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Russian Default Risk Surges To New 6-Year Highs As Ruble Rubble Returns
Just when you thought it was all over... Having bounced post-CBR intervention and somewhat stabilized, the re-collapse in crude oil prices and continued weakness in Russian macro data provided just the impetus for a re-plunge in the Ruble (back above 63.5/USD) and surge in Russian bond yields (back to 14%). While Russian stocks are also retesting towards recent lows, it is Russian CDS that is the most telling as it closed to day at 595bps - the widest since March 2009. While these violent gyrations are new for recent history, they are not a new phenomenon, but are quite characteristic of the country’s financial history.
The Ruble and stocks are not quite back to recent lows...
But Russian credit risk has hit new highs...
However, as RT explains, this is nothing new for Russia...
The dramatic fall of the Russian ruble made headlines in December. The violent gyrations in the ruble are not a new phenomenon, but are quite characteristic of the country’s financial history.
On December 15 and 16, the ruble took a 22 percent dive, which prompted a run on the Russian national currency.
The ruble’s spectacular 22 percent plunge on December 15 and December 16 has prompted investors to liken the crisis to 1998, when the ruble lost 27 percent on August 17. Reaching a 16-year low, the ruble fell to 80 against the USD. By the time of publication, it had recovered to 62.7, compared to 32.9 at the beginning of 2014.
800 years of history
One of Europe’s oldest currencies, the ruble has been in use since the 13th century. First made of silver, the currency derives its namesake from the Russian word ‘rubit’ which means to chop or hack, and originally was made from fragmented pieces of the Ukrainian hryvnia.
The ruble has been chopped, hacked, collapsed, and re-denominated several times throughout its nearly 800-year history. The most volatile years came along with regime change and revolution.
After the 1917 Bolshevik revolution, the ruble lost one third of its value, and in the following years while the country was gripped by civil war, the ruble dropped from 31 against the dollar to nearly 1,400. The ruble hit its historic low of 2.4 million per USD after the civil war and the year the revolution’s leader Vladimir Lenin died. It was re-denominated to 2.22.
Throughout the Soviet Union, the ruble was little used outside state borders, so the government kept the official rate close to the dollar, a massive overvaluation.
In the last years of the Soviet Union, the economic crisis caused panic among the population who were ‘stuck’ with their increasingly worthless rubles. A black market naturally developed, and while the official rate for the ruble was 0.56 per dollar, a single greenback actually sold for 30-33 rubles on the street.
From Soviet to Shock Therapy
The ruble collapsed along with the Soviet state, and different currencies were set up in the 15 different republics. The Central Bank of Russia replaced the State Bank of the USSR (Gosbank) on January 1, 1992 and the Russian ruble replaced the Soviet ruble.
The new Russian Central Bank set the official exchange rate at the Moscow Interbank Currency Exchange (MICEX) at 125 rubles to the US dollar. By December 1992, the ruble had already lost about two third's of its value.
Russia’s post-Soviet economy was dominated by ‘shock therapy’, and as President Boris Yeltsin’s reforms spurred rapid inflation, millions of Russians lost their savings.
Boris Yelstin’s political infighting with the Communists in 1993 caused the ruble to slide more, down to 1,247 per 1 USD. Yeltsin won the political coup, and a constitution was signed on December 12, 1993.
Shortly after the political victory, in January 1994, the authorities banned the use of the US dollar and other foreign currencies in circulation in an attempt to stymie the ruble’s decline.
Black Tuesday and Black Thursday
On October 11, 1994, an event known as ‘Black Tuesday’ hit the Russian financial market, and the ruble collapsed 27 percent in one day, which on top of a decline in GDP and massive inflation, catapulted Russia into an economic recession.
By the end of 1995, chronic inflation had reached 200 percent.
In 1996 the currency closed at 5,560 rubles per US dollar. 1997 was the first year of relative stability, but the ruble still fell to 5960 rubles per dollar. An era of stability prompted the government to devalue the currency and slash 3 decimal places, and on January 1, 1998, the ruble was set to 5.96 against the US dollar.
The bottom was ready to fall out of the economy. On August 17, 1998, Russia announced a technical default on its $40 billion in domestic debt and ceased to support the ruble on the same day. At the time, the bank only had $24 billion in reserves. The stock market and ruble both lost more than 70 percent, and nearly a third of the country’s population fell below the poverty line.
Along with the default came another mass devaluation of the ruble. In six months the value of the ruble fell from 6 to the dollar to 21 to the dollar.
“There was a desire to escape from the ruble from any direction,” Sergey Aleksashenko, deputy finance minister under Boris Yeltsin, has observed. Aleksashenko says today’s ruble crisis reminds him of 1998.
On May 27, 1998, the Central Bank increased the main lending rate to 150 percent, which brought loans to a near halt. By the end of 1998, inflation was 84 percent and the Russia GDP lost 4.9 percent.
Both currency crises in the 90s forced the governors of the Central Bank to resign.
