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Russia Has Begun Selling Its Gold, According To SocGen
A few days ago, we first reported a rumor that was floating around Wall Street desks, and which, according to some, was the "reason" that gold was being kept lower even as sovereign risk was exploding around the globe. The rumor was that Russia was selling its gold holdings:
Rumor Russia selling gold
— zerohedge (@zerohedge) December 15, 2014
This led to Bloomberg speculating, and us rhetorically asking, if "Putin's next step will be to sell gold"
"Russia is at a critical juncture and given the sanctions placed upon them and the rapid decline in oil prices, they may be forced to dip into their gold reserves, if it happens it will push gold lower." That is what, according to some people Bloomberg has quoted, is in the cards.
While some suggest the accumulation was "tradition" it is still nonetheless an impressive aggregation of the barbarous relic:
So given the efforts to build this gold-backing for their nation's currency, do we really expect Putin to now dump his physical: or perhaps more strategically suggest a true gold-backed currency and jawbone the currency that way?
So what is the truth? Well, we won't for sure until the next official report by the Central Bank of Russia hits the IMF database, but in the menatime, SocGen just reported that the selling may have started:
Looking at the correlation between gold and oil prices, the chart above illustrates that both commodities were moving closely in tandem over the July to September period. However, this link was broken in early October when gold embarked upon the new rally on weaker US dollar and some physical support, while oil prices continued to slide. The rally, nonetheless, proved to be short lived, as gold returned to its downtrend after hitting the $1,250 level on 21 October, and continued to move down, along with oil, for the remainder of the month.
Starting from November we have seen gold and oil prices moving in opposite directions again. As we mentioned earlier, oil prices came under significant pressure on concerns about a growing global oil supply glut. On the contrary, gold recovered some of its earlier losses, supported by fresh buying interest in India on the news that the Reserve Bank of India (RBI) was reviewing gold import restrictions that were introduced last year. Towards the end of November, the RBI surprised the markets by announcing the withdrawal of the 80:20 rule, which saw gold imports surging to 150 tonnes that month, according to the latest statistics from the Indian Ministry of Commerce and Industry. In addition, worries over the potential impact of stronger US dollar on the global economy spurred some safe-haven buying.
...
It is not surprising that Russia has been tackling its financial problems by selling the gold they have been accumulating. According to the IMF data this year, one of the world's largest oil exporters acquired 115 tonnes in the January to September period, and added another 18.9 tonnes to their reserves in October. Russia has been purchasing the yellow metal at a faster pace this year, taking advantage of lower gold prices and, perhaps, preparing for the possibility of a long-lasting restrained relationship with the West and economic downturn. It appears possible that the Central Bank of Russia has started to sell off some of its gold reserves in December, with some sources reporting that official gold reserves dropped by $4.3 billion in the first week of the month.
Of course, it should be noted that SocGen and its "sources" have a conflict: in an indirect way, none other than SocGen is suddenly very interested in Russia stabilizing its economy because as we wrote before, "Russia Contagion Spreads To European Banks : French SocGen, Austrian Raiffeisen Plummet" which also sent SocGen's default risk higher in recent days. So if all it will take to stabilize the RUB sell off, reduce fears of Russian contagion, and halt the selloff of SocGen stocks is a "source" reporting what may or may not be the case, so be it.
In any event, keep a close eye on the next update of Russian official gold holdings: it may well be the next big story of where gold is headed and, if true, an even more important question will be who is Russia selling its gold to.
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Thanks for another recommendation, for something informative to read today. I will be checking out "Last Move".
Today the comments are far more valuable than the lead.
Thanks in turn. To my knowledge however, It was Jim Wiilie (goldenjackass.com) that first broached the possiblilty that Shanghai is slated as the pivotal force. Willie no doubt puts off a great many people with his personal style and frequently strange syntax, but I've reading him since he first appeared online and I've never known him to be wrong in substance.
I've been a Willie follower for awhile, for the same reason.
He's maybe a little crazy sometimes, and in the things he's not an expert in, maybe a bit of a kook.
But in the big de-dollarization picture, he's been right on the money time and again, for years. The latest being Saudi Arabia's 'so surprising' refusal to cut oil levels, which greatly benefits China among others, but does not benefit the Ango-American Axis at all.
Bingo.
good honey-pot for all of us 'domestic terrorists'/skeptics of this administration that frequent the site. Makes one wonder....
"possibility that the Shanghai Gold/Silver Exchange will soon be announcing that it has run out of silver --the true achilles heel of the Western banking cabal, thus provoking an immediate and dramatic, overnight rise in the price of gold and silver and, as the dominoes begin to fall, no doubt a great many other commodities as well..."
I have heard this story before. But I have no evidence that a lack of silver on this exchange is real, or would crash the entire system.
So I have home work to do tonight I guess.
I agree this much, something will crash this Central Bank, Money Printing Dollar hegemony World Economy. I just don't think silver on this exchange is it.
The silver market is extremely tiny, Jack. The ETF sphere has massively over-represented its true size. I suspect you actually know that, but the Asian exchanges are perforce transparent in a way that the fraudulent western markets can never be, and as you can see by the daily acceleration in increasing instability around the world, only a tiny push by a truly reputable organization is required to bring it crashing down.
I believe that timing is everything however, so that although this event could have already been accomplished, the East has had reasons to hesitate until the 'last moment' as it were.
Just for you, Jack : )
google this:
"Chinese Silver Inventories Nearly 90% Depleted.... @ Srsroccoreport.com.
Why the entire Western Media including ZeroHedge backed out the Peshawar Attack ?
