Sanctions on Russia

Nathan Evans78 said:I’m not quite sure who you’re asking, but honestly, I don't really care about the context here. I just look at the historical charts and throw some numbers out there for us all to debate.

Every single economy is going to be feeling the fallout from the Fed's moves and these aggressive sanctions throughout 2023. If the Russian economy doesn't completely collapse, that war machine isn't going to stop grinding. And if Americans end up having to burn trash just to stay warm this winter, we could easily be looking at a return to those dark, desperate days. ☕

You.
Cool, so context doesn't matter to you and you're just staring at historical charts. Fine. Why don't you show us a historical USD/EUR chart then? Let's say, from 1980 to 1995, or some period like that.

Richard Wilson4 said:Everyone’s acting like this exchange rate is gonna stay stuck like this forever...

Maybe it will. Maybe we'll see 0.85 Euro = 1 USD.

Bryan Booth82 said:Germany, no matter how you slice it.
Lp

Well, they aren't the only ones, but yeah, you aren't wrong.

ironranger69 said:Then why don't you explain to us why the Euro is tanking? Take thirty minutes, go Google it, and actually find a real explanation.

Sent from my Samsung Galaxy A72

He doesn't care about context. He just... tosses numbers around. He doesn't grasp what they mean, how they work, or what's actually happening, but sure, he'll just toss them out there.

Melissa Rivera5 said:This kind of reminds me of that old debate about how devaluing the dollar would make our exports more competitive. So, I guess if products from the European Union end up being cheaper for Americans and everyone else, people will probably jump at the chance to buy ours instead.

That line of thinking hasn't changed one bit.
The dollar was tied—as it remains today—to a set value, with the exchange rate being administratively fixed and propped up through market interventions by the Federal Reserve using its foreign exchange reserves.

If the exchange rate had been set about 10% higher and held at that level (roughly $3.00 per Euro), we would have seen a significant boost in exports while simultaneously curbing imports.

The Federal Reserve and Vujčić always maintained that their primary mandate was simply to maintain price stability.
Now, we have clear, undeniable proof of how much control monetary policy actually exerts over the economy, yet Vujčić continues to brush off this obvious inflation by claiming it’s all just imported.

Nathan Thomas12 said:The Ruble isn't set by the market—it's being held up by heavy-handed government control. Once it actually hits the open market, it’ll be worthless trash. Right now? It's basically just cellophane over the truth.

If you look at Russia and how their Central Bank operates, they really only implemented one specific rule: demanding that their gas and oil be paid for in Rubles. Aside from that single move, everything else has been driven by standard market dynamics and the impact of international sanctions.

urbanotter said:That line of thinking hasn't changed one bit.
The dollar was tied—as it remains today—to a set value, with the exchange rate being administratively fixed and propped up through market interventions by the Federal Reserve using its foreign exchange reserves.

If the exchange rate had been set about 10% higher and held at that level (roughly $3.00 per Euro), we would have seen a significant boost in exports while simultaneously curbing imports.

The Federal Reserve and Vujčić always maintained that their primary mandate was simply to maintain price stability.
Now, we have clear, undeniable proof of how much control monetary policy actually exerts over the economy, yet Vujčić continues to brush off this obvious inflation by claiming it’s all just imported.

I’m not sure if you recall, but back in 1995, the exchange rate was fixed at 1 DEM to $1.50. After that first peak tourist season, the rate strengthened slightly (to about 3.6-3.7), and that’s when they decided to start defending it aggressively.

gentlestag15 said:It was hovering at $92 just the day before the invasion started.
That’s basically how sanctions end up gutting the West. The whole goal is to get Europe completely decoupled from Russian gas, and once that happens, you're going to see gas prices absolutely crater.

Yeah, well, that's only half of Russia's economy. They won't even feel a thing... ☕

boldbison40 said:I’m not sure if you recall, but back in 1995, the exchange rate was fixed at 1 DEM to $1.50. After that first peak tourist season, the rate strengthened slightly (to about 3.6-3.7), and that’s when they decided to start defending it aggressively.

