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    Russian Economy General News: #11

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    Arrow

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    Post  Arrow on Thu Feb 27, 2020 8:32 am

    Putin's Russia gas station project. wrote:

    What ? Mad
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    Post  Austin on Thu Feb 27, 2020 10:48 am

    magnumcromagnon wrote:
    Austin wrote:Siberian Gold Find Brightens Ruble’s Future

    https://www.wsj.com/articles/russias-new-shield-from-u-s-sanctions-a-siberian-gold-mine-11549535400


    SUKHOI LOG, Russia—Beneath this plot of land in southeastern Siberia lie vast stores of gold, according to Russia’s biggest gold producer, Polyus PJSC, and tapping them could provide the Russian central bank with a huge and nearly sanction-proof backstop for its currency.

    Tests commissioned by the company last year and undertaken by Australia-based AMC Consultants, along with a scoping study conducted in 2018, determined that there are 63 million ounces of gold at Sukhoi Log, Polyus has told investors.






    How much is 63 million ounces of gold in tons ?
    35,274 oz. in a metric ton, so 63 million oz. translates to 1,786 metric tons of gold.

    Thanks

    Hope the CBR buys all the gold from Polyus. Russia neeeds to have 5000 T of gold before Putin tenure ends in 2024.
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    Post  Austin on Sat Feb 29, 2020 8:11 am

    Siluanov:there is enough money in the budget for four years, even at an oil price of $ 30 per barrel

    In the spring, the Ministry of Finance will revise the forecast and budget parameters for 2020, taking into account the consequences of the spread of coronavirus, the head of the ministry Anton Siluanov said. According to him, even with an oil price of $ 30 per barrel, Russia will be able to finance all budget expenditures for four years.

    “Our budget is protected, reserves are created. The budget was always such a source of instability, because there was no money, expenses were reduced. Now we, at an oil price of even about $ 30 per barrel (I fantasize), will quietly finance our expenses for four years, ”he said (quote from TASS ).“ But I’m sure there shouldn’t be such a long time for low oil prices. Because the cost of production of a number of deposits, primarily shale, is still higher. "

    He noted that the price of oil affects the ruble, but the budget rule holds back the weakening of the national currency.
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    Post  kvs on Sat Feb 29, 2020 3:33 pm

    Austin wrote:Siluanov:there is enough money in the budget for four years, even at an oil price of $ 30 per barrel
         
    In the spring, the Ministry of Finance will revise the forecast and budget parameters for 2020, taking into account the consequences of the spread of coronavirus, the head of the ministry Anton Siluanov said. According to him, even with an oil price of $ 30 per barrel, Russia will be able to finance all budget expenditures for four years.

    “Our budget is protected, reserves are created. The budget was always such a source of instability, because there was no money, expenses were reduced. Now we, at an oil price of even about $ 30 per barrel (I fantasize), will quietly finance our expenses for four years, ”he said (quote from TASS ).“ But I’m sure there shouldn’t be such a long time for low oil prices. Because the cost of production of a number of deposits, primarily shale, is still higher. "

    He noted that the price of oil affects the ruble, but the budget rule holds back the weakening of the national currency.

    Monetarist twats endlessly chirping about the weakness of the ruble. A "weak" ruble gives Russian producers stimulus by increasing
    exports. Since Russia does not depend on imports, the "weakness" of the ruble has no negative impact on its economy.

    BTW, this endless drivel is a type of 5th column propaganda since many sheep think that the forex determines the absolute
    value of a currency and the economy. They dismiss PPP corrections and think that some fuckwad currency speculators know
    more about the domestic economy than actual experts living there.

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    Post  calripson on Sat Feb 29, 2020 4:13 pm

    kvs wrote:
    Austin wrote:Siluanov:there is enough money in the budget for four years, even at an oil price of $ 30 per barrel
         
    In the spring, the Ministry of Finance will revise the forecast and budget parameters for 2020, taking into account the consequences of the spread of coronavirus, the head of the ministry Anton Siluanov said. According to him, even with an oil price of $ 30 per barrel, Russia will be able to finance all budget expenditures for four years.

