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Doesn't this mean the ruble will collapse? They only have $12 billion in physical cash and $140 billion or so in gold.
by from 5y ago
Doesn't this mean the ruble will collapse? They only have $12 billion in physical cash and $140 billion or so in gold.
- _Algernon_ 5y agoRuble? More like rubble...
- megous 5y agoPutin's decision to go to war backfired quite a bit.
- na85 5y agoWe'll see. I'm not convinced that he's quite the buffoon he's being portrayed as lately. This is a shrewd ex-KGB officer who's held onto power for more than two decades.
- rootusrootus 5y agoIs he really being portrayed as a buffoon, though? In my experience most people seem to respect that he is quite good at playing the power game. Lately he's definitely being portrayed as evil, for sure. But I wonder if maybe he miscalculated how this war would play out. Even skilled operators f*ck it up once in a while.
- chrisseaton 5y ago> Is he really being portrayed as a buffoon, though? Yeah - for example the Economist cover on the 19th. https://www.economist.com/weeklyedition/2022-02-19 https://www.economist.com/weeklyedition/2022-02-19
- rosndo 5y agoPutin can have painted himself into a corner without necessarily being a buffoon.
- losteric 5y agoHe's getting old. This is Putin's last opportunity to cement himself into history. Putin still enjoys tremendous domestic support. He has no effective opposition. Putin wants to claim Ukraine. Ukraine can't fight Russia alone. Will the West fight harder for Ukraine than Russia/Putin? What happens if Ukraine's leaders are assassinated? Stronger sanctions against Russia? Europe still depends on Russian fossil fuel, as do China and others, so leverage is limited. Strangling European energy supply remains a weapon at Putin's disposal. Economic MAD, sure, but who's going to back down first? The autocrat, or the union of democratic states?
- simonh 5y agoGermany is much better connected to the gas pipelines of neighbouring European countries than it used to be, and Europe has extensive strategic reserves. The US does too and might be willing to share some of them. We’re also coming out of winter. This is going to be hard, the cost will be heavy, but much, much heavier on Russia. But we’re at war, whether we like it or not, and we have to do this.
- deleted 5y ago[deleted]
- toyg 5y ago> Putin still enjoys tremendous domestic support. But does he really? The economic situation is not great, the Southern Ukraine border has been a mess for almost a decade, COVID wasn't exactly a success (their vaccine didn't perform as well as expected)... There has been a lot of grumbling over the last couple of years. In fact, I think he counts on this conflict to shore up his internal support significantly. > He has no effective opposition. Well, when he did, he made sure to kill or jail them, so that's not really an indicator I'd rely on. I agree that there is a good chance things might not be as bad as they look for him, though. It's easy for us to talk tough in February, with Springtime on the doorstep and enough gas to last several months; the real challenge will be September / October.
- megous 5y agoIf he fails militarily, which he still might, the result of all this commotion will be that Ukraine will have much tighter ties to EU, NATO will be strengtened in the east, and Russia's economy will tank, for no geopolitical benefit.
- regnull 5y agoHe can only suffer a major failure once. Being an authoritarian is a tough job. Sharks are always circling.
- ajb 5y agoUnfortunately ability to start in power isn't all that linked to delivering good results to the public. There are examples where a dictator stayed in power for a long time after crashing the economy. Mugabe, for instance.
- jamiek88 5y agoHe has to keep his fellow oligarchs happy not joe public.
- LadyCailin 5y agoI definitely am not an authority here, but I can’t imagine a top 10 GDPPPP country is particularly comparable to Zimbabwe.
- from 5y agoErdogan is probably a better analogy but we'll see how long that lasts.
- SllX 5y agoI have insufficient data on Putin to even try in good faith to even try and analyze him, past and present. But I did just finish catching up to current on the Revolutions podcast which covers 10 political upheavals defined in the podcaster’s terms as Revolutions under a broad label and what’s amazing to me is that any of the Revolutions that tended to center around strongmen also tended to outstay their welcome and any of the Revolutionary Big Cheeses that lived to old age tended to lose touch with their own inner circle. The monarchs or whoever was being overthrown were also not immune to this: if they were popular, it was often because people didn’t actually know them very well and they tended to lose popularity quickly when they made the worse blunders of their lives. So, just a perspective, and maybe some of this is applicable to Putin, but again, I’m not in good faith going to try to make that call but leave it to those who maybe can.
- slim109ya 5y agoExactly. This situation was highly thought out and I'm sure he has at least one ace up his sleeve. Most likely in the form of controling natural resources to europe.
