Medvedev Warns Of "Unlimited Reaction" If Russia Cut From SWIFT

Tyler Durden's picture

While nations around the world continue to de-dollarize, Russia signed into law its anti-crisis plan today (though details will not be released until tomorrow). Prime Minister Dmitry Medvedev, however, was quite vociferous in some of his threats, warning The West that the "Russian response - economically and otherwise - will know no limits" if Russia is cut off from the SWIFT payments system. Additionally, as Royce, the chairman of the House foreign affairs committee, explains Iran nuclear talks "appear to be stalemated," just days after Iran completes its de-dollarization and news today, that Russia and Iran plan to create a mutual account for bilateral payments in national currencies.

 

As ITAR-TASS reports,

Western countries’ threats to restrict Russia’s operations through the SWIFT international bank transaction system will prompt Russia’s counter-response without limits, Prime Minister Dmitry Medvedev said on Tuesday.

 

"We’ll watch developments and if such decisions are made, I want to note that our economic reaction and generally any other reaction will be without limits," he said.

 

In late August 2014, media reports said the UK had proposed banning Russia from the SWIFT network as part of an upcoming new round of sanctions against Moscow over its stance on developments in neighboring Ukraine. However, this proposal was not supported by the EU countries at the time.

 

After recent shelling of the Ukrainian city of Mariupol some western countries again started calling to disconnect Russia from SWIFT.

 

SWIFT transaction system

 

The Society for Worldwide Interbank Financial Telecommunications (SWIFT) transmits 1.8 billion transactions a year, remitting payment orders worth $6 trillion a day. The system comprises over 10,000 financial organizations from 210 countries.

 

Under the SWIFT charter, groups of members and users are set up in each country covered by the system. In Russia, these groups are united in the RosSWIFT association.

*  *  *

Russia continues to try to create its own payments system as de-dollarization continues - believed to be ready by May.

Russia intends to have its own international inter-bank system up and running by May 2015. The Central of Russia says it needs to speed up preparations for its version of SWIFT in case of possible ”challenges” from the West.

 

"Given the challenges, Bank of Russia is creating its own system for transmitting financial messaging... It’s time to hurry up, so in the next few months we will have certain work done. The entire project for transmitting financial messages will be completed in May 2015," said Ramilya Kanafina, deputy head of the national payment system department at the Central Bank of Russia (CBR).

*  *  *

As Reuters reports, Russia's isolation appears to be shrinking...

Russia and Iran plan to create a mutual account for bilateral payments in national currencies, RIA news agency quoted Mehdi Sanaei, Iran's ambassador to Moscow, as saying.

 

"Both sides plan to create a mutual bank or a mutual account to make payments in rials and roubles possible," the ambassador said.

*  *  *

Quickly followed by:

  • *SHELBY SAYS MORE PRESSURE ON IRAN NEEDED FOR `VIABLE' DEAL
  • *ROYCE SAYS IRAN NUCLEAR TALKS `APPEAR TO BE STALEMATED'
  • *CHAIRMAN ROYCE OF HOUSE FOREIGN AFFAIRS HOLD IRAN HEARING
  • *OBAMA, SAUDI KING DISCUSSED IRAN NUCLEAR NEGOTIATIONS: OFFICIAL

*  *  *

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IridiumRebel's picture

When does RIFT get unveiled? Serious question. Anti-Troll mist has been sprayed....

jefferson32's picture

Quote from Yanis Varoufakis' (new Greek Finance minister) book "The Global Minotaur" (p. 227):

A second, even brighter, scenario would be for the West to have an epiphany and, at long last, embrace John Maynard Keynes’ suggestion of an International Currency Union – the very suggestion that America rejected at the Bretton Woods conference of 1944.

Varoufakis often appears as guest analyst for news media like the BBC, CNN, Sky News, Russia Today and Bloomberg TV among others. Since January 2013 he has been teaching at the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin.

 

Renfield's picture

I don't know anything about this idea in history. For the sake of discussion (and later reading) can anyone give a quick digest of what the ICU would have entailed? If it came from Keynes then I am already suspicious...

jefferson32's picture

You can start here. The point of the Greek tragedy is introducing a new international currency union (dollar 2.0).

 

Four chan's picture

dr strangelove regains its relavancy in 3 2 1 

Latina Lover's picture

Sometimes I just wish Russia was denied access to SWIFT.   I'll just hang onto  my gold and silver and watch the action on TV from the safety of my Living Room.

Publicus's picture

Yeah,  the foreplay is getting excessive. We all know what is coming, so get it going already.

BaBaBouy's picture

UnDollarization... Kryptonite (Or GOLD) To Usa...

PS... Let The Dollar Die, No Reason To RISK A NUKE WAR Over A Fiats Currency...
NEW Fiats Will Come And Go As They Have In Modern History...

