[Thunder90]

Military spending is stimulating to the economy. The Russians realize this. Russia is a net exporter and a major lender to Europe, thus doesn’t have deficits. Furthermore, weapons sales and other raw materials can serve as cash cows. Finally, Iran is planning something to drive up the cost of oil back over $100/bbl.

[AdmSmith]

The ruble has slumped 35 percent against the dollar since July 4, compared with a 68 percent slide in the price of Urals crude, the country’s chief export blend, from a record $142.94.





The foreign reserves:


Finance Minister Alexei Kudrin said the inflation rate could be as high as 14 percent this year, compared with 13.3 percent in 2008, as import prices rise and the government stimulates the economy by running a budget deficit equal to 8 percent of gross domestic product, its first in 10 years.
http://www.moscowtimes.ru/article/1009/42/375116.htm

In February the inflation was 13.9 %. The Russian government is betting that the world economy will improve in a few months. However, that is a futile assumption and the corruption, bad loans and bad banks will cause a further economic meltdown in Russia. The question is if they will divert the domestic problem with attacks on Georgia and Ukraine?