"Russia Increases Key Interest Rate to 17%" ????

17% yield ?
At this rate it makes russian bonds highly speculative.
Putin will probably try to blackmail the world's economy with a risk of default (france is playing the same game with Switzerland, "too big to fail") and i bet that this is probably what is going to happen. I hope that russia's agriculture is totally selfstanding.

why? brainwashed much?

Of course, few people remember that around 1980 US interest rates reached 20%. No big deal if you look at record rates around the world at times of market stress. Today the ruble is recovering quite strongly but mind you, remember that the energy companies earn foreign currencies and a lower Ruble actually means a lower cost of production (so its not all bad).

now imagine the inflation that you need to handle that...
Also the dollar has a special status...

If the fund rate is high, then it's harder for the russian banks to borrow money (more expensive at the russian central bank), so it's going to shrink the economy and that can generate a deflation that can block the economy.

If the fund rate is high, then it's easier for the russian central bank to borrow money outside of the country since it pays more. But if the russian economy is going to shrink, then it's gonna be harder for russia to reimburse its debt.

I guess that the outcome is also partially based on russia's real strength...

Well inflation is due to the weak Ruble and is a lagging indicator so early next year the inflation figures will no doubt be over 10% but so what? Many economies have had higher than 10% inflation for many years.

Russia might just get a year of high inflation. The top of Ruble weakness is over so inflation should moderate after that.

As for special status ie Reserve Currency Status, Obama & co and doing "everything they can" to destroy that. Both Russia and China are ditching the dollar big time:

VANNESS: Russia, China preparing to eliminate our reserve currency status - Washington Times

It's a shame because they could have kept that going for a long time. Russia and China would have just played along but Obama (and the neo cons) have wrecked it. Infact all the major emerging markets are ditching the dollar.

It'll take a very long time for the dollar to lose that status but its happening as we speak.

if russia has to buy its goods outside the country

I agree :thumbsup

Renminbi - Wikipedia, the free encyclopedia

Russia will probably have to buy chinese goods..

Nope....... unlikely. They'll be multitude of ways for use but the key thing is that they are avoiding the US dollar and that is devastating for the petrodollar.

Bottom line is that the Chinese are doing many bi-lateral swap agreements with different countries and I believe it has been done with all the majors now, so it wont be long im sure before the Yuan (Renminbi) is a fully convertible currency. We're probably talking no more than 6 - 8 years from now but some say much sooner:

How Long Before China's Renminbi Becomes Fully Convertible? - Forbes

Shame they have to avoid USD but RMB is a great holding by the way. I have as many RMB as I have USD. Right now you get 6 RMB for 1 USD. Within twenty years from now it'll no doubt will have reached one for one.

China is one hot fast growing economy - 4 Trillion USD foreign currency reserves. Name me one country in the world which is a "creditor nation" and that has even a quarter or that?

not possible, unless China has plans to stop producing and exporting all the shit they make:winkwink:

There's no way to predict the future but everything is possible and twenty years is a reasonable time horizon. They are in the process of rebalancing their entire economy towards a substantial increase in domestic consumption:

Nielsen CEO Predicts Boost in Chinese Household Consumption by 2020

So there's no way of knowing what the outlook will be but I think most analysts expect the RMB to continue to appreciate (in the long term) which is why I hold some. I'd rather hold RMB than Euros that's for sure.

yes, but it can't an argument to think the reality.

http://quotes.ino.com/charting/histo...15&a=50&v=dmax

Yep, and I am stuck with all those worthless (petro)dollars:upsidedow

interesting how everyone talks about RUB when it sinks, but nobody talks about it when it recovers

True and a lot of people just do not understand it because it can get into complex economics. Paul Craig Roberts (Former Assistant Treasury Secretary during Ronald Reagan era and former editor of NY Times) puts it much better than I can on Ruble's decline:

bump me. 65/1$

Ruble follows the oil prices. Good news anyways :thumbsup

yes for you :)

:thumbsup

Not 63 anymore and that's sad :(

http://kurs-dollara.net/image/kurs-d...blyu-month.php

yes but still at $1 for 53 rubles

A few mounts ago I was able to buy 2x times more goods than in 2013. Now I can't because ruble has grown a lot :(