- elorant 5y agoSeems like he expected Ukranian leaders to fold and get into negotiations in a matter of days. The longer they hold the harder it will become for Russia to reap any benefits from the conflict.
- toyg 5y agoIt's barely been 3 days. It's incredible how everyone (including leaders, allegedly even "operative" leaders like Putin with a paramilitary background) now expects wars to last a few hours. Even swift one-sided conflicts like Desert Storm and Desert Fox lasted a month or more! To expect less than a week from invasion to regime change in the capital is just stupid, if the Russian generals really worked on that basis they are not fit for command.
- elorant 5y agoI read a story today that Russian soldiers were sending Ukrainian women photos on Tinder. The story alleged that they expected to be treated in a friendly way upon arrival. This may reflect the general sentiment in the Russian chain of command.
- from 5y agoMy armchair analysis: Losing SWIFT access is bad but it's definitely not a death knell (estimated to cause around 5% GDP contraction initially but they could probably get by with the alternatives). The central bank thing seems much worse because an 80% collapse in the ruble would result in lots of angry Russians who had their savings wiped out. I read that Russia has a lot of its debt denominated in rubles so I guess it would be beneficial in that regard. Seems like Russia did not really prepare for this part or maybe I'm missing something.
- lstodd 5y agoSWIFT doesn't matter that much; the other financial stuff either. The big deal is the loss of high or medium tech supplies for the foreseable future. You might not realise how the whole of Russia runs entirely on import of those. China, even if they wanted to, can not replace that. If Putin doesn't end up hanging on some random light pole in next few days, RU will collapse.
- from 5y agoDoesn't it just mean they'll pay extra (for the cost of evasion)? Apartheid South Africa still got oil when it was sanctioned, they just had to pay Marc Rich a 10% premium. Of course that's not great, especially when your currency and everything is collapsing, but still.
- lstodd 5y agoIDK about what SA had to offer back back then. Diamonds? Gold? Thing is, Russia lived all those years on gas and oil export mainly. Which isn't exactly a great proposition nowadays.
- stefan_ 5y agoLike it hasn't already? They are already spending massive reserves to keep it up after the initial drop from the invasion.
- baybal2 5y agoThey are buying back rouble like crazy, they burn billions of dollars per day in foreign exchange
- mtmail 5y agoIs that a strategy to make money long term or a necessity at this point? I kind of understand stock buybacks companies do but I'm not familiar with currency buybacks.
- from 5y agoIt's to keep the exchange rate stable. Although that can't happen if the FX reserves are frozen.
- deleted 5y ago[deleted]
- csdreamer7 5y agoTo keep people from selling the ruble and buying dollars and euros because they fear their money will become worthless. If Russians stop accepting rubles and use foreign currency for transactions, the Russian govt stockpile of rubles, and it's ability to print more rubles, becomes worthless. They will need foreign currency to pay people.
- deleted 5y ago[deleted]
- csomar 5y ago> they burn billions of dollars per day in foreign exchange Well, given the sanctions they might as well burn these dollars/euros. So maybe it's not that bad to pump their currency rate here.
- duxup 5y agoIt plummeted pretty hard right after the war started.
- JohnJamesRambo 5y agoMaybe I’m stupid but did he not calculate the cost of this? Their stock market crumbled, the ruble crumbled, SWIFT kicked out. All that for Ukraine? What is so valuable there to him, I really still don’t get it. Is he just a crazy person? So what if Ukraine joins NATO. Is NATO going to launch an offensive on Russia? No. I don’t understand how his mind works.
- FpUser 5y agoI think he's gone mad. No one in his right mind would do what he did in this situation. I thought he was an authoritarian but rational person. Not anymore.
- ILMostro7 5y agoHe's done pretty bad things before. Georgia in 2008. The endless attacks on his own citizens, institutions; poisoning dissidents and hunting them down across the globe. This is not overnight. I'm not sure why some people are giving him benefit of the doubt now for his long legacy of ruthlessness.
- FpUser 5y agoThere is a difference between supporting an asshole or thinking that asshole being rational. I've never supported what he's done. But I did not think he will do what he did now. Ok I was wrong. Does that make you happy?
- ILMostro7 5y agoNot judging you, buddy. Just saying that his methods have always been relatively aggressive and crazy, in my opinion, even when they were on a smaller scale than this.
- rwaksmunski 5y agoCurrency exchanges in Europe no longer accept the Ruble, they are selling for well below current official exchange rate.
- stjohnswarts 5y agoChina and India can still accept it. I imagine between those two countries Russia can make due for a while