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The Annotated History Of Russian Crises Since 1860
While the current episode of Russian geopolitical and economic turmoil may seem significant, the following chart from Goldman Sachs shows the tempestuous time the nation has had over the past 150 years...
click image for large legible version
And here are Goldman's thoughts on Russia and The West now and into 2015...
Where we stand now:
Currency distress has taken center stage in Russia, with the ruble down 40%+ against the US dollar since early August. Already under fundamental pressure from sanctions and lower oil prices, the currency experienced a sharp sell-off this week in what we would characterize as a crisis of confidence. After the USD/RUB exchange rate depreciated by 10%+ on December 15 alone, the Central Bank of Russia (CBR) responded with a 650bp midnight rate hike. Despite the unexpected move, the ruble has remained weak. The currency's high volatility – part of which was likely driven by retail deposit outflows – and the sharply higher interest rate environment introduce risks to the health of Russia’s banks.
The sharp currency movements come on the back of shocks to the Russian economy from geopolitics (Russian capital outflows and sanctions that limit foreign inflows), falling oil prices, and sharp tightening of domestic financial conditions. Russian economic growth in the first three quarters of the year nevertheless stood at 0.8%yoy, indicating the economy’s resilience. The weakening of the ruble served as an important channel for the macroeconomic adjustment, keeping ruble-denominated oil prices relatively stable and shielding local balance sheets from more intense stress. However, the CBR’s large rate hike now makes it likely that FX distress migrates to domestic balance sheets.
The conflict in Ukraine remains far from resolved. The eastern Donetsk and Luhansk regions are still under rebel control, having declared independence on the back of controversial referendums held in May. Presidential elections later brought pro-Western Petro Poroshenko to power, though voting did not take place in parts of the east. Large-scale violence subsided after a ceasefire in September, but sporadic clashes have continued.
Diplomatic relations between Russia and the West remain strained, and economic sanctions against Russia appear likely to remain in place in 2015. President Obama is due to sign into law new sanctions legislation, although this is unlikely to result in any meaningful escalation of sanctions, in our view. In fact, there have been growing signs in the past several weeks of a renewed push toward diplomatic negotiations over the conflict in Ukraine. Meanwhile, deals between Moscow and Beijing on natural gas and currency-swap lines have reinforced expectations for the Kremlin to pivot eastward.
In response to Western sanctions, Russia introduced bans on food imports from the United States, Europe, Canada, Australia, and Norway for one year. This ban has had greatest effect on fresh product exports from Europe but little impact on the more tradable and storable agriculture products, such as wheat (of which Russia is a large exporter). As expected, the ban triggered a sharp rise in Russian food inflation. Of course, the worst-case scenario of Russia halting energy exports to Europe has not come to fruition, and exports of base metals and palladium have also been maintained. Following an agreement over gas debt payments, Russia also reportedly restarted gas flows to Ukraine on December 8.
Despite limited direct exposures to Russia, increased uncertainty resulting from the conflict weighed on investor sentiment in Europe and was one of several factors behind a deterioration of European economic indicators in 2Q14.
What to look for in 2015:
A highly uncertain Russian economic picture. Since the CBR’s decisive rate hike, we have placed our forecasts for rates, FX, growth and inflation on hold. There is a high likelihood of further measures to arrest the ruble’s fall – including a tightening of liquidity that leads to higher front-end rates, FX interventions and, in more extreme scenarios, there could be a risk of capital controls and bank holidays. Meanwhile, sustaining the CBR’s current policy stance for some months is likely to come at the cost of a sharper economic contraction, forcing pain onto local corporate and household balance sheets. The domestic banking system is now the most important place to watch for signs of broadening stress. And in the event that contingent liabilities in the banking sector are taken onto the sovereign balance sheet, pressure could migrate to sovereign credit.
Persistent tensions between Moscow and the West, with a highly uncertain path to resolution of the conflict over Ukraine.
Subsiding negative influences on the European economy, contingent on the conflict being contained.
