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    Russian Economy General News: #3

    TR1
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    Post  TR1 on Tue Dec 30, 2014 8:55 pm

    According to Siluanov- budget might have shortfall of 2.6 trillion rubles next year.
    http://lenta.ru/news/2014/12/30/siluanov/

    WOW.

    There is your vaunted Putinism in action. All the talk about securing Russia and shit, and somehow the idea that OPEC might fuck with oil prices again did not cross their minds.
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    Post  sepheronx on Tue Dec 30, 2014 9:04 pm

    TR1 wrote:According to Siluanov- budget might have shortfall of 2.6 trillion rubles next year.
    http://lenta.ru/news/2014/12/30/siluanov/

    WOW.

    There is your vaunted Putinism in action. All the talk about securing Russia and shit, and somehow the idea that OPEC might fuck with oil prices again did not cross their minds.

    The problem I see here is they have a budget based on $100bbl. Whoever decided that was dumb. Oil prices dropped to $60 so budget is supposed to be based around that or less.

    They should tie in budget surplus to this.  To help soften it. Or get a deficite.

    Never understood why the budget of gov did this and become reliant on high oil prices. In past it wasnt like this.

    The only way out of this is either lower budget, get into a deficite of 2.3T rubles, or increase taxes and use reserves and any surplus.

    You do know budget and economy are different, right? Because all budgets get adjusted every year to make it realistic. Their initial plan was a budget set with oil at $100bbl but now it is different. Means they either revise budget or get into a deficite. Well, it appears more and more countries are getting into a deficite.... not smart imo.
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    Post  flamming_python on Tue Dec 30, 2014 9:26 pm

    TR1 wrote:According to Siluanov- budget might have shortfall of 2.6 trillion rubles next year.
    http://lenta.ru/news/2014/12/30/siluanov/

    WOW.

    There is your vaunted Putinism in action. All the talk about securing Russia and shit, and somehow the idea that OPEC might fuck with oil prices again did not cross their minds.

    Yes. Playing with oil prices is how the US nailed the Soviet economy in the 80s. And now, 30 years later it seems none of the lessons have been learned. The economy is vulnerable to the same tricks.
    Russia spent all its energy over the last 15 years securing new oil & gas field projects; Stockmann, Sakhalin, West Siberia, Yamal Peninsula, Caspian; countless joint-ventures with Kazakhstan, Azerbaijan, Vietnam, Venezuela, Norway, Holland, Great Britain, US, France, Italy, etc...
    Pipelines to Germany, Italy/Greece/Bulgaria, China, etc...
    Yet it all counts for nothing if the price of oil tanks.

    I guess it's because it can't stay down for long.

    Our government only seems to get something done when something hits it right in the face.
    Thing is - it's pretty much the same for every single government in the world. Just that some bomb and invade other countries too; whereas Russia mostly just focusses on defending itself from the many threats that face it - rather than spreading ideology or whatever.

    I honestly don't know what kind of country you want TR1. If you say that you want Russia to be a better, more accountable country, ruled by honest people - then I agree. But if you want it to adopt 'Western standards'.. well.
    If you can't see by now that the country you currently reside in is just as corrupt as Russia if not more; with its corrupt bunch of billionaires in congress whose only concern is that they are not feared enough by the junior nations of the world (like Russia) and who are completely out of touch with their own people, policy making and political ideology that has very little connection or does very little for its own citizens in general, rampant social engineering attempts rather than trying to reflect the values of their own people, ranting about free opposition and media while having the most sophisticated and wide-spread propaganda machine in the whole world and refusing to allow democracy on any issue of any actual importance, pointing to East Germany's Stasi and the KGB while running an intelligence-gathering operation in Europe that would make the former green with envy, corrupt generals and politicans, their sons, etc... pocketing millions from failed states like the Ukraine, Kosovo, etc... while Russians and Serbs are simply driven out and ethnically cleansed by venomous regimes there, destablising nations and funding rebel groups all across the world, creation of 'controlled chaos' in the Middle East, twisting arms and forcing countries to sacrifice their own economic and political interests in subordination to their own whims, buying off elites and politicians in countries across the world and making it very difficult for anyone to climb the rings of power in such countries who has anything to say against them... if you can't see that - well then you are a fool.

    I certainly don't want Russia to be like the US and Europe. I want it to be less like them - in fact as far away as possible as I'm certain that the correct path is not there but elsewhere. These are the most corrupt countries, with the most unaccountable leaders, who have the lowest approval ratings amongst their own people, who tell their own societies what values they should have and then drill those values in with the help of Hollywood and the media, as opposed to reflecting the actual opinions of their people.
    Putin, 'Putinism' is far from perfect but I personally think that it's a great improvement on the Western model (maybe says more about the West than about Putin), a great improvement, and it will be imitated more and more.
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    Post  TR1 on Tue Dec 30, 2014 9:35 pm

    I don't think asking for the thievery to end is a "Western Standard".

    Let's start there, a shocking number of problems would be solved if the kleptocracy was purged. Rule of law would be nice.

    Talking about the US when Russia is in such shit shape compared to what it could be is absurd. And falls nicely into Putin's strategy of pushing all blame away from his ineffective leadership to "external enemies" and the "corrupt West".

    Putinism is anti-intellectual bullshit. But people get what they deserve, and in Russia's case that brings up some uncomfortable questions indeed.