    “Our budget is protected, reserves are created. The budget was always such a source of instability, because there was no money, expenses were reduced. Now we, at an oil price of even about $ 30 per barrel (I fantasize), will quietly finance our expenses for four years, ”he said (quote from TASS ).“ But I’m sure there shouldn’t be such a long time for low oil prices. Because the cost of production of a number of deposits, primarily shale, is still higher. "

    He noted that the price of oil affects the ruble, but the budget rule holds back the weakening of the national currency.

    Monetarist twats endlessly chirping about the weakness of the ruble.   A "weak" ruble gives Russian producers stimulus by increasing
    exports.   Since Russia does not depend on imports, the "weakness" of the ruble has no negative impact on its economy.  

    BTW, this endless drivel is a type of 5th column propaganda since many sheep think that the forex determines the absolute
    value of a currency and the economy.    They dismiss PPP corrections and think that some fuckwad currency speculators know
    more about the domestic economy than actual experts living there.

    You are correct. Russia has very little external debt and foreign reserves of $560 billion. The only one affected by a weakening ruble are rich Russians who love to travel abroad and purchase foreign luxury goods. The kind of voters who live in downtown Moscow and vote for Navalny.

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    Post  kvs on Sat Feb 29, 2020 11:34 pm

    Russian Economy General News: #11 - Page 14 EQAfMckXUAANtOO?format=jpg&name=900x900

    Cargo rail car output in the USSR and Russia over the last 91 years.   Russia is exceeding both the peak volume and
    sustained production of the whole of the USSR. This is on top of the massive overhaul of the Russian passenger
    rail car stock.

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    Post  magnumcromagnon on Sun Mar 01, 2020 12:05 am

    kvs wrote:Russian Economy General News: #11 - Page 14 EQAfMckXUAANtOO?format=jpg&name=900x900

    Cargo rail car output in the USSR and Russia over the last 91 years.   Russia is exceeding both the peak volume and
    sustained production of the whole of the USSR.   This is on top of the massive overhaul of the Russian passenger
    rail car stock.

    Russia is going to be one of the largest trading hubs in the world despite sanctions once OBOR kicks in, and I don't feel sorry for the Baltic states or Poland, their ports will wither on the vine, once Russian cargo ships off load the train freight, and sail straight to Germany. Lukashenko jackassery will have to stop or he'll seriously have to change his adult diapers, because it makes more sense to off load on to cargo ships than to pass through Belarus, or Poland, or the Baltic states just to pay transport fees to pass through countries with hostile leadership, so offloading freight on to ships sailing from Russia directly to Germany will be both cheaper and it'll send a message by punishing them for their hostility. It's bad for business for world trade to be handicapped by irrational hostility towards a neighboring state.
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    Post  Vann7 on Sun Mar 01, 2020 9:57 am

    Russia gas station project not going well.... No
    This is what happens when you put all your eggs into a nation dependent on energy business
    and exports of bananas and food.

    The perfect storm sends natural gas crashing


    https://www.rt.com/business/481924-perfect-storm-natural-gas/

    so oil prices low.. and natural gas prices low.. Laughing
    Belarus threatening to halt the gas supplies to europe in nord stream 1.. and nord stream 2 paralized
    because of american sanctions..   Russia hoping to finish it 1 year later..  Laughing
    this is what happens ,when Russian leadership refuse to modernize their nation economy ,
    and become lazy and mostly focus in commodities based business..   No
    only third world countries .build their economies based around commodities ..
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    Post  Big_Gazza on Sun Mar 01, 2020 11:20 am

    Vann7 wrote:Russian leadership refuse to modernize their nation economy, and become lazy and mostly focus in commodities based business

    FFS Vann, are you really that censored stupid?

    Suspect
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    Post  Rodion_Romanovic on Sun Mar 01, 2020 11:47 am

    Vann7 wrote:Russia gas station project not going well.... No
    This is what happens when you put all your eggs into a nation dependent on energy business
    and exports of bananas and food.