Still little impact on Russian commodity production and exports. Russia may be able to keep oil production flat during 2015: lifting costs for conventional projects are low, and the cost structure is more resilient than that of other producers as Russia has a local service industry that generates ruble-denominated operating costs. Further out, Western sanctions combined with weaker market conditions may pose a downside risk to oil production. In terms of natural gas, a 2009-style disruption to European gas flows appears unlikely this winter, but in the current tense geopolitical climate there is still a risk that the deal breaks down. And as far as agricultural commodities, we continue to believe that sanctions impacting Russian agricultural exports are unlikely given their large size and the potential humanitarian aspect of such a move.
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Ded Moroz will make it right.
https://www.neweurasia.net/wp-content/uploads/2010/12/ded-moroz-snow-mai...
You think things are tough for them now, well, they used to be under the iron boot of communism....
and now the commies walking on someone else...
...and they will also shed tens of millions.
Lebensraum
I'd be more interested in a chart showing assassinations and central bank caused attacks on Russia, vs. defiance of the Rothschild family by Russian leaders.
Volkodav, I wonder if anyone really knows what your moniker means. It is the wild Russian dog that can be very fierce. The volkadov is a very large dog and is built for survival. I respect this.
I am the White Wolf given to me by the Objibwe tribe and also a very large dog. It is no wonder that we stare off. We are both very loyal it seems. We shall solve our issues.
All should know what a volkadav really is and what it means.
dup, our Sobaka are Alabai, which is more calm than pure Caucasian Shepherd.
I know Lady maybe 50 kg AirForce Officer basically that trains Caucaus type.
She has two little doggies from 65 kg her own. She herself is like cat, all wire and muscle, no fat.
Things always get better for Russia after she sheds tens of millions of her citizens. It's a hell of a coping mechanism, but who are we to question foreign customs?
Communism is always "foreign". It creeps around, on the periphery, looking for weak, suggestible, rebellious minds. Capitalism and freedom are hard and mean, they say. Just give up your rights for the "common good". What, are you a hater?
Soviet was never a Russian construct
From 1917 thru Stalin was never Russians in control.
Read Solzhenitsyn he told they were not Russians
"And of all things on earth the Marxist hates the Kulak the most"
from book: Count Your Dead They Are Alive! Wydham Lewis 1937
Russia has had a long tough history and I don't think the academics and beltway insiders understand how long they can hang tough.
Just ask the survivors of Leningrad.
VV Putin's Mother survived siege, but lost infant there.
Brother of President.
Russia can last longer than the west. Their debts are lower. Their banks are not leveraged like the west. They have less oil income, but they still have income. (Ask Greece, Italy, Spain, France how they are doing.) Europe is hanging on by it's fingernails.
Winter is coming and Russia supplies one third of Europe's gas.
Putin is very popular in Russia. He doesn't have to run for office and the Russian people are used to hardship.
And don't forget China is getting very chummy with Russia and they have 1.5 trillion of crappy US paper they are regretting buying.
China has manufacturing and consumer goods but no energy. Russia has energy but less manufacturing. Could China be Russia's white knight?
And SO WHAT if Russia defaults. Who do they owe? Western banks that's who!
Low oil is hurting north sea oil (England and Norway)
It's putting the last nail in the coffin for Venezuela.
It's killing US shale. Shale wells need around $100 oil to break even. There are a TON of shale junk bonds and those prices are plummeting. Also, the wells that those bonds paid for only produce for two years. No one is buying new junk bonds to keep the shale ponzi scheme going. The defaults on these energy bonds may be way more damaging to America. Could they trigger the next credit crisis?
I think Putin knows exactly what he's doing. (Now where did I put that Russian/English phrasebook?)
CBR is an extension of the IMF. It's time for Russia to declare Independence and rewrite their Constitution. If they don't, they will be sucked dry by the vampires.
Putin either keeps being deluded (by the CBR and Oligarchs) or deludes himself, that he or Russia can EVER make a fair and equitable "Deal" with Western Elite or Globalist Bankers. He just keeps on taking the rational, reasonable, diplomatic Middle Ground toward conflict resolution. This is his big False Hope, his Fata Morgana (Mirage).
