Russia Defence Forum

Would you like to react to this message? Create an account in a few clicks or log in to continue.

Military Forum for Russian and Global Defence Issues


    Russian Economy General News: #11

    magnumcromagnon
    magnumcromagnon

    Posts : 7224
    Points : 7373
    Join date : 2013-12-05
    Location : Pindos ave., Pindosville, Pindosylvania, Pindostan

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  magnumcromagnon Wed Jan 06, 2021 3:08 am

    kvs wrote:The top video food basket was bought for 1053 x 0.017 = 17.90 Canadian dollars.    I do my own food shopping and there is
    no f*cking way I could buy the same amount of food for under $50 Canadian.   She did not shop around and bought everything
    at one grocery supermarket.   The ingredients are mostly of the primary sort as opposed to value added production so the
    cost is lower (e.g. price for a few onions, eggs, etc.).   But the amount adds up quickly.  

    The cost goes up for smaller quantities in Canada.   So buying a few of this and that is not all that cheap.


    Those $15 worth of food equates to $700-800 in America, probably even more in cities like NYC/LA.

    1ffmm likes this post

    avatar
    Vann7

    Posts : 4788
    Points : 4890
    Join date : 2012-05-16

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Vann7 Wed Jan 06, 2021 3:07 pm

    calripson wrote:Since you like objective measures, here is the link to the top ten global finishers in the IBM Collegiate Programming Contest held annually. (It is actually an impartial test of formulating mathematical algorithms and then coding them.

    https://en.wikipedia.org/wiki/International_Collegiate_Programming_Contest

    Winners

    2019 Moscow State University
    2018 Moscow State University
    2017 ITMO (Saint Petersburg)
    2016 Saint Petersburg State University
    2015 ITMO
    2014 Saint Petersburg State University
    2013 ITMO


    As an aside, there is one country that does not allow its best and brightest to compete in this contest? Anyone want to guess which one?


    By the way, you will not find Qatar anywhere in the top 100 finishers.


    Those contest are totally meaningless . This does not contradict in any way that
    Russia economy is (largely) a gas station economy .  You can have the best programmers
    in the world , the best engineers , the best mathematicians in the universe.. but if they are only
    used by the state ,in medals e-penis competition contest , then your talent is wasted.

    What is in question is not if Russia have good talent or not.. i don't think not even the west will
    ever claim that Russia don't have good scientist or engineer talent. What the west claims
    (and they are right..)   is that Russia is a gas station , what does russia make ?  

    The contest that this was told , by obama , is on the presence of top developed nations .
    That in comparison to most developed nations , there is very little to almost nothing
    that Russia contributes to the world.. other than cheap gas prices and taxi to the ISS.

    If master yoda Putin , alias the "chessmaster"  Rolling Eyes
    used those talented programmers ,to create a competition to American software industry..
    then HELL YESSS!!  that will be brilliant decision ,to invest heavily in Russia it software industry
    to build total independence from the west software industry + build a global business that directly compete with them .

    So in other words.. RUSSIA needs to do capitalism and compete with their top most influential business for capturing their world market. this is how western empires are defeated without firing
    a missile. Being successful in high tech industry and entertainment industry ,provide more influence in the world ,than all putin nuclear weapons and hypersonic inventory.

    But thats is not what is happening in Russia.. is all Putin does with their talent , is send them
    to ibm epenis contest and nothing else for a stupid medal ,then this is another example of
    a complete waste of talent.. So this is the other side of the story , those russian programmers ,
    goes to those contest ,because they are jobless and they are recruited by american companies,
    thanks to the massive ignorance of Russian president ,that don't invest on its scientific and engineer
    talent.. other than for building wepaons . No

    whenever oil prices in russia collapse,, the russian ruble collapse.
    whenever oil prices raise , the russian ruble value improve.. this is an example of an
    economy extremely dependent on energy and almost nothing else.. why nothing else ?
    because russia is undeveloped outdated economy . is not a global exporter of anything  , no one in the world ,can mention a single company in russia , unless they are fans of their weapons. this is the very definition of a very outdated nation with outdated business , when no civilian in the world can name a single company that comes from Russia.. why? because russia is not a major exporter of anything than the civilized world cares. And this outdated backwards development of Russia ,during
    putin 20 years in power ,is what makes it very very easy for Americans to influence ukrainians , belarusians ,georgians ,latin americans ,the young generations but adults too ,who like progress
    to their orbit.

