Russian Currency Crisis

[FriendlyFire]

Bears walk around the streets and drink vodka!1!!!". Those are exactly the stereotypical assumptions I was talking about.

Russian bears walk around the streets and drink vodka
Bad news for Russia and all oil / energy companies are taking a hammering.

The Ruble Plunged As Oil Crashed

The ruble got slammed again on Monday.
The currency ended the day at around 61.61 per dollar, around 6.4% weaker against the dollar.
During the day, the currency got as weak as 62.0 rubles per dollar.
By comparison, on the first day of trading in 2014 the ruble was at 32.03 rubles per dollar.
The currency’s drop coincides with crude oil crashing below $US50 per barrel on Monday, the lowest price for the commodity since April 2009.
Oil fell as low as $US49.89, a more than 5% decline on the day.
Over the course of 2014, the ruble fell approximately 40% against the dollar.

http://www.businessinsider.com.au/ruble-plunging-again-as-oil-falls-2015-1

 

[onejayhawk]

Russian bears walk around the streets and drink vodka
Bad news for Russia and all oil / energy companies are taking a hammering.

Better than being picky about beer.

http://www.nbcnews.com/id/5756809/n...wns-beers-passes-out-campground/#.VIIu_tLF_is

J

 

[FriendlyFire]

In Russia, no such thing as too much vodka

https://www.youtube.com/watch?v=-MRpCrykrKQ

 

[Yeekim]

That's because Russians aren't going to discuss internal issues on an English speaking forum with Americans.

That's exactly what they are doing, though.

Or are you saying that they aren't going to be critical of Russia on an English speaking forum with Americans, regardless of what they are actually thinking?

 

[Whomp]

Openly discussing US foreign policy and strategy as any historian or political academic would appears to be, for many here, indistinguishable from 'criticizing America' or even 'anti-Americanism'. Is the USA an astutely-run, self-interested superpower or a some sort of superhero from a Disney cartoon? I'd say for most of those guys it really is, in their imagination, like the latter. That's the power of propa... sorry, PR--but there are still others capable of having grown-up conversations.

To get back on this topic, I think one of the problems people are having is whether US foreign policy had anything to do with the collapse of oil prices. Allowing condensate to be exported is not moving the dial much. On other matters, I think you'd get plenty of agreement on US policy.

Maybe I'm blind because I see oil as economically driven not politically driven. For instance, shale barrels went from 32 million to 345 million and new basins from 48 to 95 between 2011 to 2013. For perspective, US daily production over the last 6 years took 24 years to accomplish from 1943 to 1967 trough to peak.

I would suggest the pace of disruption to an archaic industry will have volatile effects. Why would Saudi Arabia announce yesterday it was cutting prices on US deliveries of Feb. sweet crude $0.60 while raising prices the same $0.60 in Asia? Seems like they're undercutting their competition and trying to regain market share not as an actor in US foreign policy.


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[Harv]

Maybe I'm blind because I see oil as economically driven not politically driven. For instance, shale barrels went from 32 million to 345 million and new basins from 48 to 95 between 2011 to 2013. For perspective, US daily production over the last 6 years took 24 years to accomplish from 1943 to 1967 trough to peak.

Well, 2008 proved that I am blind. I also see oil as economically driven, not politically driven. Actually I see oil as market driven.

Let's say I am selling oil in the futures market. The price of oil is collapsing and I am making banks of money. I use this money as collateral to sell more oil and make more money as the price goes down. The more oil goes down, the more money I make and the more rail-cars full of oil (contracts) I can sell. As the price of oil falls, supply is increasing.

Let's say I am buying oil in the futures market. The price of oil is collapsing and I losing more than just my shirt. In fact, I would get arrested if I am seen in public like this. When I bought the oil, I only put up a small percentage in cash and borrowed the rest, knowing that stability of the price of oil would prevent me from losing too much oil. As the price of oil keeps going down, I have to keep selling rail-cars (contracts) of oil to keep my equity percentage constant. As the price of oil falls, supply is increasing.

