09:37 | 5397991 Debugas
Debugas's picture

russia should lower rates in order to stimulate local production (in the view of sanctions they need local producers to step in)

instead they hike the rates WTF they are thinking? Being afraid of bankrupties of overleveraged banks and companies ?

Fri, 10/31/2014 - 10:04 | 5398130 headhunt
headhunt's picture

Weak currency demands higher rates.

No one will buy your bonds if you do not raise rates.

Cash flow, cash flow, cash flow.

 

Fri, 10/31/2014 - 09:55 | 5398087 americhinaman
americhinaman's picture

this move was clearly designed with the middle-class and wealthy russian in mind, i.e. the ones with some spare cash savings.  the message is the following.  if you repatriate any USD or forex you have, you can make ~9.5% (less bank costs) in a demand deposit account, compared to <0.25% in USD or EUR accounts.  similarly, if you have been tempted to convert RUB into USD because of the recent forex trend, now the interest you earn on bank deposits will roughly pay for the level of inflation.  in other words, real deposit rates in RUB are now close to 0, whereas real deposit rates in USD are still negative (relative to US CPI).  the decision is still yours: choose what you want.

they didn't change the intervention rules because they are happy for anyone who wants RUB to get a better price.  obviously they are not like the BOJ, which is trying to maximize market impact with policy/jawboning before their own folks (pension) can buy.  if the BOJ had say, waited a month before changing policy, then the pensions could have bought their fill of stocks before the 6% move rather than now having to do so afterwards.  simply retarded.  russia wants their own folks to repatriate RUB at good prices.

the icing on the cake is that the entities that are buying USDRUB i.e. shorting the ruble (i presume western banks and hedge funds, but could include other speculators) are effectively going to the ones funding local russian's bank 9.5% deposit interest... i.e. you have to pay the negative carry (i.e. roughly the local overnight rate plus a bank fee) when you short a currency.

 when the geniuses who are shorting rubles figure out that it is one of the only currencies that offers a flat real deposit interest rate or better, they are going to have fun trying to unwind into locals who now have .095 reasons per ruble per year not to buy any forex.

 

Fri, 10/31/2014 - 12:05 | 5398625 tarabel
tarabel's picture

 

 

And where, exactly, are Russian banks going to find an invesmtent inside Russia that pays 15-20% annually in order for them to cover their expenses and forward 10% to their depositors?

 

Fri, 10/31/2014 - 12:16 | 5398665 Titus
Titus's picture

Average credit rate banks give clients is 20-30%. Mortgages last year, absolute lowest, were 12-13%.

So the banks got a way. Other folks will buy real estate or invest in business or just spend it, as have the Russians done for the last 20 years.

Fri, 10/31/2014 - 12:35 | 5398703 tarabel
tarabel's picture

 

 

An economy based on immediate spending before the money falls further in value or gets hijacked, no savings, and ruinous interest rates equates to a cadet version of Zimbabwe-on-the-Volga rather than the happy, healthy, virile Motherland so unconvincingly touted by the Okhrana around here.

A 20-30% credit rate requires a very healthy and steady income to service it-- which western sanctions and oil market manipulations are ravaging. Can't go on for long.

Fri, 10/31/2014 - 13:10 | 5398860 Volkodav
Volkodav's picture

been 20% for borrow for years....and more

Must be very healthy and steady income servicing then...cos you said so

 

I doubt you know anything about this subject.

Russians normally do spend money they do not have

 

 

 

Fri, 10/31/2014 - 13:12 | 5398881 Titus
Titus's picture

Russian banks have high credit rates and short payback periods because, well, they still want the money paid back.

Western banks have low rates and extended periods because, well, they don't want anyone to try to pay back the loans. Because then the whole house of cards will fall. 

Russians don't borrow money at 20-30% unless they have a really good fucking reason. Which is why they aren't debt slaves. Putin's macro behaviour accurately reflects the micro behaviour in the country.

Fri, 10/31/2014 - 12:55 | 5398804 Volkodav
Volkodav's picture

agree

Fri, 10/31/2014 - 10:35 | 5398255 chindit13
chindit13's picture

FX Reserves tumbling, rates bubbling, Russian shoppers grumbling, Puti humbling.

The game of chess is seemingly highly overrated.

Ladbrokes is now quoting odds on Puti getting Ceaucescu'd.

Fri, 10/31/2014 - 12:10 | 5398634 tarabel
tarabel's picture

 

 

Dear General Wingate, I see the Okhrana hates you for speaking the unspeakable-- i.e., the truth--about Mirova Putinova. Keep up the good work.

Fri, 10/31/2014 - 12:14 | 5398629 Boogity
Boogity's picture

Yawn...  Just talked to the In-laws in St. Petersburg and they haven't noticed any significant disruptions in product availability or prices since the West, their pet MSM, and their hook-nosed money changers started all of their chest-thumping BS about sanctions and devaluing the Ruble several months ago. 

Lesson to the wise....  Don't believe everything you read and hear from the West's propaganda machine.

Fri, 10/31/2014 - 12:17 | 5398670 Titus
Titus's picture

There is a decline in some basic foodstuffs, especially cheeses. Otherwise just slower consumption, from a culture that is consumes quite quickly (new cars every two to three years, for example, because that's how long the warranty lasts in Russia).

Fri, 10/31/2014 - 15:02 | 5399368 TweedleDeeDooDah
TweedleDeeDooDah's picture

For sure, on the cheeses part, especially. Also on the processed meat stuff... meaning stuf from livestock, not the cat/dog products known as cheburekas or beliashas.
I see the trucks at the grocery stores with Belarus and Russia license plates, and half the clients at the business consultancy/accounting form I work for live in Russia... They pick up 500 Euro notes to hold, and even more Benjamins for use in Russia... they LOVE Dollars.

Everybody knows what's going on, but nobody DARES to talk about it in the street... like Soviet times...

As if some proud former Soviets are going to admit to their western in-laws that everything is working against them just as engineered....

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