    look at this..
    Trump have been unable to sanctions china entertainment social business.. wall street love technology and they refused to delist china high tech industry..  Laughing



    And it comes only a day after the New York Stock Exchange refused to comply with a demand to delist three major Chinese telecommunications firms which had been blacklisted by the White House.


    https://www.rt.com/op-ed/511677-trump-ban-chinese-apps-stunt/

    So china is effectively building an economy that is more or less sanctions proof ,too important for the west to sanction. and this is what putin needs to follow example.. The entire russian industry is sanctioned without problems , because russia is  backward nation and their business not needed at all by any country . means they could replace those business easily with someone else .Russian billionaires lost 1/3 of their fortune do to this sanctions.. while at the same time china billionaires ,
    during 2020 alone ,increased their fortune by hundred of billions of dollars..  and i posted that link earlier.

    So unfortunately , obama was right.. Russia is an outdated nation ,a gas station (economy) and
    it will never ever take off its economy ,at best it will only float and survive with a lot of help from china ,but if china restored relations with america and moved away from russia ,it will be the end
    for putin and the end for russia parasite heavily dependent economy.   the only way russia can become a true modern nation ,is when putin is kicked from there and a new leadership in place ,that understand clearly ,that the only way russia can be saved ,and avoid a nuclear war ,is by challenging direct competition to US most popular and modern business that they use as a soft power to influence the world into their orbit. True independence from the western modern business ,and compete with them too ,to reduce their world influence and end their ability to blackmail nations..

    when trump sanctioned venezuela and iran.. that did caused a lot of damage to their economies.
    catastrophic damage.. all trump had to do is to say..  " any nation who wants to do business with us ,will need to follow our sanctions"   and this is exactly what happened ,everyone followed
    US sanctions. because they need american business.

    and this is why is extremely critical for russia existence ,to fight back the west and challenge
    US ,not with politeness , or with olympic bullshit medals , but with business that directly compete
    with the west.. not banana records , but business than challenges US silicon valley industry and take their clients away from them..  so building technology just for the sake of building it ,is not enough.
    is to capture the western top business market ..as china is doing ,that have outpaces apple with huawei in smartphones sales.. this is what really hurts , not only damage the western economy ,but their influence ,their leadership in the world too and encourage nations and billionaires to disobey american sanctions why? because there are strong alternative to  them.


    Last edited by Vann7 on Wed Jan 06, 2021 3:15 pm; edited 1 time in total
    miketheterrible
    miketheterrible

    Posts : 5659
    Points : 5633
    Join date : 2016-11-06

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  miketheterrible Wed Jan 06, 2021 3:11 pm

    I just spent $15 on a jug of milk and some toquitos at 7-11.

    Christ almighty.

    Big_Gazza, kvs and 1ffmm like this post

    avatar
    calripson

    Posts : 452
    Points : 491
    Join date : 2013-10-26

    Russian Economy General News: #11 - Page 38 Empty Russia

    Post  calripson Wed Jan 06, 2021 4:13 pm

    I simply illustrated that your criticism of Russian education is way off the mark. The reason they run these contests is so talent can be identified by western companies and poached. All those talented Russian programmers will get big fat offers from Silicon Valley. That is why one clever country does not compete - it funnels its talent into its military industrial complex. That country of course is Israel.
    Hole
    Hole

    Posts : 3987
    Points : 3983
    Join date : 2018-03-24
    Age : 44
    Location : Merkelland

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Hole Wed Jan 06, 2021 8:36 pm

    The Ruble fluctuates with oil prices because the exchange rate is set by western bankers who can´t look further then the lenght of their dick.

    The chinese economy is not sanctions proof.

    1. China needs huge amounts of resources (coal, oil, gas) to come in from abroad. Most of the suppliers can be forced/manipulated/blackmailed by the western block. That´s why China is kissing Russias feet to get a bullet proof supplier of raw materials and high tech.

    2. Most of the things the sweatshops in China produce are going to western countries. Trump raised a few tariffs and China was eager to make a deal. It will need a few more years until countries in the global south will and the peasants in China will be able to replace western buyers.

    3. The biggest mistake of the chinese leaders was to copy the western financial system. According to estimates China has something between 15 and 25 Trill. $ in debt. A lot is state owned but the whole financial system would implode if they would eradicate these debts. That´s why China has to grow by 5+ % every year.
    Hole
    Hole

    Posts : 3987
    Points : 3983
    Join date : 2018-03-24
    Age : 44
    Location : Merkelland

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Hole Wed Jan 06, 2021 8:38 pm

    miketheterrible wrote:I just spent $15 on a jug of milk and some toquitos at 7-11.