I remember those days vividly,

and I distinctly recall how the exchange rate against the Euro eventually stabilized around 8.88. If they had actually held the line and defended the currency at that level, it would have been significantly better for our domestic economy, particularly for the exporters and manufacturers who rely heavily on the local market.
For years, several economists warned that the currency was overvalued, but nobody seemed to be listening. Instead, we just watched as a whole segment of businesses collapsed—companies that honestly could have survived if the dollar hadn't been so unnaturally strong.
Among the first to raise these red flags was Zvonimir Baletić, followed by many others who saw the writing on the wall.

urbanotter said:I remember those days vividly,

and I distinctly recall how the exchange rate against the Euro eventually stabilized around 8.88. If they had actually held the line and defended the currency at that level, it would have been significantly better for our domestic economy, particularly for the exporters and manufacturers who rely heavily on the local market.
For years, several economists warned that the currency was overvalued, but nobody seemed to be listening. Instead, we just watched as a whole segment of businesses collapsed—companies that honestly could have survived if the dollar hadn't been so unnaturally strong.
Among the first to raise these red flags was Zvonimir Baletić, followed by many others who saw the writing on the wall.

Now, thanks to Dr. Vlado, we’ll finally get our chance to transform into a global export powerhouse.😬

I have to admit, I’m completely lost; I just can't seem to wrap my head around all of this anymore...

I really thought I had a solid grasp on what "international sanctions" actually meant in practice, but then I saw this... 🕺

July 15th (Reuters) - Saudi Arabia, the world's leading oil exporter, more than doubled its imports of Russian fuel oil during the second quarter to power its electrical plants in an effort to meet the massive summer demand for air conditioning while freeing up its own crude oil for export instead.
Russia is selling its fuel at deep discounts because international sanctions following the invasion of Ukraine have significantly limited their pool of buyers.

This surge in fuel oil sales—which is essential for electricity generation—highlights a major hurdle facing President Joe Biden as his administration works to isolate Russia and choke off its energy export revenues.

Data obtained by Reuters reveals that between April and June, Saudi Arabia imported 647,000 tons (roughly 48,000 barrels per day) of Russian fuel oil through various ports, compared to just 320,000 tons during the same period last year.
https://www.world-today-news.com/exc...-markets-news/

So, if I am reading this correctly, the Saudis are essentially buying up cheap, "sanctioned" Russian diesel to cover their own domestic needs, which allows them to save their high-quality oil to sell at full market prices??? 😵

I’d love to know if these big-time advocates for sanctioning Russia actually have any idea if the Americans got the green light from Zelensky for this ☕

urbanotter said:If you look at Russia and how their Central Bank operates, they really only implemented one specific rule: demanding that their gas and oil be paid for in Rubles. Aside from that single move, everything else has been driven by standard market dynamics and the impact of international sanctions.

Man, you totally slept through the part where they slapped limits on foreign currency savings.
Exporters are forced to swap 80% of their foreign inflows into rubles.
Interest rates were sitting at 20%!
Foreigners aren't even allowed to sell off their stocks!

The worst thing you can do is lie to yourself.

I’m sitting here watching Germany ZDF, listening to the experts debate how much they should actually be sweating about gas shortages IF Nord Stream 1 isn't running...

Back in March, reserves were sitting at 24%, but by July, they climbed up to 65%.🤔
Last year, half of Germany's gas supply was coming straight from Russia, but they've managed to slash that down to 29% this year. The goal—driven by sheer political willpower—is to bring that Russian dependency down to absolute zero.
The experts are saying we could see this fully realized in somewhere between 1.5 to 2 years, worst-case scenario.

And honestly? Even without any sanctions (since there aren't any on gas), the Russians have already lost—and continue to lose—a massive, high-value customer.
France is already signaling they'll cut ties even faster, Poland has already walked away, and plenty of other European Union nations are lining up to do the same.

