Started by Richard Wilson4 · · 👁 376 views · 9.5K replies
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urbanotter said:Think about it—what does a central bank really need in terms of foreign currency when they can just print more of their own? In this case, ExxonMobil is essentially buying from Russian importers who have been paid in foreign currency to cover their import costs; it’s a standard economic cycle seen in almost any nation.
The Federal Reserve doesn't exist just to facilitate currency trades for importers and exporters; it isn't like the old days of the Central Bank of America, where the primary goal was simply maintaining price stability by pegging the kuna to the Euro.
Looking back, we can clearly see how much "stability" that policy actually achieved.
Honestly, it’s ridiculous. Just ten days ago, you could pick up a candy bar for $2.00/, and now you can't find one for less than $9.90. So much for "stable" prices.
The specific account opened by ExxonMobil is designed specifically to bypass the freezes on funds meant for gas payments within Western banks that have slapped sanctions on Russia.
It isn't just a matter of buying and selling currency based on supply and demand; the converted funds actually remain sitting within the Russian banking system.
Because Russia is seeing such a massive trade surplus due to the drop in imports, the ruble has actually strengthened beyond what the government wants.
Now, the Central Bank is stepping in with measures to weaken an overly strong ruble because it’s starting to act as a bottleneck for Russian exports.
And remember, Russia isn't just exporting energy; they export a wide range of goods and raw materials. This is going to create significant issues with grain supplies, too. We're looking at expected yields in Ukraine dropping by as much as 50%, and with droughts ravaging American agriculture right now, yields for soft crops could easily be cut in half as well.
The rain just won't come when it's needed most, and if it finally does arrive, the damage will already be done.
Beyond just market volatility, we should probably prepare for food prices to keep climbing while everyone else tightens their belts; it’s highly unlikely that wages will keep pace with the rising cost of groceries.
urbanotter said:The Western buyer was buying rubles, not paying for gas.
You can only pay for gas in rubles, and you can acquire those rubles using Yuan if that's what you have on hand.
I don't really have anything to add there; the Russian economy dropped by about 4%, which is quite different from the 11.5% or higher many were anticipating.
It seems a few people's crystal balls were a bit off.
That dip wasn't exactly a shocker, considering how many Western companies pulled out of Russia due to the sanctions.
At the end of the day, most of that is just service-sector stuff. A Russian citizen isn't going to starve just because they can't grab a McDonald's burger, but a German might be shivering in 20-degree weather when it hits -20 outside if the gas runs out or becomes prohibitively expensive.
Word is that prices hit $3,000 per 1,000m3, while Russian gas was being sold for under $300.😉
Reuters isn't exactly delivering any sunshine regarding the German economy lately.
https://www.rekreativno.info/2022/08...85C2msIvaXWz20
urbanotter said:Think about it—what does a central bank really need in terms of foreign currency when they can just print more of their own? In this case, ExxonMobil is essentially buying from Russian importers who have been paid in foreign currency to cover their import costs; it’s a standard economic cycle seen in almost any nation.
The Federal Reserve doesn't exist just to facilitate currency trades for importers and exporters; it isn't like the old days of the Central Bank of America, where the primary goal was simply maintaining price stability by pegging the kuna to the Euro.
Looking back, we can clearly see how much "stability" that policy actually achieved.
Honestly, it’s ridiculous. Just ten days ago, you could pick up a candy bar for $2.00/, and now you can't find one for less than $9.90. So much for "stable" prices.
The specific account opened by ExxonMobil is designed specifically to bypass the freezes on funds meant for gas payments within Western banks that have slapped sanctions on Russia.
It isn't just a matter of buying and selling currency based on supply and demand; the converted funds actually remain sitting within the Russian banking system.
Because Russia is seeing such a massive trade surplus due to the drop in imports, the ruble has actually strengthened beyond what the government wants.
Now, the Central Bank is stepping in with measures to weaken an overly strong ruble because it’s starting to act as a bottleneck for Russian exports.
And remember, Russia isn't just exporting energy; they export a wide range of goods and raw materials. This is going to create significant issues with grain supplies, too. We're looking at expected yields in Ukraine dropping by as much as 50%, and with droughts ravaging American agriculture right now, yields for soft crops could easily be cut in half as well.
The rain just won't come when it's needed most, and if it finally does arrive, the damage will already be done.
Beyond just market volatility, we should probably prepare for food prices to keep climbing while everyone else tightens their belts; it’s highly unlikely that wages will keep pace with the rising cost of groceries.
Harold Nelson6 said:Could you please explain what's actually driving inflation in Russia—since it's currently higher than the inflation rate in the European Union?
I think we can all agree that rising energy costs are a massive driver for inflation in the European Union, but what on earth could be fueling it for the Russians?
pronto2 said:I just can't tell if those EU clowns—sorry, let me say "experts"—are consciously shooting themselves in the foot here, or if
they were all just caught completely off guard by this mess.
It’s all retirees on life support.
pronto2 said:I just don't know—are these EU clowns—pardon me, "experts"—knowingly shooting themselves in the foot, or
did this whole mess just catch them totally off guard?
Retirees living on life support.
Amanda Flores88 said:It’s almost like they’re enjoying the chaos. Small business owners are landing contracts while getting hit with electricity bills up to five times higher than before—we're talking monthly bills jumping from maybe $2,000 to over $7,000.
And then you've got these guys—either they're riding the government payroll or they haven't even moved out of their mom's basement. It's total Scarlett mode, much like our Government saying they'll "look into it" sometime... maybe by autumn. 🙏
Operation Thermostat
This is how the European Union is gearing up for a brutal winter without any gas from Russia
nimbleviper3 said:The rising costs of groceries, electricity, and gas have very little to do with the war in Ukraine, just saying.☕
Jesse Hughes6 said:You're wasting your breath.
Donna Harris11 said:Operation Thermostat
This is how the European Union is gearing up for a brutal winter without any gas from Russia
operation thermostat
operation baby blankets
operation thermal socks
rowdytiger13 said:China is feeling the heat too. It started with the real estate market, and things got messy enough that the central bank had to step in.
Asian markets are just sliding.
The Euro is hitting its lowest levels in two decades, while the Pound is holding steady. Meanwhile, the Dollar is surging—banking experts are saying this momentum is pretty serious.
Well, now things are getting interesting.
Brenda Murphy3 said:Man, we're all circling the drain here...😁
I look around and honestly, it feels like half the people I know are struggling just to put food on the table, let alone keep the heat running through the winter... and it’s all being blamed on those sanctions against Russia🤣 ...man, I wouldn't mind having a slice of that Russian prosperity instead of this total American meltdown...😵
It doesn't matter if 90% of these doom-and-gloom scenarios are complete nonsense. It doesn't matter that energy prices weren't even tied to the sanctions and were already skyrocketing long before the war in Ukraine kicked off... but none of that matters to the usual suspects. They'll just keep shouting about how incompetent the US is, how "stupid" the sanctions are, how "strong" the dollar is becoming, or how the whole system is collapsing. Just endless noise...
Of course, according to them, everything would be fixed if we just scrapped the sanctions entirely and let Russia do whatever the hell they want...
How dense do you have to be to constantly peddle the same garbage that the usual idiots are always spewing?