The 1998 ruble crisis, like today, was driven by falling oil prices, which went as low as $18 in August 1998. However, today's crisis is much less of a risk, as Russia has more than 10x the amount of currency reserves as it did in 1998.
The ruble met the new millennium with a rate of 28 to the dollar, and after hitting a low of 31 in 2003, started to slowly strengthen.
Recession: in, out, and in again?
In 2008, Russia along with the much of the rest of the world fell into recession, losing 7.8 percent of GDP in 2009. The Russian economy fared the crisis rather well, and the economy was back on track with 4.5 percent growth in 2010.
Russia is facing its biggest currency crisis since 1998. The ruble has mostly been tumbling in tandem with weak oil prices, which have nearly halved since June, when Brent crude went for $115 a barrel. In January, prices plummeted below $50 a barrel. The ruble has lost more than half its value since the beginning of the year. Investors worry that the devaluation, along with falling oil and political tensions, will send Russia into recession this year.
The Central Bank forecast a 4.7 percent decline in GDP if oil prices stay at $60 per barrel.
On December 15 the ruble plunged 11 percent, and to counter the plummet, the Central Bank increased the key lending interest rate to 17 percent, in the middle of the night. The next morning after slight gains in the early morning hours, panic against ensued, and the ruble shot up 22 percent, the biggest single day loss since 1998.
Russians called it ‘Black Tuesday’ in reference to the 1998 currency devaluation when the ruble jumped from 6 to the US dollar to 21 in less than 24 hours.
During his annual end of the year press conference, Russian President Putin didn’t place blame on any particular government department, but said the Central Bank’s response had been appropriate, but possibly too late. So far, Putin continues to describe the Central Bank’s policy as “adequate.”
The government has already made many swift moves to salvage the ruble since mid-December. It hiked the key interest rate to 17 percent to control ruble flows, has lent money to the company’s biggest oil producer, Rosneft, and bailed out the country’s 29th largest lender, Trust Bank.
Russia’s biggest oil producers, including Gazprom and Rosneft, have been ordered to sell a fraction of their foreign exchange revenues over the next couple of months in order to support the ruble, adding an estimated $1 billion to the daily market.
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Interesting. What are the liabilites of the U.S. government again? Wait what, who is the default risk again?
Obummer reportedly admits Russia is the target of falling oil price:
http://www.dailymotion.com/video/x2dqj0c_obama-admits-falling-oil-prices...
Paging Mr Holmes, Mr Sherlock Holmes. Please meet your NoShiat Party at 1600 Pennsylvania.
So, Oil prices will not stay low forever. Russian stocks keep getting hammered in sync with oil. So when oil bottoms, and it will, I will start buying Russian stocks, and EFT's. Oh, and vodka.
Obummer might wish to consider that the Russians have long memories, and may also consider the adage "revenge is a dish best served cold".
With the Russian SWIFT equivalent almost ready, and all those deals with China (NOT in Dollars!), there is more afoot that immediately visible. Whilst the US Debt ($ 18.1T) is of no real concern whilst the US has Reserve Currency status, if that status is lost, then that "notional figure" becomes a real debt, in a currency NOT under US control (so the "ctrl-p" option will no longer work!)
Then what?? Do those to whom the US now owes a "real" debt decide the time has come for collection? "Assets please, not paper currency"? Brings not-so-pleasant visions of the USA being chopped - up and swathes "sold off" to those who have a pecuniary interest - and I wonder how that will go down with the locals . . . :-)
This is false, read the transcript. Screwing Russia may be the unofficial policy but officially, Obama admitted nothing of the sort.
http://www.npr.org/2014/12/29/372485968/transcript-president-obamas-full...
Thanks. That's why I wrote "reportedly".
Always to remember the propaganda cuts both ways.
and do we need an official statement from us sate department of denial . It's understood duh .
This looks more like a manipulation. Economic capital market warfare. Lets see if China comes with some help.
China is a Tribe proxy state; definitely helps explain the extremely favorable oil/NG deals they've been brokering with Russia. There are Tribe-affiliated entities within Russia ready to pounce, think Yeltsin era 2.0.
Planet Earth is a tribe proxy planet.
I know this because I saw a Grey buying Knishes at Yonah Shimmels.
JPMorgan settles currency manipulation lawsuit in U.S.
http://fortune.com/2015/01/05/jpmorgan-settles-currency-manipulation-law...
racketeering
http://criminal.findlaw.com/criminal-charges/racketeering-rico.html
RICO is only applicable to those outside the clique. Those inside the clique can openly flout any law they want without consequence.
Calling all trolls!
They are coming with their youtube barrage and msm bunker busters .
just another clown currency
putin is a clown so no surprises
Junkers need to realize he really is nothing more than a puppet. All heads of state are.
You need to learn to distinguish between Caesar and a common Theodosian.
