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    Russian Economy General News: #8

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    Austin

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    Re: Russian Economy General News: #8

    Post  Austin on Tue Jun 06, 2017 5:20 pm

    Sergei Glazyev in an interview with "Gazeta.ru" sums up the SPIEF-2017.

    "Calls for patience is no longer a ride"

    https://www.gazeta.ru/business/2017/06/05/10708133.shtml

    What is Russia's proposal to do Donald Trump, who profits blokcheyn how to replace speculative investments for long-term and why Moscow has no confidence in the Beijing - Advisor to the President of Russia and Academician Sergei Glazyev in an interview with "Gazeta.ru" sums up the SPIEF-2017.

    - What is "hooked" in Vladimir Putin's speech at the forum?


    - The President emphasized the digital economy, which covers more sectors and activities. At one time, working chairman of the State Duma Economic Policy Committee, I have initiated the adoption of several laws necessary for the development of e-commerce.

    Since then, millions of people are already using the Internet to purchase goods. And the business, and the government carry out operations in an electronic form and electronic auctions, and auctions have become the main form of public procurement.

    Today's agenda to create the legal conditions for use in transactions - blokcheyn - a technology that will make economic use transparent, ensure trust between the partners, which is so lacking in our business and the state.


    Why is it so important and that "touches"? And because digital technologies are revolutionizing our daily lives and telemedicine, distance education, "smart" homes and even city - this is an incomplete list of the new opportunities offered to every citizen and equalizing conditions for obtaining high-quality services and the disclosure of its features.

    - Equal opportunities - it's good, good dream. But authorities propose to live according to a different formula: no money, but you stay there, be patient.

    - This phrase premiere shows a misunderstanding of the nature of money. Our monetary authorities do not understand that modern money is created under the debt in order to finance the expanded reproduction of the economy.

    The main objective of monetary policy in all successful developing countries is to create conditions in order to maximize investment and innovation. At low savings and incomes of the population, underdevelopment of financial market issue is used to finance investment target.

    This policy has been used successfully in the second half of the XIX century: Hamilton in the United States, Witte in Russia, the State Bank of the USSR in postwar Japan and Western Europe, today's China, India, Indochina countries. All countries have committed economic miracle, using large-scale monetization of credit investments.

    Currently, in order to overcome a structural crisis and revive the economy wide emission of money used US Fed and the ECB. Its main channel is to finance the state budget deficit in order to ensure the necessary research and development spending, modernization of infrastructure, promotion of investment in the development of new technological order. China, India, Indochina countries as earlier post-war Europe and Japan, emit the money under the investment plans of economic agents in accordance with the centrally set priorities.

    - But opponents of such practices scare a rise in prices, the inflation jump, if you include the printing press.

    - Target emission of money for lending to investment in these countries does not lead to inflation, as its result is to increase the efficiency of production and expansion of production volumes of goods, thereby reducing costs, increasing supply of goods and increased the purchasing power of money.

    With the growth of the volume and to improve production efficiency are increased incomes and savings of the population and the private sector, thus expanding private sources of financing investment, and the importance of the issue of money is reduced.


    But as soon as a private investment activity is declining, the state compensates for its increase in public investment, including at the expense of monetary financing of budget deficits and the development of institutions. This is what we see today in the policy of quantitative easing in the US, EU and Japan, and the growth of state investments in China and India.

    As the economy monetization growth of inflationary background will decrease.

    In Russia, inflation background is relatively high due to the lack of development of competition, regulators corruption, technological backwardness and low efficiency, generating cost inflation and devaluation of the ruble.

    A key reason for the constant decline in the purchasing power of the ruble is a monetary policy pursued by: higher interest rates, or passed on to prices, or involve the reduction of crediting of production, resulting in rising prices and reduced supply of goods.

    The ongoing policy of inflation targeting is based on the primitive notion of money as a commodity whose price is determined by the balance of supply and demand.

    Following this logic, the Central Bank is trying to reduce inflation and increase the cost (purchasing power) of money by reducing the supply. This automatically results in a credit contraction, falling investment and innovation activity, thereby reducing the technical level and competitiveness of the national economy, which causes devaluation of the currency and a new wave of inflation.

    This vicious circle of monetary policy, we pass into the next, for the fourth time with a consistent primitivization and increasing technological backwardness of the economy.

    - The purpose of SPIEF - show Western politicians, investors and regulators Russia's ability to invest. But the foreign policy agenda of economic forum has dissolved. And there is no doubt that foreign investors after the forum will invest actively.

