Thread: The end.

15.12.2014 Monday
Time 19 hundreed.
Somewhere in Russia...

77.8 Rub \ Eur
62 Rub \ USD
RTS 718 (- 10 % )

Now we`re definetely going down.

He is good at making a poker face, telling lies. Like "well, rouble became little bit cheaper, we`ll only win because of that" and same bullshit. Years of KGB training and some natural talent I guees. But the biggest problem is in those who agree.

For those who are not complete idiots - everything turned obvios today.

It`s an uncontrolled tailspin with no way out.



No oil incomes anymore + sanctions + unreasonable spendings (like Olympics) and we`ve got the "buy-buy" pie.

I was so afraid not to gain something. It appears that very soon it`ll be fine to sell property in order to buy food. Like computer that I`m using right now.

Eat your Crimea with a big spoon, dear russians.

See you in hell.

Is there a particular reason for this decrease that happened today?
Crimea is a long-term investment based on the reasoning of Cremlin.
The ruble crisis is just temporary. I am pretty sure that they knew that this will happen.

Топикстартер, вам туда.

Originally Posted by Antonio1986

Is there a particular reason for this decrease that happened today?

It`s been decreasing since January.
But today it fell on another 10 % (from 58 to 63). Just in one day.

Crimea is a long-term investment based on the reasoning of Cremlin.
The ruble crisis is just temporary. I am pretty sure that they knew that this will happen.

They also "knew" that Ukraine will collapse in two or more equal countries.
And that santions were just a joke.

Antonio, you appear to be not unintelligent, taking into account the things you do for living.
So as an exception I`ll tell you: it`s not about the rouble itself. Currency is just another piece of goods that may be bought or sold. It fell mostly because oil prices went down (and they are not supposed to come back quickly). 3700 (number under normal condition - etc late 2013) \ oil price = rouble. For ex. 3700 \ 62 = 59. The problem is that today rouble fell even further, despite of the fact that Brent stood still.

We had many problems before, and some predicted that unless our government changes its way - something bad will occur between 2016-2018. Then, we started Ukraine campaing. Because our rulers hate any positive examples of revolutions and pro-democracy reforms - once that happened in Georgia and inspired many, so they decided to destabilize them by starting a provocation back in 2008 in the Tskhinvali region or how they call it now South Osetia, now another neighbours decided to be more european, less corrupted and they got "civil war", artificially created by Kremlin. So the sanctions happened which played a role of a catalyzer for upcoming troubles (accelerating the time lapse). It`s like they knew that will probably happen, and took the risk. Being desperate and hoping that europeans won`t do anything serious.

Now we are in big big trouble.

Many dummies here believe that we shouldn`t care much about it. We should work hard, we should be strong and same sh*t (for instance Доллар как много в этом слове / Блог им. Northid / Клуб трейдеров sMart-Lab. Мы делаем деньги на бирже.). The bad thing is that we are dependent from the whole world imports just like any other country. We can`t even bake a piece of bread without using foreign technologies.

We import the huge majority of goods and even things that we produce ourselve are normally made with foreign components, materials or machines... which are being sold to us for dollars.

Moreover, I`ve intentionally posted a picture of RTS index only showing that the catastrophy itself is in economy deep dive - back to the basic numbers (from 1500-2000 to 750 in one year), there are not some minor currency fluctuations.

That means that everything is going to become extremely expensive in Russia and because (as I hope you understand now) it`s not about some Iphones or Parmesan cheese - it`s about anything from german oven to chemicals - then many notable companies will go bancrupt in the following months.

And only god knows what will happen in the nearest two weeks or month.
I didn`t want to make any predictions here, but governments dismission (and Putins escape) is very possible.
The only question is what are we going to do next...

Originally Posted by RedFox

Топикстартер, вам туда.

Я тебе в виде исключения поясню: не боятся в этой жизни только дураки. Когда удавка туго затягивает тонкую шейку - дурак будет продолжать ржать. Ведь он же дурак И убеждать себя не паниковать. А потом свет погаснет.

Примерно это с вами сейчас и случится.

Originally Posted by Serge_spb

It`s been decreasing since January.
But today it fell on another 10 % (from 58 to 63). Just in one day.





They also "knew" that Ukraine will collapse in two or more equal countries.
And that santions were just a joke.