    The perfect storm sends natural gas crashing


    https://www.rt.com/business/481924-perfect-storm-natural-gas/

    so oil prices low.. and natural gas prices low.. Laughing
    Belarus threatening to halt the gas supplies to europe in nord stream 1.. and nord stream 2 paralized
    because of american sanctions..   Russia hoping to finish it 1 year later..  Laughing
    this is what happens ,when Russian leadership refuse to modernize their nation economy ,
    and become lazy and mostly focus in commodities based business..   No
    only third world countries .build their economies based around commodities ..

    Nord stream 1 has nothing to do with Belorussia...
    Nord stream 1 starts from Vyborg and nord stream 2 starts from Ust Luga. Both of them are in Russia.


    Russian Economy General News: #11 - Page 14 Nordstream
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    Post  kvs on Sun Mar 01, 2020 3:49 pm

    It really is hilarious and poetic justice how NATzO currency manipulators f*cked themselves when they thought they
    were f*cking Russia back in 2014:

    1) They nullified totally the oil price drop impact on the Russian economy since the "devaluation" of the ruble
    meant that lower oil prices brought in the same amount of rubles to the Russian GDP. Since Russia does not
    depend on exports and is in the top handful of countries on this planet in this advantageous category, the
    "devalued" ruble did not shrink the GDP. There was a short-lived bout of inflation driven by internal business
    hysteria but it did not last bast March of 2015.

    2) They forced the CBR to stop backing the ruble on the forex markets. Thus they lost billions of dollars of
    revenue from their speculative scamming. They went for Russia's jugular and sliced off their own testicles.
    There really is a God and He is not their creation.

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    Post  GarryB on Mon Mar 02, 2020 1:36 am

    Since Russia does not
    depend on exports and is in the top handful of countries on this planet in this advantageous category, the
    "devalued" ruble did not shrink the GDP.

    I think you mean imports... a devalued currency is great for exports because the foreign money is worth more local currency so you get paid more for the same thing.

    Devaluation means imports become rather more expensive which encourages local production and development...

    Belarus threatening to halt the gas supplies to europe in nord stream 1.. and nord stream 2 paralized
    because of american sanctions.. Russia hoping to finish it 1 year later.. Laughing
    this is what happens ,when Russian leadership refuse to modernize their nation economy ,
    and become lazy and mostly focus in commodities based business.. No
    only third world countries .build their economies based around commodities ..

    As already pointed out Belarus has nothing to do with nord stream 1 or 2, but complaining about Russia not spending a lot on energy delivery options is the opposite of diversifying the economy away from energy... You are complaining that Russia is a gas station and complaining that the gas station doesn't have more distribution pipes to customers...

    You want them to spend more money on delivering gas to customers who currently hold Russia under economic sanctions at the muzzle of a gun on their borders with a military organisation called HATO.

    Ideally, Russia should stop making new gas pipelines to the EU and should just liquify the gas and build ships to deliver it... they can then sell to the highest bidder and make more profits and not worry about long term contracts... LNG powered ships would be effectively free for them to power... and they could sell it to anyone, not just those connected via pipes.
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    Post  kvs on Mon Mar 02, 2020 2:02 am

    GarryB wrote:
    Since Russia does not
    depend on exports and is in the top handful of countries on this planet in this advantageous category, the
    "devalued" ruble did not shrink the GDP.

    I think you mean imports... a devalued currency is great for exports because the foreign money is worth more local currency so you get paid more for the same thing.

    Devaluation means imports become rather more expensive which encourages local production and development...

    Belarus threatening to halt the gas supplies to europe in nord stream 1.. and nord stream 2 paralized
    because of american sanctions..   Russia hoping to finish it 1 year later..  Laughing
    this is what happens ,when Russian leadership refuse to modernize their nation economy ,
    and become lazy and mostly focus in commodities based business..   No
    only third world countries .build their economies based around commodities ..

    As already pointed out Belarus has nothing to do with nord stream 1 or 2, but complaining about Russia not spending a lot on energy delivery options is the opposite of diversifying the economy away from energy... You are complaining that Russia is a gas station and complaining that the gas station doesn't have more distribution pipes to customers...

    You want them to spend more money on delivering gas to customers who currently hold Russia under economic sanctions at the muzzle of a gun on their borders with a military organisation called HATO.