    - If we want to attract foreign investment, the government first needs to invest itself. Then private investors as their own and foreign, believe in seriousness of purpose, and invest their money. Is this not the experience of India and China, the experience of post-war reconstruction of Europe and Japan, as, indeed, and our own recent experience.

    - This is an allusion to that?

    - I remember the St. Petersburg Economic Forum sample of 2007.

    Then on the eve of the global financial crisis, our leaders are trying to lure foreign investors to the image of Russia as a financial haven, protected from external storms. In practice, we got the flight of capital instead of investment, and the Russian economy has slipped more than others.

    - The image of Russia - secure financial harbor seems to have used Alexei Kudrin, the then Minister of Finance. He did not stay afloat, but actively critical of your ideas to ease monetary policy.


    - Let them continue to criticize, but investors see well all the flaws of the system of regulation of the Russian economy, which makes it dependent on external market fluctuations.

    If the record of the ruble volatility unmanageable monetary and financial flows, the bank stopped the transmission mechanism of transformation of savings into investment, the State's failure to fulfill its own plans no investments other than speculative, we can not wait.

    Except, of course, political investment, which will be organized by the President personally.

    - Speaking of criticism from Kudrin, now the head of the Center for Strategic Research and curator of socio-economic development of the country until 2035. He called the five dangerous, in his view, the economic fallacies. On one of the attacks you actually are now answered. About the "quantitative easing". Kudrin believes that the domestic version of this policy will accelerate inflation and increase the pressure on the ruble as a result of "spilling" of extra money on the currency market ?


    - I would supplement my answer ... Of course, the money will be on the market, but they will at the same time through increased production.

    - According to Kudrin, and the myth is this idea that economic growth can be accelerated by employing existing in the country of significant spare capacity and using again easing of monetary policy. Your opponent says that while there is a real threat to the formation of entire clusters, which are at negative margins will lobby for cheap loans from the Central Bank. Ie financing of inefficient industries will be at the expense of all other encumbrances inflation tax ?

    - Firstly, I note that the spare capacity in Russia, about 40%. Secondly, the sharp rise in interest rates to 17% and the credit crunch from the state-owned banks in 2014 caused the collapse of the large investment programs even in industries with high profitability.

    Many businesses have gone bankrupt. And the banking system at the same time has become a mechanism for pumping money from the real economy.


    - Let us return to the Investment Forum in St. Petersburg. Almost half of the time at the plenary session of the forum was dedicated to the United States, not least, by the way, thanks to the diligence of the moderator and the leading American TV channel NBC Megyn Kelly. You can walk to the impeachment of President Trump?


    - Do not doubt the victory Trump after identify candidates from the major parties. This was told to me well-known pattern of electoral behavior of the citizens who are unhappy with the status quo and want to change it. But I doubt whether he will be able to legalize the victory.

    But, oddly enough, in the United States democracy is still working and the electoral law is observed. This means that it is possible and impeachment.

    The American ruling elite is painfully aware of the loss of global hegemony. It seeks to preserve the dominance of the military and political means, losing competition in the economy of China and other countries in South-East Asia, shaping the new global economic order.

    Trump continues to go down the path of hybrid war, taking the decision to increase military spending and modernization of nuclear forces. The US continues its occupation of Ukraine in order to use its people as cannon fodder, to unleash a war against Russia in Europe.

    But the US has little political choice. If Washington continues hybrid world war, it will trigger the formation of a powerful anti-war coalition, which hit the US financial power by de-dollarization of the Eurasian Economic Space.

    This will cause the collapse of the US financial system, with catastrophic economic consequences. If, however, the US government will return to the mainstream of international law and recognizes the realities of a multipolar world, agree with our principles of international cooperation, the Trump would have to give up the increase in military spending, from the occupation of the Ukraine, the global electronic spying and stop global hybrid war.

    And in fact, and in another case, very likely impeachment incumbent president - it is necessary to find a scapegoat.

    - Igor Dodon said at the forum, trying to convince that Moldova will be able to sit on two chairs: pro-European and Russian. We do not get a second Ukraine?

    - Fortunately, Moldova now leads a strong-willed person and devoted to the interests of the people. I know Dodon many years. It is characterized by the consistent position of serving the interests of Moldova, which objectively are inextricably linked with Russia. And he convincingly demonstrated at the forum that imposed Western puppets and corrupt Association of Moldova with the EU turned to the once prosperous republic in the USSR economic disaster.

    I am confident that the Moldovan people for the most part support the line of the president to return to one with Russia and EAEC economic space.