Antonio, you appear to be not unintelligent, taking into account the things you do for living.
So as an exception I`ll tell you: it`s not about the rouble itself. Currency is just another piece of goods that may be bought or sold. It fell mostly because oil prices went down (and they are not supposed to come back quickly). 3700 (number under normal condition - etc late 2013) \ oil price = rouble. For ex. 3700 \ 62 = 59. The problem is that today rouble fell even further, despite of the fact that Brent stood still.

We had many problems before, and some predicted that unless our government changes its way - something bad will occur between 2016-2018. Then, we started Ukraine campaing. Because our rulers hate any positive examples of revolutions and pro-democracy reforms - once that happened in Georgia and inspired many, so they decided to destabilize them by starting a provocation back in 2008 in the Tskhinvali region or how they call it now South Osetia, now another neighbours decided to be more european, less corrupted and they got "civil war", artificially created by Kremlin. So the sanctions happened which played a role of a catalyzer for upcoming troubles (accelerating the time lapse). It`s like they knew that will probably happen, and took the risk. Being desperate and hoping that europeans won`t do anything serious.

Now we are in big big trouble.

Many dummies here believe that we shouldn`t care much about it. We should work hard, we should be strong and same sh*t (for instance Доллар как много в этом слове / Блог им. Northid / Клуб трейдеров sMart-Lab. Мы делаем деньги на бирже.). The bad thing is that we are dependent from the whole world imports just like any other country. We can`t even bake a piece of bread without using foreign technologies.

We import the huge majority of goods and even things that we produce ourselve are normally made with foreign components, materials or machines... which are being sold to us for dollars.

Moreover, I`ve intentionally posted a picture of RTS index only showing that the catastrophy itself is in economy deep dive - back to the basic numbers (from 1500-2000 to 750 in one year), there are not some minor currency fluctuations.

That means that everything is going to become extremely expensive in Russia and because (as I hope you understand now) it`s not about some Iphones or Parmesan cheese - it`s about anything from german oven to chemicals - then many notable companies will go bancrupt in the following months.

And only god knows what will happen in the nearest two weeks or month.
I didn`t want to make any predictions here, but governments dismission (and Putins escape) is very possible.
The only question is what are we going to do next...

My opinion as an economist:
1. The main indicators that define the prospects and prosperity of a country are: (a) Real GDP growth - Unemployment (b) Government Deficit (c) Public Debt (d) Current Account. Based on these indicators Russia is in a better condition than the majority of EU countries, USA and India. But in a worst condition than China and Arabic countries. Regarding the statement that Russia depends mainly on imports, I would like more clarifications, the current account (i.e. Trade Balance = Exports - Imports) of Russia is pretty fine http://en.wikipedia.org/wiki/List_of...entage_of_GDP: . You have a pretty strong industry and many neighboring countries depend on Russia exports.
2. I don't live in Russia but I suppose that now you have a severe inflation which counterbalances the depreciation of the currency. Now you as Russians have limited purchasing power abroad but foreigners have extended purchasing power in Russia. This will lead to foreign investments (mainly from Germany, India and China given the sanctions from USA)
3. I agree that Russia needs to make reforms and not depend just on its natural resources (especially oil). I would have expect more investment on heavy industry and R & D from Russia.
4. Russia is the second biggest military power. The extension of EU and NATO in Eastern Europe just provoked a "reasonable" reaction from this country. Sadam Husein was hurting the interests of the US Oil Companies in the region leading to the invasion of US in Iraq ... When the Baltic countries entered the NATO I expected a Third World War. Perhaps Russia didn't feel so strong then. But not gospodin Putin has a different opinion

RedFox

Вам туда

+1 000 000

Россию хрен что потопит. А что потопит Россию - не потопит Русских!

Serge_spb

We can`t even bake a piece of bread without using foreign technologies.

We can. Believe me.
All we have to do is to return to some sort of the iron curtain once again, which is what we are seemingly being provoked to do.
We ARE self-sufficient, no matter of your panic.