Russia has not and will not EVER be in the inner circle of the Western or Globalist Elite. To them, Russia is and always has been merely a vast wasteland to be conquered, its resources tapped and its labor exploited. Even Hitler, who himself was duped to go soft on the English (due to the English/German aristocratic connection), saw all Slavs as "UnterMenschen" (SubHuman). That's quite ironic, coming from a guy with... "questionable paternity in his lineage" (his grandmother got pregnant by the Jewish master she worked for, and was then dismissed).
He can only win through strength: Full-Spectrum Strength. And that includes having the clarity of the Worldviews and Strategic Intentions of his Adversaries: the West (US and UK) and globalist Bankers. All else is folly and predetermined defeat (Sun Tzu style). If he and Russia (and its Oligarchs) can keep building Russia into a Mixed Economy, and keep making direct deals and Defense Agreements with key global players, then they can weather the coming Monetary and Financial Cataclysm.
As part of that Cataclysm, he can help Europe recover from its American Disaster of the last 20 years (since Bosnia, Serbia/Kosovo and the 2008-2014 Financial Crisis). If he can turn the table on the US and Globalist Bankers by getting the Europeans to literally say "Go Home Yankee!", he can help them get access to the Eurasian resources and markets -- and do so peacefully and business-like. Europe's true enemy is not Russia, but the last 4 US Administrations, Wall Street bankers and those Powers that dictate US domestic and foreign policy.
agree...
by far the starters do not realize what kind of game they started
dont fuck with RUSSIA
How it is possible for GS to post a rather accurate timeline chart without even reading it? Perhaps they had the US CONgress print it?
Except for your belief that China is not yet Russia's white knight, you have concisely described the Russian Federation's expectations today.
I won't bore everyone with the 40 year old circumstantial evidence I believe in, but to me the border conflict between R and C in the mid 60's was a sham, contrived to protect themselves from a Curtis LeMay military and a CIA that may have been responsible for the assassination of JFK.
This allows me to be more confident that things will work out well for Russia and Putin.
I found the Goldman Sachs' article to be a little like a summary of 'How to Raise Chickens for Fun and Profit' by Raynard B. Fox.
There's something wrong with that chart. The left side says: "Real Crude Oil Price". Doesn't compute.
I have always been hugely impressed with the Russian people and their toughness. I was particularly impressed with their love toward children and animals. The average Russian is a hell of a lot tougher than the average spoiled American. I just wish the Russian leaders and oligarchs reflected the best in the Russian people.
.
Perhaps some do.
http://www.russiaotherpointsofview.com/2014/04/russia-report-putin-.html
There are a lot of good yet somnolent folk in the U.S. who don't understand the temper of the Russian people.
The whole article reads like western propaganda, 85% of Russian economic activitiy is domestic which doesn't care about the value of the rouble or exports. The article is focused on speculating about only 15% of the Russian economy.
The article also ignores that oil will rise in 2015 once the expensive shale producers are wiped out of the market.
The rig count is falling by at least 1% per week, at that rate it wont be long before shale oil depletion overtakes new well production. As soon as global oil production shows an obvious decline the price will rocket along with the rouble, and the shaile oil producers will look fraking stoopid.
I think we are starting to see a bottoming in some energy stocks based on those expectations. The markets suck and are rigged but the energy stock prices usually look out about 3 to 5 months.
I think one of the things few people talk about is substitution where nat gas is replacing oil in some cases which has reduced oil demand.
Self aggrandizing Rothschilds trying to compensate for some major "issues".
Now is the time to go to Russia and go see what is up. Airfare to Russia has never been cheaper since 2001. But then there is the rest of it to pay for as well such as an invitation, a visa, a bribe to your cab driver, a bribe to exchange your currency, a passport with a an RFID chip in it.
All of the asslove for Russia has been out of control here for far too long. Here you fucking go. I found roundtrip airfare from the US to Russia for $729 this morning. Get on the fucking plane and go and find out for yourself. The exchange rate could never be better. For all of these assholes who proclaim to know Russia and what it is I say get on the fucking and go see. One caution, what you asslovers of Russia will find out is that they don't like you and that they will not help you. The Russians do not give one fucking lick about what you have to posted about them online. They don't care what you have to say.