    Although Objectively speaking, to implement this line of Dodona is much more complicated than might be the same for Ukraine to make Viktor Yanukovych, who had much more power and support of the majority of the working population, it is inextricably linked the results of their work and family ties with Russia.

    - Why is it so slowly is turning Russia to the East? Are we not deceiving ourselves when we think that China will be friends with us economically, to their detriment?

    - In order to achieve successful cooperation with China, it is necessary to understand the secret of its economic miracle and to use these mechanisms. The core of the entire Chinese economy regulatory framework is to encourage investment and innovation.

    A key role in this is played by the public sector, which is based on the state banking system, which generates credit under the indicative plans for increased investment and production. This is the aim of transport and energy infrastructure, the development of which is given priority in the government's plans. As well as state-owned corporation, concentrating resources for the development and introduction of advanced technologies.

    Public investments are the engine of development of the Chinese economy. Following their growth and rising private investments, using risk reduction and public infrastructure.

    There are no fundamental problems in the application of proven methods in China and economic management in Russia.

    - Prime Minister of India, Narendra Modi made it clear at the forum that he is a great liberal and India are friendly with Russia over inertia. What do you think, if possible at the political level the conflict of interests between Russia and India, is increasingly focused on its former mother country?

    - With India we objectively have a good complementary economies, the combination of competitive advantages that can count on a significant economic impact.

    - Upcoming presidential elections - it's an incentive to implement the new socio-economic strategy (which prepares the Kremlin), or rather an obstacle? How much is now an opportune time to develop a strategy paper?


    - Election of the President - it is always a summing up and the waiting time changes for the better. The Company is not satisfied with the situation in the economy, which is heavily dissonant with our foreign policy success.

    The president really need a realistic scientifically based program of economic growth. And such a program. It is presented together "Stolypin club", the Chamber of Commerce, Academy of Sciences, Moscow Economic Forum. Our program allows the calculation of the withdrawal of the Russian economy on the path of sustainable growth with a rate of 5-10% GDP growth per year.

    In the modern world it is impossible to combine global leadership underdevelopment.

    The more impossible to achieve global success in declining living standards. The era of modernization at the expense of the living standards of the people is no longer possible, it is a thing of the past.


    After the catastrophic consequences of shock therapy, which is imposed under the slogan "we have to be patient, to go through radical reforms to build a high-performance economy and improving living standards in America and Europe," the people in such a miracle once again going to believe this is not a ride.

    People see the helplessness of the authorities in the organization of economic growth accompanied by the luxurious lifestyle of the ruling elite, the export of capital abroad, record revenues of monopolists.

    Russians do not want to be victims of the economic experiments of the Central Bank, leading to the loss of their savings in the banks obankrochennyh, depreciation of ruble earnings and savings due to the ruble exchange rate fluctuations, as well as the loss of employment due to lack of credit for normal reproduction. And this is happening against the backdrop of the overwhelming success of neighboring China, which has already cost us on wages, while not having the oil and gas and other natural resources.

    People understand that the reason for our plight in the economy is in its inefficient management, and suspects that it works not in his interest.
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    kvs

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    Re: Russian Economy General News: #8

    Post  kvs on Tue Jun 06, 2017 11:43 pm

    What a moron. Playing into the 5th column regime change narratives of corruption. GDP growth and personal wealth are two different
    things. It sounds like he wants people to get poor because the GDP is not growing fast enough. This clowns is a real idiot for trying
    the apply some sort of neo-Marxist interpretation of this. Russia opted for capitalism based on solid needs, now we have central planners
    coming out of the woodwork demanding "socialist" solutions. It never crosses the mind of this idiot that GDP growth is due to private
    initiative and not government planning. If the malcontent masses want GDP growth, then instead of bitching at the government or
    praying for manna from Washington, they need to move their asses and make those high earnings and in the process drive GDP growth.

    Thank goodness that millions of Russians don't think like welfare leeches like Glazyev and actually show real initiative and are driving
    the current structural transition which is laying the base for serious long term growth.
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    KomissarBojanchev

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    Re: Russian Economy General News: #8

    Post  KomissarBojanchev on Wed Jun 07, 2017 12:03 am

    kvs wrote:What a moron.  Playing into the 5th column regime change narratives of corruption.   GDP growth and personal wealth are two different
    things.  It sounds like he wants people to get poor because the GDP is not growing fast enough.  This clowns is a real idiot for trying
    the apply some sort of neo-Marxist interpretation of this.   Russia opted for capitalism based on solid needs, now we have central planners
    coming out of the woodwork demanding "socialist" solutions.   It never crosses the mind of this idiot that GDP growth is due to private
    initiative and not government planning.   If the malcontent masses want GDP growth, then instead of bitching at the government or
    praying for manna from Washington, they need to move their asses and make those high earnings and in the process drive GDP growth.  