#PeshawarAttack Continuation of Colonial British Strategy for the Subjugation of the Subcontinent
http://greatgameindia.com/peshawar-attack-the-empire-strikes-again/
The recent attack in Peshawar following the blueprint of the ongoing disintegration of Pakistan is not just a matter of penetration of the military and the intelligence services by forces friendly to the Taliban, but is the direct result of Colonial British Strategy—with the help of U.S.-based co-conspirators—to partition the country into a potpourri of ethnic entities.
The break-up of Pakistan’s westernmost wing is evidently backed by the colonial forces, and their adjuncts; it would establish an unstable state that would depend wholly on Western powers for its survival. That would cut off both India and China, in particular, from land access to the Central Asian oil and gas fields, as well as from Iran. Over a period of time, it would also endanger Russia’s southern flank.
PeshawarAttack Continuation of Colonial British Strategy for the Subjugation of the Subcontinent
http://greatgameindia.com/peshawar-attack-the-empire-strikes-again/
Seems like all the West dreams about is Russian gold these days. I don't think Putin is going to part with it. But keep dreaming. Getting your hands on gold is a good dream.
SocGen is a paragon of virtue, I'm sure they would never lie about this.
C'mon.
What can you do?
When you are short of fiatso electronic credits?
Better to go out and steal than to sell your gold. Oh, right, they already did that.............
Seems Zerohedge may be better served explaining how things will be and how to survive financially in a post US Dollar based world than spreading what amounts to rumors.
<<explaining how things will be and how to survive financially in a post US Dollar based world>>
Comment of the day, shame it's so far down the page.
I am HUNGRY for such articles. (Yes, I know there are other excellent blogs out there too, thank God.)
The new innovation in fiat currencies will the the introduction of additional currrencies that are backed in gold, while the original currency will be maintained, but will be crammed-down in value significantly. Just like what happens to companies in trouble that are forced to sell off a huge chunk of the company for a relative pittance just to stay alive.
Russia not only has gold to sell, they have lots of gold. They have been buying heavily now for a long time. Wonder why? But Russia also has their miners, they produce gold as well as buy it on the markets.
I would say, with it's gold reserves, it's nearly 700 billion dollars in FX reserves, it's 16% debt to GDP, it's vast resource base, and new trade zone comig into effect in January, Russia is not the helpless and bankrupt baby that the west assumes.
If anyone crashes and burns this winter, it is Ukraine. No need to tell you they need their 15 billion promised by the IMF, and a new 17 Billion from the IMF, plus by summer another 17 billion from IMF, and this ALL BEFORE anything is spent to restructure the economy to meet EU standards or pay for the civil war.
Right now, the IMF is balking at keeping the billions flowing to Kiev. Yet, that leaves the EU to throw tens of billions at Kiev in the next two months. The war is being funded by US taxpayers, that is a fact, or else the war would be over, as Ukraine is bankrupt, yet vowing to build "the stongest most modern Army in Europe!" If you can believ that.
"Hello, is that you Poroshenko? Brilliant. Your old mate Junker here. Just ringing to say that we have run out of money to lend you. Good luck old man. Have a great Christmas and New Year. Talk to you next year."
BRUSSELS, December 18. /TASS/. EU is running out of budgetary capability to support Ukraine, European Commission President Jean-Claude Juncker said on Thursday upon arrival at a regular EU summit.
He said the heads of state and government of the 28 member-nations would discuss financial and economic assistance to the Ukrainian government but the EU had reached the upper limit of its budgetary capacity.
"There is only a small margin of flexibility for additional financing next year. And if we fully use our margin for Ukraine, we will have nothing to address other needs that may arise over the next two years," Juncker said.
Somewhat earlier, the authorities in Kiev asked Brussels for a third program of macro-financial aid in the amount of €2 billion. European commissioner for neighborhood and enlargement policies, Johannes Hahn, said the EU was prepared to continue aid to Kiev but only in exchange for concrete results of reforms.
Earlier on Thursday, Finland’s Prime Minister Alexander Stubb said EU would not take any decisions on extra financial aid to Ukraine right now because the country had not implemented the essential structural reforms yet.
Well don't you worry! The USA will print up a couple hundred billion for them! Fuck our children. Let's fund Ukraine instead and kill some more of their citizens. Gods work I tell ya....
Jack Burton, documents have surfaced that the USSA is paying salaries to Ukrainian officers. Think about that for a moment. The Ukraine is bankrupt, with unpaid pensions, salaries, rolling power blackouts, an imploding industrial sector, 40% unemployment etc. I cannot recall in recent history of a country determined to destroy itself so quickly and thoroughly. It will take DECADES for the Ukies to recover to, say, 2007 levels of prosperity. The West is desperate for Russia not to call in Ukie debts, and to give her free gas. This also will not happen, especially in light of recent events. Starting on Jan. 1 2015, new visa requirements for Ukies will send literally millions of them back to the Ukraine.
The vicious propaganda campaign against Russia is mostly lies mixed in with a few half truths. For example, if the Russian Central bank was selling gold on behalf of miners, who were pledging their forward production, this would be nothing more than a swap, a way for the bank to help out miners cut off from trade and finance credit. The Russian Central Banks net gold exposure would be essentially unchanged. Gold is the most liquid asset in the world, and the Russians have absolutely no need to sell it when they have hundreds of billions in USD Treasuries.
Moreover, if Russia wants to protect herself against future Soros/USSA bankster currency attacks, they must take reduce their exposure to the Fed Reserve system. If the Russian currency was blocked, and their trade was primarily in non USD currencies, the USSA banksters could not have pulled off their speculative attacks against Russia. Finally, the average Ivan now realizes that they in a cold war with the West and must respond accordingly. Putin now has a mandate to reform the Russian economy in a way to blunt future financial attacks against her.