Originally Posted by Antonio1986

My opinion as an economist:
1. The main indicators that define the prospects and prosperity of a country are: (a) Real GDP growth - Unemployment (b) Government Deficit (c) Public Debt (d) Current Account. Based on these indicators Russia is in a better condition than the majority of EU countries, USA and India. But in a worst condition than China and Arabic countries. Regarding the statement that Russia depends mainly on imports, I would like more clarifications, the current account (i.e. Trade Balance = Exports - Imports) of Russia is pretty fine http://en.wikipedia.org/wiki/List_of...entage_of_GDP: . You have a pretty strong industry and many neighboring countries depend on Russia exports.
2. I don't live in Russia but I suppose that now you have a severe inflation which counterbalances the depreciation of the currency. Now you as Russians have limited purchasing power abroad but foreigners have extended purchasing power in Russia. This will lead to foreign investments (mainly from Germany, India and China given the sanctions from USA)
3. I agree that Russia needs to make reforms and not depend just on its natural resources (especially oil). I would have expect more investment on heavy industry and R & D from Russia.
4. Russia is the second biggest military power. The extension of EU and NATO in Eastern Europe just provoked a "reasonable" reaction from this country. Sadam Husein was hurting the interests of the US Oil Companies in the region leading to the invasion of US in Iraq ... When the Baltic countries entered the NATO I expected a Third World War. Perhaps Russia didn't feel so strong then. But not gospodin Putin has a different opinion

My dear friend,

you was able to notice our GDP numbers but somehow did not take a peek at the GDP per capita list. Russia is lower than
-Greece
-Lithuania
-Estonia
-Slovakia
-Czech republic
and on the same level with Poland.

I wonder if it is what you mean under "better condition"?

Now, those countries had no gift in such amount of natural resources as Russia, but were able to achieve the same level of prosperity as we did. Moreover, many experts recently claimed that these countries (like Poland and Czech rep.) were predicted to overtake Russia in the current year (even when Russia still was stable!). Oil pumping (in Russia as well as in Brazil, Venezuela, South Africa, Indonezia) cannot eternally develop countries economy - we lost to eastern states due to their less corruption and higher management efficient).

Furthermore, take into account that half of our $ 400 b budget used to be incomes from oil \ gas exports. Taxes from businesses - much less than in western countries. 50% of USA`s GDP are incomes from lower companies. In Russia - nothing like this. Simply because companies don`t pay legit taxes. Or simply because companies (in such amount) do not exist. Which do - they are mostly retail shops or services, because it is extremely unreasonable to produce anything in Russia. Money are expensive, energy is expensive, inflation is high, property safety is low.

You have got different opinion like "you have got pretty strong industry" - maybe you could name what useful apart from raw materials do we sell? Russian vehicles? Software? Electronics? Food? Anything. You can even use a list of 200 largest private companies. 200 крупнейших частных компаний trying to find anything notable except retail and oil\gas.

I begin to have doubts about your competence, since I have to explain such obvious things.

Concerning NATO - actually, don`t even want to discuss this. Remember, that Georgia never attacked Russia or any other country. Russia did. No wonder that after that everyone became concerned about their safety. As well as Ukraine. So don`t tell me anything about "NATO provoked" or so. There is no point in discussing this.

Представляю, как страшно, когда не знаешь, что делать. У меня так было, когда у меня маленький ребёнок и объявился рак груди. Ужас сковал. Обошлось, слава Богу, выжила. Было б здоровье, всё можно пережить.

Вот классная песенка развести тоску.





Припев
Только пусть переменится,
Это все перемелется,
Пусть нам светит надежда путеводной звездой.
Встречный ветер изменится,
На попутный изменится,
Старый снег скоро стает подталой водой.

I куплет
Сколько в мире дорог,
Сколько в мире начал,
И счастливых начал больше я повстречал,
Чем счастливых исходов.
Никогда я не знал,
Где найдется причал,
Где, войдя в старый порт,
Мой корабль отдохнет перед новым походом.

Припев
Только пусть переменится,
Это все перемелется,
Пусть нам светит надежда путеводной звездой.
Встречный ветер изменится,
На попутный изменится,
Старый снег скоро стает подталой водой.

II куплет
Что же делать теперь,
Не бросать же все так.
Можно выход найти,
К солнцу выход найти из любых лабиринтов.
Только надо понять,
Что не надо менять,
Что нашел и хранил,
Что берег и копил,
Что любил в этой жизни.

Припев
Только пусть переменится,
Это все перемелется,
Пусть нам светит надежда путеводной звездой.
Встречный ветер изменится,
На попутный изменится,
Старый снег скоро стает подталой водой.

Originally Posted by Antonio1986

My opinion as an economist:

May I request your opinion on another issue:
- Is it normal when the government cannot predict the imminent devaluation of currency?
- If yes, then is it normal for government to deny with obstinacy of donkey the gloomy perspective and do nothing to moderate people's losses.