Dines and drinks with his supposed worst adversaries: Theodosian
Puts his political opponents and unruly oligarchs in prison(or worse): Caesar
Gets quickly replaced after his first undictated action: Theodosian
Singlehandedly remakes the national laws to allow for his lifelong, undisputed reign: Caesar
Gets stoned to death trying to escape own rebelling capital by himself: Theodosian
Gets stabbed in the back by friends and associates at the first occasion: Caesar
Bonus: Gets stabbed, bombed, shot, sniped, crushed under rubble and more over a dozen times without losing sleep over it: certainly not a Theodosian. More likely a Hitler.
The stupid cat is at it again...
He always gets this way after eating a few of the 'chocolates' in his litter box.
looking fwd to the up to date stats on russia's dollar reserves and gold holdings. defending that piece of shit currency is gonna cost. burn baby burn.
Default now and stick it to the kike banking cartel just like the yokos return to the Russian citizens.
this must be the reason the Dow has erased over 110 points in the last hour approaching the close in NY...
v-shaped rocket propulsion underway...
So what you're saying is Russia takes on some debt then periodically says fuck you to the bankers followed by the bankers providing more credit later on. Interesting...... remind me again who the stupid one is in this scenario.
The Donald lighting up a cigar ...
If the banking mafia lent something of actual value then you'd be right but the banksters conjure the money out of thin air at zero cost to them and then charge interest on it - literally money for nothing so the logic is different.
They always make an actual profit even on default because they charge interest on pretend money. Default only causes problems for them by complicating the accounting charade necessary to smoke screen the fact that it is all pretend money (and because it might encourage others).
Banksters continue to lend to countries after defaults because it is money for *nothing*.
One more reason to keep defaulting on a regular basis... since money ain't what used to be anyway...
Indeed, Russia keeps selling its natural resources in exchange for numbers on a computer. Sounds pretty stupid to me guys. Really think through what the petrodollar means.
Specifically:
1. People sell oil in exchange for US dollars.
2. People buy stuff that used oil to make and transport. The buy that stuff using US dollars (or some locally converted US dollar equivalent)
3. People need more stuff. Repeat 1.
Exhorbitant advantage indeed. The thing to keep in mind is that the USD losing it's reserve status doesn't really mean anything if it's not replace by a gold or resource backed currency.
Russia uses part of its dollars to buy gold. That's what they used to call "saving" before the invention of MMT (also known as the Magic Money Tree theory). Your reasoning is faulty.It's back to school for you... and learn some real economic history this time !
Keep your eye on the 1200 ton gold prize. New loans mean this has been looted.
"Russian Ruble Rubble Returns"
Everybody stand back- I just alliterated all over the place.
The Four Rs strike again
Russian ruble rubble returns--rubs Russians wrong.
If you owe the bank $10k you have a problem. If you owe the bank $1T the bank has a problem. Russia needs MOAR debt
shame no lenders will touch them with a barge pole
Not really. The large banks have a bottomless piggybank from which to draw.
If you owe the bank $10k you have a problem. If you owe the bank $1T the bank has a problem. Russia needs MOAR debt
Just like Draghi !
They are ALL on the same page; remember, its the US oligarchs : the TBTF, who started this new mantra in 2008 during Lehman Moment.
Now its soooooo déja vu !
Boring!
None of it really matters anymore. Russia doesnt have access to western credit anyway so if they decide to default on all private loans, then the Rus government can buy back at a fraction. Rub to dollar only makes sense if they have access to foreign loans in usd and buy goods in rub to usd transactions. Since they dont and pushing to use other currencies, it is becoming useless to compare the currencies at this point. Rub to yuan is far more important to Russians. Most of their imports are coming from China now, as EU is losing the market due to sanctions.
Well, we've already heard reports of those "Russian Sanctions" having not such great effects on the EU economies - http://www.washingtonpost.com/world/europe/europe-weighs-russia-sanctions-against-economic-pain/2014/07/28/816b56cd-dcc4-41bb-a457-d9411c272f71_story.html
Now, it seems France is feeling the pinch, enough to propose lifting of said sanctions - http://www.bbc.com/news/world-europe-30679176 (with "conditions" of course - must save fact, mustn't we!)
So, is this rapprochement a start towards something more substantial than "consideration" of Putin's "Welcome to the EurASIAN Trading Bloc"??
Putin to the EU - "We welcome to join us in the largest (and most productive) Global trading bloc. Or would you prefer to remain subservient to the USA and watch your economies wither?"
Wonder what's really going on "behind the scenes"??
Oh Czar Putin are you going to fold in this uncertain world?
Nothing really matters anymore...the cry of the damned who are prepared to be grand slammed !
Fold? , he is pumping as much Oil as he can, just like he should. His costs in Rubles are falling faster than the price of oil.
driving prices lower which increases the amount they need to sell which drives prices even lower.
Low prices cure low prices.
wrong. lower oil prices beget even lower oil prices. paradoxically high oil prices cure high oil prices.
S.A. is selling at a loss, and they largely just collect it in buckets from the sand.