China has also signaled that they will not stand idly by and watch the West ruin the Russian Economy. They know they are next.
Further, despite the deluded fantasies of Israelis determined to set up a Khazarian homeland in the Crimea, (which, BTW, explains the vicious filthy tactics such as killing MH17 passengers) they will fail. Crimea will never be returned to the Ukraine, and the Russians will go nuclear to protect her, since their military doctrine authorizes any and all means to protect against an invasion of the Russian homeland.
Finally, it is your choice but I respectfully suggest to stop feeding the latest infestation of dumb ass Ukie trolls, parroting the same cheap ass propaganda. They get paid for replies, so lets starve them out.
The war is being funded by US taxpayers, that is a fact
All wars of US are financed by all countries that hold USD reserves - which practically the whole planet. US gov spends more than twice as much as gets from taxes, the taxes of US folks are not significant anymore.
(USA) guys, I see your point: you dislike Obama -> Obama dislikes Putin -> Putin is your idol. Then I see no reason not to praise Mugabe, Maduro, Chavez and Kim Chen im - those fighters against evil America. But for some reason people wealthy and educated enough to be able to choose country of residence don't go to Venezuela, North Korea or Russia. They go to USA.
And ever think how those people got wealthy? US is money laundering capitol of the world. Every evil thug in the world who has stolen wealth from their country wants to park it here becuase our banks are so corrupt.
I don't idolize Putin but he is correct in this instance. No different than if Russia overthrew the Mexican government with an illegal coup and move weapons into Mexico
More than half of my classmates and Univercity friends now reside in USA. They are not some evel bankers oligarhs - just ordinary people. They simply follow opportunity just like every sane person would. They just see much more opportunity abroad than in Russia. That's why I don't see any bright future for Russia from historical perspective. Best people have been fleeing Russia for hundreds of years now and I don't see this trend changing anytime soon.
You don't wat to hear but more than half of one MIT class students have left USA!
I don't think there is any such thing as "best people". Everyone I have ever met was smart, but all in different ways.
Stop pretending to be an idiot, fer gawd sakes
FUCKEN liars ...
maybe Russia started the rumor.
That's different! What an interesting idea.
What did Russia actually do to be so ostersized by the West? NOTHING
How much longer do we all have to listen to the fucking hubris and pompous scolding coming from Washington?
I am so fucking sick and tired of this shit. The US is the biggest bully and America deserves to go down in flames unless Americans can rid themselves of their own oppressive government.
It's actually a concerted global effort. The entire world population needs to wake up and stop drinking the fucking American koolaid propaganda.
Fuck America
"What did Russia actually do to be so ostersized by the West?"
The banking mafia trashed America when they off shored all the industry. This lead to the current situation where they are totally dependent on the continuation of the dollar and petrodollar system to pay the bills. Devaluing the dollar to pay the bills in the US is effectively a tax on the rest of the planet - tribute.
The Russkis said nyet.
(The obvious - non WWIII - solution is for the US to get rid of the banking mafia and rebuild their industry so their imports and exports get back into balance more but that's easier said than done while the banks own the politicians.)
the banking mafia pulled the world into WW1 and WW2
so many people out there are willing to believe the official history kakamania b.s. accounts to ensure that WW3 will happen and it will be blamed on anybody BUT US banking mafia again
US just needs to implode and restart
It makes no sense for Russia or Putin to sell their gold.
However it is perfectly possible and in fact extremely likely that the nominally Russian *central bank* would be trying to sell Russia's gold.
Russia has big plans with their gold-buying spree. There is NO WAY they are parting with it. I can't wait to see what they pull off using their gold holdings in the coming years. It's going to be epic.
Russia's central banker
http://static.businessinsider.com/image/53148de46bb3f7fa133af1c6/image.jpg
compared to Fed's Yellen. I won't bother posting the mutt's pic.
She could be Mario Draghi's sister
http://ais.badische-zeitung.de/piece/02/b4/2e/60/45362784.jpg
Putin has vowed that economy will rebound. So has Maduro.
The race is on. Who is telling the real truth?
We are a bit like in the N Korean Sony caper!
Is it Saud, is it Maduro or is it Putin? How long with the Saud play make the global oil market look like a flaccid Oil lobby dick with withdrawal pains?
As for Cuba, its time to go long Havanas and Casinos, whatever Marco Rubio may say.
Don't forget Obama!
its about time for more Snowden cyber leaks to show that it is the USA that is trying to overthrow Russia and not the other way around-and the horseshit that Putin is meddling with the Nazi run Ukraine.
On CNN Christine Anampour was discussing her pipe dream that Russia is ready to collapse and the people will rise up and throw Putin out and put in a Banker/Western friendly new President-maybe even an American, as was just done in the Ukraine; stupid muthahfuckas geezus gawd!
Tiotal BS!
Christiane A. is a CIA asset, a old whore serving her masters.
Sounds like total horseshit to me... AND... if Putin wanted to sell his gold, why not first take $2Billion and crash the silver Comex... that would cause gold to double pretty fast... OR... he could sell some to China on the QT... but why the hell would he, it sure wouldn't strengthen the Ruble... more Western propaganda... Goebbels would be so proud...
More fucking lies and obfuscations on the innocent proles who caused none of this shit, in any of our collective countries, but who will be sent by script to fight the wars these fucking should be dead sons of bitches banksters and political cunts.
More proof, if any was needed my friends, everything we have ever known has been a lie, everything.
Take heed you fuckers from the NSA, and you child molesting protecting cunts at GCHQ, the proles is waking up, and folk like Mixy aint fighting no fucker unless its you and those who allow you to operate. Go and tell Mr Camoron and Ed The Red, you will be dead before I am.