    Last edited by TR1 on Tue Dec 30, 2014 9:40 pm; edited 1 time in total
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    Post  sepheronx on Tue Dec 30, 2014 9:40 pm

    Russia isnt even close to as vaulnerable as it was in the past. A 9% decrease in GDP would still pit Russia higher GDP wise than it was back in 1998 and 2008/9. I doubt it would ever get to that point anyway. And the real look will be PPP terms. That is, if the Russian people will even take advantage of the new private company laws. All these figures are pure speculations and no one really knows. Even at $40BBL, I doubt gdp will drop 9%. There really isnt much to support it, as oil dependancy in GDP terms is less now than it was 6 years ago. A combination of low oil prices and devalued currency will cause it to drop 9%. But that is nominal, as PPP terms will stay higher as their currency floating to that of oil prices will cushion the fall and provide them with more rubles. Russia hasnt been standing still. You guys are forgetting about the technopatks and industrial parks that has been setup since 2007. Half of them are finished and the rest are finishing up being built. These are the future for Russia. Already industrial parks raise up to around $6+ billion a year in revenue. And will increase.
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    Post  sepheronx on Tue Dec 30, 2014 9:44 pm

    TR1 wrote:I don't think asking for the thievery to end is a "Western Standard".

    Let's start there, a shocking number of problems would be solved if the kleptocracy was purged. Rule of law would be nice.

    Talking about the US when Russia is in such shit shape compared to what it could be is absurd. And falls nicely into Putin's strategy of pushing all blame away from his ineffective leadership to "external enemies" and the "corrupt West".

    Putinism is anti-intellectual bullshit. But people get what they deserve, and in Russia's case that brings up some uncomfortable questions indeed.

    If Russia was in such shit shape as you out it, they wouldnt have same growth rate as EU this year. In 2008/2009, Russian GDP contracted at average 10% between 1-2 years. Next year, more probably 3% contraction. I will agree its bad that change happens under the issue of a fire being lit under the arse, but to say no change has happened is a joke. Even doing business in Russia has greatly improved.
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    Post  TR1 on Tue Dec 30, 2014 9:49 pm

    And who do you think will contract more next year, the big EU states or Russia?
    Which population has lost more in real income? Savings?
    Seriously, should we sit here and go "Well thank fuck Germany is barely growing this year, that really makes things better for us in comparison". Come on.

    Do I really need to go on?

    No change can fundamentally happen while the country is ruled by a kleptrocratic elite, a brainwashed bought off population and an upper class of theieves.
    It is fundamentally incompatible with entrepreneurship and honest business. Please, don't post some token product as proof that Russia is moving up in the world.  


    Maybe the tighter wallets of 2015 will make those have-nots rethink their feelings regarding who they support politically.


    Actually I am glad oil has plumetted. Time to wake up and see Putin's economic "miracle" for what it really is.
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    Post  sepheronx on Tue Dec 30, 2014 9:54 pm

    It all depends. Have they lost income and savings? They spent their own money on junk. Inflation is hitting everyone and Russia isnt only one, at least they dont try to hide it. GDP decline will hit some EU countries (already has) and some others have growth. EU nations like Greece, Portugal, Spain amd Italy (all considered wealthier than Russia) has a much higher unemployment rate so no income at all. And savings/income by whos standard? Exchange rate? Some goods increased and some others have not. Imported goods did but the deal between Russia and China wasnt just currency swap, but also trade in respective currency and move to basing prices out in goods trade.

    Brazil isnt even an oil country and is seeing a decline already. As for the EU nations, they are getting pounded hard, same with Japan.

    Actually, average wage in Russia has increased by 2%. May not have meet inflation but neither has mine in Canada. As well, people blew their own money away in recent rush when ruble hit 70/usd, so many must feel foolish after that as ruble sits around 55/usd now. No different than what happened to India when their currency hit 62/usd.

    Prices will have to adjust and Russian gov needs to reign on the people purposely increasing prices when exchange rate has no dealings on domestic made goods.


    Last edited by sepheronx on Tue Dec 30, 2014 9:58 pm; edited 1 time in total
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    Post  TR1 on Tue Dec 30, 2014 9:55 pm

    2015 is gonna be great. The government is being obstinate on any idea of cutting the military budget. They don't want to eat away at the entire reserve fund to cover the budget shortfall.

    They need to spend money subsidizing Crimea now as well, which given old oil prices wouldn't have even been an issue, but now will eat away at pension fund.

    I wonder how long it will take for people to start getting angry when their government welfare and subsidies fall, or at best don't adjust for the inflation at all.
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    Post  TR1 on Tue Dec 30, 2014 10:00 pm

    sepheronx wrote:It all depends. Have they lost income and savings? They spent their own money on junk.

    Uh yes. Income is not keeping up with inflation by a long shot. How about old people and their pensions? Once again, they get put out to the pasture like in the 90s.
    Savings got kicked in the balls with devaulation and currency scrambles.

    As for spending on junk, most people care about that much more than Armata MBTs or supposed foreign policy independence. It is the same in any nations populations.
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    Post  Vann7 on Tue Dec 30, 2014 10:03 pm

    TR1 wrote:I don't think asking for the thievery to end is a "Western Standard".

    Let's start there, a shocking number of problems would be solved if the kleptocracy was purged. Rule of law would be nice.