Are you actually a retarded person? There is a lack of demand, which would seem to me to affect price first, but they are loss - selling already.
don't you get it?
what is Saudi's marginal cost of production...they are not selling at a loss?
edit
http://uk.businessinsider.com/how-low-can-oil-prices-go-2015-1
complex game to say the least.
Putin's Achilles heel : he creates no institutions, just a crony Oligarchy...and nobody is eternal. I fear for the Putinista system when he falls.
No oligarchy blob . Oligarchy rules in your free land .
some exceptional country has way too many institutions already, not do anything but add to vertical growing debt.
Russia should do nothing...
Stay on course, defend motherland, and resources.
for all russofobiacs i have message : go buy $5 globe on garage sale, then find Russia!
yes 11 time zones, on fifth of land, and enough everything from gold to oil for next 450 years.
what Russia needs is world peace and order so that it can build itself in to
nice country, WITHOUT impoverishing anybody else...
Well that Peace will not be allowed with USA around
Get Russian companies to default on western bank loans. Attacking the London and Wall St banks will end the conflict becuase the bankin gmafia own western politicians.
Russian default sounds like nonsense, Russia has a positive current account balance and substantial foreign reserves.
We all know forex is a rigged market not based on fundamentals, if it was an honest market the $US would be worthless.
When people talk about Russian default I think they generally mean Russian companies with dollar loans from western banks.
Some reason, people here and in western media say Russian debt is $600B. But private debt is close to that. State debt is not. If companies decided to default on it, what will happen? Since most of it is in fixed assets (factories and what not), then the foreign investor will pull out and the company wont get foreign loans. But, they dont have access to foreign loans because Russia is barred from cheap loans. So reality is, if they default, nothing will happen till sanctions are lifted and they wont have access then to loans. But what if sanctions arnt lifted? Well, then nothing will happen period. They hold onto the debt because some people in Russia who has power believe (yes, believe is key word here) that sanctions will be lifted this year. After some words recently from Italy, France and Germany, this could happen. So they think that if they wait it out, they can pay off the debt then and instantly get more cheap loans. This is really a gamble honestly, but if they did choose to default, well, doubt anything will happen to them as it wont be easy (especially now) for someone to come in and just strip assets and move it out of the country. Probably wouldnt be worth it anyway. So the companies stocks would be worthless and either operate on worthless stocks or is purchased out by someone else. Recently, Russia purchased back stocks heald by westerners on its energy companies for a fraction of the cost, and gained all ownership of stocks back.
If they won't pay back their debt than their assets out side Russia will be taken away.
potatosack russian rosneft paid 6-9 billion $ loan at the end of 2014 . rosneft is the only russian company with large debt . at least get complete FACTS .
...the Briiics have plenty of fiat to loan the Bear.
I think Putin will not go down without a fight....he will stir up some trouble somewhere with his military...they will shoot down a plane or sink a boat somewhere..just to create a mess.....I would not want to play his chess game...
Judging by recent history, is that US has a tendency to blatantly attack nations and stir shit anywhere. Ukraine, Iraq, Afghanistan, Libya, Tunisia, egypt, etc. Just recent examples. So I am pretty certain Russia is doing the right thing.
you forgot Hong Kong
.
Some 'americans' could claim brain damage to come up with such cheap propaganda.
Not surprised as commonly, 'americans' struggle at thinking out of group patterns.
In Amerika, It's that sportaholic crappola... Put your USA, Usa, usa sweatshirt on and rah rah your team no matter how stupidly or wrong they play.
Oh I see Fourth Stooge, you fucking douche bag, but those like you that sit here for the whole day posting, because you have nothing better to do than stick your finger up your own ass, are so much more "intellectual" than Americans..lol
You fuck bag...go fuck your self, and while you are at it continue to Blow Putin, while he rams his dick up your beloved Russia's ass, you fucking propagandist fuck tard mother fucker
Captain Butthole said:
Nothing about being intellectual, a simple look at reality is enough.
Brilliant US citizen intellectualism on display.
The pouring of gibberish does not offuscate your lack of grip in addressing any made points.
potty mouth..
Sorry, are you writing Putin but thinking about Israel?
is that the best you ruskie shills can muster ..... c'mon sucky sucky some more red knob !
Waaaaaah waaaaaaaah waaaaaaaaaah ruble in the toilet waaaaaaah PoooPPplooooooooooosh down she goes swirly swirly
You will never earn potato for such cheap stuff.
you mean i have to work harder to get the shills to poo poo my comment... Jeeez... I can't do anything right today... can't even get the red shills to lob a comment
a fuck it
Dudes... all the leaders in these countries are pure garbage.. why people cheer for any of them is bizarre ..
The 'shills' here actually seem like the people who rarely comment except to bash Russia or Putin with, for the most part, ad hominem and shit 13 year olds say.
One has to ask why an American or Brit would root so hard against Russia and Putin - because you want the US to remain unchallenged as sole superpower for a 1,000 year reich>?
Or because what you really want is Israel ruling the world by proxy, through its puppet American government - meaning endless wars to remake the middle east?