At least if you do have the balls to go to Russia, which 99% of you won't, those who do will come back much more informed and realize what Russia really is like. Get on the plane: I did so more than once. Get out of Mommy's basement and go see the world.
I dare you asslovers of Putin to go to Russia.
You know what I would give a world of asslove for?
To see your systolic (it's got to be over 200) and your diastolic (110 at the minimum) while you are writing a venom filled rant like that.
If you live in Southern California, your road rage must be epic.
Can you at least tell us what kind of car you drive?
Let's see here. Alright doctor I have 149 over 99. I do monitor my pressure I have the proper equipment to do so. Do you really want to know why my blood pressure is elevated? We made ham and potatoes earlier tonight. That is a lot of sodium in the ham Mr. Doctor. Thank you so much for thinking that I am a fool and that I do not what is going on.
I don't live in SoCal. I own three vehicles. Each one has their own attributes and I use them as such.
If you want Russian asslove here you go. http://www.cheapoair.com/fpnext/Air/Listing/s/1 $727 round trip? That is cheap. Come on then, step up. I want to hear all of the asslovers experiences that they have there but you see there WILL NOT BE ANY EXPERIENCES to talk about so shut your fucking faces. If you love Putin then go there. Talk to the people.
What I said was the truth.
Remember this snippet of Milton you learned when you were a tot:
Well, I'm the converse. Wherever I go is paradise so I never go anywhere.
The Midas touch with a happy ending.
Hey, why don't you go to Russia and tell me all about it when you get back?
ps I'm glad you're watching your salt intake. We'd hate to lose you. :o)
I appreciate your concern about my blood pressure. What you fail to understand is my history as a blogger. I always keep this name and I got so sick and tired of people you that I made my own website. I've said what I have to say and lot's of people do like it.
One thing is for sure, you have never been to Russia and you want to talk me about Russians. BULLSHIT! Do you not understand? Are you mentally slow or something? I guess that Russian as the primary languge spoken in this household escapes you? I have no idea what you think you trying to prove.
Russian immigrant ? Or rather Westernized Russian ? Married to a Russian woman and brainwashing her with the crappy Western "values" ? Poor thing. Well now I understand your regular rants about Russia...
You know I have testimony from Russian on a French forum, and it's lot less darker than you want to make us believe...
Edit: Recently the Russian owner from a Russian restaurant in Paris got harassed by phone, death letter, death threat and so on and got assaulted by stupid leftist and pro-American due the Russia-Ukraine crisis, they said that if it don't stop they don't mind to return back in Russia. In the first place they haven't left Russia because it was crappy, but just because they were interested in the French culture...
Westernized Russian =/= Russian, same thing with Japanese, Arab and Chinese in general.
(Downvotes seems to prove that I have right on this one, thanks !)
you nailed it. white trash, probably some army under his belt so he could get out of the trash bins he grew up in, playing the politician in internet. most probably vodka is his connection with russia. stupidity at its lowest level.
on the russian in paris, most probably paid mob, regular guys dont do that crap. freedom fries comes to mind, regular people do not fell for that crap, it is ridiculous.
No, just go for it. You are nothing but lip service. I really want to see how this will work out.
GET ON THE FUCKING PLANE. Can it possibly be that hard to figure out? GET ON THE FUCKING PLANE. It is really not hard to figure out that you junkers will never go to Russia but will talk about them.
Get your ass going. Prove me wrong.
???????
Have been all over Russia many a time and concur people hate the system and actually hate each other with boorish behavior. Nevertheless admire their tenacity in times of hardshipp, rich culture and feeling of Ntionalism which we in West have sacrificed for matirialism, income disparity etc. Niether of us is perfect and should respect each other
Dude, I upvoted you for "lip service." Clever, but not gross.
Haven't been in a sardine can with 300 hoi polloi since 1996. I'd rather be inside a CT scan for 24 hours than for 10 minutes on a plane with the obese Americans wearing shorts and tee shirts and screaming infants.
I quit flying 5 years before 911 when air terminals became what they are today (my knowledge is only hearsay. If your experiences there are pleasurable, I defer to you).
In my younger days, I could throw my bag over my shoulder and walk from Munchen airport into town and find a nice hotel along the way. I have been everywhere I want to be.