    Ideally, Russia should stop making new gas pipelines to the EU and should just liquify the gas and build ships to deliver it... they can then sell to the highest bidder and make more profits and not worry about long term contracts... LNG powered ships would be effectively free for them to power... and they could sell it to anyone, not just those connected via pipes.

    Yes, that was a Freudian slip. I meant imports. But exports are not the driver of Russia's GDP either like they are for Germany and Japan.

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    Post  magnumcromagnon on Mon Mar 02, 2020 10:09 pm

    The Bank of Russia will prohibit bankers to go abroad
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    Post  Vann7 on Mon Mar 02, 2020 11:03 pm

    in more news..
    Putin wants ... to create conditions ,so that nobody will want to fight Russia. Rolling Eyes

    Russia seeks to ‘create conditions so that NOBODY wants to fight us’ – Putin

    https://www.rt.com/russia/482078-putin-trump-military-spending/


    anyone see this?  
    Putin is saying that he wants respect.. he told it.. clearly.
    People respected inspire admiration ,so effectively they are not attacked.. and treated fairly.
    Like something important..

    in other words..  the thoughs behind the words are like this...
    Putin is saying... the world is disrespecting us...we want respect.. to our nation and our interest.
    Russia is one of the most disrespected nation in the world.. and someone need to explain that moron..
    how he can earn respect back..  there is a saying... that you will not get respect for free.. that you need
    to earn it.. and this is truth.. and foolish President Putin believe ,that by investing in better weapons ,that people will respect Russia more... Rolling Eyes

    So please someone tell that moron...the next list ,so he can get the respect he wants.. for his nation..

    How Russia can get respect list...

    1) Putin should STOP!!! with his bullshit politeness and soft speaking.. Don't be polite with bullies ever...
    don't do it..it doesn't work.. This doesn't means to be rude ,but to be confident and decisive.. polite people are weak personality people. that are afraid to offend others.. because think will not be able to handle it.. so they
    are polite and soft.. people like that  shows insecurity and weakness.. and this is why adversaries of Russia feels pretty comfort in disrespecting Russia and its interest.. they believe.. he will do nothing.. is afraid to fight. he send the wrong message to his enemies..  

    2) If Russia wants respect.. so nobody will want to fight Russia..
       then Putin needs LEADERSHIP. To be a strong confident person with strong leadership skills..
       a leader is someone that knows what he wants , and is confident that anything is possible. Putin
      will not motivate anyone being a boring person or being soft and polite... it will only encourage to not be
      taken seriously..

    3) the most powerful way to earn respect and that nobody fight russia.. is with..
       Business Power .  Becausue the west is at war with Russia ,a cold/semi hot indirect war..
       Russia existence will depend of only one thing.. on Leadership.  If Putin wants success for Russia ,
       and that no nation will want to fight Russia.. then he needs Business leadership. ,that not only
        competes with the west.. but surpass it..  There is no place for putin's Russia in this world as a second best.
       Russia will only get respect ,when it becomes the world leader.. when it can compete with american top popular business , and replace them.. this will damage the western hegemony in the world and their influence too..  Russia needs to create an alternative and superior business system.. to the american one.. it can do it..
    in an alliance with China..  An alternative internet.. an alternative to US high tech industry,, and more than anything.. Russia needs to be the absolute leader in space.  leader in space exploration  and militarization of space too..  instead of an economy based on bananas ,wheat and oil and gas.. instead of tourism.. and pretty expensive parks ,instead olympic medals..  Putin needs to modernize its economy.. to become heavily focused
    in space and in high tech industry and digital entertainment.. Putin needs to leave behind the Russian past.. and recreate the nation and its culture in a completely new and modern way. promote patriotism through business and space leadership.. not through past victories of ancestors.. Russia needs to completely recreate itself in a better and more modern way , not attached to any religion ,but without abandoning moral system of family values. a modern culture will create jobs ,will create business.. what is the american enterntainment industry ,
    that makes the country popular in the entire world.. its movies and digital games ,if not an expression of a modern culture?  Russia needs a digital economy revolution.. around Space ,high tech and entertainment..
    and leave behind the potatoes and wheat records and leave behind the gas station..sell it to germany and france and tax it.. and leave behind the olympic medals. all the money putin waste in distractions ,should be better expend in competition to American business giants.. in california state. and in florida.. that NASA is located.