    Thank goodness that millions of Russians don't think like welfare leeches like Glazyev and actually show real initiative and are driving
    the current structural transition which is laying the base for serious long term growth.    

    I'll say it again: central planning is good for Russia, capitalism only brought death, exploitation and dsigusting oligarchs. The free market didnt allocate resources in the right places due to the shitty desire for short term fossil fuel profit.
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    OminousSpudd

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    Re: Russian Economy General News: #8

    Post  OminousSpudd on Wed Jun 07, 2017 2:26 am

    KomissarBojanchev wrote:
    kvs wrote:What a moron.  Playing into the 5th column regime change narratives of corruption.   GDP growth and personal wealth are two different
    things.  It sounds like he wants people to get poor because the GDP is not growing fast enough.  This clowns is a real idiot for trying
    the apply some sort of neo-Marxist interpretation of this.   Russia opted for capitalism based on solid needs, now we have central planners
    coming out of the woodwork demanding "socialist" solutions.   It never crosses the mind of this idiot that GDP growth is due to private
    initiative and not government planning.   If the malcontent masses want GDP growth, then instead of bitching at the government or
    praying for manna from Washington, they need to move their asses and make those high earnings and in the process drive GDP growth.  

    Thank goodness that millions of Russians don't think like welfare leeches like Glazyev and actually show real initiative and are driving
    the current structural transition which is laying the base for serious long term growth.    

    I'll say it again: central planning is good for Russia, capitalism only brought death, exploitation and dsigusting oligarchs. The free market didnt allocate resources in the right places due to the shitty desire for short term fossil fuel profit.
    There's a big a difference between free-market capitalism and the crony-capitalism that Russia was inflicted with by US policy makers...
    Central planning under the offspring of the RSDLP brought exactly death, exploitation and disgusting oligarchs (or rather political tyranny) initially.

    Austin

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    Re: Russian Economy General News: #8

    Post  Austin on Wed Jun 07, 2017 7:17 am

    June 2017 -- China, Russia creating robust agricultural industry


    Austin

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    Re: Russian Economy General News: #8

    Post  Austin on Wed Jun 07, 2017 2:29 pm

    Naryshkin has warned about the threat of an "economic war" against the United States Russia

    https://www.gazeta.ru/business/news/2017/06/07/n_10147037.shtml

    Head of the Foreign Intelligence Service Sergei Naryshkin during the hearings in the Federation Council, said that the US intends to strengthen the sanctions pressure on Russia, the correspondent of "Gazety.Ru".

    "Among the priorities of the US government agencies, in fact, an economic war against Russia. According to information received, Washington intends to intensify the sanctions pressure on our country and looking for a new reason for this "- he said.

    Naryshkin added that the restriction can be extended against Russian mining and allied sectors, worked as the idea of ​​reducing the credit terms in foreign markets Russian banks with state participation and the energy profile companies.

    "The US is urging its partners the advisability of reducing the volume of purchases of Russian oil," - he stressed.

    Also, according to Naryshkin, attempts to disrupt the implementation of the project "North Stream - 2". He concluded that it directed the US action, Poland and the Baltic states.

    Earlier it was reported that the US president asked Secretary Donald Trump Rex Tillerson to improve relations with Russia, despite the ruling in the domestic US political atmosphere of anti-Russian sentiment.

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    Re: Russian Economy General News: #8

    Post  Austin on Fri Jun 09, 2017 8:01 am

    Looks like China and Russia have difference still to be resolved for issuing RMB bonds


    Russia is in no hurry to issue bonds in RMB, because it wants to put them through their depositary. China insists on its site and its own terms. About the difference in the approach to this issue, the risk that foreign investors will begin to throw off Russian OFZ, the last Russian state debt and the reform of the IMF in an interview with "Gazeta.ru" said Deputy Finance Minister Sergei Storchak.

    https://www.gazeta.ru/business/2017/06/05/10709009.shtml#page1

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    Re: Russian Economy General News: #8

    Post  Austin on Fri Jun 09, 2017 10:22 am

    Elvira Nabiullina’s achievements as head of Russia’s Central Bank

    More:
    http://tass.com/economy/950613
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    franco

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    Re: Russian Economy General News: #8

    Post  franco on Fri Jun 09, 2017 1:36 pm

    Austin wrote:Elvira Nabiullina’s achievements as head of Russia’s Central Bank

    More:
    http://tass.com/economy/950613

    Very Happy Oh the haters aren't going to like that article! Twisted Evil

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    Re: Russian Economy General News: #8

    Post  Austin on Fri Jun 09, 2017 3:53 pm

    Rosneft chief Sechin looks beyond Russia sanctions

    https://www.ft.com/content/0805cc2e-4907-11e7-919a-1e14ce4af89b

    Proudly recalling the 25 per cent rise in Rosneft’s market capitalisation under his first 18 months as chief executive, he complains that the political crisis put a deep dent into that achievement.

