Russia and economic war by the west #2

GunshipDemocracy wrote:

sepheronx wrote:
It isn't money sitting in Russian banks.  Most of it are bank notes or promises.  Nothing to do with physical cash.

Its all zero's at this point and worthless.

Sure but you need swift/Euroclear to move anything ... so you can have a lot in balance and cannot use it.

That's not an answer or response to my point, which leads me to believe you didn't understand my comment.

GunshipDemocracy wrote:

sepheronx wrote:
That's not an answer or response to my point, which leads me to believe you didn't understand my comment.

then please elaborate? money don't need al; messaging collateral systems to move? other banks needing to accept them? to how can you move money i.e. information about what's on your account then? Im no banking expert but always happy to learn something new.

What I'm saying is that, the money you speak of isn't in Russia or Russian banks. It isn't physically in Russia.  It sits in European banks.

They are more or less ious or notes or whatever you want to call it that then Russia uses to move that money to someone else which is about same thing in the end.  Alexander Mercorus explained it in one video. Don't worry, I wasn't sure myself at first till it was explained to me.

So I always tell people the Russians might as well put those in backlog for the future if the eurotrash demand anything from Russia in finances but as current time, might as well loom at those IOU notes as a whole lot of nothing. Not even worth the data the note is typed on.

The West preparing to self-fulfil their prophecy about the invasion of the Baltics?

They are empty and worthless and are just doing this because they are ordered to by Washington.

That´s an old myth. It looks like that because Gorbi and Jelzin let it all break apart. After that all of the investment was lost. But the same would be true for any part of Russia declaring "independence". Then people would say that all the money spend in Wladiwostok or Krasnodar was a drain for the rest of the country.

Not the same.

A good example would be the Crimea... a popular holiday destination for Russians... when it was under the control of Kiev money was extracted from their economy and not invested back into infrastructure and investment in the region... they were bleeding it dry of revenue and stealing assets.

With the Crimea part of Russia it is no longer being bled of funds so as the boss in the Crimea remarked he had 10 times more money to spend on the Crimea than he had under Kiev because Russia was not taking the income away from them.

With the Baltic states being ports and rail lines used by Russia to send things to that part of the world lots of goods and trade went through there that could otherwise have gone through other Russian ports and rail lines, but when the Baltic states jumped ship and started being hostile to Russia and changing history to suit that narrative Russia has stopped sending their freight through Baltic Ports and so the ports and the rail lines have suffered... which they obviously blame on Russia and not their own short sighted policies.

When they were part of the Soviet Union they were a connection to the west, but now with the west and Russia splitting apart they are becoming a dead end attraction at the end of a very long dirt road that most people have no interest in seeing.

They are now doing all this to show the west how to hurt Russia and Russians and for a short while the west will think they are relevant but once everyone has done their part and Russia adapts its communications links with Kaliningrad, then there is only a slow lingering death for those little outposts of democracy, peace and justice.

Why invade when they are dead already.

They also have a coal power plant for backup.

And in good time they could float nuclear power stations there as required to boost electrical power supplies as needed...

If the ruble still remains stubbornly overvalued you might see a further increase in pensions and minimum wage. Say by 5%.

The government will thus increase money supply and put it directly at the bottom of the pyramid. Those hardest hit by price hikes. Not the top.

A very sensible thing to do... normally in the west money injections into the economy are normally directed at the already rich and big business with the intent that they increase wages and hire more staff... but they never do. Most of the money disappears into bank accounts for a rainy day...

The 750 billion the US paid to US banks who fucked up and would have gone bankrupt meant most of their CEOs got big bonuses that year... people who don't pay for anything... company car, company parking spot, company health insurance, company lunches, company holidays, etc etc that extra money probably just went into the bank and did nothing.

Paying the unemployed and elderly means it is more likely to be spent... when bank interest rates are so small it makes more sense to buy things you might need over the next 5 to 10 years... your oven on its last legs... your car a bit worn out and getting expensive every visit to the mechanic... washing machine making funny noises... even if you don't start using it right away it will be cheaper to buy a replacement now than in 5 years time, and if you put the money in the bank it will just get spent over time anyway...

Here in New Zealand, with the value of our dollar and the low price for fabrics we lost our fabric making industry and reverted to a fashion industry where we make designs and get companies in China or Asia to make the products to our specification and standards... they can simply make the clothes much cheaper than we could so it makes sense... they make them for a few dollars and charge us a few dollars more so they make a profit and then we get to buy the clothes for 10 times that price to pay the fashion designers...

We sometimes even provide the raw materials like Merino wool for instance is sent to China to make clothes by our design and then sent back to New Zealand to be sold to customers.

