RummyBoy

http://www.bbc.com/news/world-europe-29956277

Have you seen how the ruble is collapsing? Interest rates are like over 10% I think and the economy is going into destruct mode - it will not surprise me if Putin now decides that war is the best option.

http://finance.yahoo.com/news/putin-...084457706.html

just a punk

No, it is not. It simple follows the oil prices. There is a very simple correlation: oil down - ruble down, oil up - ruble up.

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RummyBoy

Here we go.... Mr. Cyber Russian Contraryness.... I knew id have to contend with you.

OK so a large part of this is to do with the falling oil price, and part is to do with the strong dollar but there is also a lot of fall out from Crimea, sanctions, a negative investment climate and so on. They are all contributing factors and I think a 40% fall over 1 year - its fair to call that a collapse or near enough.

http://finance.yahoo.com/echarts?s=U...=on&z=m&q=l&c=

pornmasta

yes but he is probably right

just a punk

Russian ruble doesn't depend on "investment climate". You should take a basic curse of economics. Oil and Gas are the only Gods in Russia.

You have mentioned "sanctions". Please explain how exactly they can affect ruble? Do you know that today ruble has strengthened (from 47+ to 44.8 for 1 USD). So what happened? Sanctions were lifted? Crimea was returned to the Ukraine? Maybe a negative investment climate turned into a positive one?

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RummyBoy

Im a market trader and a student of economics (self taught). Nothing moves either up or down in a straight line so you can always anticipate volatility. If you read my reply clearly, I was not disagreeing with what you said. I am simply pointing to a confluence of factors which CLEARLY together make an impact on the ruble because it affects the demand and supply dynamic.

I myself have many times pointed out that the current sanctions have little affect on Russia. Cutting off Visa/MasterCard or SWIFT would make a big difference, but not the current sanctions.

http://www.bloomberg.com/news/2014-1...o-growth.htmlp

just a punk

About Visa/MasterCard: https://translate.google.com/transla...tml&edit-text=

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woj

Many Russian oil/gas companies have debt in USD, so every month they have to pay interest in USD to investors and when the debt matures they have to give back the USD that they borrowed...

so before sanctions, as the debt matured, these oil companies issued new debt, and everything worked great... in a way kinda like a ponzi scheme...

but now after sanctions, they can't borrow USD any more (at least not from the western financial markets) and so they are forced to sell RUB in order to buy USD so they don't default on the debt...

wall street journal probably explains it better than me though:
http://online.wsj.com/articles/russi...ebt-1412860551

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RummyBoy

Exactly.... couldn't have said it better.

Although I would add that this is accelerating the decline of the USD. It's a bigger long term negative for the position of USD as the global reserve currency at a time when the US needs Russia in the USD system more than ever.

Russia has multiple other options and other options are actually good - gold & the Chinese yuan. Its increased purchases on those multi-fold on month to month basis. BRICs bank, China-Russia deal etc etc etc..... all nails in the coffin of USD longer term.

klinton

actually the country that goes to wars these days (last decades) to improve his economy is USA, not Russia...so please stop spreading BS....

Horatio Caine

Western propaganda. Ruble is the future currency of the world.

klinton

along with albanian lek and haitian gourde

but to be honest with you, all curencies are shit and they are worth exactly how the people value them

just a punk

And your car moves faster with a fair wind. No BS. However the most important thing is the engine power. You give too much credit to the factors that can have a very small side affect.

Ruble? Nah, don't think so. But yuan may definitely become the one: http://rt.com/business/203903-ruble-...r-settlements/

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RummyBoy

The way China is going RMB/USD, yuan will (i suppose) someday be 1/1 (500% gain from here). A lot of my friends are investing in Chinese property purely for exposure to the long term expected gains in the RMB quite apart from anything else.

But its a long way off. The USD is on the decline but its a very long drawn out thing. RMB is already well on its way to become a strong trade currency with a lot of bi-lateral swap arrangements. However, to be a reserve currency you need investable assets (bond market) as well as a strong developed rule of law. China has neither, at this stage.