    “I am sweating to try to bring the capitalisation up. It used to be $93bn. And then somebody decides to impose sanctions. And my capitalisation, the product of my efforts, goes down to $62bn,” he says.


    “The problems that we could have had because of the sanctions, we are solving those problems without any difficulty. They are not affecting us, so far. But the market views it differently,” he adds. Outside, over the music and the sound of chatter, handpicked executives from across the global oil industry wait for Mr Sechin at the company’s annual St Petersburg party.

    We work very hard,” he says. “They kept telling us that private companies operate in a more efficient manner. And I completely disagree with that . . . We obviously demonstrate that we are competitive. We can compete with any market players.”

    Not that sanctions have held back Mr Sechin’s longstanding ambition to turn Rosneft into a big global producer.

    This week he is expected to close a deal to take control of Essar Oil, an Indian producer and refiner. Rosneft also owns a stake in a major Venezuelan oil project, is building a refinery in Indonesia and is developing five oilfields in Kurdistan, as part of a number of deals this year to increase its presence in the Middle East market.

    “Every good deal, every masterpiece, requires some effort,” he says of the Essar acquisition. When challenged on whether the debt-laden company bears comparison to Michelangelo, he replies: “It is more like a Henri Matisse.”

    The deal, done in conjunction with commodity trader Trafigura, increases Rosneft’s total refining capacity by 20m tonnes to more than 120m tonnes a year, gives it control of a deepwater port on the Indian Ocean, close to the Gulf, and a national network of 2,700 petrol stations.

    “To put it mildly, the Indian market goes through very positive dynamics right now,” he says. “I like Essar. It was a challenging project . . . [but] this project is really a gem, a jewel among our projects.”

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    Re: Russian Economy General News: #8

    Post  Austin on Fri Jun 09, 2017 3:58 pm

    Can they move frieght train at 400 km/hour ?

    Russia and China plan to launch first high-speed freight train in 2019


    More:
    http://tass.com/economy/950596

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    Re: Russian Economy General News: #8

    Post  Austin on Fri Jun 09, 2017 5:23 pm

    Finally some one in State Duma is asking the right question to CBR why on Earth are they buying more US T Bills ?

    http://tass.ru/ekonomika/4326577

    Volodin proposed to ask the US data on the state of the economy in the light of the debt to the Russian Federation



    MOSCOW, June 9. / TASS /. State Duma Speaker Vyacheslav Volodin proposed to request from Congress information about the state of the US economy in the light of the country's debt to the Russian Federation.

    The subject raised by the deputy of the Communist Party Vera Ganzya when discussing reassignment Elvira Nabiullina as the Chairman of the Central Bank of the Russian Federation. "The Central Bank is responsible for the development of national economy raises the question of the attachment of our funds into the US economy." - said a Communist, referring to Nabiullina. According to the parliamentarian, the Russian Federation has recently increased the investments in US Treasuries by $ 13.5 billion, "Now the amount if I am not mistaken, $ 99.8 billion of our investments."

    "US debt grows, the tension increases, and these bonds for some reason considered to be one of the most reliable. I would like to know why the United States?" - the politician said, was also interested in how to "take into account the risks due to the worsening of the international situation."


    For its part, Volodin said that his colleague raised "absolutely the right question." "But maybe we need to request information from the Committee on the Budget of the US Congress on the state of their economy, - he suggested -. Given that they owe us a really significant amount."

    "Your question is under a clear base, because with the situation as it develops, the subject no one picked up, except you," - said the speaker. "Russia needs America, so there must be stability, - he said -. We have witness the turbulence." "So the question is entirely justified, not only to our Central Bank, and it is necessary to set the (Central) Bank of the United States", - concluded Volodin.



