Posted on 08/21/2015 1:00:14 AM PDT by elhombrelibre
Moscow (AFP) - Russia's battered ruble fell Thursday on the back of weaker oil prices to more than 75 to the euro for the first time in over six months, deepening its recent decline.
The ruble also tumbled against the dollar to near 67.44, its weakest against the greenback since February.
Russia's currency has fallen more than 20 percent against the dollar in the past two months, sparking fears of more instability after a period of relative recovery.
Russia's economy has slumped into recession amid lower oil prices and Western sanctions over the Ukraine crisis.
(Excerpt) Read more at news.yahoo.com ...
Or are we still in line?
With all those Chinese loans we’ve taken out, I’m surprised they haven’t been called in yet...
Maybe we’re ‘too big to fail’? (Crashing the dollar would hurt the Chinese as much or more).
A funny thing happened on the way to the change-in-reserve-currency-bank
“(Crashing the dollar would hurt the Chinese as much or more)”
Not necessarily, depends.... The Chinese would’ve never been U.S. creditors if they weren’t ‘comfortable’ with it and potential consequences. Of course debt has its limits and is never good.
Why would they?
It would be a double whammy for them. Those US treasury notes are worth more yuan as the dollar gets stronger and, it’s a big and, they devalued their currency relative to the dollar to make their products cheaper in dollars. If they start selling massive amounts of dollar debt and devalue the dollar it defeats their efforts to devalue their own currency. Neither does them any good.
If they sell dollars their currency (yuan) goes up. And actually they want their currency to decrease.
So if anything, the Chinese will buy more dollar denominated debt/commodities.
They are not so smart actually. They bought a bunch of worthless paper and are blocked from getting the best US assets and companies.
Thanks for the chuckle :)
China wants to be #1. To do this they have to destroy America. Devaluing their dollar actually makes them stronger in the sense of being able to sell more stuff. This in turn hurts other countries production and sales. Making the dollar stronger hurts our exports. By making the dollar stronger they can dump the paper they own to others who think their money is safer in US dollars. In the meantime china is buying up gold right and left.
Several other countries are getting mad at the US because the stronger dollar is causing mass inflation in their countries like is happening in Indonesia.
So pretty soon china will broadcast that their money is more stable in price and is gold backed not like fiat dollars. They will advise people to dump the US dollar and use theirs instead.
Think of the results of that.
“Several other countries are getting mad at the US because the stronger dollar is causing mass inflation in their countries ...”
That’s not the fault of the US central bank. The federal funds rate is at 0.15%. It’s not like the Fed is using high interest rates to attract investment in dollar-denominated assets. These “mad” countries should take a look in the mirror and reconsider their own monetary, fiscal, and regulatory policies before blaming the US for their largely self-inflicted wounds.
Thanks elhombrelibre. The Putin gangsters continue to drag their turf down into the grave. P.S. there sure are some idiots around here.
With all those Chinese loans we’ve taken out, I’m surprised they haven’t been called in yet..
Treasury bonds cannot be redeemed before maturity. It's a common myth that the Chinese can "call" any of the bonds they've purchased.
The chinese aren't even the biggest holders of US debt. That's another common myth. They're just the biggest foreign holders of US debt.
I don’t think China has invested more half of its cash reserve in U.S. debt for nothing. It’s the safest bet and investment for them; way I understand it, their economic growth is partly fueled by the return on their U.S. investment? But if China wanted to economically hurt the U.S. it could by selling off its debt securities, which in turn would result in higher interest rates and sharp devaluation of the dollar. Though devaluation of the dollar would also mean a drop in the Yuan.
That said, although the U.S. owes around $1.3 trillion to China, something like 11% of its total debt, and is the single biggest foreign creditor to the U.S., other countries also have invested in U.S. debt for different reasons; that includes Russia, Belgium, Taiwan, Japan, Brazil, etc... I think, after China, Japan is the next biggest foreign creditor to the U.S.
It is not long ago since the Putin lovers talked about the crash of the dollar. Here is an article with a lot of crackpots from January this year:
Experts Predict Crash of Dollar and Collapse of United States
http://beforeitsnews.com/self-sufficiency/2015/01/experts-predict-crash-of-dollar-and-collapse-of-united-states-2485610.html
It is one think to accept tyranny because the cost to confront it is too high and too inhumane. It's another thing to support it because you like the tyrants style, charisma, and small flabby pectorals. The truth is Putin can only bring decline and suffering to Russia and Europe because he does not support liberty, rule of law, property rights, civil rights, a legal opposition, human rights, and equal treatment under the law. It is, and continues to be, shocking that so many people on FReeRepublic seem to believe the alternative to Obama is Putin. Far from it. They're in many ways cut from the same cloth. Putin just has historical and institutional advantages over Obama and a KGB legacy that helps him line up equally ruthless and lawless thugs to carry out his agenda. Obama's instincts are the same. But contrary to the pessimists who claim Obama is worse we are still able to push back. This website being one example of the case, though it seems to escape the minds of those who think living in America today is worse than living under their favorite "Christian" dictatorship run by Putin.
If this http://www.forbes.com/sites/paulroderickgregory/2015/08/20/is-a-slow-putsch-against-putin-under-way/ is correct something may happen within a month or so
The founder of Kommersant, Vladimir Yakovlev, suggest that those who can should leave Russia the next 2 - 3 month due to a likely unrest when Putin will be deposed
http://gordonua.com/publications/Osnovatel-Kommersanta-YAkovlev-rossiyanam-Uezzhayte-i-glavnoe-uvozite-detey-94613.html (In Russian)
He is not alone to have this opinion, here is Yuri Ryzhov; (in Russian) https://www.youtube.com/watch?v=6IkCoOknL0c&feature=youtu.be
I’ve ascribed to the idea that Putin’s actions in Ukraine were more out of desperation than any type of realistic or necessary Russian national security interest. He dresses his war on Ukraine with Russian chauvinism and self defense. But the real fear for him and his clique of leaches on the Russian economy and the Russian way of life is that the Russian people will wake up to the fact that Putin and his cronies, like former Ukrainian president Viktor Yushchenko was in his neighboring country, are robbing the people blind.
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