Your repeated focus on homoerotic/homphobic imagery suggests someone who yearns, verily, pines away, for the salve of a long and fat phallus, introduced violently and repeatedly into his own colon.
Which uncle made you pet his monkey, Hamm?
how do you talk or even breathe with that large putin ruskie knob in your mouth... hahaha typical blah blah zion, blah blah american gov't ... blah blah blah ....
Its the BANKS ... you fucking moron ... ITS THE B A N K S !!!!!!
they run the show, they own the actors, and they make the FAKE STORY that dipshitts like you swallow up
your dense for even a russian shill... usually they blab off about russian history and other garbage russian shit
Strutting will not help idiot .
Interesting...
In 1920 the US occupied Russia along with Anglo-Franco looters. At the same time, Poland attacked Russia and occupied the Eastern parts of Russia (including Ukraine).
The North Russia Intervention, also known as the Northern Russian Expedition, the Archangel Campaign, and the Murman Deployment, was part of the Allied Intervention in Russia after the October Revolution http://en.wikipedia.org/wiki/North_Russia_Intervention
http://en.wikipedia.org/wiki/Timeline_of_United_States_military_operatio...
In 1990s the West (US + EU +NATO) occupied Russia from the top, economically, financially an politically) See Testimony of Anne Williamson Before the Committee on Banking and Financial Services of the United States House of Representatives September 21, 1999
http://gizadeathstar.com/2014/08/look-back-anne-williamson-rape-russia/
1920 and 1990s on the chart were the times of the collapse of the Russian economy, due to the western occupations.
2014-2015 - the West economic war on Russia.
The Western world is the mortal enemy of the Russian civilization.
nothing to add here. Nothing at all.
"Let's you and him fight."
signed
The Banking Mafia
The Bolsheviks were the antithesis of Russian civilzation and they murdered millions of Russians in concentration camps. It was a great shame western intervention in the 1920s didn't destroy the Bolsheviks then we might not have had WWII at all and Russia would have been a lot better off.
to tumblemore
The Western intervention was just the second part of the bankers plan to destroy Russia. The first was the Bolshevik (mostly Jews from Brooklyn and Baltic criminals) revolution masterminded in US and England and financed by the German, US and English banks. If the Western plan worked, Russia would be broken into pieces and divided between England, US Germany, Poland and France.
If the Western interventions in 1920, 1941, 1990s succeeded, Russia and Russian people would cease to exist.
Somehow, Russian people don't believe that they should die in order for the West to prosper on Russian natural resources.
Ironically, if the Germans hadn't invaded Russia the Bolsheviks would have wiped the Russian people out. When the Germans invaded and started shooting all the Bolsheviks the Bolsheviks had to reverse their genocide of the Russians because they needed them to fight the Germans.
The revolution was largely banking mafia - one of the first "color" revolutions.
The 1920s intervention was anti-Bolshevik but sadly failed.
The 1940s intervention was partly anti-Bolshevik and partly anti-Russian.
The 1990s intervention was 100% banking mafia.
So the whole blood-soaked 100 years was mostly caused by the banking mafia trying to force every country into their central banking fraud.
Well, in the interests of equal time, permit me to add something for the sake of context. Not that you will like it at all.
In the middle of the First World War, Russia surrendered to Imperial Germany and left the Western Allies to face their enemy alone. Vast shipments of western military goods were stacked up in various ports around the periphery of the Russian Empire.
Small Western contingents were originally landed at these locations to safeguard the equipment and make sure that the faithless Bolsheviks did not hand it over to Germany. Beyond this original desire to not help the Central Powers came the realization that there were dissident factions in Russia that would re-enter the war, or so they said, if they could have access to the supplies already sitting around in Russia.
With Ludendorff hammering on the gates of Paris, the French army recovering from a mutiny, the Italian army fleeing from the disaster of Caporetto, the British army bled down, and the untrained Americans just starting to arrive, it sounded like a good idea to stir up some free trouble for the Kaiser on his supposedly-docile Eastern flank.
The Russian Civil War grew out of this original need to fight off a nearly-victorious Germany at all costs. It is wrong, however, to impute that this unfortunate series of events came out of some rapacious urge of the West but rather arose from a cynical abandonment of their Allies by the newly-enthroned Bolsheviks.
The Allies did not supply transport to Russia for the exiled Lenin. Germany was the train conductor, and the Germans counted on the Bolsheviks to quit, which they promptly did, and this act of surrendeer thus endangered everyone.
+1 just for adding readable content to ZH.
The Russian Civil War grew out of the Judeo-Bolsheviks seizing an opportunity to attack when the Russian forces were elsewhere.
By the time the Russians surrendered to end a war they never should have entered to begin with, a war not started by Germany {in case you don't know this}, and really started by Britain and France and their desire to remain dominant in Europe, they had been fighting for 3.5 years. They loss well over 2 million men.
he JudeoBolsheviks had little interest in fighting Germany where Jews held tremendous power. They busines themselves setting up the Cheka and Red Guards - both overwhelmingly run by anti-Christian fanatical Jews, in order to complete their take over of Russia.