    Подробнее на ТАСС:
    http://tass.ru/ekonomika/4326577
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    franco

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    Re: Russian Economy General News: #8

    Post  franco on Fri Jun 09, 2017 6:56 pm

    That sounds more like a shot at the Americans. Smile
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    Re: Russian Economy General News: #8

    Post  miketheterrible on Fri Jun 09, 2017 8:00 pm

    franco wrote:That sounds more like a shot at the Americans.  Smile

    A shot at both really. Why are we buying them and US owes us a lot while their economy isn't increasing but the debt is.

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    Re: Russian Economy General News: #8

    Post  Austin on Sat Jun 10, 2017 7:20 am

    miketheterrible wrote:
    franco wrote:That sounds more like a shot at the Americans.  Smile

    A shot at both really.  Why are we buying them and US owes us a lot while their economy isn't increasing but the debt is.

    $100 Billion of T Bills is not much for the fed , they used to print like $65 billion per month during QE , Infact it just penuts.

    Come the political change they can refuse to encash the T Bills for any reason including Putin getting off on the wrong side of bed.

    It would be wise to keep minimim amount in US T Bills just to take care of some basic needs if that is absolutely needed , better to diverisify that money in SDR,Euro and Physical gold.

    It would be Vert Anti-National for Russia/CBR to keep T bills inspite of all the sanctions US put on Russia ...No country with any self respect would do that , atleast least not subsidise US Debt.
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    Re: Russian Economy General News: #8

    Post  kvs on Sat Jun 10, 2017 3:05 pm

    Austin wrote:
    miketheterrible wrote:
    franco wrote:That sounds more like a shot at the Americans.  Smile

    A shot at both really.  Why are we buying them and US owes us a lot while their economy isn't increasing but the debt is.

    $100 Billion of T Bills is not much for the fed , they used to print like $65 billion per month during QE , Infact it just penuts.

    Come the political change they can refuse to encash the T Bills for any reason including Putin getting off on the wrong side of bed.

    It would be wise to keep minimim amount in US T Bills just to take care of some basic needs if that is absolutely needed  , better to diverisify that money in SDR,Euro and Physical gold.

    It would be Vert Anti-National for Russia/CBR to keep T bills inspite of all the sanctions US  put on Russia ...No country with any self respect would do that , atleast least not subsidise US Debt.

    While some clown trolls on this thread call this "hating", in fact it is the rational view. Nabiullina is acting as a 5th column element
    and I could care less about her motivations. Time for a purge of the CBR and no more T bill purchases combined with a rapid offloading.
    Accumulating gold and diamonds makes more sense than the toilet paper T bills. Then there is the "hate" about the insane interest
    rate policy. Regardless of some vapid, personality cult fluff pieces, the CBR has been an epic fail as far as the best interests of
    Russia are concerned.
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    miketheterrible

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    Re: Russian Economy General News: #8

    Post  miketheterrible on Sat Jun 10, 2017 7:54 pm

    Have you guys ever noticed how Russia operates? A fire is lit under its ass after something bad happens. When Ukraine was going the route it was, Sberbank and a few others pumped billions more into Ukraine. Now they lost it all and are looking to sell their Ukrainian subsidiaries.

    I agree. They need to stop purchasing US T-Bills. But the liberals of Russia are trying to gamble pretty damn hard. And it may or not pay off. It is easy to take US T bills and sell them to purchase gold. Compared to selling Indian Rupee or others to purchase gold.

    I figured this out when trying to buy Qatari currency.

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    Re: Russian Economy General News: #8

    Post  Austin on Sat Jun 10, 2017 8:18 pm

    It is easy as long as fed does not stop it freezes thevT bills on political dictat , it is a high risk proposition.

    Atleast the Indian sovereign bond won't get blocked and India pays 7 % interest on its own t bills .

    Buy gold that's best , fiat currency does not have a great future in current form
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    miketheterrible

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    Re: Russian Economy General News: #8

    Post  miketheterrible on Sat Jun 10, 2017 8:43 pm

    Austin wrote:It is easy as long as fed does not stop it freezes thevT bills on political dictat , it is a high risk proposition.

    Atleast the Indian sovereign bond won't get blocked and India pays 7 % interest on its own t bills .

    Buy gold that's best , fiat currency does not have a great future in current form

    Agreed but it isn't easy to convert currencies even if it is large amounts (Indian Rupee the same) compared to USD which nearly the world trades in. I don't agree with it Austin, not at all. But this is the unfortunate part about reality now.