    Like i said.. is a leadership crisis ,what Russia face.. the west have leadership thanks to its business power
    and this is why they can sanction the entire world and pressure even Russian companies to obey american gov.
    is an identity problem.. what Russia have.. they want to be the past.. and they should look instead at the future..
    And re-invent the nation into a better way ,than ever . that is influential to the west.. why the west? to disband NATO and the American destructive system ... If Russia had a lot of leadership and influence.. [with the west.].
    then nobody will be fighting russia..because russia will be respected ,will be a leader. And nations will want
    to be part of the Russian world.. and abandon the unfair anglo-jewish system. The ukraine conflcit and syrian
    conflict will have not happened.. if Russia was the absolute leader of the world in high tech business and space manned exploration and space tourism.. all those nations disrespecting russia will be fighting.. but only to become closer friends.. and not enemies.. to become part of that success.





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    Post  Austin on Tue Mar 03, 2020 5:59 am

    Putin and Gref discussed the work of Sberbank in 2019

    Russian President Vladimir Putin and Sberbank CEO German Gref discussed the work of a credit institution in 2019. According to Gref, according to Russian standards, the bank received 860 billion net profit.
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    Post  miketheterrible on Tue Mar 03, 2020 6:16 am

    And this is why the government will be buying 50% +1 shares.

    Then hopefully start buying back the shares from foreign entities.
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    Post  GarryB on Tue Mar 03, 2020 8:23 am

    Yes, that was a Freudian slip. I meant imports. But exports are not the driver of Russia's GDP either like they are for Germany and Japan.

    Guessed as much, but the low value of the ruble should make exports more attractive in all sorts of markets... especially if all materials are sourced from Russia they would be cheaper than imported material so the whole products could be put together for less...

    A weak currency makes imports expensive which encourages domestic production and also domestic consumption...

    anyone see this?
    Putin is saying that he wants respect.. he told it.. clearly.
    People respected inspire admiration ,so effectively they are not attacked.. and treated fairly.
    Like something important..

    Respect would be nice, but the US does not respect anyone... so the more realistic alternative is fear... some serious weapon systems that can obliterate everyone in the west... not just the western military but the entire western population... far cheaper than matching them in conventional forces...
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    Post  kvs on Sun Mar 08, 2020 3:41 pm



    The Russian government will delete 50% of the debt of Russian defense sector companies (375 billion rubles) and
    restructure the rest at 3% for 15 years. It turns out that Russian contractors have fallen into a debt hole where
    they spend their earnings paying off debt instead of upgrading their production.

    Now, let me guess why they fell into a debt hole. Could it possibly have something to do with 10% lending rates?
    If you think not, then you are out to lunch. You can thank the CBR under Nabiullina for this mess. The monetarist
    lunatics (and 5th columnists) at the CBR are engineering a debt crisis in Russia by imposing a prime rate of 7.25%
    or more which translates into private bank loan rates around 10%. This is in spite of the fact that inflation in Russia
    is 3%. The CBR has not excuse to set the prime rate over 3%. In fact, the CBR is driving inflation in Russia by
    inflating loan costs across the economy. Not just consumer lending. When businesses have to pay substantially more
    for loans, they pass the costs onto consumers (both individuals and companies). This is direct inflation.

    Recall that businesses require loans for daily operations. This is something that too many people are totally unaware of
    and think that profit accumulation is how business invest in retooling and product redesign or new products. BS. They
    do not have the luxury of doing this over a span of years, they need to do this as fast as possible driven my market
    competition. In fact, if you believe in a free market, then you have to accept bank loans as essential to the operation
    of companies. How can those companies ever accumulate the capital for anything if they are making near zero profits
    in a competitive environment. That is the definition of a free market: many competitors making nearly zero profit.