    Christ almighty.

    Sounds expensive. Was that camel milk? Very Happy
    miketheterrible
    miketheterrible

    Posts : 5659
    Points : 5633
    Join date : 2016-11-06

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  miketheterrible Wed Jan 06, 2021 9:44 pm

    Hole wrote:
    miketheterrible wrote:I just spent $15 on a jug of milk and some toquitos at 7-11.

    Christ almighty.

    Sounds expensive. Was that camel milk? Very Happy

    Standard fucking 3.5% milk. Milk at grocery stores (this was an emergency buy)are roughly $5 for a jug. Which is still abysmal since our dairy farmers dump excess milk down the drain instead of selling it.

    Fuck this country.
    Scorpius
    Scorpius

    Posts : 198
    Points : 200
    Join date : 2020-11-06
    Age : 33

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Scorpius Thu Jan 07, 2021 1:35 am

    Dynamics of the average purchasing power of the population in the United States and Russia, expressed in terms of the "Big Mac Index" by year for the period 2000-2019:
    Russian Economy General News: #11 - Page 38 %D0%B1%D0%B8%D0%B3_0
    Data on wages in the United States are taken from ssa.gov, data on wages in Russia are taken from Rosstat. The entire salary is calculated after taxes, that is, what the average American and the average Russian actually have on hand.
    The bottom line is the size of the Russian salary as a percentage of the American one. Green background - years when the Russian salary shows positive dynamics of growth of purchasing power.
    So, in 2000, Russia started with 5% relative to the American salary - that is, the income in the United States was twenty times more than the Russian one. In 2019, US revenues will exceed Russian ones by only 2.33 times.
    But the most interesting thing here is this: while the purchasing power of wages in Russia has increased almost 7 times, in the United States it has fallen by a third.
    https://aftershock.news/?q=node/933741&full

    Big_Gazza, LMFS and 1ffmm like this post

    franco
    franco

    Posts : 4028
    Points : 4058
    Join date : 2010-08-18

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  franco Thu Jan 07, 2021 1:50 am

    miketheterrible wrote:
    Hole wrote:
    miketheterrible wrote:I just spent $15 on a jug of milk and some toquitos at 7-11.

    Christ almighty.

    Sounds expensive. Was that camel milk? Very Happy

    Standard fucking 3.5% milk.  Milk at grocery stores (this was an emergency buy)are roughly $5 for a jug.  Which is still abysmal since our dairy farmers dump excess milk down the drain instead of selling it.

    Fuck this country.

    Hear American milk is cheaper... and the gmo is free Smile

    miketheterrible likes this post

    Hole
    Hole

    Posts : 3987
    Points : 3983
    Join date : 2018-03-24
    Age : 44
    Location : Merkelland

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Hole Thu Jan 07, 2021 11:53 am

    Here there are farmer protets because milk and butter are getting cheaper and cheaper.
    avatar
    calripson

    Posts : 452
    Points : 491
    Join date : 2013-10-26

    Russian Economy General News: #11 - Page 38 Empty Diary Farms

    Post  calripson Thu Jan 07, 2021 4:24 pm

    Here in America the government has to subsidize farmers as milk prices are at break even. The only farmers that get by are the Amish because they use family labor and do no have to finance expensive equipment. They are a very admirable people. I have dealt with them in business - never a need for a contract just a handshake. They work like dogs from dawn to dusk and never complain and are master craftsmen.

    miketheterrible and 1ffmm like this post

    Hole
    Hole

    Posts : 3987
    Points : 3983
    Join date : 2018-03-24
    Age : 44
    Location : Merkelland

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Hole Thu Jan 07, 2021 9:28 pm

    But they are bad electricians. Very Happy

    GarryB
    GarryB

    Posts : 28582
    Points : 29112
    Join date : 2010-03-30
    Location : New Zealand

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  GarryB Fri Jan 08, 2021 4:16 am

    They are a very admirable people. I have dealt with them in business - never a need for a contract just a handshake. They work like dogs from dawn to dusk and never complain and are master craftsmen.

    The west talks about values and morality, but they don't mean trust and honesty and integrity and human kindness... for values they mean profit and morality they mean what is mine is mine and what is yours is mine...