Your last word is "everyone" - I think that quite says a lot about your capacity for rigorous thought.
Well, what can I say? As a mindless slave of the sinister Judeo-Bolshevik conspiracy, I have to unquestioningly follow Lucifer's orders in my fruitless efforts to deceive you and the rest of the anti-tribe dia-tribe tribe.
Alas, that you have so cleverly unmasked me and my malign designs. Oh, the shame of it all.
regrugiating bullshit will not help kool-aider .
Ha ha ha .... God bless the American inventors of fracking. Yet another case of technical ingenuity besting resource-based thuggery.
And that gentlemen, is why America is a rich country, and Russia never will be. There are plenty of Russians who are smart enough to have invented fracking. But they had no motivation to do so, since they knew Vlad and his friends would just steal the benefits.
Made me laugh. That is quite a delusion this US citizen tries to sell.
Your god is certaily not helping then , choomboy
Fact: Russia and China recently signed two major Gas agreements.
Fact: These agreements span 30 years.
Fact: These agreements allow for payment in "non-US" dollars.
Because it will be buying Russian Gas for 3 decades, from China's perspective,
the Ruble is effectively equivalent to Russian (Gold) Gas.
So when the Ruble drops today, China sees its future price of Gas dropping.
The more the Ruble drops, the more China is motivated to buy Rubles,
thereby securing cheaper and cheaper Gas for its future. And the best part
of this is that China gets to pay with (shit) something they have in abundance,
something they (trust) have no use for and are (love) desperately to unload
because they (know) fear it will become next to worthless, oodles of U$D.
In fact China's dilema now is "Do we buy Gold or Rubles" with our (shit)
US (money) currency.
Anyone shorting Rubles today can be sure China is on the other side of
the transaction and China will be holding on to those Rubles, long term.
So Putin doesn't need to defend the Ruble, China will do that for him.
ps: (strikout) just doesn't work for me
Okay, so, as I understand your explanation, China trade rubles for gas and the lower the ruble goes, the cheaper their gas will be. So what interest does China have in helping keep the ruble high? None, according to you. The lower it goes, the better they like it. So what am I missing here? Sounds great for China but why is this good for Russia?
Russia sells oil & gas to China for yuans not rubles. The yuan is pegged to the dollar (that annoys US to no end, by the way...). So China could support Russia just to spit in the American soup (so to speak) with no consequences for their imports. What you're missing is the essence of their trade: Russia doesn't need rubles (it has plenty of those) but yuans which it could use to buy pretty much anything it wants from China.
And what you are missing is that it is not MY argument that China will use rubles, but HIS argument that China will use rubles. In your eagerness to disagree with anything I might have to say about anything, you leap to a conclusion but thank you for the elementary lesson in economics nonetheless.
But you do raise an interesting point. Since it is YOUR thesis that Russia will need yuan to buy necessary items from China and the yuan/ruble rate is going to approximate the disastrous dollar/ruble rate, Russia will have to obtain these highly-expensive items through foreign trade where their weak currency makes their exports (gas) cheap and ever cheaper and their imports expensive. How does this benefit Russia? Again, you are both enumerating the benefits to China and then suggest that they are going to strengthen the ruble so they can pay more for their gas and oil. Why would they do that?
Ruble down about 10% in TWO DAYS, by the way. Currently 63 and dropping.
Ruble will keep following the oil price. Nobody needs to "defend" it (unless it decouples).
China has no interest in keeping the Ruble high any more than they do in
jacking up the price of Gold (at the moment), but they do have interest in
(1) unloading their USDs.
(2) buying dirt cheap gas futures (Rubles).
A great summary of Ruble history. Thank you.
I would like to see one on rial.
Today is Russian Christmas Eve.
We sanctioned some folks and now they won't pay us back the dough the owe us.
I thought we owed them bobbity... Default and lose those bonds.
Now look at that photo of Nicholas II for a second and tell me he ain't Medvedev doing a beard --- with Martin Armstrong riding shotgun...
is that the near path of the usd and the reason for russia's renewed interest in the gold standard?
"Just when you thought it was all over..."
Never thought it's over till Putin regime is in power.
The Collapsing Ruble Is Creating Food Shortageshttp://www.businessinsider.com/the-ruble-is-falling-against-the-dollar-a...
For some Russians, mortgage costs soaring due to ruble slidehttp://news.yahoo.com/russians-mortgage-costs-soaring-due-ruble-slide-15...
""In November, we gathered my entire monthly salary and that of my husband and took it to the bank, but the sum was still not enough to cover the new monthly payment," said Li, a 35-year-old office manager whose mortgage is in Swiss francs.
When the Li family took out their mortgage in 2008, their monthly payment was equivalent to 38,000 rubles. By the end of 2014, it was 129,000 rubles.