You fuckers started it though, so stop blaming blameless folks all over the world for your lies, theft, self interest, child molestation, and outright depravity on my fucking coin.
The only government folk like me will fight, is mine, and I can tell you this you cunts. You had better fucking kill me as soon as you see me for what I have planned for you fuckers. And look on the bright side you cunts. There are literally 'Millions' of Inthemix96's all, around, the, world.
Come on then cunts, lets get this started. You want it, so does I...
;-)
I'd say a couple billion.
only sold to china for a bailout
I could believe the story if it wasn't for the fact that 4 billion dollars is a laughable amount.
Then again Societe Generale is as ridiculous as Hollande.
I wonder if SoGen is close enough to have these insights.
MSM "reporting" continues to be directed at herding the muppets and algos in the desired direction for a 3rd party. Analyze “who benefits” from the BS propaganda reports over the past few years and the 3rd party suspect list gets very short.
...and we should believe SocGen why? I'm waiving the Bull Shit flag on this one. Russia has far more Gold than the US and other FIAT Currency nations. Putin scared? I doubt it. Is Obama a Pussy and a Faggot? Yep. He/it surely is.
I think Obama is like mr. garrison and Michelle/Michael is like Eric Cartman's mom.
has the price reacted at all ????????????????? NOPE
fake?
Not selling their gold, leasing it out at current prices. The straw goldholders will forfeit their claim when the price of Au goes back up, but better yet, in the interim these strawmen take tax deductions for interest payments they don't even make.
Are they innovators? Are they geniuses?
- Leo Getz, CPA
What's the difference?
Gold Leases Explained
http://www.jsmineset.com/2013/04/20/gold-leases-explained/
"What's the difference?" Gold stays in the same vault it just moves from one side of the room to the other.
ZH, in its infinite wisdom, has, strangely, chosen to provide us with up-and-down arrows to critique one another. HAhahhaha! But only now, given the ridiculously shallow premise of this particular article, does it occur to me how much more valuable it would be for ZH to provide itself with the same enlightening service on behalf of the articles it publishes. Now THERE would be some revealing feedback, don't you think, fellow cluckers?
By the way, Jack. In case you missed it below, I am recommending that you google 'Chinese Silver Inventories Nearly 90% Depleted...' , to be found at srsroccoreports.com.
Sure, revealing feedback. It would reveal that "20,000 reads" is actually
40 Chinese clickers
12 adolescents
9 real people
7 birds a'ducking...
5 robot hands!
4 trolling turds
3 French dicks
2 turtlenecks
and 10 Tylers living carefree
<--This article is stupid
<--This article is on point
You could just make a ....^
Perhaps they sell to China for an eventual golden yuan?
Russia printed roubles and bought gold to devalue the currency. The next player in this type of roulette is probably The ECB.
True reason of this rumor is that Socgen is busted in Russia.
Didnt learn from history with last century broke russian loans.
Come on !Talk about financial experts.
Seems SocGen also wanted to declare gold is in a, "6000 années vieille bulle," but had to go all the way to Russia to find a story that fits their lie.
Russia will let the Ruble go down until it believes it has hit rock-bottom at which point it will buy up all the Rubles with Dollars.
If those rumors are true, let me guess who's buying it? The guys who promised to bail-out Russia, of course, the Chinese!
Physical gold, or the paper stuff the BRICS call "shitcoin"?
If Putin sells, it'll be to the Chinese, and the Chinese alone.
LOL, sell money , at the lows, for paper bullshit/fiat called dollars.
I was out all day. I would have been dissapointed if this story wasn't floated.
Most likely in order (imo)
1) The Russian central bank started to sell gold and Putin stopped them
2) It's some bank or individual bankster using rumor to talk their book (in which case the source of the rumor may be in trouble connected to the reverse of the rumor)
3) Putin has been told by the central bankers that selling gold is necessary and he's dumb enough to believe them
Russia is selling it's gold.
Russia is selling it's gold.
Russia is selling it's gold.
I have repeated it three times, so it is truer than it was 3 lies ago.
Russia is selling it's gold.
Russia is selling it's gold.
Russia is selling it's gold.
I have repeated it six times, so it is truer than it was 6 lies ago.
Sounds perfectly plausible to me that Russia could and would consider selling some gold to make up for some Ruble weakness and volatility.
As long as they don't sell it back to the west who cares.
mistake! unless they are selling direct to china, in exchange for potential bailouts. which would seem...likely?
Spot on!
Direct to China.
Maybe by reposki (repurchase agreementski.)
That it will confuse the Obrainless and his tribal banksters into doing the exact worng thing is a certainty.
Frabjous Day can't be far away
https://www.facebook.com/pages/Canadian-beekeepers-against-McCormicks-im...
Yep, gold to $300 coming soon to a coin dealer near you and your gas will still be $2/gallon.........
What if the Chinese buy Russia's paper/physical gold then china sells the equal amount of USA treasuries? What if both dump large amounts of treasuries that serve as a shot across the bow?
The swift system works only so much which is why Saudi Arabia is doing what they are doing. Also the Saudis are trying to "encourage" japan and Europe to do some economic easing.
Putin is a chess player and it's hard to believe he hasn't thought this through. China also has a role in this but is it the obvious choice?
Could India rear it's head in all of this because their are part of the brics?
Sounds like more nonsense to me.
From Putin's "state of the nation" speech yesterday:
Does that really sound like a nation on the verge of a gold fire sale? I think not.
Well like SocGen these "players" appeared to be pretty confident and in good cheer going into the holiday season...
Because we will certainly know if it doesn't work out!