    Talking about the US when Russia is in such shit shape compared to what it could be is absurd. And falls nicely into Putin's strategy of pushing all blame away from his ineffective leadership to "external enemies" and the "corrupt West".

    Putinism is anti-intellectual bullshit. But people get what they deserve, and in Russia's case that brings up some uncomfortable questions indeed.

    US is on an economic war against Russia..
    Even american idiots can see that.. but you sir are a moron.. that do not see it..
    To try to blame putin for the fall of oil prices..  is completely retarded .

    To blame Putin for not allowing a massacre of thousands of Ethnic Russian in eastern Ukraine and to listen Crimea
    when was asking for help too.. You sir ,you are a selfish ignorant , who either are incredibly Ignorant on world
    geopolitics or simply a troll .

    take a look what OSCE vice president have told...

    This is more evidence of how US manufacture violence and unrest. in the world for geopolitical gains.
    Vice President of the OSCE and former german mp, Willy Wimmer. told ......

    "Unrest in Ukraine part of NATO's expansion plan"  



    Anyone not attached to the kremlin politics and with independent views even says the obvious that Russia is under attack by the west and using Ukraine conflict ,the west provoked to split Russia from Europe.

    There is no way for any president in Russia to develop the country as a prosperous and independent nation in control of their future and avoid direct confrontation with America as long  is controlled by the super inflated Anglozionist EGOS that always control that nation..

    Which Part of US don't like competition and always seek to destroy it ,you don't understand?

    So unless your solution for Russia is that it no longer seeks to become an independent Nation and give away
    and allow Russia to split in many parts with american bases in their territory .. and live as a powerless nation.. then shut up.  

    The eternal conflict of Russia vs the west as a matter of fact is as old as Russia.. Every major power from ottoman empire ,to napoleon to hitler in the west have always tried to break Russia in many parts.. Now the tactics are different ,instead of using their armies.. to a suicide mission.. they simply lead and economic war.  

    This is because again Anglozionist powers wants to become a world police and its sole authority . and the goals of Russia of a world where every nation is seen as equals is not compatible with the bastards you support.

    Russia have been under attack since the collapse of soviet union.. through caucausus jihadist and oil wars..to finish the job. And you SIR if it is true ,that you are Russian..which i doubt.. should instead kiss the Ass of Putin for fighting back and taking Russia as a super power again ,with a modern army with an independent nation.

    Will you be happy with a Russian President if they allow their nation to be run by Americans and be betrayed later
    and the country turn into another yugoeslavia?  Siberia for siberians , Caucausus for muslins and St Petersburg independent too? trading in change the support for Gay laws that you so much like?  Even the Gay community in Russia ,the one with brains fully understand the west simply is attacking Russia economy because they envy their development success  as a super power.   and that it have NOTHING TO DO WITH UKRAINE.  If the revolution in kiev failed (which was financed by US congress) , then will have moved to Belarus or try again in Georgia.. the goal is simply to provoke a war between former soviet republics and  Russia..to weaken their economy.


    Ignorants like you will not see the submarines ,warships and development you claim you like  WILL NOT EXIST. had Russian Government capitulated by the demands of the west..and fully opened the nation to USA demands. i really cannot understand how can anyone will be happy with their nation giving away their control of their own future to another nation.. American government will accept nothing less than the complete destruction of Russia as a country..
    and split it in many parts.. as much as possible and take away all their scientist talent for their own. I don't think any sane person in Russia will welcome the complete destruction  of their country..and become a colony what is left ,in order to be seen with favorable eyes in the west. Only people completely ignorants will do.

    . This is ridiculous dude.. you are wrong at all levels...you  should not be even discussing politics with anyone. and keep living in your fantasy world about americas "freedom" and "land of prosperity". When the way the run their economy is through literary bombing their competition ,overthrowing governments that do not subjugate to their authority and destroying it.


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    sepheronx
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    Post  sepheronx on Tue Dec 30, 2014 10:04 pm

    TR1 wrote:2015 is gonna be great. The government is being obstinate on any idea of cutting the military budget. They don't want to eat away at the entire reserve fund to cover the budget shortfall.

    They need to spend money subsidizing Crimea now as well, which given old oil prices wouldn't have even been an issue, but now will eat away at pension fund.

    I wonder how long it will take for people to start getting angry when their government welfare and subsidies fall, or at best don't adjust for the inflation at all.

    What subsidies? Only real subsidies is to tooling plants. Crimea also provide taxation money which will help levy costs. Now Russia saves money on base fees for navy in black sea. Yes, development money is needed but as you spend money to build there, it creates jobs and creates more tax wealth. They wont even come close to eating at reserve funds regarding this. Taxation brought in revenue surplus of 14% this year, that can easily help pay for it.

    So what do you think will happen? Run a defecit? Of course that may happen, and wont be surprising. In the end, rebuilding crimea will bring in loads. Already Turkey is investing in it. So Russia isnt only one to invest in it.

    Budgets can be stretched out and revised. Good thing is, lower value of ruble, more you get out of your investments. Yuan will end up as a reserve currency for Russia soon as well.
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    Post  kvs on Tue Dec 30, 2014 10:07 pm

    Funny how the whole BS NATO narrative about low oil prices forever is being pimped here as God's Truth.