Except for Moscow and St Pete. I'd like to see the Hermitage and a few operas and ballets at the Mariinsky and Bolshoi.
You think the Russians who go the ballet are more like the Lincoln Center people or WalMart shoppers?
And whom do you identify with, the former or the latter?
Singapore Airlines non-stop round trip Houston Moscow $918 now
I am already here! Been here 9 years now...
Who the hell pissed on your Wheaties today and made you lie like a frog with a firecracker up its ass?
Yes I think Russia is a wonderful place and it is a far cry freer than the USA...
"I dare you asslovers of Putin to go to Russia."
No, I dare you let me pick your ass up at the airport, in Moscow.
Shit for Brains...
...
You mean an American passport with an RFID chip? American passports are electronic, Russian aren't yet. I suggest if you want to examine bribery in a culture check out how much Jamie Dimon's organization has paid in bribes over the last couple years.
They need to redraw the chart to include the Crimean War 1853-1856. The Charge of the light brigade, Florence Nightingale, and all that to really understand the importance of Crimea to Russia.
Not to mention that two Crimean cities are designated "Hero City" in recognition of the invasion 42'-44'. The Russians lost over 450,000 fighting the nazis. Roughly the same loss that the US suffered over 3.5 years in all theatres. Kinda like giving the Alamo to Mexico.
Americans have forgotten Alamo much...mexico is there all around
forgot in history books
Really no comparison
Of importance Crimea to Russians...most families have history of fallen there
Reverent History
When you throw poorly trained soldiers with a few firearms and mostly sticks and pitchforks against a highly trained mechanized army the result is a bit lopsided. Not the first time either.
collapse of the ruble is bad for russia. the collapse of the yen is good for japan. i get it now.
No, you can't talk about Russia around ZH if you actually ever been there or have relatives there. I'm the asshole again. Fine, get on a plane and go visit. I would like to see what happens.
Now here's a very good quote from the "shadow CIA":
"Russians' strength is that they can endure things that would break other nations. It was also pointed out that they tend to support the government regardless of competence when Russia feels threatened. Therefore, the Russians argued, no one should expect that sanctions, no matter how harsh, would cause Moscow to capitulate."
http://www.stratfor.com/weekly/viewing-russia-inside#axzz3MQsSwWaX
Friedman actually confirmed in an interview that the Kiev coup was organized by the USA...
"Indeed, it was the most overt coup in history", the political analyst stressed.
http://sputniknews.com/politics/20141219/1016024377.html
you should say by us, not by USA. Its YOU who helped them to get power
Starting from 1928, the Soviet economy was put under a system of planning whereby all modes of production were socialized and foreign trade was de-emphasized in favor of an autarkic system of domestic demand and supply. The irony was that Soviet central planning adopted much of its effective techniques from successful US experience. It was a system of planning focused solely on unit end-results while externalizing social costs. The key distinction was that the Soviets rejected and bypassed the corporate structure and replaced shareholders with state ownership. Stalin brought about "revolution from above". Its main features were: strengthening of political dictatorship in the name of the proletariat (equivalent to enhancing management authority in the US in the name of shareholders), collectivizingkulak peasants (equivalent to agri-business development in the US), emergency measure authority (equivalent to government bailouts and regulations in the US), introduction of a five-year plan structure (adopted from US corporate strategic planning) and rapid expansion of urban labor force (equivalent to urbanization in the US), and tight state control over agriculture (equivalent to farm subsidy programs in the US), heavy industry (equivalent to defense contracts in the US) and finance (equivalent to central banking in the US). Between 1934 and 1936 the Soviet economy achieved a spectacular economic growth rate that continued despite political purges of Trotskyites between 1936 and 1938. Economic growth was unfortunately interrupted by war in 1941. German invasion of the Union of Soviet Socialist Republics was not independent of apprehension of continued Soviet economic success.
Propaganda works. It worked in the USSR, in Nazi Germany, in imperial Japan and in the capitalist US, each to instill in the general public an acceptance of its system as being the suitable one if not the best, despite visible shortcomings. It helped achieve optimal effectiveness and stability in the overall economy in all these countries.
http://henryckliu.com/page105.html
"And of all things on earth the Marxist hates the Kulak the most"
from book: Count Your Dead They Are Alive Wyndham Lewis 1937
Moribundus,
What you described is what von Mises had written about almost hundred years ago.