Just for your information: for many recent years, our chiefs are claiming, that rouble is super-solid currency, and "WE PERSONALLY HAVE OUR SAVINGS IN ROUBLE".

Спасибо, Лампада, что подбадриваешь.
Кстати, ссылки на матершинные стишки принимаются?
Тогда вот они (это как бы disclaimer)
Игорь Иртеньев | Хозяйке на заметку

Originally Posted by Serge_spb

Я тебе в виде исключения поясню: не боятся в этой жизни только дураки. Когда удавка туго затягивает тонкую шейку - дурак будет продолжать ржать. Ведь он же дурак И убеждать себя не паниковать. А потом свет погаснет.

Примерно это с вами сейчас и случится.

О, разумеется. А с вами не случится. Потому что вы поистерите заранее.
Логика, где ты?


“Fear is not real. The only place that fear can exist is in our thoughts of the future. It is a product of our imagination, causing us to fear things that do not at present and may not ever exist. That is near insanity. Do not misunderstand me, danger is very real, but fear is a choice.”

...поистерите заранее. ...

"Истерить" - откуда это противное слово взялось? Не хотелось бы здесь его легализировать.

Вполне ходовое слово

Как это было в КВН?

Раньше болгарский перец стоил рубль - пятьдесят и его закатывали в банки, а сейчас он сам закатывает истерики, просит 20 штук баксов за концерт и разъезжает на лимузине

"— Тебя как, сразу прикончить или желаешь помучаться?
— Лучше, конечно, помучаться."

Если бы Россия "проглотила" события на Украине, это бы означало медленный, но неизбежный конец её как суверенного государства. Странно, что кто-то этого не понимает.

А кто выйдет живым из текущей экономической войны, мы еще поглядим.

"Was mich nicht umbringt, macht mich stärker".

Originally Posted by Serge_spb

My dear friend,

you was able to notice our GDP numbers but somehow did not take a peek at the GDP per capita list. Russia is lower than
-Greece
-Lithuania
-Estonia
-Slovakia
-Czech republic
and on the same level with Poland.

I wonder if it is what you mean under "better condition"?

Now, those countries had no gift in such amount of natural resources as Russia, but were able to achieve the same level of prosperity as we did. Moreover, many experts recently claimed that these countries (like Poland and Czech rep.) were predicted to overtake Russia in the current year (even when Russia still was stable!). Oil pumping (in Russia as well as in Brazil, Venezuela, South Africa, Indonezia) cannot eternally develop countries economy - we lost to eastern states due to their less corruption and higher management efficient).

Furthermore, take into account that half of our $ 400 b budget used to be incomes from oil \ gas exports. Taxes from businesses - much less than in western countries. 50% of USA`s GDP are incomes from lower companies. In Russia - nothing like this. Simply because companies don`t pay legit taxes. Or simply because companies (in such amount) do not exist. Which do - they are mostly retail shops or services, because it is extremely unreasonable to produce anything in Russia. Money are expensive, energy is expensive, inflation is high, property safety is low.

You have got different opinion like "you have got pretty strong industry" - maybe you could name what useful apart from raw materials do we sell? Russian vehicles? Software? Electronics? Food? Anything. You can even use a list of 200 largest private companies. 200 крупнейших частных компаний trying to find anything notable except retail and oil\gas.

I begin to have doubts about your competence, since I have to explain such obvious things.

Concerning NATO - actually, don`t even want to discuss this. Remember, that Georgia never attacked Russia or any other country. Russia did. No wonder that after that everyone became concerned about their safety. As well as Ukraine. So don`t tell me anything about "NATO provoked" or so. There is no point in discussing this.