There's also speculation that China is clandestine in its aim to go to a gold standard. I'm not so sure about that as most of the smarter analysts suspect its more of hedge against a weakening USD (China is the biggest holder of US debt) but there is strong evidence that China is accumulating gold at a record pace...

ilnjscb

Russian officials are braced for sanctions, which will definitely affect tourism. However, just like us (US and everywhere else) they do not move in lock step with, or even know what their leaders are doing. Russia is arguably the largest oil exporter in the world, exporting 11,000,000 barrels a day, and barrels were at like 107$ and now are like 78$ so yeah, thats 330,000,000$ per day less, or $120bil less a year. Also $20 Bil in tourism will suffer a bit, and of course all industries are going to be hit a bit. In a highly leveraged economy, especially one with a GDP 2.1 tril that is a 7% hit! A 7% hit on the US would devastate our economy. It may not be quite as simple as CyberSEO is making out to be, but to a large extent he is correct IMHO

woj

correlation isn't as obvious as you make it sound:




oil is down 22% since june 2014, rub is down 30% since then

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pornmasta

i see a correlation, but it's probably not the only correlation

dyna mo

that's a myth. so please stop spreading BS...........

Proof that War Is Bad for the Economy
Posted on February 24, 2012 by WashingtonsBlog
Top Economists Say War Is Bad for the Economy

Preface: Many Americans ? including influential economists and talking heads - assume that war is good for the economy. Many congressmen assume that cutting pork-barrel military spending would hurt their constituents? jobs. As demonstrated below, it isn?t true.

Nobel-prize winning economist Joseph Stiglitz says that war is bad for the economy:

http://www.washingtonsblog.com/2012/...d-for-all.html

woj

it probably depends how you look at it, to me it looks like since jan 2013 oil prices were pretty much constant around ~100
but rub was sinking hard...

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just a punk

Looks legit, isn't it? Also please don't forget the oil prices and Russian/Chinese deals. Putin has ruined the real Russian economics. We are living only due to the oil/gas trade.

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WDF

That is what I got from your PPP (Putin Propaganda Patrol) post.

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Kolargol

Woj is usually right.

Kolargol

Yeah, like wars in Iraq and Afghanistan hugely improved America economy

klinton

what you would like to say is: If Professor Joseph Stiglitz or whoever would say that is good for economy, you would be 100 % pro - war ? or what do you want to say exactly ?

it's good for economy, but unfortunately - only for those who know how to profit from it and have good connections with government.so it is good for few %, not for 100 %.

klinton

for dick cheney, rumsfeld, bush and few other guys - YES.
obama's friends from big corp, military industrial complex etc. - also YES.
Who cares about the rest ? not them, for sure

Barry-xlovecam

I hear what you are saying: The Russian military posturing and expenditures will vastly improve the Russian economy

klinton

just a punk

Yes. We always try to put our country borders near the NATO bases

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shoot twice

Honestly I'm not trying to troll anyone but just the same I've got to ask the question...

Who cares?

I mean if you're not Russian and you're not doing business with somone in Russia then why would anyone care?

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PS I'm impossible to troll.

just a punk

99,9% of GFY webmasters work with Russians (affiliate programs, affiliates, content providers, designers, artists, SEO-optimizers, traffic traders/brokers, software/script developers etc)

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shoot twice

I didn't know this so thank you for responding to my question. I can now see where the exchange rate would be very important to someone.

However I still think it's pretty pointless to debate what Putin or Obama are doing. Afterall someone would have more luck yelling at the weather to change than they would influencing a world leader.

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RummyBoy

Its actually important and its interesting, because it is a NEW cold war and you know what? Putin is actually winning it!

https://in.finance.yahoo.com/news/pu...131700912.html

They've just signed a new deal and he flirted with Xi's wife all on the same weekend...