    Big_Gazza likes this post

    Backman
    Backman

    Posts : 560
    Points : 566
    Join date : 2020-11-11

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Backman Fri Jan 08, 2021 7:34 am

    [quote="Vann7"]
    calripson wrote:


    whenever oil prices in russia collapse,, the russian ruble collapse.
    whenever oil prices raise , the russian ruble value improve.. this is an example of an
    economy extremely dependent on energy and almost nothing else.. .

    Just looking through my notes.... From 2016/17. But Russia is always in this spot. Its probably higher now. Pretty strange for a country that makes nothing No If you actually look at some data on economics and industry and knew how to interpret it, you'll see that its more complicated than what the US media tells you. If you think you can make a slogan out of the Russian economy, you'd be an idiot.

    Russian Economy General News: #11 - Page 38 Curerct_acct_suprles_by_backspin321_debuusj-fullview.jpg?token=eyJ0eXAiOiJKV1QiLCJhbGciOiJIUzI1NiJ9.eyJzdWIiOiJ1cm46YXBwOiIsImlzcyI6InVybjphcHA6Iiwib2JqIjpbW3siaGVpZ2h0IjoiPD01NTYiLCJwYXRoIjoiXC9mXC82NzMyZjYzZi1kNTRmLTQ3ODktYjRlYS1kZTRlMjEzMzJkOTZcL2RlYnV1c2otZDE4NmZjOWEtOGVhMi00MDQ4LWJjYmMtNmNiY2JkZDRkZmMxLnBuZyIsIndpZHRoIjoiPD0xMjU3In1dXSwiYXVkIjpbInVybjpzZXJ2aWNlOmltYWdlLm9wZXJhdGlvbnMiXX0

    Big_Gazza and LMFS like this post

    Maximmmm
    Maximmmm

    Posts : 257
    Points : 260
    Join date : 2015-07-27
    Location : Switzerland

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Maximmmm Fri Jan 08, 2021 12:45 pm

    Real problems in the economy have less to do with oil and more with stimulating business growth.
    Loans to businesses have always been too expensive and too hard to get, so there's an unnatural break on the speed with which companies can grow in Russia.
    miketheterrible
    miketheterrible

    Posts : 5659
    Points : 5633
    Join date : 2016-11-06

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  miketheterrible Fri Jan 08, 2021 2:20 pm

    Maximmmm wrote:Real problems in the economy have less to do with oil and more with stimulating business growth.
    Loans to businesses have always been too expensive and too hard to get, so there's an unnatural break on the speed with which companies can grow in Russia.

    The loans for businesses that have a sufficient potential get cheap loans. The authorities already mentioned how they select which loans with interest rates subsidized by the government, should go to. Making it heavily available to any business isn't a good idea imo. It just makes many companies end up as reliant on loans to survive when a lot of these companies are not very profitable or functionable.
    avatar
    calripson

    Posts : 452
    Points : 491
    Join date : 2013-10-26

    Russian Economy General News: #11 - Page 38 Empty Current Account

    Post  calripson Fri Jan 08, 2021 3:27 pm

    Backman wrote:
    Vann7 wrote:
    calripson wrote:


    whenever oil prices in russia collapse,, the russian ruble collapse.
    whenever oil prices raise , the russian ruble value improve.. this is an example of an
    economy extremely dependent on energy and almost nothing else.. .

    Just looking through my notes.... From 2016/17. But Russia is always in this spot. Its probably higher now. Pretty strange for a country that makes nothing No If you actually look at some data on economics and industry and knew how to interpret it,  you'll see that its more complicated than what the US media tells you. If you think you can make a slogan out of the Russian economy, you'd be an idiot.

    Russian Economy General News: #11 - Page 38 Curerct_acct_suprles_by_backspin321_debuusj-fullview.jpg?token=eyJ0eXAiOiJKV1QiLCJhbGciOiJIUzI1NiJ9.eyJzdWIiOiJ1cm46YXBwOiIsImlzcyI6InVybjphcHA6Iiwib2JqIjpbW3siaGVpZ2h0IjoiPD01NTYiLCJwYXRoIjoiXC9mXC82NzMyZjYzZi1kNTRmLTQ3ODktYjRlYS1kZTRlMjEzMzJkOTZcL2RlYnV1c2otZDE4NmZjOWEtOGVhMi00MDQ4LWJjYmMtNmNiY2JkZDRkZmMxLnBuZyIsIndpZHRoIjoiPD0xMjU3In1dXSwiYXVkIjpbInVybjpzZXJ2aWNlOmltYWdlLm9wZXJhdGlvbnMiXX0


    The flip side of a current account surplus is a capital account deficit meaning that there is a negative flow of money out of Russia. By definition they have to match as opposites. In practice this means there is very little direct or indirect foreign investment in Russia relative to its economy and plenty of wealthy Russians leak their money out of Russia into dollars and euros in offshore accounts.
    miketheterrible
    miketheterrible

    Posts : 5659
    Points : 5633
    Join date : 2016-11-06

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  miketheterrible Fri Jan 08, 2021 3:36 pm

    No they don't. They haven't done so in two years due to sanctions.