    The Saudis could flood the market during the 1980s.   They obviously, yes indeed it is trivially obvious, cannot
    do this today.   If you NATO media true believers think the Saudis are responsible for the current prices then
    why don't you exert some effort (maybe that is too much for you) and do some research:

    http://peakoilbarrel.com/world-oil-production-september-numbers/

    Russian Economy General News: #3 - Page 23 Winners-and-Losers

    Well looky here the Saudis actually dropped 100,000 barrels per day of production as of the latest
    data for September.  

    Also, why are the prices falling now when production has been high since 2013?

    Russian Economy General News: #3 - Page 23 World10

    Now look what happened in 2008:

    Russian Economy General News: #3 - Page 23 Screen+shot+2013-02-06+at+9.04.17+AM

    Why wasn't the collapse to $40 per barrel in winter of 2008-9 the end of Russia, but now we have every twit declaring that Russia is finished.

    All I see is a bunch of ignorant parrots repeating what their beloved western media propaganda tells them.
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    Post  sepheronx on Tue Dec 30, 2014 10:09 pm

    TR1 wrote:
    sepheronx wrote:It all depends. Have they lost income and savings? They spent their own money on junk.

    Uh yes. Income is not keeping up with inflation by a long shot. How about old people and their pensions? Once again, they get put out to the pasture like in the 90s.
    Savings got kicked in the balls with devaulation and currency scrambles.

    As for spending on junk, most people care about that much more than Armata MBTs or supposed foreign policy independence. It is the same in any nations populations.

    Hmm, no one ever pays that meets inflation. No one in Canada at least. Pensions here suck too, doesnt pay for even basic rent. Exchange rates should not effect Russian goods like Utilities, housing and non imported food prices. Only reason it would effect it (exchange rates) is peoples greed and that isnt just governments fault. Guess the old will have to work again like they do here and in US (you live in US, you probably see it all the time) or in India where pensions dont exist outside of government jobs. Military is important and I suppose 80% of your former countrymen think so too. Better than being invaded and your nations borders being stripped down.
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    Post  kvs on Tue Dec 30, 2014 10:12 pm

    sepheronx wrote:
    TR1 wrote:2015 is gonna be great. The government is being obstinate on any idea of cutting the military budget. They don't want to eat away at the entire reserve fund to cover the budget shortfall.

    They need to spend money subsidizing Crimea now as well, which given old oil prices wouldn't have even been an issue, but now will eat away at pension fund.

    I wonder how long it will take for people to start getting angry when their government welfare and subsidies fall, or at best don't adjust for the inflation at all.

    What subsidies? Only real subsidies is to tooling plants. Crimea also provide taxation money which will help levy costs. Now Russia saves money on base fees for navy in black sea. Yes, development money is needed but as you spend money to build there, it creates jobs and creates more tax wealth. They wont even come close to eating at reserve funds regarding this. Taxation brought in revenue surplus of 14% this year, that can easily help pay for it.

    So what do you think will happen? Run a defecit? Of course that may happen, and wont be surprising. In the end, rebuilding crimea will bring in loads. Already Turkey is investing in it. So Russia isnt only one to invest in it.

    Budgets can be stretched out and revised. Good thing is, lower value of ruble, more you get out of your investments. Yuan will end up as a reserve currency for Russia soon as well.

    If it is just fine for the whole of freaking NATO to run huge budget deficits and run up debt to 100% of GDP, then it is more than fine for Russia
    to run a budget deficit in times of need.

    I see, again, ludicrous double standards. The US had $1.5 TRILLION deficits after Obama took over from Bush. So Russia can't
    even have a $100 billion deficit and must have a surplus? Even pipsqueak Canada had a $50 billion deficit recently.
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    Post  Regular on Tue Dec 30, 2014 11:07 pm

    I wonder how new sanctions packet will affect Russia. US is striking iron when its hot.
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    Post  sepheronx on Tue Dec 30, 2014 11:13 pm

    Regular wrote:I wonder how new sanctions packet will affect Russia. US is striking iron when its hot.

    What new sanctions packet? Any new ones wont make a difference. They already hit as hard as they could unless they want to totally destroy oil in their own nation, my nation and plenty other allied nations. Outside of that, Russia is now completely limited from foreign funding and alike. Actually, worst they can do is bar Russian companies from US market and US companies from Russian market, pulling out the manufacturing plants (subsiquently enough, a lot of people losing jobs and more capital outflow). But at that point, Russian market will be prime for the taking for any other companies wanting to get in but too much competition.

    Trade among Russia and US was around 2% of total Russian trade. Else, they just bar more people from entering US from Russia. Oh noes!
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    Post  flamming_python on Wed Dec 31, 2014 1:04 am

    TR1 wrote:
    sepheronx wrote:It all depends. Have they lost income and savings? They spent their own money on junk.

    Uh yes. Income is not keeping up with inflation by a long shot. How about old people and their pensions? Once again, they get put out to the pasture like in the 90s.

    Old people and their pensions got raised a lot in recent years.
    All social benefits did.
    It's a case of 1 step back, but a few steps forward were taken earlier on so no biggie.

    Compare that to Europe and the austerity measures; most of South and Eastern Europe got hit hard; some of Northern Europe too. Pension ages went up, social benefits got cut-down. Family tax benefits nullified. Additional taxes levied. Regional subsidy cuts. Healthcare cuts. Lowering of minimum wages. Public sector employees laid off in their thousands.
    That hasn't happened in Russia. Nothing like it. Not in 2008 either, during the GDP plunge. Actually more social support to vulnerable parts of the population has been introduced since then, raises in military pay, more pro-birth government support and some government programs for SMEs, innovative companies, etc... too

    For sure Putin didn't create an economic miracle. But then what would you call Europe's situation over the last 5 years in comparison? Do you know what their unemployment levels are like? In Russia it's among the lowest of any major country in the world, growth or no growth.