Happy Chanukah Jeb! Enjoy it for the short while it will last!!!!
http://libertyfight.com/2014/jeb_bush_lights_menorah_happy_hanukkah_jewi...
http://investmentwatchblog.com/shipless-in-france-400-russian-sailors-he...
My apologies. Here is the Jeb Bush Rick Perry dance contest.
in Oh what a friend we have in Israel!
http://libertyfight.com/2014/rick_perry_one_ups_rand_jeb_jewish_rabbi_da...
Not so dumb those Russkies... selling into the bear rally.
http://www.globaldeflationnews.com/gold-elliott-wave-update-for-week-end...
Depends on your perspective. Step back and you will see a higher degree uptrend which will carry gold well past 2011 levels. But then, most in the market have the perspective of a 21-day lived fruit fly.
No way would gold zoom. It's controlled by the CBs in the paper markets. Keeping it at home doesn't help either because the price is set in the paper market.
If yur were a 30 month fruit fly you would only have seen a 20% drop in gold price.
Are you possibly a fruit fly who is carrying gold from $1,800?
What is the prespective of a really, really, really large brained and long lived fruit fly? Tell us the full fruit fly report, please.
I see Vlad's driving the price of gold down so regular folks can afford some - awesome!
If I was Putin I would try something a little more drastic like selling oil for $10pb on the open market. That would be a nice 'fuck you back' message.
Defending the ruble has cost Russia around $80 billion this year, and depending on who's doing the calculations, its usable hard currency reserves are now either starting to run low, or at a healthy $400 billion-plus.
While Russia has only slowed the ruble's slide, it looks all right by any yardstick of whether its reserves are adequate. According to official data on Thursday, its foreign currency and gold reserves were $414.6 billion in the latest week.
While down from $509.6 billion at the end of last year, the latest total would still cover more than a year of Russian imports, far above the three month level generally considered to be the safe minimum.
The other leading measure requires reserves at least to equal a country's external debt payments for the coming year; Russia has four times that.
Russia's currency has lost about 45 percent against the dollar this year due to diving prices for oil, Russia's main export, and Western sanctions imposed over the Ukraine crisis.
But, since floating the ruble last month, the central bank has intervened on the currency market in only relatively small amounts. Instead it has tried to slow the slide by raising interest rates by 7.5 percentage points in two takes, even though the economy has already been crushed by the sanctions and oil collapse.
Doomsayers attribute this shift to a desire to conserve what, on closer examination, may be pretty sparse reserves.
Anders Aslund, a senior fellow at the Peterson Institute in Washington, D.C., is one of those who say the official headline reserves figure is deceptive. That's because it includes two "rainy-day" funds built up over the years, which strictly speaking should not form part of reserves, he says.
Aslund wrote this week in the Financial Times that stripping out the two funds with combined assets of $172 billion, plus gold worth $45 billion and $12 billion in IMF drawing rights, would leave Russia with usable, or liquid reserves of around $200 billion.
After accounting for Russia's current account surplus, which makes hard currency funds available for repaying foreign debts, the country would still have to delve rapidly into the reserves to meet its obligations.
"In each of 2015 and 2016, Russia has net external debt payments equal to $100 billion after subtracting its current account surplus. In other words Russia's liquid reserves would be finished after two years," Aslund said. "The central bank appears helpless because it is."
This graphic, based on data from Russia's central bank and consultancy Trusted Sources, shows the reserves breakdown.
President Vladimir Putin told a news conference on Thursday that the $415 billion worth of reserves was enough to cope with any crisis but would not be spent "thoughtlessly."
Officials are wary of spending the reserves too fast as the country is forecast to go into recession next year.
Without doubt, the situation is far bleaker than 2008-2009 when reserves were $600 billion—well in excess of total external debt, private and public. Since then, a borrowing binge by companies has worsened the reserves-to-debt ratio.
Banks in particular— faced with weak earnings, shrinking deposits and hard currency debts—may need more central bank help, analysts at BNP Paribas said, estimating that the equivalent of $72 billion had already been disbursed this year.
A draft law aims to allocate an extra trillion rubles ($17 billion) to support the banking sector.
Many would argue there is nothing wrong with that, because the rainy day money is meant for hard times such as now, when oil prices are low and companies cannot raise global capital.
More importantly, disbursing cash to the private sector from one of the two wealth funds will not entail a drop in reserves, said Citi strategist Ivan Tchakarov.
The central bank holds the rainy day funds, usually in dollar assets, on behalf of the government. If the finance ministry wants to raid them to help a bank, the fund sells the dollars to the central bank in exchange for rubles.
"The overall reserves remain unchanged as what the (fund) is losing is gained by the central bank (CBR). The rubles that the CBR prints to buy the dollars are then used by the finance ministry to lend rubles to bank X," Tchakarov explained.
Printing currency is inflationary for the economy, Tchakarov admitted, but from a reserves point of view "there will be no change and Russian foreign reserves will remain as they were."
The question is how long the drain on reserves continues, especially if Western sanctions are extended and oil prices stay at current levels. Energy provides 70 percent of Russian export earnings and half its federal budget revenues, so at current prices central bank buffers are unlikely to be replenished.
Most companies are reckoned to have enough cash to fund their 2015 debt payments. Alfa Bank analyst Nataliya Orlova said that even excluding the two reserve funds' assets, the remaining money would probably tide Russia over the worst of the crisis.
There is a caveat. Major changes are needed to bring more investment, diversify exports and allow Russia to reduce its dependence on energy. That seems unlikely for now.
"If you have a government that is doing reforms, the central bank can spend reserves. If there is no chance of structural changes happening, there is an issue because then, for the long-term, $200 billion is not enough," Orlova said.