Taking mortgages in a foreign currency was an accepted practice in countries like Russia before 2008. The borrower gained by enjoying the interest rates of the country whose currency the loan was denominated in. Switzerland's main interest rate, for example, is now near zero, while Russia's is at 17 percent."
The food shortage is a blatant lie, there isnt one. Please find me stores that have no food on shelves so I can remind my family, who says otherwise.
Housing prices also fall during a recession. Dont know a single case where it goes the opposite direction. Can already buy locations for next to nothing in Russia. Mortgage rates through sberbank is up, but that is just sperbank. If a family has three kids, they qualify for free housing in Russia.
Keep trying though.
Who said the shelves were empty? A shortage just means that some things don't get restocked especially if the price on that item rises too swiftly. Make no mistake, this is how it starts at first. surely they can remember the last default and devaluing.
Name few things which were not restocked again ? Because there is none . My friends living there can buy the items but the only difference is in price . Inflation
Oh freedom patriot yahoo is not a credible source . Quoting yahoo on zh is a disgrace . Don't you know ? Moreover every western plagued media is showing crisis in russia only . Such smoke-screen will only bring smile on turds and stupid shills like you . Business Insider : Koch borther's propaganda again not a credible source . Yanks are loosing disinformation war via their propaganda .
Default on what?
Gee, If they default then those billions they owe western banks can't be paid..... HAR, Har, har...
To all the Khazar inbred trolls visiting ZH
Enjoy your "Park Place" and "Get Out of Jail Free" while it lasts!
Third Act has arrived and you might as well sit back and enjoy the rest of the shit show you created for yourselves because every one of you reading here will most likely be losing your shirt which will inevitably lead to your tribal elders starting something on your behalf you know you won't finish!
I know... I know... Poverty sucks!
Especially when you no longer take responsibility for your own actions and must resort to complete treachery in blaming others in order to covet more of what was never your's in the first place!
The Monopoly money with the dead goyim on it is evaporated... And nothins gonna save your sorry Zionist Jew asses from the Hell on this earth you created for yourselves !
Well, thank you for the kind welcome, my friend.
Frankly, I come here to see how the other half lives (and thinks). It is always good to get as many viewpoints as possible and thus avoid the pitfalls of a confirmation bias where you drive off everyone who disagrees with you and then end up in an echo chamber that cannot convince anybody of anything since nobody other than the already-convinced ever visit.
Down with the hive mind. Long live dissent.
"It is always good to get as many viewpoints as possible and thus avoid the pitfalls of a confirmation bias where you drive off everyone who disagrees with you and then end up in an echo chamber that cannot convince anybody of anything since nobody other than the already-convinced ever visit."...
Tarball
What can I tell ya brother it's in your DNA. Actions speak louder than words and your people high up on the org chart are proof that Satan isn't a myth!
Dissent is one thing. Being a tireless advocate for the shrill anti-Putin, pro-Israel, pro-neocon, pro-war crowd is quite another.
You're more savvy than the others, I'll grant - but it distills down to the same neocon/ziocon propaganda.
So you are suggesting that there are certain limits beyond which dissent from your personal viewpoint should not be tolerated?
So you are suggesting that there are certain limits beyond which dissent from your personal viewpoint should not be tolerated?
Yes t
When a small Country that the American taxpayer has paid for for more than 60 years attacks it's patron multiple times... Usurps and corrupts the government that pays for it with "dual citizenship" status to it's elected officials... Destroys it's own neighborhood in order to consolidate power by using it's influence militarily as well as through usury to coerce politicians through bribery and every other kind to get what they want, I'd say the limits of dissent in this case don't apply when the history of that Country and it's deeds are scrutinized unfettered from a biased mainstream media that sells out to it like the whore politicians in Washington D.C. do as well!