If Russia can make it cheaper than China can then why not do it... but that is not the profitable end of the game... it is the designer labels and cut and design that results in value and the price of clothes.

Of course for most people clothes are just clothes... I would rather have more pockets than for pants or tops to hang nicely...

I dont agree here. Baltics location is dangerous for Russia geographically as US weapons can be just placed there/ military or intel.

Turkey is closer to Moscow and Finland is closer to St Petersberg... anything threatening they put there is far enough away to be dealt with using nuclear weapons... so actually no danger at all.

Baltics shall be "recovered" from NATO to either friendly countries or...those who dont lik ecan emigrate somewhere else isnt it? (taht's what now Russian speaking population is going through)

Why... let them sink in the ship they have chosen...

Russia should not attack them, but equally should not offer them a hand out of the sinking ship they are throwing rocks from.

Respect their choices. Tell citizens of the Baltic states they can go through a vetting process and if they speak Russian and want to remain Russian they can get a plot of land somewhere and start again in Russia. Elderly can be given flats and full pensions if they want to move to Russia too... and then when all the ones who want to be Russian or are Russia friendly have left Russia can safely ignore those countries moving forward.

It is not Russias problem to fix their problem or help them regarding the choices they have made... the EU solution to their loss of population could be more immigrants... both the EU and the Baltic States would love that solution.

The problem is that this all has to go through SWIFT and EUROCLEAR. SWIFT afaik works only in USD... so until new system is created money can be stuck...

No it does not, but even if it did we are talking about EU countries getting two bank accounts in a Russian bank... one bank account they can pay their money for gas payments and that might be in Euros or US dollars, but their other account in that same Russian bank is in Rubles... so they pay in their western currency and it is converted by the Russian bank into rubles and paid into the ruble account which Gazprom is paid for gas in rubles from.

The problem mentioned is that this will result in that Russian bank... which ever they decide to use, to end up with lots of western currency that they are initially paid in.

It also means the Russians control the exchange rate, which is also a good thing.

That Russian bank getting western currencies could then take ruble dividends from Russian companies and pay out to foreign investors in those western currencies they received for gas payments directly bank to bank... they can work out their own means of money transfer, but suggesting the west could freeze the money from the Russian bank will simply result in that bank refusing EU money... Gasprom wont get paid and the gas supplies to the EU will stop... I don't think the west is ready for that just yet.

Sure but you need swift/Euroclear to move anything ... so you can have a lot in balance and cannot use it.

SWIFT was only put into practise in 1973... international inter bank transactions took place before then, and now that the west is abusing its power over that system alteratives will be created for use where it can not longer be used.

It is just a communication system of codes that idenfies every bank and every region to facilitate notification of transactions... it is not magic.

Even if this money was in Russian bank accounts, it would be still worthless, as you can not use it to pay anything with it, since clearing transactions would need to be approved by US and EU.

So if the US and EU prevent that Russian bank from using their currency then I suspect they will simply stop accepting it, which means they will stop transfering any money into rubles so Russia will no longer get paid for gas so they can turn the taps off.

Equally the US buys Russian Uranium... if they pay in US dollars and then prevent the use of those dollars then the bank would simply stop accepting US dollars or Euros in payment for anything at all because they are useless to them.

It is the west that suffers because they still need Russian gas and Russian Uranium and other products as well.

It hurts the west more than it hurts Russia... the EU doens't buy Russian gas as a favour to Russia... the US does not buy Russian Uranium because it wants to help Russia out... both the EU and US are interested in cheap energy from Russia so of course not only will they miss out if they decide to escalate this, but someone else is going to benefit from the cheaper energy... it is not like they can't sell it to anyone else.
The fact that they prefer long term contracts actually makes them more appealing because middle east and US gas sales to asia are normally short term or market value sales to get higher prices and therefore bigger profits... if they were locked into long term contracts they couldn't redirect ships headed for Asia to go to Europe when the price goes up high enough.

But the depressing truth is that minds are rarely changed, you have to change the man. How much longer will the West's leaders outlast their repeated failures?

A good article... and very frightening for those in the west, because the west has made a habit of trying to demonise Russia and Putin and they generally do it by accusing it of having committed crimes the west is guilty of already... so crime bosses likely run the west and the only way to get rid of Biden or Trump is to hurt the 1% in the US... but who would be surprised by that...

"We believe it is critical that entrepreneurs transition to payments in national currencies, mainly the ruble. However, we are willing to accept other currencies in settlements," he said.