So what is the purpose of the rainy day funds? To look pretty? An 45 billion in gold doesn't matter? More western bankster BS.
Russia's currency reserve are definitely helpful, but at the end of the day may not be enough. Over the next year or three, there will be numerous drains on Russia's finances. Russia will be in a severe recession in 2015 and likely beyond, so that will test Russia's finances and draw down reserves. Likewise, if Russia continues to defend the ruble, that is a serious drain over time. And then there's the issue of all the domestic Russian companies that will have to roll over dollar-denominated debt in 2015 - this alone is in excess of $100 billion.
If oil continues to stay in its current range, Russia's going to need every ounce of gold and every dollar, euro and ruble to stay solvent, and even that might not be enough.
Putin is smart and he's far from being in a corner. In fact, Obama and Soros wouldn't make a decent size pimple on Putin's ass.
It's going to be fun, watching to see what Putin pulls out of his hat to befuddle Obama, Soros, and Company. The show is about to start! (And to all our friends out there: Better make sure your gold and silver are close at hand and well concealed)
I still feel like a neophyte here, but Russia, with almost no debt, would not seem pre-disposed to selling gold. On the other hand, they and their new BFF China could sell their dollar reserves and their treasuries if they wanted to.
The question remains- why haven't they....
I reckon there's a much bigger game afoot here than any of us realizes.
First if the Ruble is in a Currency War where it's value is Declining... Russians would not sell US Dollars or Currency.
That is something that some posters don't realize. I suspect we have posters here from the MIC, so they are not well educated in history or economics.
The Nature of Power is what you are Talking About.
Power usually relates to:
1) Monarchies, Kings, Royalties, Empires
2) Today Corporations act with no Borders, no Capital Controls, Free Trade, are allowed to pull Capital off shore like old Royalty, and Defer Taxes for Executives through Trust Accounts where the money is invested and allowed to accrue Interest to off-set Taxes - although you won't be able to...
3) Bankers hold the power to Create Money out of Thin Air(Credit), if you are powerful you don't have to worry about ratios of rehypothication, assets or government regulators in London or Wall Street
So what are the powers of the world?
1) Create Money in Monopoly like US Banks
2) Dampen Economic Growth like Federal Reserve
3) Off Shore manufacturing, Offshore Services like Transnationals
4) Write Legislation
5) Start Wars
6) Create Policy or Culture in the Justice System through free seminars, university conferences, gifts of tuition for the Justices
7) Create Insurance and Laws for Health Care, Structure Finance for Health Care to drive up costs, liabilities, and have consumers pay for expansion of buildings, facilities, and new equipment like Aspirin
Ah, but what do I know??
Which is prolly why the central fucktards will let it rise now.
I think selling Au is a bad idea and probably about the last thing you would liquidate in an emergency. I don't see it happening unless some gold is being sold to China as part of a trade deal.
Russians have nationalized Companies before... in order to take the foreign assets, Capital Investment, for themselves.
I heard there was $20 Billion in US Investment in Russia in the last few years. Including a Coca Cola Factory with Coca Cola secret formula.
- Russia has a history of taking Foreign assets, Nationalization
- Russian can Nationalize all Banks to Save Businesses facing Bankruptcy
- Russian can Nationalize the Central Banks as long as they have Gold
Russia is not going to sell all their gold to be Puppets of the Western Banking Cartel. lol. That is the most absurd idea. China & Russia are major players due to the land holdings, resources, population that can work and develop resources & products...
I say Bull Shit.
Russian will fight, will keep gold, will invest in it's own infrastructure, and will provide security to it's citizens who support the Empire. Even Female Soldiers get a pension of some kind in Russia.
The Future of Russia is Nationalized Banks, Nationalized Central Bank, Links with Asia & the Global Market Place, and Gold Reserves.
History Virgin wrote this story...
. . .
First, nationalization of businesses does not save businesses, it steals them. See Venezuela.
Second the Central Bank was nationalized when created.
Third, Russian gold reserves were fraudulently purchased with rubles that Putin knew were going to crash in value. the government fraud is why no one will acccept ruble for trade.
Fourth, Russian gold reserves are worth less than the purchase price when valued with regard to other currencies. More destruction of value by Putin.
You have presented the full Bull Shit analysis.
Zero Hedge really dropped the ball on the Bloomberg story that commodity trading firm Gunvor Group was giving up trading physical precious metals partlydue to "difficulties in finding steady supplies of gold where the origin could be well documented".
Firstly, their spinning of the story came out three days after the Bloomberg story. That is an eternity when we have been told by experts that "the London hub is failing" (more on that in a future post) - I mean, the bullion banking system could have blown up in that time!
Secondly, ZH were obviously only half committed to their meme as they couldn't be bothered to do their signature LinkedIn profile highlighting. If you look atCedric Chanu's profile you'll see that he only joined Gunvor in January, after having spent over 5 years with Deutsche Bank! Need I say more? And Francois Beuzelin, who worked at Soc Gen from 1998-2009 as "head of metals swap trading"! Gold swaps! Need I say more? And finally, coincidental that Cedric also worked at Soc Gen from 2004-2007, the same time as Francois?!
Seriously, ZH's last two paragraphs are a mess in terms of trying to spin a meme out of this story - it reads like a first draft and I've seen a lot better from them. Gold is one of ZH's mainstay themes and it is surprising to see them give this story such slack treatment; maybe it is a sign of the bottom that ZH's heart is not in to pumping this story for all its worth.
ZH starts off trying to link this story to the "rehypothecated commodities scandal in the port of Qingdao" and twist it to being about "gold whose ownershiptraders are unable to validate - has now flooded into the global trading infrastructure". Two misdirections here. First, "flooded" - where in the Bloomberg article is their any indication that undocumented gold is flooding the market? Zero.