    There are possibilities to this though:

    1) Sell them a rope they can hang themselves with - Buying US T-Bonds means US owes money to Russia and Russia is one of the benefactors why US stays alive hence the US won't push too hard. Although 90B isn't a whole lot compared to the grand scheme of things.
    2) It has been seen already the purchasing of US bonds were used later on to sell and purchase gold. This was even with current head of CBR. They could be building up while gold is still high and waiting for a drop. This is pure speculation of the market and something that apparently Russia was against. So who knows.
    3) CBR views the US T-Bonds a much safer investment. Indian Rupee isn't a safe investment unfortunately since India is a nation with a really bad ease of doing business and has a growing debt themselves, mixed in with lots of liabilities due to the fact the economy relies upon a poorer market (cheap labor). Although, this kind of gives indication that Russia and its regional partners are not necessarily doing what they should towards the nations who are very much interested in keeping close ties with them like India.
    4) They think that the risk is too low so they continue to purchase T-Bonds because they are secured and easy to sell/buy even if it has a lower return. Low risk, semi-low return. Although, as you said, it just keeps America chugging along.

    As for the whole "they are able to just make more of the currency through QE", while is true, it actually created the downward spiral of the US economy. Contrary to belief, majority of growth is simply debt in the US. And this has gotten everyone scared and kicking the can as long as they can because they don't want to be responsible and present when the whole thing pops. The more they do it, the more it becomes obvious and a huge problem. Much like EU.

    But the good thing is Austin and KVS, is that since you got people talking about it in Russia, the seed has been planted. People are fully aware on how that is a dangerous game. Sberbanks doings in Ukraine was a huge gamble because they thought "Well, we are investing in them and ultimately they become dependent on our business activities in Ukraine, they wont get rid of us", came out to be untrue, now they are scrambling to sell their Ukrainian assets at a loss of a couple of billion $. Because of this, it has gotten a lot of people in Russia's financing industries worries about what the US will do if Ukraine was willing to do it. Thus now, people are talking about it. If Ukraine didn't do what it did, most would be spending even more Rubles to convert to USD and other currencies in hopes of having an edge in foreign trading.
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    GarryB

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    Re: Russian Economy General News: #8

    Post  GarryB on Sun Jun 11, 2017 11:21 am

    What happened in the Ukraine was not inevitable... they could have realised the western hand in it at any time and had second thoughts.

    Investing in Ukraine and buying Ukrainian engines and rockets and other things made sense because it is cheaper to buy off the shelf than to actually make everything your self... that frees up money to spend on developing other things you can't buy off the shelf.

    By cutting off the Ukraine they would have guaranteed what happened to happen without any chance of any other result... they clearly wanted to give them a chance.


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    Austin

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    Re: Russian Economy General News: #8

    Post  Austin on Mon Jun 12, 2017 7:25 am

    miketheterrible wrote:
    Agreed but it isn't easy to convert currencies even if it is large amounts (Indian Rupee the same) compared to USD which nearly the world trades in.  I don't agree with it Austin, not at all.  But this is the unfortunate part about reality now.

    When you invest in say India T-Bills or for that matter Russia or China T Bills your money has sovereign gurantee from the Government which is the highest quality bond paper you can get , The conversion of currency is not dificult , You invest say for eg $1 USD in India T Bills you invest Rs 65 say you buy 10 year bond which pays say 7 % at maturity you take back the convered Rupee to USD which is managed by Indian Central Bank.

    The risk part for China and India is the Inflation factor which now is not bad as it used to be 10 years back.

    Right now there is higher risk in investing in US T bills , That country is practically broke and has Debt more than 100 % of GDP which will just keep on going up according GOA estimates.

    If you listen to all the Political Class Rep or Dems , If you listen to FBI , CIA and NSA chief all of them state RUSSIA IS A ENEMY NATION , Thats the badge of Honour Russia has to wear and Central Bank is Rewarding the US Government who is practically Broke by Buying more US T Bills when better options are available.


    There are possibilities to this though:

    1) Sell them a rope they can hang themselves with - Buying US T-Bonds means US owes money to Russia and Russia is one of the benefactors why US stays alive hence the US won't push too hard.  Although 90B isn't a whole lot compared to the grand scheme of things.
    2) It has been seen already the purchasing of US bonds were used later on to sell and purchase gold.  This was even with current head of CBR.  They could be building up while gold is still high and waiting for a drop.  This is pure speculation of the market and something that apparently Russia was against.  So who knows.
    3) CBR views the US T-Bonds a much safer investment.  Indian Rupee isn't a safe investment unfortunately since India is a nation with a really bad ease of doing business and has a growing debt themselves, mixed in with lots of liabilities due to the fact the economy relies upon a poorer market (cheap labor).  Although, this kind of gives indication that Russia and its regional partners are not necessarily doing what they should towards the nations who are very much interested in keeping close ties with them like India.
    4) They think that the risk is too low so they continue to purchase T-Bonds because they are secured and easy to sell/buy even if it has a lower return.  Low risk, semi-low return.  Although, as you said, it just keeps America chugging along.