TahoeBilly2012's picture

 

After recent shelling of the Ukrainian city of Mariupol some western countries again started calling to disconnect Russia from SWIFT

Oh, entire Countries, or a handful of Zionist bought off politcians in said Countries?

Againstthelie's picture

...Russia and Iran plan to create a mutual account for bilateral payments in national currencies.

 

That's the really important thing.

You buy something from my country, then I receive a surplus on my account. I buy something from your country, my surplus shrinks. The more countries participate, the more ways the balance can be established: A sells something to B, B sells something to C, C sells something to A.

No debt, no banks controlling international trade, no money lenders!

Nationalsocialist Germany invented it to escape the economic warfre of international Jewry which had declared war on Germany in 1933. After Gemany's victory over France it was planned to establish this barter clearing system in Europe after the war would be won.

BKbroiler's picture

Unlimited consequences, like rusty subs and prop planes.  Terrifying.   We should cut off access to SWIFT immediately, see how loyal Putin's subjects are then.

sun tzu's picture

Russia should cut off the EU's supply of oil and gas. Then see how loyal the EU subjects are to Brussels when they're sitting there cold, dark, and hungry

Maybe the EU can send some Muslim Arab soldiers to die for the old dying white Europeans

Latina Lover's picture

Loyal enough to beat Hitler and Napoleon.  Be careful what you wish for, it could get really hot for all of us.

BKbroiler's picture

 it could get really hot for all of us.

The only thing certain about nuclear weapons is their uncertainty.  Talk to anyone who ever worked on any nuclear research, at Los Alamos or otherwise, they will all tell you the same thing: nukes are more a scare tactic than a real weapon.  Nukes are still unpredicatable, delicate, difficult beasts and nobody really wants to fire one off, because if it doesn't go as planned their country becomes a giant target.  This is why they haven't been used since WW2.  Russia isn't even a regional power, the UK alone could easily defeat them militarily.  This is what's so funny about the latest crop of ZH members, this wacky allegiance to Russia and the belief they could do anything.  That guy in the movie "The Good Sheperd" said it best (before he threw himself out of the window):

 

Soviet power is a myth. Great show. There are no spare parts. Nothing is working, nothing, it's nothing but painted rust. But you, you need to keep the Russian myth alive to maintain your military industrial complex. Your system depends on Russian being perceived as a mortal threat. It's not a threat. It was never a threat. It will never be a threat. It's a rotted, bloated cow.

Karlus's picture

>>nothing but painted rust

Sounds like someone knows whats up

NoDecaf's picture

"painted rust"...wasn't that in a huffpo propaganda piece today about the Russian military? I know I saw it somewhere recently.

Bingo Hammer's picture

"Soviet power is a myth. Great show....It's a rotted, bloated cow."

Don't stop there BK, keep going! You're hilarious hahaha

Next you'll say is:

they have no resources

they don't actually have any oil

they have no subs, tanks, jet fighters, missiles

they have no gold

they have no industry

they have no friends (they're isolated right)

and you'll then confirm that Yat's was right - they invaded Germany in WW2!

haha

 

 

TahoeBilly2012's picture

My "wacky allegiance to Russia" lies in my distain for our Deadly Western Leadership and it's threat to my own peace and health. If I was a German and against Hitler and therefor supported say the anti war French, would that be "wacky French allegiance" at the time?

TheFourthStooge-ing's picture

American power is a myth. Great show. There are spare parts, but it's a JIT supply line sourced in China. Nothing is working, nothing, it's nothing but painted rust. But they need to keep the American myth alive to maintain the compliance of the vassal states, as well as the welfare gravy train of the military industrial complex. The US Empire depends on America being perceived as an omnipotent threat. It's not omnipotent. It is a threat, though. Like all falling giants, it will remain a threat until its frail, rotting, bloated corpse hits the ground.

 

Fixed it for you.

tunnelvizn's picture

Perhaps, lies the con in the insatiable "American Market" .  What then happens when the world realizes that there is just the shell of the once enormous American consumer appetite ?  Power seeps away from declining position . 

Calmyourself's picture

BKbroiler your seriously stupid. Atomic weapons are mature, tested, reliable technology tested constantly with supercomputers as well as 2119 live shots..  You sir are an idiot..

sun tzu's picture

Compared to the great US military that can't even defeat a bunch of rice farmers and goat herders LMAO

silvermail's picture

When Putin said that Russia has a weapon that can surprise the West, he was not joking.
In case of war, the United States will lose all of their satellite constellations in a few minutes. Russian satellites killers already have In orbit. It's just a bucket of explosives and damaging elements. At a signal from the ground, they will all be blown up. On the orbit of the earth, there will be nothing, - only a lot of space debris.
---
Moreover, Sakharov, long ago created a weapon directed underwater explosion. These weapons could be used before, even in the Soviet Union time.  The underwater nuclear explosion generates a wave height of 11 kilometers. One such wave will go to the coast of the United States. And the second such a wave will go to the coast of the United States on the other hand.
Nobody in the world does not know where those nukes and how many them.
They just lie on the ocean floor in the form of large containers and waiting encrypted signal to activate them.
Furthermore, they wait signal outage. If the control signal has not been received for a long time, it mean that Russia was attacked by nuclear weapons. This means that all systems of nuclear retaliation should work independently - in automatic mode.