So as I see it, the price of oil falling because supply is outstripping demand - and supply is increasing because the price of oil is falling. Corrections to my logic are welcome - I do not play in the futures market and my understanding of the rules is therefore not perfect.

 

[Pangur Bán]

To get back on this topic, I think one of the problems people are having is whether US foreign policy had anything to do with the collapse of oil prices. Allowing condensate to be exported is not moving the dial much. On other matters, I think you'd get plenty of agreement on US policy.

Maybe I'm blind because I see oil as economically driven not politically driven. For instance, shale barrels went from 32 million to 345 million and new basins from 48 to 95 between 2011 to 2013. For perspective, US daily production over the last 6 years took 24 years to accomplish from 1943 to 1967 trough to peak.

I would suggest the pace of disruption to an archaic industry will have volatile effects. Why would Saudi Arabia announce yesterday it was cutting prices on US deliveries of Feb. sweet crude $0.60 while raising prices the same $0.60 in Asia? Seems like they're undercutting their competition and trying to regain market share not as an actor in US foreign policy.

Yes, it is accepted that the Saudis play with prices for competition reasons, but these are not mutually exclusive and it is a mistake to separate 'political' and 'economic' logic if you are trying to analyze events from the point of view of the Saudi rulers. They are not short-termist corporations seeking to maximize profit. For them the oil revenue is primarily a political resource, either because money gives them more power and security or for any other reason that gives them more power and security. Their primary interest is not in getting incrementally richer at any political cost, but saving themselves from the fate of suffered by their Iranian colleagues in 79.

What did you think about Obama's interview? How to you interpret his willingness to claim credit for Russia's oil price problems?

 

[Pangur Bán]

Here's a recent article in the Spectator which might come across more convincingly than what I've posted:
http://blogs.spectator.co.uk/coffee...-an-ambitious-one-heres-how-to-understand-it/

 

[Farm Boy]

Well, if it makes anyone feel better the vultures in the US are starting to circle around the low gasoline prices. The Republicans are now dipping in their toes to see if they're brave enough to institute a regressive 25-40 cent/gal tax in order to institute corporate tax breaks.

 

[Takhisis]

Are those the same Republicans whom I watched on FOX on Sunday discussing for hours on end how to stop Obama's evul plans instead of actually trying to run the war fronts, curb Putin, deal with illegal immigrants and drug smuggling, etc. etc.?

 

[Farm Boy]

Yes, and add to their number the increasingly large amount of Democrats that are every bit as bought, follow the same policy goals, and sing their song in a different key in order to attract different birds.

 

[LamaGT]

quoted for noted.


Didn't you literally tell him that Americans here aren't critical of US foreign policy when Americans here, as he points out, are routinely critical of US foreign policy?

You're right. Though in my experience this criticism is often misplaced. As an example, the Iraq war being "better" than the annexation of Crimea is one of those morally abhorrent arguments.

You ARE a kid, if I recall. Aren't you still a teenager? Like, 15 or something?

You're putting words into my mouth. You know I never said anything of the sort. This is the crap I get all the time. People don't listen to my arguments; they listen for familiar words and phrases in order to pigeonhole me as someone I'm not. You, in this case, invented a Phrossack who believes in all stereotypes about Russians because he hates them, although the real Phrossack was making statements about the Russian posters here and not in general.

After introducing a personal (and amusingly hypocritical) attack into the discussion, you then, as Hygro pointed out, actually committed the same fallacy you falsely accused me of using! If only people actually bothered to read my posts and understand them as things in their own right without pigeonholing them and attacking them for doing things they don't...

Actually, Americans here and in person do often oppose American foreign policy. Look at any thread on US torture or drone strikes or nearly anything about American foreign policy. You'll find plenty of American critics, as well as a few blind American nationalists, who are then criticized in turn by other Americans. We do express our opposition to our government and culture, and quite openly. Australians and Britons are also quite open in their views about their own countries, and have no qualms expressing them here, or about expressing their opinions about the US. Russians do. There's the old joke that Russia and the United States actually have some things in common: One is perfectly free to openly criticize the United States in either country.