    Savings got kicked in the balls with devaulation and currency scrambles.

    Unfortunately yes, but still it's not 1998. It's not even 2008. Actually, everyone's savings are more or less alright, considering that for now all that this affects is spending power on foreign imported goods, and holidays abroad. Of course there will be a correction, but its magnitude will rather depend on whether the Central Bank and Russian government can get the rouble under control. If they can, and stabilize it in the 50s to a dollar, perhaps the high 40s, then the impact won't be too great.

    At the end of the day - savings are mostly about one thing - saving for property. Property prices haven't gone up, at least not any more than they've been growing in all the years before. If property prices actually end up falling, just perhaps, well then actually people's savings will end up being worth more than they were before. It's perfectly possible. Just goes to show that a little devaluation against foreign currencies is not the end of the world, nor the end of the economy.

    As for spending on junk, most people care about that much more than Armata MBTs or supposed foreign policy independence. It is the same in any nations populations.

    I care about Armata MBTs cheers

    Anyway, yes most people are apolitical, they don't hold any grudges against Europe or anything. But at the same time, there is a sort of understanding here, that the crisis is artificial and due to political tensions.

    TR1 wrote:And who do you think will contract more next year, the big EU states or Russia?
    Which population has lost more in real income? Savings?
    Seriously, should we sit here and go "Well thank fuck Germany is barely growing this year, that really makes things better for us in comparison". Come on.

    Think about it for a second. Their purchases from us are assured. They've put no sanctions on our exporters. And most of what they buy are raw materials that they need one way or the other. The value-added products we produce - may actually get more popular there as now they're cheaper due to the deevaluation.

    When it comes to the other way 'round however, we find that in terms of them exporting to us; they've mostly either sanctioned themselves, been sanctioned, or been priced out of our own market.
    All those multi-billion dollar deals Western oil/gas conglomerates secured in some of Russia's (and the world's) largest oil and gas fields - now they're all on hiatus due to the prohibition on selling oil-drilling tech to Russia. Stupid isn't it? What do you think is easier - for them to find other mega-gas & oil fields and win contracts in them, or for Russia to purchase tech/bring in partners from Asia and/or develop the neccessery technology by itself? In fact this is a synonym for most of the 'economic damage' that Europe has inflicted on Russia. Most of it has actually hurt itself more. Russia helped out with the agricultural bans of course. And as for the rest of the stuff, and Europe does export a lot of stuff to Russia; it's become a whole lot more expensive in Russia and people/companies will prefer Russian domestic alternatives instead more and more.
    Russian companies win, European companies lose.
    Russia is one of Europe's largest trading partners - they export over $100 billion in goods, and nearly $20 billion in services to Russia each year. Yet under US pressure and their own misguided policies; they're losing the Russian market.
    Yet is Russia losing the EU market? No, not at all, in fact it might even strengthen its positions there.

    The key factor is that Europe needs what Russia produces. But by and large, Russia doesn't need what the EU produces - given that there are alternative suppliers in Asia, and among its own companies in some cases. A lot of important stuff, Russia has encouraged to be set-up production for in Russia; wood processing plants, automotive plants, consumer goods production, etc... a lot of European companies have set up production in Russia, and now they will be even more encouraged to do so; given that the country is less keen on imports now and more keen on domestic production.

    Or take the South Stream cancellation. So fine, Europe and the US pressured Bulgaria into creating problems for South Stream. The US wanted it to be cancelled, Europe wanted Russia to go along with the 3rd energy package. Result? Russia cancelled it, made a new pipeline deal with Turkey.
    US got what it wanted. Did Europe? Hell no. Here they had a chance for their poorest members, to gain hundreds of millions of dollars yearly in transit fees from Russia. For Bulgaria, Hungary, Greece, Italy - to receive gas cheaper than via any other means. For thousands of jobs to be created in construction, local engineering enterprises to be involved, hundreds of European specialists to be trained and employed by Gazprom and other involved partners. And they blew it.
    Now Turkey takes home the prize; they'll be controlling everything, and Europe will get more expensive gas. Gazprom's involvement will end at the Greek-Turkish border and they don't care what happens to the gas after it crosses into Europe. Russia loses a little, as it strengthens Turkey's hand (who is a competitor), and gives Turkey a discount - but Europe loses a whole lot more.

    The main way that Europe hit Russia, is with the withdrawal of investment, bank loans, some high-tech joint-ventures, military-tech joint-ventures, etc... I mean these things hit the European partners as well, but it hit Russia too.
    Otherwise - the bulk of the damage has been done by the US, and its oil price manipulation, speculation on the ruble and other financial instruments; rating downgrades of Russian assets and banks, controls on liquidity, anti-Russian economic propaganda for the investors by the US media machine, etc...
    And the US is virtually not suffering at all. Its allies are. But not the US.

    So yeah, between the US and Russia - the US is not going to feel it one bit. The EU though - has been doing nothing but shooting itself in the foot. And with their own mass-protests, lack of confidence in politicians, spying scandal with the US, and other internal problems; not to mention the economic issues; unemployment, continuing austerity, sliding back into recession - they're the ones who really can't afford a confrontation with Russia. Russia itself can hold out for years. Europe - nope.