Answers based on my understanding as a foreigner with minimal understanding of the actual situation in Russia, but with desire to learn about it:
0. The value of a currency is more affected by expectations rather than actual economic variables. I have serious reasons to believe that the ruble now is facing a controled "speculative attack" orchestrated by all those that posses ruble globally. Who possess ruble globally: Russians and the buyers of russian gas. Also given that the expectations of the prospects of the Economy of Russia is based on the price of oil ... and the price of oil is controled by OPEC, i.e. Arab countries, permanent allies of USA. The depriciation of ruble is not a macroeconomic phenomenon based on how bad is entering Russia a financial crisis ... is just a political decision. Italy, Spain, UK, USA have much more serious economic problems than Russia.
1. The countries you mentioned are member of EU and NATO and have received serious subsidies and economic help. Just the agriculture sector of Greece has received since 1981 help about 5 billions euro. These countries cannot be compared with Russia, because they are protectorates of the Big Powers (new colonies). Russia is a sovereign independent coutry and should be compared only with the G20. Based on the G20 rates is about in the middle. Also Russia has become a "modern" capitalistic democracy in 1990. Greece is a democracy since 1848 (things cannot be compared). Also if we consider the Purhasing Power Parity and not the Nominal GDP, Russians have more power tha some of the countries you mention.
2. Russia is corrupted, but USA and China has biggest inequality on income based on the Gini Coefficient. Perhaps USA has more poor people per analogy of population than Russia. Also Russia is a massive country and this create serious problems to manage and control. Some oligarchs have personal armies in Russia ... what you expected. Russias spans from Europe to Japan. In its population are included many people that are not even Russians. Cyprus has a much bigger per capita income than Russia, but Cyprus is a small island in the size of the city of Krasnoda and for this reason is very easy to manage and control. Cyprus, Greece, Estonia etc are a semi-sovereign semi-independent countries ... Russia is an independent superpower. If Russia close the oil-pipes half Europe will remain without electricity.
3. Regarding Oil I don't have anything to comment. I totally agree. Russia is unfortunately massively based on oil revenues. This is normal. It has a comparative advantage on selling oil (Adam Smith, Ricardo David theories) ... so it does what it has the advantage to do. In addition... it has a massive industry. It is the biggest military equipment provider on the world. The 36% of the GDP is based on heavy industry (I think it ranks 8th globally). It is not just oil.
4. Regarding taxes. It is true that you have many off-shore companies, but at some point they will return back. They already started.
5. It is a historical fact that NATO and EU have expanded to East Europe. For me as an objective economist is an expansion ... for Russians is an invation. But only a naive person will think that NATO and EU didn't exploid the chaotic situation in Russia after 1989 to achieve this expansion. For Russians it doesn't make sense Russians to leave in a country, such as Latvia, that is a member of a coalition which was created with ONLY aim the destruction of Soviet Union, i.e. Russia. NATO is an anti-Russian coalition.
6. The ruble declines but at least in Russia they were not confiscated the 60% of the deposits as in Cyprus, which is a "proper civilized high-income european" country.
7. As an economist I recognise that some times dignity is more important than money. If Russians consider that they do anything they do (whether is called invasion in Georgia or invation in Ukraine) for dignity I respect this. If they do all this just to increase the money and power of some oligarchs, I feel sorry of them. But as I understood Russians consider that Crimea has always been part of Russia (if I am not wrong the majority of population there are Russians), as Greeks consider that Cyprus has always been part of Greece (80% Greek population). The difference that Greeks never had the balls to enter and take back Cyprus, but Russians had the balls to enter and take Crimea.

This is just a personal opinion. The fact that I am against wars it doesn't mean that I don't understand why countries make wars.

By the way, because I don't want to create the impression that I speak from a secure position.
The 35% of my incomes depend on Russian tourists and investors.
Also my country depends on Russia.
Due to the sactions and the decrease of ruble we all face serious economic problems.
Already many companies started to bankrupt.
As everyone else I try to understand the situation and have an objective opinion.
For this reason I encourage everyone to express his opinion.
Everyone is affected.

Originally Posted by Lampada

"Истерить" - откуда это противное слово взялось? Не хотелось бы здесь его легализировать.

надо его люстрировать

Рубль падает по двум причинам:
1. падение цены на нефть
2. отсутствие интервенций со стороны ЦБ
сейчас курс нестабильный, но думаю где-то 60-65 будет стабильно в 2015-м

кстати наблюдения показывают что санкции тут не причем
Доллар в начале года - 33р
Доллар в середине марта - 36р. (Крым случился, санкции ввели, нефть 95)
Доллар в середине июня - 33р (еще санкции, нефть 9
Доллар в сентябре - 36р. (нефть 95)
Доллар в отябре - 39р. (нефть 85)
Доллар в ноябре - 47р (нефть 70)

Если кто-то хочет возразить, что дескать нефть падала ниже 40 в 2009-м и было все ок, то я отвечу, что в 2008-2009 ЦБ потратил примерно 100-200 миллиардов вечнозеленых на поддержку курса рубля, тогда как в 2014-м всего 44 миллиарда за весь год, и прекратил это делать с конца октября, объявив 5 ноября, что официально прекращает сдерживание, 10 ноября вышло постановление ЦБ об отмене границ валютной корзины