Every nationality that has more than three or so members here criticizes both America and their own country. Every nationality except the Russians.

Such sweeping and generalizing statements always make me assume the worst. In any case if you didn't mean Russians as a nationality in general, we go back to what I and red_elk wrote previously. You don't disagree with everything the US does, and we don't disagree with everything Russia does. It just so happens that in the issues discussed here on CFC we go from different premises and with different information.

And I'm close to 18, which is in any case irrelevant because my statement was about a behaviour. You could be 75 year old for all I care.

 

[Takhisis]

Yes, and add to their number the increasingly large amount of Democrats that are every bit as bought, follow the same policy goals, and sing their song in a different key in order to attract different birds.

Oh, don't get me wrong, I despise US Democrats as well. It's just that these Republican politicians sound so much like that which they criticise…

 

[Whomp]

What did you think about Obama's interview? How to you interpret his willingness to claim credit for Russia's oil price problems?

My thoughts are he made those claims to look strong in response to his critics, like Bill O'Reilly, who called Putin strong and the west weak. If there's one thing I've learned about Obama is he will fire back at his critics and give that little smirk.

He can stake claim to sanctions against Putin's inner circle and certain businesses but we know sanctions are not what is sinking the economy. Really, it's Russia's own Dutch Disease repeating (for the third time since the 80's) not anything Obama can take credit for.

Sanctions coming off Russia and/or Iran should give Saudi Arabia even more pause on future oil supplies.


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[onejayhawk]

To get back on this topic, I think one of the problems people are having is whether US foreign policy had anything to do with the collapse of oil prices. Allowing condensate to be exported is not moving the dial much. On other matters, I think you'd get plenty of agreement on US policy.

Maybe I'm blind because I see oil as economically driven not politically driven. For instance, shale barrels went from 32 million to 345 million and new basins from 48 to 95 between 2011 to 2013. For perspective, US daily production over the last 6 years took 24 years to accomplish from 1943 to 1967 trough to peak.

I would suggest the pace of disruption to an archaic industry will have volatile effects. Why would Saudi Arabia announce yesterday it was cutting prices on US deliveries of Feb. sweet crude $0.60 while raising prices the same $0.60 in Asia? Seems like they're undercutting their competition and trying to regain market share not as an actor in US foreign policy.

You are not blind. However, there really are countries out to get Russia, so that they are not OVERLY parnoid.

J

 

[Takhisis]

And Russia's out to get other countries, too.

 

[onejayhawk]

And Russia's out to get other countries, too.

That makes a certain symmetry to the whole situation, I agree.

I am reminded of a thief who accidentally picked up the wrong briefcase. He was convicted of stealing it, because his own briefcase would have convicted him of worse.

J

 

[red_elk]

France: Europe Hurting From Russia Sanctions, Needs to Act

France's economy minister says Europeans should work together to pressure Russia for a solution over Ukraine so that all sides can ease sanctions that are hurting European economies.

http://abcnews.go.com/International/wireStory/france-europe-hurting-russia-sanctions-act-28050002

It's time to pressure Russia to ease sanctions imposed to pressure Russia!

 

[Akka]

When America was just starting its ground wars last decade imagine 50% Americans here most of whom cheerleading the USA and getting faiiiirly angry at dissent.

Yes it would be cool if we had more Russian posters, and with more diversity of opinion. Oh well. Let's not antagonize the few we have... ?

Sorry, but I was there ten years ago while the USA invaded Iraq. The amount of jingoism and blind nationalism was cringe-worthy and made me more than once foam at the mouth and argue vehemently.

Never, though, did it reach the same level of duplicity and dishonesty like I've seen with the Ukrainian crisis, which is one of the few time I just gave up attempting to argue and wrote it off as a lost cause.
And that's saying a lot.

 

[luiz]

I think all sides can agree to one point, however. The best thing brought about by the Russian invasion / liberation if Crimea and the subsequent crisis is that now nobody in the English-speaking world refers to that country as "the" Ukraine anymore.