Second, the Bloomberg quote talks about the undocumented "origin" of gold, not "ownership". Zero connection between those two concepts (maybe this is what the "zero" in Zero Hedge means - they just make stuff up of nothing). Any knowledgeable commentator on the professional gold markets would be aware of the LBMA's responsible gold framework, which implements "OECD Due Diligence Guidance as well as Swiss and US KYC, Anti-Money Laundering and Combating Terrorist Financing regulations". Not just refiners, but anyone trading in the gold market, needs to comply with this. Therefore Gunvor's reference to "origin" and "documentation" is clearly referring to the need to be able to verify that gold is conflict-free. It is not a reference to the "ownership link", as ZH puts it, of the gold that is the meme spin that ZH tries to put on this story.
Finally, ZH tries to play up the unusual nature of Gunvor pulling out of trading gold, since they are "the world's fifth largest trader of commodities". Well what is unusual is that Gunvor was in the gold market in the first place because Bloomberg notes that "neither Glencore Plc (GLEN), the biggest metals trader, nor Trafigura Beheer BV, the second largest, trade physical gold." The gold market is dominated by a handful of bullion banks who have a deep contact list and often contractual supply arrangements in place with miners and refiners. It is not surprising therefore that a "handful of people in Singapore and Geneva" were not able within a year to crack this market and gain enough business to justify a specialist division within a large firm. That is the mundane reality behind this story, not a biblical flood of ownership undocumented gold.
While we are talking about people who don't know what they are talking about,this Bloomberg piece on the possibility of Russia's next move being to sell their gold is a classic piece of gold bashing. In support of the thesis they quote two bullion market nobodies:
The only credible source is "Michael Widmer, metals strategist at Bank of America Corp. in London" It is not surprising that he is the only one who notes that Russia could use their gold as collateral, rather than selling it. The others just simplistically argue that Russia will sell their gold outright. Given that Russia has been accumulating gold almost every month since mid-2006, I think it is highly unlikely they would sell it rather than just swap/repo it. I'd ignore this Russia-to-sell-gold meme only except that it may be a narrative influencing some traders.
http://www.24hgold.com/english/news-gold-silver-zero-hedge-fail-on-undoc...
You may have asked before... why nationalize Russian or more importantly US Bank? How the hell will that make a difference??
Repost:
A Fair Question.
- Bill Still, Ellen Brown, Public Banking versus Crony Capitalism
- No reason to pay interest to Private banks when clearly they don't prevent Moral Hazard or Excess Federal Spending or even Prevent War when there was no War Chest & $6 Trillion in Federal Debt by 2002 & $11 Trillion by 2009
I assume that:
- FED, US Presidents, & Congress are All Corrupt & lying about Economic Statistics
- US Private Banks Dominate Money Creation, Especially through Fraud & Derivatives
- US Private Banks are Corrupt & Dominate US Capitalism, Corporate Cronyism, and US Socialism
- War is Corporate Socialism or Corporate Subsidies
- Bailouts & Bail ins for Private Banks & Corporations are Corporate Subsidies
- US Corporate Culture Trend is to cut Costs no matter the solution, the damage to US Jobs, US Middle Class, US Consumers, and the End of the USA & the American Idea
- US Private Banks Loot US & Transnational Corporations Damaging Investors, the Financial System, and US Households & Pensions
- US Private Banks are not Patriots & will take their money and leave at anytime
History. Frustrating since no Citizens want to learn US & World history. But really all the Economic & Political History is from Western Europe if you live in the USA.
Wow. What a Statement. History repeats. But we in the USA have no basis in European Socialism, Communism, Fascism... and Especially when it comes to who is funding with no Regulations, no Ceilings, No Capital Controls... our major World wars... and Dirty wars in South America for the last 100 years. And we in the USA don't know the corporations that pushed for covert & over wars in South America against the Middle Class & poor workers & farmers.
What a shame... as my Grandma used to say if I didn't study, play the game, be political, and kiss ass to teachers... What a shame America.
Apparently there is no such thing as a Dirty War? Compartmentalization? Networks, Secret Ivy League Societies that end up with members in high levels of Federal government? No such thing as Empires that blackmail or Bribe Foreign Powers??
- I suppose you think the US government has little fault, responsibility of indigenous deaths(US), military suppression of democracy(US), Assassinations(US), murder of indigenous(US), Cronyism with wealthy corporations(US)... false flags(US)
"If you look atCedric Chanu's profile you'll see that he only joined Gunvor in January, after having spent over 5 years with Deutsche Bank!" ...So no such thing as Networks, Associations, Ivy League Secret Societies, CFR secret Plans?
Which head chopper is your favorite?
Do you prefer Brit Head choppers or the indigenous Muzzie to be your executioner?
Possibly you have gifted your 10 year old daughter to a shiek for immunity?
Or sent your son to work his skills under the table cloth to demonstrate that the family wants a Muzzie to enjoy his meal?
There is a zioshill in our tabernac!
Step 1
Buy all the gold
Step 2
Melt it down, Clad Tungsten Bars
Step 3
Sell tungsten bars to China
Step 4
Laugh
Who let Vlad have a belt last night? I took it away from him just as he was starting to fasten it over the door.
Whew!!!
Is halving the value of the ruble in terms of foreign currencies just another part of Vlad's 'crazy like a fox' long game?
Man, that dude is good!
yup, dump their reserve UST and buy rubles until there are none left to buy
then back rubles with gold and other such real collateral
then trade resources for things other than paper fiat promises.