    Do I really need to go on?

    No change can fundamentally happen while the country is ruled by a kleptrocratic elite, a brainwashed bought off population and an upper class of theieves.

    You can say that about any country. Media is government-controlled, population is shaped by its own consumerist desire and what Putin says, the oligarchical elite are hopelessly corrupt and nepotism reigns supreme, etc... sure. My point is that you'll hardly find many countries to take examples from.

    It is fundamentally incompatible with entrepreneurship and honest business. Please, don't post some token product as proof that Russia is moving up in the world.  

    Russia did actually move up in the business rankings in recent years. There have been some measures to support SMEs.
    Illegal practices and all sorts of law-breaking did start getting cracked down starting from 2008-2009 or so; across all of Russia's legal landscape - slowly, Russia's courts have begun to be taken seriously.

    Maybe the tighter wallets of 2015 will make those have-nots rethink their feelings regarding who they support politically.

    Certainly not Navalny & co. though. People know who secures their interests - and who doesn't.

    Actually I am glad oil has plumetted. Time to wake up and see Putin's economic "miracle" for what it really is.

    I'm glad too. It's a hell of a drug, but now's the perfect opportunity for Russia to diversify.

    As for miracle - Putin actually did promise a miracle back in 2012. 6% economic growth. Like we're China or summit. Well I wanted to believe it. But of course it turned out to BS. And I do actually blame him - he hasn't done enough. He hasn't made the government do enough. He hasn't made the Central Bank be more flexible. He hasn't driven more reforms, or done more to improve foreign perception of Russia's investment climate. The man's not a reformer, he's a stabilizer. He has stabilized Russia, but it's time for Russia to enter a new era.

    TR1 wrote:2015 is gonna be great. The government is being obstinate on any idea of cutting the military budget. They don't want to eat away at the entire reserve fund to cover the budget shortfall.

    The military budget shouldn't be cut. One of the deputy ministers made the case against it earlier on. She basically made the point that to cut the program half-way through - would actually make the whole thing much more expensive later on, when the process of re-equipment and modernization has to be resumed from scratch or from hiatus. Because of course it will have to be resumed anyway - 60% of the Russian military's equipment is out of date, a far more critical situation than in any NATO country - and it isn't getting any newer. In that she's completely correct - continuing with the program in full is the most cost-effective option; rather than pausing and starting and pausing and starting and incuring huge costs.
    Of course, when it comes to things like Aircraft Carriers, those can be put on the back-burner, but then there were never any real plans for them drawn up anyway; most of the big spending is down to modernization programs to equipment in dire need of it (MiG-31BM, T-72B3, Su-30SM, Kirov cruisers, Su-25SM, Kuznetsov carrier), while others are focused on next-generations of equipment that in many cases are replacing tech from the 70s completely (PAK-FA, Su-34, Kurganets/Bumerang, Armata MBT, Tornado MLRS, Gremyashyj corvettes, Gorshkov frigates, Mi-28N, new power generation/electronics/communications equipment, Tigr vehicles, Typhoon trucks). In some cases the old stuff was produced outside the USSR or otherwise can't be produced again at all and bringing in new generations is thus even more of a priority (PAK-DA, Sarmat, Ivan Gren, Iskander-M, Il-112, Voronezh EW radars, Yak-130, Military satellites & GLONASS).
    Only a minority of programs really attempt to improve on newish tech or replace things that are already modern and capable (Pantsir-S1, Koalitsiya artillery, Volk vehicle, S-400, BMD-4Ms, Yars, Ratnik infantry set, Lada sub, Buk-M3).

    The other point is that military spending is a driver of the economy, essentially its a way for the government to reinvest tax money back into the economy without incurring inflation. Just about all that money goes back into Russia, into Russian enterprises, many of which are securing export orders with the help of R&D and new developments that their cash flows from Russian MoD orders partially fund. Some of these enterprises are moving into dual-use technologies too, and making new products for the consumer markets. Of course government support forever is hardly a good outcome, but in this case the stimulus is temporary, until the winding down of the rearmament program in 2020 or so - and until then for the next 5 years, the military spending will help strengthen Russia's next breed of high-tech industrial companies.

    One last thing. Whether we like it or not, agree with the politics, decisions or not - we all have to accept that the likelihood of conventional conflict, at least on some limited scale, between NATO and Russia - has gone up considerably. Already we have military tensions at the border - or rather in the airspace. That could extend to naval tensions as it did in Sweden. Then land border tensions. There has been a sharp increase in rhetoric - and mainly from the NATO side. Some NATO members are even openly calling Russia a terrorist state. Others are now getting as involved in the Ukrainian conflict, as Russia is; moving the whole thing closer to a proxy-war - right in the middle of Europe.
    It's not excluded that the Baltic retard leaderships and their hordes of loyal nationalists won't start provoking ethnic Russians in their respective republics. Who knows what this could lead to.
    But I am pretty sure that fully-equipped, very modern conventional forces, and enough of them to cover all of Russia's borders with Europe - are more important now than at any point since the collapse of the Berlin wall.

    They need to spend money subsidizing Crimea now as well

    Well I didn't see you or anyone else complaining - when they took it over.

    which given old oil prices wouldn't have even been an issue, but now will eat away at pension fund.

