The impact of a declining exchange rate depends on the amount of foreign goods a country needs to import, and also on the type of dependency. A country that needs to import a high share of its food will feel the sting of a crumbling currency much more immediately than a country which is autarkic with regard to its food production and only needs imports for long-term causes, say to replace high-tech parts of a pipeline infrastructure. Russia is well-positioned in this regard: they need neither food nor energy imports, and their industry was never geared toward global export either.

A collapsing ruble will eventually catch up to them, but in the meantime, it mostly affects those Russians who liked to travel a lot or to buy foreign luxury goods. Your average vatnik who lives in a dilapidated apartment block, only watches Russian TV, rarely eats out or travels and couldn't afford a fancy Western car anyway will not notice until the government itself gets in financial difficulties.

This post was edited by Black XistenZ on Mar 4 2024 10:44pm

Did you use ChatGPT to summarize a video of an IMF head whom you criticized as untrustworthy in your previous post? Your post has no grammatical mistakes and ends with a typical ChatGPT “it’s important to note”.

What does “high level of production and low level of consumption” mean?

So, shall we trust IMF or shall we discard them as rubbish? Make up your mind, without ChatGPT.

Do you have any original thought of your own?

In my opinion rouble is being artificially propped up before the election as not to stir uncertainty.

Overall - without going too far into monetary theory - the exchange rate for countries with non-reserve currency status is also a question of a trade balance. A weaker rouble will make exports more viable to support local producers and improve tax collection (export taxes) while imports from eg China will become more expensive.

Capital flight from Russia has been stopped by the West (ostensibly to help Putin), Russia still rakes in export revenues for its commodities which puts pressure on exchange rates. Russia, unlike EU or US or Japan is not able to borrow from foreign investors via rouble denominated debt (nor do they want to).

This post was edited by Malopox on Mar 5 2024 12:03am

Lets look at artillery shell production for example, Russian 152 mm shells $600 a pop vs Western 155 mm shells $5K-6K a pop.

Resources / energy / manpower are all way cheaper in Russia.

RU buying RU stuff I'm sure.. Buying or importing goods, the down Ruble effects that.
Their military isn't a good comparison.. They look like dog shit out there, just sayin. Shelling stuff from afar is about all they have done right tho.

https://www.google.com/amp/s/www.bbc.co.uk/news/world-europe-68477318.amp

Allegedly a Russian frigate with complement of up to 80 sailors is no longer floating.

Probably not the trip to Crimea they were expecting

Abrams tanks left smoking on the battlefield, not the wonder weapon NAFO was expecting

Cope ^^

Oligarch Sunak losing it after George Galloway's by-election win. The establishment realizes they face electoral wipe-out

That's what you get when you send your economy down the shitter and still push for more war expenses regardless

The US and UK are funding, supplying & supporting Israel's genocide of the Palestinians. i.e. aiding and abetting, complicit. When countries, such as Yemen, sought to sanction Israel, the US and UK bombed Yemen. If the US stopped supplying bombs to Israel, Israel would run out of bombs within 2 weeks. George Galloway is a critic of Israel. It might come as a shock to some people, but he thinks its wrong to kill 30,000 (confirmed dead) with another 10,000 (presumed dead) and wrong to operate an apartheid state, never mind stealing occupied land. For the last 5 years Israel displaced over 5million non-jewish from greater Israel and shoved them all into Gaza, the largest open air prison in the world. That boiled over on Oct 7th last year and the response was to carpet bomb 2.1 million people. The only reason why Israel didnt use poison gas in the tunnels was because the "optic's" might not look good internationally, so instead they flooded them.

Rishi Sunak, the out of touch billionaire leader of the UK has nothing better to do then to attack Galloway when he should spend more time fixing the deplorable wealth discrepancies in the UK, where millions are surviving week by week, on food handouts. Instead of whining about Galloway he should look at the UK his party has created, look at their foreign policy re: Ukraine and Israel and maybe do something to fix it. While they are at it, they can also fix the poverty problem rampant throughout england. This is the same Sunak who went to Northern Ireland and told them how amazing the position was as they were part of the EU (i.e. That Brexit was a lie and he was happy to admit that).

Similarly, and in order to stay on topic, the leaders of the UK and the US continue to fund, supply, support Ukraine, who, for 8 years, cluster bombed their own ethnic minority* in Eastern Ukraine, killing 50,000+ civilians. What did Zelensky say to his own people? "your not welcome". It is confirmed that the leaders of the UK ensured that the war in Ukraine would rage on, no negotiation, no peace and thats exactly what we have. The US has also repeatedly ensured that there will be no negotiated peace in Ukraine and has rebuffed and cauterized any channels for peace, rebuffing all attempts to stop the war.

*i say ethnic minority when they were in fact the majority in the region.

This post was edited by ferdia on Mar 5 2024 06:57am