Squawk On
Vlad's resources just got repriced to a level where he cannot buy chicken to distribute to the populace. Russians will be getting subsidies from Cuba.
Ireland holds more UST than Russia.
Lucky for him he has 1000 tons to dump on the market fast as he can.
Is that the chess move where the horse jumps?
Dumping causes prices to drop.
The smart way is to offer a little, and when people ask if you have more, you ask what it's worth?
Comes down to currency crisis, the seller is not in charge
Buying High and being forced to Sell Low is financial checkmate. King fall over.
For those with psychology training the replies here are classic. It is called the Backfire Effect, when your deepest convictions are challenged by contradictory evidence, your beliefs get stronger.
Unfortunately if you belief is gold can only go up it is going to hurt.
http://en.m.wikipedia.org/wiki/Confirmation_bias
Check it out even knowing it is happening to you can't break your belief
Yes but gold has only gone down....
Taste the rainbow.
Much farther yet.
Tastes like unicorn piss.
OK I will throw a curly one for "gold bugs" and it is "Peak Easy Gold".
Devotees of the idea that "going back to a gold standard will save the world" have a major problem, because all easily recoverable gold was exhausted about a century ago and all gold recovery since has been increasingly expensive in man hours and other resources consumed, such as metals to build extraction equipment and oil to power that equipment ... so diminishing returns and diminishing amounts of gold recovered from inferior ores.
Meanwhile, during the last hundred years, "Easy Oil" has enabled an explosive growth of economic activity globally which, even excluding financial exotics like futures and derivatives, still amounts to trillions of dollars in global GDP.
There is not enough above-ground gold to cover/underpin the global economy ... unless, at a guess, gold was to valued at a billion$ per ounce, which makes it worthless in effect, because then no one could afford it.
Despite what gold bugs say, all gold-based currencies have failed since Greek and Roman times, because there is never enough gold to go around to back anything.
Of course if I happened upon a stash of gold coins, then I would cash-out, buy a house, pay a housemaid to ease my declining years and indulge a few fantasies maybe; BUT gold is now as useless as it was to King Midas.
BTW many ZHers say they like contrarians, but few will like what I have just said about gold, which is contrary to most ZH disciiples.
Whomever down voted me should explain how gold could cover trillions of debt to Rothschild vampires of the global banking and propaganda system. based in Washington/Tel Aviv.
https://www.intellihub.com/ruble-plummets-putin-blames-u-s-says-west-wan...
Utter bullshit, I think Putin will sell his shitty US Treasuries and buy more Gold before he sold a single ounce.
I do not think Putin and his advisors really give a shit about gold, except for pragmatic reasons.
If I understand Putin and his rational advisors correctly, he/they/Russia will break away from all Western models of economics and probably sack the Harvard-trained Central Bank idiot, who is a left-over from the Yeltsin era.
you're an idiot, Putin needs USD, a lot and quick. he doesnt need to sell USTs. thats already USD denominated and can be used as $ collateral.
Oil doesnt sell for much nowadays, so no choice but to sell gold, whether he likes it or not.
He'll buy gold again, if/when oil prices recover AND the ruble with it. that may be a while away, so for the time being he is SELLING
if you don't like the price hes selling at, just make a bid for his 1000 tons at 1200$$ you may get filled
There is no shortage of physical in this market. ITs all bullshit
Goldcore is a liar. Russia is selling its gold, don't listen to Goldcore or ZH, they are trying to fool you
Gold is going down, whether you like it or not, and maybe not bottom before FED is finished raising rates, and by that time, Gold may be trading nearer to 700$. so be dumb, and dump gold, better be dumb money and rich, than smart money and poor.
Buy gold again, when the dumb money will buy again, and (when) the FED is finished raising rates.
Gold is now just as "fiat" as any other commodity in this Financialist World, Casino Economy/Ponzi Scheme.
Expect the worst possible.
Ya been had, darkie:
Russia Busts "Gold-Selling" Rumors, Reports It Bought Another 600,000 Ounces Taking Gold Holdings To New Record High
Bwaaaahahahahaha.
Bought in Nov. Article says sale in Dec
Its in bold to.
What is the truth? Here is the truth. This is awesome work and I am only about a month away closing out an estate. I know a guy in St. Petersburg who just love doing something that video. He is my wife cousin's husband and he likes me. He makes good money but he won't wear a shirt when talks to me via skype via woman and just loves my whole idea of "Let's get running again" and I have been invited several times. He is totally the white trash version of me.
The Russian women, whom we both married think they need to go to Moscow and spend way more than you to. Well, we are thinking otherwise. I think I want set something up because the guy has invited me several times and does at least speak understandble English. Going out and doing something like that is how you earn respect as a male in Russia. That is something I think I could help out on too. It is rather interesting to me that they would be interesting in doing the same thing as I would be doing.
I really do want an old Soviet/Russian car. All the shit works just the same as it does anywhere else. Perhaps a Lada. But to be honest a great of older vehicles where built to last from both countries. I would be fun to do. I would just bring one pair of my grease stained Carhart coveralls. I could imagine that the grease and dirt on my best pair of coveralls would cause a huge problem upon leaving a U.S. Chairport.
And? Apart from from your persoanal fantasies, what do you have to add to global issues?
It is not a fantasy setacros. So what you are saying is that my wife is not Russian? You are making some claims so why don't we don't see how we ends up for you? Do you have some proof that I am a liar? The answer is easy for you. No You Don't.
Show me. Show everyone.
"what do you have to add"
More than you just did, smart ass.
This story is wrong and extremely sloppy reporting by Zerohedge as pointed out by Mish Shedlock.
http://globaleconomicanalysis.blogspot.com.au/2014/12/russia-not-selling...