    Over 70% of the Russian population supported the Crimea reunification/annexation/etc... at least it was a decision of the people. I think they'll be honest enough, to at least blame themselves if they end up paying for it - a big part of the reason the Crimea was annexed is because Russian domestic opinion would have it no other way. And Russian domestic opinion, while mallable and faultable and only human, is genuine - and is actually a potent force in Russia, unlike in many countries in Europe and North America where it's simply either ignored, or manipulated to whatever the political elite decrees.

    I wonder how long it will take for people to start getting angry when their government welfare and subsidies fall, or at best don't adjust for the inflation at all.

    I don't think people will be angry at the government. Like I said, it's a fight we picked ourselves. I didn't support the annexation of the Crimea. But I did support helping the Donbass, and I standby that decision and am ready to answer for the consequences. Most of the Russian population supported the Crimea annexation. About half supported involving Russia further in the Ukraine; specifically the Donbass rebellion; perhaps more.
    I doubt any opposition movement will ever rise to prominence - on the slogan of 'Putin led us into messing into Ukrainian internal affairs!'. The Russian opposition politicians who publicly voiced similar views have pretty much been disowned - not that Russian society is so nationalistic; it's just that their duplicity is astounding, and it's impossible to feel any sympathy with the Ukrainian side regardless; they're a bunch of retards and criminals.

    If there's any anger against the government - it's the one coming from the other side - that Putin didn't do more to help the Novorussians. But they're not really a potent force for the moment either.
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    Post  GarryB on Wed Dec 31, 2014 3:08 am

    The Crimea will be an even more useful new part of Russia... it is my understanding that it is a very good holiday destination... they speak Russian, they will now accept Russian money, and there is good weather in the summer and plenty of historically significant places and things to see there... I would say its potential as a holiday destination for any Russian would have just multiplied 1000 percent just for these reasons alone.
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    Post  sepheronx on Wed Dec 31, 2014 3:42 am

    GarryB wrote:The Crimea will be an even more useful new part of Russia... it is my understanding that it is a very good holiday destination... they speak Russian, they will now accept Russian money, and there is good weather in the summer and plenty of historically significant places and things to see there... I would say its potential as a holiday destination for any Russian would have just multiplied 1000 percent just for these reasons alone.

    Not only is it a massive tourist destination (prior to annexation, most of the tourists going to Crimea were from Russia), making it a cheap vacation for most Russians, but it is also a massive agricultural and semi industrial economy too. If I am not mistaken, certain gadgets that were made for the Ukrainian tanks like fire control and optics were made in Crimea. As well, they have tooling plants and electrical companies that create modern electrical grid equipment. Crimea has more of an economy than one thinks and would provide a lot in terms of taxes over the years after the right amount of investments. Actually, the biggest investments Russia can make for it is a bridge to it (for highway and railway) as well as nuclear power plants and other electrical systems to help provide energy. Possibly even a desalting plant to bring drinkable and irrigation water from the Black Sea.

    Plenty of opportunities for Russia in Crimea.

    As for the rest, because of the wests heavy influence in the banking system in Russia, in terms of credit and alike, as well as FDI, Russia will get hit hard for the next couple of years till they can balance out their economy. Chances are, Agriculture and heavy industrial equipment will become a front runner for Russia's economy both domestic and export. Already Russian agricultural equipment, construction and engineering equipment as well as trucks, mining equipment and energy equipment is becoming popular in the international market (none western countries), thus it will only improve later on, especially if Russia becomes more aggressive in their workings with African and Latin American countries (whom are still semi-untapped markets and this is where Russian goods could do very well due to prices).

    That all said, reason why they wont cut the military budget, or at least not stop the modernization program (they need 70% modernization by 2020, it could be pushed back to 70% modernization by 2023 or so to help economically) is because the MIC is 25% of Russia's industrial strength. At that, they are the major reason why the tech industry is semi-booming in Russia as well as the use of materials being created for end use (composite materials as example). Cutting the budget will actually hurt the economy big time, possibly as much as the oil glut. Stretching out the budget can still guarantee work and production, but may slow down a bit, rather than halting altogether.
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    Post  GarryB on Wed Dec 31, 2014 5:36 am

    NATO can scream all they want, but their thugs use the same methods too

    But when they go for regime change is it for good reasons, but when Russia does it it is Imperial Aggression that has to be stopped.. don't you realise Putin is Adolf Hitler in 1937... I am surprised no one has said this to deflect away the fact that Obama could be described in this way better.

    Do as I say, not as I do...
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    Post  Austin on Wed Dec 31, 2014 5:54 am

    TR1 wrote:According to Siluanov- budget might have shortfall of 2.6 trillion rubles next year.
    http://lenta.ru/news/2014/12/30/siluanov/

    Russian budget revenues in 2015 decreased by 2.6 trillion rubles. According to Tass , this is the TV channel "Russia 24" said Russian Finance Minister Anton Siluanov.

    "Next year will be a very difficult budget situation. We see here and reduced revenue base. The budget was calculated based on the price of oil to $ 100 per barrel, based on a forecast of economic growth of 1.2 per cent - all this will not "- he said.

    Siluanov noted that the budget provides for large amounts of loans in the domestic market, but in the current economic situation it is also impossible.

