The Russian rouble has suffered its steepest one-day drop since the default crisis in 1998 as capital flight accelerates, raising the risk of emergency exchange controls and tightening the noose on Russian companies and bodies with more than $680bn (£432bn) of external debt.
The currency has been in freefall since Saudi Arabia and the Gulf states vetoed calls by weaker Opec members for a cut in crude oil output, a move viewed by the Kremlin as a strategic attack on Russia.
A fresh plunge in Brent prices to a five-year low of $67.50 a barrel on Monday caused the dam to break, triggering a 9pc slide in the rouble in a matter of hours.
Analysts said it took huge intervention by the Russian central bank to stop the rout and stablize the rouble at 52.07 to the dollar. “They must have spent billions,”? said Tim Ash, at Standard Bank.
It is extremely rare for a major country to collapse in this fashion, and the trauma is likely to have political consequences. "This has become disorderly. There are no real buyers of the rouble. We know that voices close to president Vladimir Putin want capital controls, and we cannot rule this out," said Lars Christensen, at Danske Bank.
Last edited by MachineGhost on Tue Dec 02, 2014 1:50 pm, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
I read recently that the mood in Russia is that people feel like the rest of the world is trying to isolate and antagonize them; there's the NATO expansion right up to their borders, the threat of missiles in Turkey, OPEC's move to flood the market with the commodity that their government relies on for most of its revenue... I'm sure there's more. I think it's dangerous to poke a bear like this. Putin has already done some bad things to try to recapture some national pride. It's a dangerous situation when a major power starts pushing people around to make itself feel better.
Last edited by Pointedstick on Tue Dec 02, 2014 10:32 am, edited 1 time in total.
Human behavior is economic behavior. The particulars may vary, but competition for limited resources remains a constant.
- CEO Nwabudike Morgan
Pointedstick wrote:
I read recently that the mood in Russia is that people feel like the rest of the world is trying to isolate and antagonize them; there's the NATO expansion right up to their borders, the threat of missiles in Turkey, OPEC's move to flood the market with the commodity that their government relies on for most of its revenue... I'm sure there's more. I think it's dangerous to poke a bear like this. Putin has already done some bad things to try to recapture some national pride. It's a dangerous situation with a major power starts pushing people around to make itself feel better.
That's always the problem with economic sanctions vs diplomacy & engagement. I think there should be zero tolerance in Muslim regions because frankly they're all batshit crazy, but Russia's an entirely different beast alltogether.
Last time we placed missles in Turkey we wound up with those 12 Days and on the brink of nuclear war. Joy.
Last edited by MachineGhost on Tue Dec 02, 2014 10:32 am, edited 1 time in total.
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
MachineGhost wrote:
That's always the problem with economic sanctions vs diplomacy & engagement. I think there should be zero tolerance in Muslim regions because frankly they're all batshit crazy, but Russia's an entirely different beast alltogether.
Last time we placed missles in Turkey we wound up with those 12 Days and on the brink of nuclear war. Joy.
Totally agree. The Arab nations are weak, too, and with especially with fracked oil and cheapening solar energy, pose no real threat to us or our interests these days. That doesn't describe Russia. We also have more cultural similarity with Russians than Arabs. All the more reason IMHO to engage with them rather than antagonize and isolate them.
Human behavior is economic behavior. The particulars may vary, but competition for limited resources remains a constant.
- CEO Nwabudike Morgan
murphy_p_t wrote:
just curious Reub / dualstow...what are your top 5 reasons for hating on Russia?
I don't hate Russia. Met a lot of great people there, as well as Russians here (in the States). I hate Putin because I think he is bad for the country, as well as the rest of the world.
No money in our jackets and our jeans are torn/
your hands are cold but your lips are warm _ . /
"All generous minds have a horror of what are commonly called 'Facts'. They are the brute beasts of the intellectual domain." -- Thomas Hobbes
Disclaimer: I am not a broker, dealer, investment advisor, physician, theologian or prophet. I should not be considered as legally permitted to render such advice!