The two manifestations of socialism: bolshevism and fascism.
Using the word capitalism in context of the US is quite misleading.
....
https://archive.org/details/TheRulersOfRussia-AmericanEdition-ByRevDenis...
https://archive.org/details/TheControversyOfZion
https://archive.org/details/UnderTheSignOfTheScorpion
http://www.theoccidentalobserver.net/articles/MacDonald-Solzhenitsyn-200...
http://www.kevinmacdonald.net/SlezkineRev.pdf
http://www.darkmoon.me/2014/russia-rising/
http://www.radioislam.org/islam/english/jewishp/russia/rusolig.htm
http://svyatoslav.50megs.com/OLIGARCHS.HTML
http://www.theoccidentalobserver.net/2014/03/the-unstable-alliance-of-na...
http://www.iamthewitness.com/Ukraine.html
It's the same tribe of financial vampires who raped Russia in 1905, 1917/1918, and under Yeltsin.
Just as certain things are not covered in the news today, events, facts, truths - many things were kept out of the history books.
So it keeps repeating.
The obvious lesson that leaps from this chart of Russian History is what happens when Oligarchs accumulate too much power and wealth in an economic system. You lurch from violent revolution to violent revolution, crisis to crisis, and wealth is ultimately confiscated and redistributed. A prosperous economy in which all contribute effort and share the reward, and which is governed by the rule of law, equals peace and progress.
Other than Bhutan, that would be where, exactly?
Kibbutzs in Israel fit that description, but they did not catch on either.
[the currency experienced a sharp sell-off this week in what we would characterize as 'a crisis of confidence'.].....
why not be honest and call it 'extraordinary economic attack' ???
http://in.reuters.com/article/2014/12/20/russia-putin-security-idINKBN0J...
...Speaking at a concert honouring past and present security service staff, Putin said he had heard people calling for Russia to "pay dearly for its independent position backing compatriots and Crimea... (and) just for the mere fact that we exist".
"Obviously, no one will succeed in intimidating us, to deter, to isolate Russia," he said in comments that were shown by state-run Rossiya 24 TV.
Separately, the Russian Foreign Ministry said on Saturday that new Western sanctions against Ukraine's Crimea region represented a "collective punishment" against residents who had voted overwhelmingly in a referendum last March to join Russia.
"It is sad that the countries which call themselves democratic resort to such methods in the 21st century," the ministry said in a statement.
Foreign Ministry spokesman Alexander Lukashevich said the sanctions undermined political efforts to resolve the conflict in eastern Ukraine.
"We advise Washington and Ottawa to think about the consequences of such actions. Meanwhile, we will work on retaliatory measures," he said in comments published on the ministry web site.
Russia retaliated to earlier sanctions by limiting food imports from a range of Western countries.
Kiev and its Western backers accuse Moscow of fanning violence in Ukraine and arming the rebels. Moscow denies the accusations and says it annexed Crimea only after the referendum showed most residents wanted it to become part of Russia.
Earlier on Saturday, in a letter published by the Kremlin, Putin called for Russia's secret services to be improved to tackle "modern challenges and threats and the emergence of new destabilising factors".
The key tasks for Russia's secret operatives were to fight international terrorism and "any attempts of foreign special services to deal a blow to Russia (and) her political and economic interests," said Putin, himself a former KGB agent.
Wow, Russia's per-capita GDP has been over $20,000 in the last few years, almost half the US value. That would make Russia a first-world country if it weren't all going to oligarchs sailing between their Mediterranean villas in battleship-sized yachts.
Of course this is a purchasing-power-parity figure based on an unrealistic basket of consumer goods (e.g. vodka, cigarettes, and locally-grown produce). My in-laws there said before this crisis that Russia's cost of living is higher than Germany's, which is higher than the USA.
Notice to the left side of the chart that there's a floor on per-capita GDP, because at that level the capita start dying of hunger.
there was no russia during 1918-1989 it was soviet union