    To date, the Reserve Fund of Russia is about 4.9 trillion rubles. According to the minister, the rapid use of these funds will lead to "eating away the reserves." He added that the Ministry of Finance is permitted in the case of the need to use up to 500 billion rubles of that money, however, and there may not be enough.

    "We have agreed that all ministries and departments will reduce their budget spending by about ten percent, and is the first step. (...) I am sure that this is not the last step, we have to act further to reduce costs, the transfer of appropriations at a later date ", - concluded Siluanov.

    Russian President Vladimir Putin on December 3 signed the law "On the Federal Budget for 2015 and the planning period of 2016 and 2017". Its main characteristics for 2015 were determined on the basis of projected GDP in the amount of 77 498.0 billion rubles and the inflation rate not exceeding 5.5 per cent.

    Projected total revenues of the federal budget is 15 082.4 billion rubles, including the estimated amount of additional oil and gas revenues of the federal budget - 344.3 billion rubles, expenditures - 15 513.1 billion rubles

    Posted Translation in Full.

    So 2.6 Trillion budget deficit , Wonder how much does that mean in budget deficit percentage terms ? About 17 % less projected revenue.

    Reserve Fund Today has http://www.minfin.ru/en/reservefund/statistics/amount/index.php?id_4=5817 4.3 trillion roubles.

    There are couple of options

    1 ) Continue with high budget deficit like 3-4 % like India or even US does it.

    2 ) Reduction of 10 % spending will help reduce the budget deficit

    3 ) Other reduction I can think of is Defence Funding.

    Total Defence Funding for 2015-2017 is ~ 9 trillion.

    Reducing 1.5 trillion or 500 billion each year is quite feseable , These funding can be rolled over to 2015-2025.

    Need to take into account like 3 years of Oil Price of $50-60 , US and its Stooge Saudi would no doubt try to keep it down As far as Possible.


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    Post  Austin on Wed Dec 31, 2014 6:04 am

    kvs wrote:

    If it is just fine for the whole of freaking NATO to run huge budget deficits and run up debt to 100% of GDP, then it is more than fine for Russia
    to run a budget deficit in times of need.

    I see, again, ludicrous double standards.   The US had $1.5 TRILLION deficits after Obama took over from Bush.   So Russia can't
    even have a $100 billion deficit and must have a surplus?   Even pipsqueak Canada had a $50 billion deficit recently.  

    Exactly , 2.6 trillion rouble budget deficit for 2015 todays dollar term is $42 billion ( 1 trillion ~ 16 billion USD )

    And US/Europe runs 90 % plus Debt , In fact their economy is so screwed up that it wouldnt be an Economy if not for the fraud and ponzi scheme they are running Laughing

    The whole Western Economy today is Phoney and Bubble Economy that would crash due to its own contradiction

    There is no concept of Economic Discipline in West Economy that Russia tries to follow so religiously


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    Post  Austin on Wed Dec 31, 2014 10:56 am

    kvs any one , Any idea what they are trying to say ?


    CB: Russia's international reserves cover the money supply by 71%


    The ratio of the money supply and international reserves is one way of assessing the adequacy of international reserves


    MOSCOW, December 31. / TASS /. Covering foreign exchange reserves of the money supply (M2, cash and non-cash money in circulation) for 11 months in 2014 increased from 64 to 71%

    This conclusion follows from the published statistics on December 31 CBR.

    As explained earlier the first deputy chairman of Russia Ksenia Yudaeva, the ratio of the money supply and international reserves is one way of assessing reserve adequacy.

    On 1 December 2014 the volume of Russia's international reserves fell to $ 418.88 billion, but because of the devaluation of the ruble reserves now cover a larger volume of money supply than at the beginning of the year (71%). M2 money supply for 11 months decreased by 2.5% to 30.63 trillion rubles.

    At the beginning of 2014 foreign exchange reserves were at $ 509.595 billion, which covers 64% of the money supply M2 on January 1, 2014 - 31.405 trillion rubles.

    During the economic crisis of 1997, the most stable in terms of the coverage ratio of the money supply turned Hong Kong, the volume of international reserves that exceed the money supply by 15 times.

    According Yudayeva, Russian reserves enough for a year of imports, their "much in terms of GDP," but not all of the money supply is covered, celebrated in June the first deputy chairman, stressing that "enough reserves to control the situation on the case of financial instability. "


    Last edited by Austin on Wed Dec 31, 2014 3:44 pm; edited 1 time in total
    sepheronx
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    Post  sepheronx on Wed Dec 31, 2014 2:54 pm

    Cutting defense spending now would be a bad decision unless it does not effect modernization of the armed forces (procurement). As I mentioned before, MIC is 25% of the industrial industry of Russia and possibly more than half of the tech industry. What you are suggesting austin, would effectively help decrease GDP and long term budget overall as companies would lay off their employees (defense is one of the largest, if not largest, in terms of employment in Russia) and the amount of tax revenue will drop significantly as well increase poverty thus the increasing overall costs on social benefits. This his how it is all tied together. So if they cut procurements, then it will utterly destroy a huge portion of Russias industrial and manufacturing base, and leave plenty without a job.

    So this is why they wont cut it. Although, professional soldiers wages should be cut, as they are one of the highest earners in the country. And Shelve some R&D for a while like the new destroyer. Simply concentrate on building newer vessels.

    The biggest money loss is beurocracy and social welfare. Cutting overall jobs will kill the economy (this is what US wants), so procurement has to stay the same.

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