Not something they would do if the US or EU could block them spending it...

ludovicense wrote:
Dagny Taggart
@DagnyTaggart369
Blinken “More than a thousand companies have left Russia, this will affect them over time. Russia still has inventories, but they are depleting. The will not be able to buy what they could buy. The will feel it , I don’t want Russian people to suffer , but it will happen “

Poor Russians, how will they ever learn to live without McDonalds, Coca Cola, Starbucks, iPhones and Disney?

All jokes aside, this only hurts the 5th and 6th columnists who are... or were, the best chance that the US had to subvert Russia and put a Navalny or Khodorkovsky into power.

A thousand companies who were there making money from Russians are now selling their businesses super cheap to people who will buy them.... the people buying them out will then run those businesses so the Russian people are not missing out at all... just those foreign companies that set up their businesses and now are practically giving them away... but teh funny thing is that most have clauses in their agreements that in 1 or 5 or 10 years time they have the option to buy their businesses back for a fixed price if the climate regarding Russia changes... sounds like they don't want to go but idiot politicians in the west are making it too hard to stay.

In the mean time those people who bought cheap get a bargain and can continue to sell rubbish, though they should adapt it for local tastes and preferences perhaps... Russians might not want the old shit back... some good India and some good Chinese chain stores might become popular.

Local Russians taking over these franchises might be able to make good money and perhaps open similar businesses in India and China and the rest of the world in direct competition to the companies they used to be... obviously with new symbols and menus and more Russian oriented business practises, and of course publicity about Indian companies entering the market too... why not... more choice is a good thing.

At least their new Zphones wont spy on them...

The problem is that things like the WTO prevents this sort of self defence of local producers and service providers... but Putin is a clever one so when the EU put sanctions on Russia in 2014 which were not cleared by the UNSC of course so were in fact illegal under international law, he bypassed the WTO by banning the imports of food from the EU.

The Russian food industry obviously had enormous potential as we see now, but it never got the investment because the market was dominated by EU importers for which this was a gravy market... they could afford to lose money for a couple of years just to take the market share and then when the local competition has dried up slowing increase prices to recover the money and make good profits.

They were already producing food for their own markets so making a bit more is efficient and cheap and easier that setting up production and building an industry which is what their Russian competition would need to do, and with western bias just make a rule you have to disclose where the product was made... how many europeans will buy food from Russia... all that toxic polution and Chernobyl... (western customers are stupid and believe what their media tells them).

Western sanctions gave the Russian food industry a chance to develop and grow...if relations with the west were getting better instead of worse what would happen would be big companies in the west woudl buy up the successful Russian companies and use them for cheap production in their own markets and save more money and make bigger profits... so in a sense the current war and wests separation from Russia is a good thing for Russia.

They need to find new customers and replacement products from the rest of the world... they don't have to go to the trouble of trying to make everything for themselves, there are other countries that already make some of that stuff that want other Russian products so trade is beneficial to both parties, but obviously a local source for most things is a good thing... don't rely on one source for everything in any category unless there is no choice... which is rarely the case... but if there is only one source and it is worth it then that is the sort of thing they should make for themselves to also export and trade...

Now Russia will have to proceed with an outright massive import substitution strategy policy. For this it will require massive cheap credit as well. So it's imperative to have negative real interest rates in the shortest run possible, now that inflation is under control.

If a product really is that strategic and important then they should invest some government money into the project as well as perhaps tax breaks for the first few years, but investments by the government should be used to secure IP rights in case they develop something really good and want to run away to the west with it or at some stage in the future some rich westerner might get the chance to buy up the company or product.

The market will be devoid of western products as competition so it is a question of working with China and India and the rest of the world including South Africa and Argentina and Brazil and anyone else... Iran, Turkey, etc etc to fill any gaps created, whether it is a joint venture or they are already making something similar that Russia can adapt and make localy or import.

The story with Russian food production applies to the semiconductor industry. The domestic Russian production has been suppressed
by imports. This is the base of all the distortions, lack of money flow to domestic production. People love to believe that it is due
to technological ability failure. That's not how it works. The technological ability is developed by investment of money and for
a country like Russia where the scientific and engineering talent and depth is not a bottleneck, it is the lack of money that is the
real bottleneck.

The NATzO west has f*cked up on an epic scale. Its mentally inadequate wishful thinking about Russia has successfully been
liberating Russia from the chains of distortion introduced by Yeltsin and the Russian depression of the 1990s. NATzO companies
have lost their market in Russia and can no longer maintain the neo-mercantilist yoke on Russia. Russia was not a gas station
banana republic but it was still in a box of economic control by the west. Since 2014 this box has been destroyed. But
Russia will not be destroyed because of this.