laomei's picture

lol, rusty subs and prop planes.  Do you have any clue at all at the state of the russian military?  Ffurthermore, fighting back with military action is just stupid.  The us has been putting forth great effort to paint putin as some sort of "new hitler", why go out of your way to provide a casus belli that justifies conflict escalation?  That's simply NOT the way Russia or Putin rolls.  All Russian military engagement has been fully justified and they were not the first to tip their hands, without fail when the Russian military has moved in, it's been AFTER the west (mainly the US) has gotten involved to a degree that fingerprints were left all over it and if the US dared to call out Russia, Russia could reveal far greater US crimes which justified the engagement.  Play the villian knowing full well that at the end of the day, US/NATO/EU will do NOTHING of consequence anyways.

 

So no, no rusty subs and prop planes.  But Russia is totally free to engage in economic warfare and escalate as much as they want.  Russia can easily deny all payments to the west, Russia can easily claim economic damage and seize foreign assets.  Russia can easily do just about anything they want and the public sentiment will be one of not giving much of a fuck... oh no, Russia cost rich people some money, what a horrible crime.  In this Great Game, Russia is sitting on essentially unlimited resources.  They have a very strong heavy industry sector and can easily partner with China for the medium/light.  China needs resources and oil (which Russia has), Russia needs more development, labor and goods (which China can provide without end).  Russia can easily just ignore any and all IP/patent claims from the US/EU as well. 

 

There are MANY cards that Russia can play, none of which are enjoyable if you are the EU/US.  Cards which can only realistically be countered with military action, and playing war with a nuclear superpower has gotta be just about the most retarded idea ever.  Russia, honestly speaking, doesn't need much of anything from the west.

MEAN BUSINESS's picture

more connections laomei:

In what was arguably a violation of international law, Evo Morales had his presidential plane forced to land on its way home from Russia in 2013 during the Edward Snowden foo-forah.

Evo Morales spoke on behalf of China +77 (in fact spoke first at the high-level segment) at the UNFCCC in Peru in December 2014.

Honestly, who needs The UN?

lol, ALL roads lead to... Paris

RaceToTheBottom's picture

Maybe it is time for the Putin to pull all the stops out.  Maybe a photo session riding a bear while bare chested or something like that?

Karlus's picture

I actually have the T-shirt....given to me by a Russian.

strannick's picture

You prefer Obama riding amorous in the Choomwagon with Larry Sinclair?

RaceToTheBottom's picture

It is never one idiot is better than another idiot.  They are both idiots, and it does not make sense to use that as a defence.

Thanks for missing my point.

I will work harder on getting my point across in the future.

 

Shropshire Lad's picture

Watching the action on TV until the electricity goes off and stays off ....

Renfield's picture

Thanx for the reply. "Bancor" gives me something solid to read up on.

From your wiki reference:

<<Bancor would not be an international currency. It would rather be a unit of account used to track international flows of wealth. Gold could be exchanged for bancors, but bancors could not be exchanged for gold. Individuals could not hold or trade in bancor. All international trade would be valued and cleared in bancor.>>

When I read this, I immediately thought of the SDR. But I still can't understand why gold would not perform this same function more efficiently.

<<Keynes was able to make his proposal the official British proposal at the Bretton Woods Conference but it was not accepted. Rather than a supranational currency, the conference adopted a system of pegged exchange rates ultimately tied to physical gold in a system managed by the World Bank and IMF. In practice, the system implicitly established the United States dollar as a reserve currency convertible to gold at a fixed price on demand by other governments. The dollar was implicitly established as the reserve by the large trade surplus and gold reserves held by the US at the time of the conference.>>

I believe this was when the bankers who won WW2 consolidated their power; and that they knew this "reserve currency" was doomed to failure. They had to know that the "large trade surplus and gold reserves" of the US were going to change, and that change was unlikely to be an increase. Sure enough, shortly after the USD "reserve currency" was established, the US was looted of its gold so effectively that its bankruptcy was official by 1971.

WW2 destroyed Europe, and World Reserve Currency destroyed the USA.