Members in US politics who hold dual US/Israeli citizenship:
June 2013
Past and Present:
1.Attorney General – Michael Mukasey
2. Head of Homeland Security – Michael Chertoff
3. Chairman Pentagon’s Defense Policy Board – Richard Perle
4. Deputy Defense Secretary (Former) – Paul Wolfowitz
5. Under Secretary of Defense – Douglas Feith
6. National Security Council Advisor – Elliott Abrams
7. Vice President Dick Cheney’s Chief of Staff (Former) – “Scooter” Libby
8. White House Deputy Chief of Staff – Joshua Bolten
9. Under Secretary of State for Political Affairs – Marc Grossman
10. Director of Policy Planning at the State Department – Richard Haass
11. U.S. Trade Representative (Cabinet-level Position) – Robert Zoellick
12. Pentagon’s Defense Policy Board – James Schlesinger
13. UN Representative (Former) – John Bolton
14. Under Secretary for Arms Control – David Wurmser
15. Pentagon’s Defense Policy Board – Eliot Cohen
16. Senior Advisor to the President – Steve Goldsmith
17. Principal Deputy Assistant Secretary – Christopher Gersten
18. Assistant Secretary of State – Lincoln Bloomfield
19. Deputy Assistant to the President – Jay Lefkowitz
20. White House Political Director – Ken Melman
21. National Security Study Group – Edward Luttwak
22. Pentagon’s Defense Policy Board – Kenneth Adelman
23. Defense Intelligence Agency Analyst (Former) – Lawrence (Larry) Franklin
24. National Security Council Advisor – Robert Satloff
25. President Export-Import Bank U.S. – Mel Sembler
26. Deputy Assistant Secretary, Administration for Children and Families – Christopher Gersten
27. Assistant Secretary of Housing and Urban Development for Public Affairs – Mark Weinberger
28. White House Speechwriter – David Frum
29. White House Spokesman (Former) – Ari Fleischer
30. Pentagon’s Defense Policy Board – Henry Kissinger
31. Deputy Secretary of Commerce – Samuel Bodman
32. Under Secretary of State for Management – Bonnie Cohen
33. Director of Foreign Service Institute – Ruth Davis
Current members as best I could find:
Senate:
•Senator Barbara Boxer (California)
•Senator Benjamin Cardin (Maryland)
•Senator Russ Feingold (Wisconsin)
•Senator Al Franken (Minnesota)
•Senator Dianne Feinstein (California)
•Senator Herb Kohl (Wisconsin)
•Senator Frank Lautenberg (New Jersey)
•Senator Joe Lieberman (Connecticut) (Independent)
•Senator Carl Levin (Michigan)
•Senator Bernard Sanders (Vermont) (Independent)
•Senator Charles Schumer (New York)
•Senator Ron Wyden (Oregon)
House of Representatives:
•Representative Gary Ackerman (New York)
•Representative John H. Adler (New Jersey)
•Representative Shelley Berkley (Nevada)
•Representative Howard Berman (California)
•Representative Steve Cohen (Tennessee)
•Representative Susan Davis (California)
•Representative Eliot Engel (New York)
•Representative Bob Filner (California)
•Representative Barney Frank (Massachusetts)
•Representative Gabrielle Giffords (Arizona)
•Representative Alan Grayson (Florida)
•Representative Jane Harman (California)
•Representative Paul Hodes (New Hampshire)
•Representative Steve Israel (New York)
•Representative Steve Kagen (Wisconsin)
•Representative Ronald Klein (Florida)
•Representative Sander Levin (Michigan)
•Representative Nita Lowey (New York)
•Representative Jerry Nadler (New York)
•Representative Jared Polis (Colorado)
•Representative Steve Rothman (New Jersey)
•Representative Jan Schakowsky (Illinois)
•Representative Adam Schiff (California)
•Representative Allyson Schwartz (Pennsylvania)
•Representative Brad Sherman (California)
•Representative Debbie Wasserman Schultz (Florida)
•Representative Henry Waxman (California)
•Representative Anthony Weiner (New York)
•Representative John Yarmuth (Kentucky)
zatetic June 2013
http://jewishcurrents.org/the-112th-congress-3476
All the jews in congress are democrats or independents (basically democrats) except one, Eric Cantor. He may be the highest ranking Tea Partier elected lol.
It might be interesting to shift focus on to how much low oil is hurting the US economy. My guess, and its just a guess, is that as we get into late January - you will see the wheels start coming off the bus as consumers turn to pay their credit cards from christmas, bonus money all gone, cold weather...
Russia is simply being forced to de-couple from the Anglo-American-Zionist Axis faster than planned. It's strange to read comments from people who seem to think there is no wealth outside the USA - the galactic capital of illegal immigration by unschooled, unskilled workers, foreign coups, drone attacks, offshorting, and debt.
Idiots.
Putin's regime has huge corruption problems as it's czar is the root of corruption. That doesn't help much Russia economy because it has poor undeveloped structure that is mainly based on raw materials and energy like gas & oil. If something bad happens to oil than Russia unlike other oil exporting countries... well... it's *ucked. Because except vodka and corruption it can't offer to the world. Like I said - it's undeveloped economy.
"That doesn't help much Russia economy because it has poor undeveloped structure that is mainly based on raw materials and energy like gas & oil."...
fing123
Just watch that "poor undeveloped structure" with a sound money system eat your 330% debt based ass inside out for breakfast!
And there is no corruption in the US? Who would have thought?
Yes indeed Cp.
The majority of Americans living large in their own minds certainly are. Worst of all the ones that traveled and learned culture abroad that still believe the sunshine story blown up their sphincters that they are still better than everyone else because they are American -much like the ones we give $4 billion a year to that bankrupted this Countryand kill it's peoples to advance it's own agenda believe they are God's chosen!
Ain't engineered propoganda that is deadly simply a marvel to behold when it is believed verbatim by so many!
kHAZAR INBRED TROLLS FROM US IS ON RISE HERE . YOUR DOWNVOTES DEPICTS IT CLEARLY . Amerikan patriot and latvian shill just came with their new avatar
looks like the Tribe will be in need another 9/11 to get the EU herd in line!