    If you are going to assume things and base off of 2008 beliefs, it's better you leave now

    Big_Gazza likes this post

    Maximmmm
    Maximmmm

    Posts : 257
    Points : 260
    Join date : 2015-07-27
    Location : Switzerland

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Maximmmm Fri Jan 08, 2021 4:03 pm

    miketheterrible wrote:
    Maximmmm wrote:Real problems in the economy have less to do with oil and more with stimulating business growth.
    Loans to businesses have always been too expensive and too hard to get, so there's an unnatural break on the speed with which companies can grow in Russia.

    The loans for businesses that have a sufficient potential get cheap loans.  The authorities already mentioned how they select which loans with interest rates subsidized by the government, should go to.  Making it heavily available to any business isn't a good idea imo.  It just makes many companies end up as reliant on loans to survive when a lot of these companies are not very profitable or functionable.

    I dunno, if even until recently defense establishments had problems with high rates and bad terms on old loans, I doubt the situation is much better down the line.
    I get what you mean though, but I'd rather see a healthy churn of companies rising and dying than some potential massive ones being held back.
    kvs
    kvs

    Posts : 9258
    Points : 9401
    Join date : 2014-09-11
    Location : Canuckistan

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  kvs Fri Jan 08, 2021 4:28 pm

    How does a trade surplus translate into any "loss" of rubles? Sales in foreign currencies get converted to rubles inside Russia.
    So there is an increased demand for rubles. Russia is obviously not subject to the Dutch disease.

    The parking of profits offshore is an unrelated issue. And it is nowhere near as bad as it is painted. Look at America if you
    want to see all sorts of offshoring and tax avoidance rackets. The Russian government is not starved of tax revenue because
    Russia has a large trade surplus.

    Big_Gazza likes this post

    kvs
    kvs

    Posts : 9258
    Points : 9401
    Join date : 2014-09-11
    Location : Canuckistan

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  kvs Fri Jan 08, 2021 4:38 pm

    Maximmmm wrote:
    miketheterrible wrote:
    Maximmmm wrote:Real problems in the economy have less to do with oil and more with stimulating business growth.
    Loans to businesses have always been too expensive and too hard to get, so there's an unnatural break on the speed with which companies can grow in Russia.

    The loans for businesses that have a sufficient potential get cheap loans.  The authorities already mentioned how they select which loans with interest rates subsidized by the government, should go to.  Making it heavily available to any business isn't a good idea imo.  It just makes many companies end up as reliant on loans to survive when a lot of these companies are not very profitable or functionable.

    I dunno, if even until recently defense establishments had problems with high rates and bad terms on old loans, I doubt the situation is much better down the line.
    I get what you mean though, but I'd rather see a healthy churn of companies rising and dying than some potential massive ones being held back.

    I have been harping on this point for years on this forum. The CBR under Nabiullina has been a prime element of sabotage of Russia's economy.
    Her monetarist gang lie and lie about the inflation pressure in Russia and claim they need to impose an astronomic prime rate to "fight it". So
    for years we had a prime rate of around 8% when the inflation was lower than this number. And this is remains true to day where the CBR
    keeps the prime rate above inflation even though they admit that the CPI is now under 4%. Only banks see the prime rate. All consumers
    including businesses see prime + markup. So even the best customers for Russian banks are seeing over 5.25% loan rates. And they only
    see these "low" rates today. In 2019 they were seeing over 8.25% loan rates.

    These rates are insanely high when it is possible to borrow abroad for under 4%. The CBR must set the prime rate to CPI - 2% as it is
    in the west. This is justified by the need to develop the Russian economy. There is no inflation pressure under these conditions since
    the economy and markets are not saturated (equilibrated). Small business people routinely complain that that borrowing costs in
    Russia are intolerable. This is serious since it means that they have a hard time being established and those that do operate in this
    environment are likely engaging in grey and black economic activity to survive.