<<Since the outbreak of the financial crisis in 2008 Keynes's proposal has been revived: In a speech delivered in March 2009 entitled Reform the International Monetary System, Zhou Xiaochuan, the governor of the People's Bank of China called Keynes's bancor approach "farsighted" and proposed the adoption of International Monetary Fund (IMF) special drawing rights (SDRs) as a global reserve currency as a response to the financial crisis of 2007–2010. He argued that a national currency was unsuitable as a global reserve currency because of the Triffin dilemma - the difficulty faced by reserve currency issuers in trying to simultaneously achieve their domestic monetary policy goals and meet other countries' demand for reserve currency.[2][3] A similar analysis can be found in the Report of the United Nation's "Experts on reforms of the international monetary and financial system" [4] as well as in the IMF's study published on 13 April 2010.>>

In reading this short synopsis, I'm tempted to jump to the conclusion that the bancor was only the precursor for SDR, and therefore just as doomed. Maybe someone more informed will comment. The Triffin Dilemma is not just a "difficulty", either. It is a key flaw in the whole reserve currency theory.

<<The point of the Greek tragedy is introducing a new international currency union (dollar 2.0).>>

Agreed, but good luck with that. The implosion of the current "Reserve Currency" is, I think, going to chill any attempts at resurrecting this idea for a few generations and maybe forever. People are only just beginning to see the collosal folly this was, and we haven't even had trials and executions of the principal actors yet. History will judge the Reserve Currency era very harshly.

I have to say, without reading much about him yet, this inclines me to view Mr. Varoufakis rather unfavourably. (Just because it sounds so very SDR to my ears.) But I don't mind reserving judgment, and waiting to see what kind of standard a new bancor/currency union would be based on.

tip e. canoe's picture

"I immediately thought of the SDR. But I still can't understand why gold would not perform this same function more efficiently."

because gold has the inconvenient quality of being owned by too many common folk in the 2 most populous countries on earth.

while SDRs can be fully controlled by a small group of people who think they're smarter and more worthy than everyone else.

jefferson32's picture

Since the outbreak of the financial crisis in 2008 Keynes's proposal has been revived: In a speech delivered in March 2009 entitled Reform the International Monetary System, Zhou Xiaochuan, the governor of the People's Bank of China called Keynes's bancor approach "farsighted" and proposed the adoption of IMF SDRs as a global reserve currency as a response to the financial crisis of 2007–2010. A similar analysis can be found in the Report of the United Nation's "Experts on reforms of the international monetary and financial system" as well as in the IMF's study published on 13 April 2010. (wiki)

Add the Greek FM to the list now.

 

Seamus Padraig's picture

It did come from Keynes. At the BW conference in 1944, he suggested using the IMF's special drawing rights (SDRs) as the new world currency. Washington shot him down though. That's how the dollar became the world's reserve currency.

Seamus Padraig's picture

I meant bancors, not SDRs. My mistake.

Razor_Edge's picture
"Other important challenges remain. In the docu- ment cited above, the Transatlantic Policy Network envisions “evolution toward an eventual Transatlan- tic Partnership Agreement embracing the economic, political, and strategic totality of the EU-US rela - tionship.” Thus transatlantic economic integration, though important in itself, is not the end. As unde r- stood by Jean Monnet, economic integration must and will lead to political integration, since an in te- grated market requires common institutions produc- ing common rules to govern it." http://streitcouncil.org/uploads/PDF/F&U-%202007-%20A%20United%20Atlanti...
Winston Churchill's picture

Its already running, and will be unveiled when Russia gets kicked out of SWIFT, or in May.

Either date means WOAR.

ForWhomTheTollBuilds's picture

A few generations ago, these sorts of high stakes maneuvers by the west would have worked to promote our place at the top of the world. 

 

Oh well, we had our turn and it was fun while it lasted.

August's picture

>>>Oh well, we had our turn and it was fun while it lasted.

It was fun, wasn't it, being the indispensible center of the world economy, where even an average Joe could build a good life?

Soon, the flow of mail-order brides will be exclusivey outbound, so be sure to have those daughters study up on "world languages".  A few basic phrases should suffice, such as "yes", "of course", "right away" and "when you are happy I am happy".

813kml's picture

Shipping would be cost-prohibitive if calculated per pound.

HardlyZero's picture

They better get that high-speed rail working from San Fran to LA.

That way no food or extra shipping, overnight.

A modern Cali-gula Brothel Boat.

5 pieces of gold for 20 minutes.

Chupacabra-322's picture

@ August,

It was all Bubaki Ponzi Therater.

Chupacabra-322's picture

No, we all have Cum on our faces from the Criminal Fraud UNITED STATES, CORP. INC.

Winston Churchill's picture

You really have to hand it to American women, which is why that will not work.

sun tzu's picture

Spoiled, rotten, entitled, obese American mail order brides? LOL

Renfield's picture

Why in May? I could understand it sooner only because things are happening so quickly now. Didn't they already complete a sort of clearing or test of RIFT (I don't even know its proper name) this month?