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    Post  Vann7 on Mon Mar 09, 2020 2:20 am

    Brent, WTI futures CRASH 20% over Saudi Arabia-Russia oil price war

    Why no one is speaking about this ?  
    Putin's gambling on Russia gas station project are collapsing again ..  
    A new oil war have started by Saudi Arabia.. they are now flooding the market with oil ,
    and announcing major discounts and major production increase which will sink oil prices
    including Russia economy..




    On Saturday, Saudi Arabia announced a stunning discount of $6 to $8 per barrel to its customers in Asia, Europe and the United States  – and said it would boost the oil production despite the global economy slowdown and crude demand drop. The sudden move was seen as a sign of an all-out oil price war, after a supply cut deal between Russia and the Organisation of the Petroleum Exporting Countries had collapsed.


    https://www.rt.com/business/482631-oil-futures-brent-wti-crash/


    i bet the usual so called "economy experts" in this forums will come with new excuses when Russia economy face a major recession in this year after this oil war...  a major recession should put an end to the BS reported in this forum by the so called "experts" ,who think "understand" Russia economy.  Rolling Eyes  

    So Russia banned from Putin's olympics and now the oil will be under $30 and for a longer time.. Laughing
    and not even tourism will save Putin ,with the corona virus menace.. this is what happen when you have
    short sight Presidents ,that develop their nation economy in the most lazy and lamest way possible , as if the
    nation was a third world banana republic in africa.. that just like Russia ,their major business are energy ,mining and food.

    It will be funny if Putin ends doing exactly what kudrin adviced him , privatization of their energy industry and develop Russia economy in a much more modern way.. as the Western powers have.. with business that are near impossible to stop.. unless they want to be isolated from nation progress.
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    Post  PapaDragon on Mon Mar 09, 2020 2:31 am


    Vann, stick a fresh tampon down there and read something not written by whiny little bitches:

    http://smoothiex12.blogspot.com/2020/03/opec-issue.html


    Also, Russians are after Saudi scalps not other way around

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    Post  Big_Gazza on Mon Mar 09, 2020 3:53 am

    F**k me but you're one dumb unit Vann...

    Saudis are bleeding cash and DESPERATELY need high oil prices to meet their budget and keep their subjects complacent with their usual bribes.  The US shale patch needs high prices to keep their losses to within the range where fraudulent financial engineering can maintain the cashflow to keep the ponzi scam going. Russia produces the marginal barrel and can readily accept low oil prices for an extended period, long enough for the Saudi economy (and regime) to collapse and for the shale oil scam to finally run aground on the rocks of financial reality.

    If you insist on blinding yourself through a slavish adherence to your anti-Putinist screeds then you'll have no hope of understanding what is going down.
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    Post  calripson on Mon Mar 09, 2020 4:04 am

    In response to prior posts, let me make two points: zero profits in a theoretically perfectly competitive market means zero economic profits - not zero profits. That is zero profits factoring in the cost of capital.

    Point two: Russia understands that  ceding production at $45-$50 a barrel oil means shifting market share to U.S. producers. They telegraphed their hand by mentioning how they could survive with cheap oil for three years due to their foreign currency reserves of $560 billion and their reserve fund of $126 billion. The problem with their logic is yes, there will be bankruptcies in the U.S. and dislocation in the debt markets and production will fall. The U.S. however views shale production as a strategic asset and as soon as oil prices recover, those fields will be recapitalized and will start producing right away. One thing America does not lack is deep capital markets. There will be a cost to Russia - if oil prices hit $20/barrel Russia will run through $45 billion a year from their reserve fund to cover their budget and Putin's national projects will be delayed or underfunded. Frankly, I think their strategy is trying to be too clever by half.
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    Russian Economy General News: #11 - Page 14 Empty And One other Thing

    Post  calripson on Mon Mar 09, 2020 4:08 am

    The observation about the CBR is correct. There is absolutely no conceivable reason why they maintain interest rates where they do other than to favor their banker friends or their "foreign" friends - the two are actually not unrelated. The cost to Russia GDP growth is huge.
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    Russian Economy General News: #11 - Page 14 Empty Re: Russian Economy General News: #11

    Post  kvs on Mon Mar 09, 2020 4:36 am

    calripson wrote:In response to prior posts, let me make two points: zero profits in a theoretically perfectly competitive market means zero economic profits - not zero profits. That is zero profits factoring in the cost of capital.