    Maximmmm likes this post

    avatar
    calripson

    Posts : 452
    Points : 491
    Join date : 2013-10-26

    Russian Economy General News: #11 - Page 38 Empty Sorry It Is A Accounting Identity

    Post  calripson Fri Jan 08, 2021 4:53 pm

    miketheterrible wrote:No they don't. They haven't done so in two years due to sanctions.

    If you are going to assume things and base off of 2008 beliefs, it's better you leave now

    In economics Capital Account = -(Current Account) by definition. Doesn't mean that a negative capital account is bad, in fact it is good. It does mean that whatever current account surplus you run is effectively financing those countries (like the USA) running current account deficits. Germany, Japan and China all run current account surpluses. US, UK, and India run large current account deficits. (In the case of US and UK for consumption in the case of India for growth).

    "Because all the transactions recorded in the balance of payments sum to zero, countries that run large trade deficits (current account deficits), like the United States, must by definition also run large capital account surpluses. This means more capital is flowing into the country than going out, caused by an increase in foreign ownership of domestic assets. A country with a large trade surplus is exporting capital and running a capital account deficit, which means money is flowing out of the country in exchange for increased ownership in foreign assets."

    In terms of private capital, there was a $44 billion outflow in the first 10 months of 2020 from Russia, but large amounts of this come from foreign bank subsidiaries and Sberbank itself.
    Backman
    Backman

    Posts : 560
    Points : 566
    Join date : 2020-11-11

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Backman Fri Jan 08, 2021 6:53 pm

    Capital acct deficit has a negative connotation. But if we agree that producing more than you consume and saving the difference is a good thing , then a capital acct deficit is what you want. Which is why power house economies like Germany , S.Korea and China have trade surpluses.

    Comparing it to a household would look like this. If you were selling your assets like your house and car , and using the money for consumption , that money would be your capital account surplus. I guess if you can perpetually swindle banks and credit card companies to perpetually lend you money so that you could perpetually consume more than you produce , I guess it's a good thing. And that's what the imperial world does. The US , UK Canada ect. They perpetually swindle the world with their reserve currencies so that they can do into debt and deficit seemingly without limit. But there has to be a limit. And the US will find it eventually.

    The Ruble isn't a reserve ccy in the Bretton Woods system. All Russia has to do is wait out the Bretton woods system. And undermine it. By buying gold. Which it is doing.

    Big_Gazza likes this post

    Backman
    Backman

    Posts : 560
    Points : 566
    Join date : 2020-11-11

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Backman Fri Jan 08, 2021 6:58 pm

    "This means more capital is flowing into the country than going out, caused by an increase in foreign ownership of domestic assets"

    Yes. Just like the household example. The US is selling it's assets and its debt to consume. Capital flowing in. Sounds good eh ? It really isn't.

    As far as what the US actually produces , it's basically an 8 or 9 trillion GDP economy. The rest is imperial grift. 8 or 9 trillion is something. But it's not the 20 trillion number that everyone trots out.

    8-9 trillion is basically Germany and Russia combined
    kvs
    kvs

    Posts : 9258
    Points : 9401
    Join date : 2014-09-11
    Location : Canuckistan

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  kvs Fri Jan 08, 2021 7:13 pm

    "Because all the transactions recorded in the balance of payments sum to zero, countries that run large trade deficits (current account deficits), like the United States, must by definition also run large capital account surpluses. This means more capital is flowing into the country than going out, caused by an increase in foreign ownership of domestic assets. A country with a large trade surplus is exporting capital and running a capital account deficit, which means money is flowing out of the country in exchange for increased ownership in foreign assets." wrote:

    This is clearly not happening in Russia which has maintained a large trade surplus for the last 20 years without any substantial investment
    outside its borders and vice versa. There are some critical assumptions above that have to be proven and not just asserted. The only
    regime that this assertion can be remotely relevant for is for a developed economy or banana republic. The excess money literally has nowhere
    to go and so goes offshore. For a developing economy there is enough internal demand for the "excess" money. But for banana republics which
    are not even developing really, there is no domestic development demand since they are in a perverse Dutch disease regime where only
    the commodity sector is developed. The trade money inflow has nowhere to go because there is basically no economy outside of
    the commodity sector. Russia is not in this regime whatsoever.

    I guess a better term for Russia and real developing economies is transition economies since the term developing is applied to all sorts of
    stagnant banana republics that are not actually developing.




    Sponsored content

    Russian Economy General News: #11 - Page 38 Empty Re: Russian Economy General News: #11

    Post  Sponsored content


      Current date/time is Tue Apr 13, 2021 8:33 am