    Honestly all this argument is just bad ones if you look at Risk to Reward Ratio.

    US Can easily confiscate Russian T Bills as the political wind is blowing and refuse to encash it any time it wish , It happend before for Iran so there is precidents.

    Rupee or Renminbi is as much as safe investment out there perhaps more safer then US T Bills for reason cited about , Russia is not doing business in India to worry about good or bad business climate.

    Indian T- Bills are Sovereign Bills Guranteed by Indian Central Bank , Much like Russian T Bills are guranteed by Russian CBR. IF the Climate of Business is deemeded more risky then interest rate goes up which is what happened to Russia in 2014 or India in 2012.

    I would rather keep like Minimium Money in US T bills and buy up Gold and Chinese/India/SDR to keep my Forex Wealth Safe , thats the hard earned money you dont want to loose by dumping in Las Vegas Casino which is what US T Bills are for Russia.


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    miketheterrible

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    Re: Russian Economy General News: #8

    Post  miketheterrible on Mon Jun 12, 2017 7:40 am

    Argue all you want but lets see reality here:
    1) China still buys US T Bonds.  And US threatens China all the time
    2) US TBonds outsell Chinese and Indian by far.  Probably way more than Indian.
    3) CBR may have unliked policies but well, look at the results.  Russia is growing and has their own developing industry.

    Sorry, the facts are here and we see the results.  Contrary to what you guys like or want.

    And well, so far, Putin is a better leader than any of you assholes would ever be. And he supports the CBR. So what the fuck you guys want? To run the Russian economy? I imagine you guys would make it implode in a matter of a week. Sorry, but so far, reality is showing Russia is growing, US businesses are still investing in it, and on contrary to what a bunch of career politicians state, things are still operating. Yes, they will continue to butt heads, but lets be real here - if they could easily just confiscate it, they would have done it already. Like as you said, they done to Iran. So why have they not done it to Russia? Because, Russia is a massive country and a massive economy. They know they will simply put themselves in a bad position for pushing Russia out of Swift and barring their money. Austin, you know little about foreign politics and you give too much credit to Iran's capabilities. Iran is a piss ant of a nation compared to Russia. Stop comparing them.

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    Re: Russian Economy General News: #8

    Post  Austin on Mon Jun 12, 2017 7:53 am

    Hope CBR Reads this every time they buy US T-Bills !

    Senate looks to jab Russia

    A bipartisan deal to boost sanctions against Russia is taking shape despite the Trump administration’s mixed signals on engaging with Moscow


    http://www.politico.com/story/2017/06/11/senate-russia-sanctions-239365

    Austin

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    Re: Russian Economy General News: #8

    Post  Austin on Mon Jun 12, 2017 7:57 am

    miketheterrible wrote:Argue all you want but lets see reality here:
    1) China still buys US T Bonds.  And US threatens China all the time
    2) US TBonds outsell Chinese and Indian by far.  Probably way more than Indian.
    3) CBR may have unliked policies but well, look at the results.  Russia is growing and has their own developing industry.

    China Buys US T Bills for keeping its Yuan from Rising which gives it competitive advantage in exporting to US and US-China has USD 1 Trillion trade between then, The Dynamics of US-Russia and US-China is totally different.

    US cannot sanction China without invoking MAD between them in Economy
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    miketheterrible

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    Re: Russian Economy General News: #8

    Post  miketheterrible on Mon Jun 12, 2017 8:01 am

    Austin wrote:Hope CBR Reads this every time they buy US T-Bills !

    Senate looks to jab Russia

    A bipartisan deal to boost sanctions against Russia is taking shape despite the Trump administration’s mixed signals on engaging with Moscow


    http://www.politico.com/story/2017/06/11/senate-russia-sanctions-239365

    And what are they exactly going to do?  They barred a nation like Iran entirely and it did nothing.  Add Russia to the list and now US creates a situation they no longer can control.  Essnetially, even if it was $200B in US T Bonds it is barely a dent at Russia.  Sorry to say, the US will end up hurting itself in the end and everyone will cry "why did we allow this to happen" when Russia really starts to push back at America.  What they don't realize is this playing nice from Russia is keeping their puppet in Ukraine alive and their bases in Syria alive.

    This is from sanctioned America:

    http://tass.com/economy/950950

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    Re: Russian Economy General News: #8

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