    Point two: Russia understands that  ceding production at $45-$50 a barrel oil means shifting market share to U.S. producers. They telegraphed their hand by mentioning how they could survive with cheap oil for three years due to their foreign currency reserves of $560 billion and their reserve fund of $126 billion. The problem with their logic is yes, there will be bankruptcies in the U.S. and dislocation in the debt markets and production will fall. The U.S. however views shale production as a strategic asset and as soon as oil prices recover, those fields will be recapitalized and will start producing right away. One thing America does not lack is deep capital markets. There will be a cost to Russia - if oil prices hit $20/barrel Russia will run through $45 billion a year from their reserve fund to cover their budget and Putin's national projects will be delayed or underfunded. Frankly, I think their strategy is trying to be too clever by half.

    But accounting takes capital depreciation into a line item cost. Companies still have to cover capital depreciation and competitive-pressure driven
    retooling. There is no free lunch. Extortionate interest rates set by some non-market player like the CBR are criminally absurd. This is why capitalism
    is such a fraud. Too many critical aspects are command-economy style social engineering and not any sort of market. There are no real free markets.
    Take any industry like cars and you will see a distinct process of oligopolization over time. This industry basically colludes to set self-serving prices and
    the consumer can lump whatever quality they dish out. These oligopolies also engage in anti-market machinations such as GM's real conspiracy to
    destroy all electric urban rail and trolleybus service to replace it diesel buses.

    The non-conventional oil and gas sector in the US is a ponzi racket boosted by land speculation. Tight oil and gas producers manage to maintain some
    level of viability by land flipping. But this means that most players are always in the red and fail. No industry that is in the red perpetually can last.
    And the reason they are in the red is that:

    1) Tight extraction requires many more wells to be drilled/fracked than conventional oil and gas. This means the cost of extraction are dramatically
    higher. If oil is a $40 per barrel, companies that frack the Bakken and similar formations are not making any money.

    2) The production tail from each well is not long and thick but narrow and short. So the cumulative production is smaller and the production decline
    is faster.

    Thus there is a quadratic revenue disadvantage from tight plays. Rosy estimates about trillions of barrels of oil and centuries of gas are utter nonsense
    designed to con sucker investors. There will be no long term cost recovery whatsoever. The Bakken is already declining. It was predicted to decline
    decades in the future. This is due to something called physics. Tight oil and gas formations have vastly less oil and gas simply due to much tighter
    rock crystal grain distribution. This is why fracking is needed with tight formations since whatever little oil and gas is there does not want to flow
    through almost impermeable rock. Investor scam propaganda makes fracking sound like some new technology. It has been around since the 1950s
    and the tight oil and gas plays have been known since then and are not recent finds. No company bothered to develop them until the last 20 years
    because the costs were too high compared to conventional plays.

    The scam about tight oil being in the trillions of barrels range is based on the lie that the Green River kerogen deposits in real shale (and not shale-like
    tight sedimentary) are "oil". They are nothing of the sort. Kerogens have to cooked to produce oil. Nature does this slowly over millions of years
    but humans need to do it fast. So energy has to be expended to process the kerogens out of the shale and then energy needs to be expended to
    produce synthetic oil. The cost is beyond any rational economic actor or even Ponzi rackets. Shell attempted to cook the kerogens in situ and
    the drive the synthetic oil out of the shale through a network of wells including ones where liquid Nitrogen was used to produce a containment
    vessel inside the shale rock where a flame front was ignited. This nightmare never worked and after 40 years of trying Shell gave up. There are
    no pilot or commercial kerogen to oil operations operating on the planet. In Estonia they used to mine "oil shale" (i.e. kerogen-rich shale) and
    burn it like coal in furnaces. The furnace heat helped extract and then make the kerogens more easy to combust.


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    Russian Economy General News: #11 - Page 14 Empty Re: Russian Economy General News: #11

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