Just think about it: how massive of a hit is this for Russia?🤔

When you factor in the announced halt on oil imports... we could be looking at a loss totaling hundreds of billions of dollars.🤔

At this point, you don't even need sanctions to make it hurt.
Best,

rowdyraven112 said:I’d love to know if these big-time advocates for sanctioning Russia actually have any idea if the Americans got the green light from Zelensky for this ☕

So what’s the actual endgame here?
Do we just unhook the Russian modules from the ISS or go ahead and shut down the whole space station?

Bryan Booth82 said:I’m sitting here watching Germany ZDF, listening to the experts debate how much they should actually be sweating about gas shortages IF Nord Stream 1 isn't running...

Back in March, reserves were sitting at 24%, but by July, they climbed up to 65%.🤔
Last year, half of Germany's gas supply was coming straight from Russia, but they've managed to slash that down to 29% this year. The goal—driven by sheer political willpower—is to bring that Russian dependency down to absolute zero.
The experts are saying we could see this fully realized in somewhere between 1.5 to 2 years, worst-case scenario.

And honestly? Even without any sanctions (since there aren't any on gas), the Russians have already lost—and continue to lose—a massive, high-value customer.
France is already signaling they'll cut ties even faster, Poland has already walked away, and plenty of other European Union nations are lining up to do the same.

Just think about it: how massive of a hit is this for Russia?🤔

When you factor in the announced halt on oil imports... we could be looking at a loss totaling hundreds of billions of dollars.🤔

At this point, you don't even need sanctions to make it hurt.
Best,

The only reason those numbers look so good is because Putin didn't just shut off the tap immediately. It’s going to be really interesting to dive into why he made that specific mistake—in my personal opinion, it just comes down to a fundamental misunderstanding of economic leverage.

Michael Davis9 said:The only reason those numbers look so good is because Putin didn't just shut off the tap immediately. It’s going to be really interesting to dive into why he made that specific mistake—in my personal opinion, it just comes down to a fundamental misunderstanding of economic leverage.

It’s pretty simple, really. As long as they're selling gas, the cash keeps flowing. Once they turn the valve off, the money dries up completely.☕

Michael Davis9 said:The only reason those numbers look so good is because Putin didn't just shut off the tap immediately. It’s going to be really interesting to dive into why he made that specific mistake—in my personal opinion, it just comes down to a fundamental misunderstanding of economic leverage.

Exactly. You don't get economics. The Russians rely on oil and gas way more than we rely on tourism—if you wiped out our tourism industry tomorrow, we'd be in deep trouble.

swiftjackal11 said:It’s pretty simple, really. As long as they're selling gas, the cash keeps flowing. Once they turn the valve off, the money dries up completely.☕

At its core, money is really nothing more than a tool—it’s just a practical way for us to make exchanging goods and services a whole lot easier.

Historically speaking, the Russian Federation has always relied on the European Union to supply those high-end, high-value goods—we're talking heavy machinery, specialized chemical products, intricate industrial components, and all sorts of sophisticated equipment used for everything from energy extraction to large-scale manufacturing.

When you look at the reality of these sanctions, it’s becoming pretty clear that Russia is hitting a massive wall. They're finding it increasingly difficult to actually buy and import most of what they need, which is why they're facing such an enormous deficit right now. I’ve been looking closely at the recent numbers, and honestly, seeing such a significant drop in imports really caught my eye. It’s one of those shifts that feels like more than just a minor fluctuation; it's a signal that deserves some real thought. When you see import volumes sliding like this, it usually points toward a deeper change in consumer demand or perhaps some tightening in the broader economic landscape here in the States. I can't help but wonder how much of this is a reaction to shifting domestic spending habits versus larger supply chain adjustments. It’s definitely a trend worth watching as we navigate the current economic climate. .

So, it looks like they’ve got plenty of cash on hand, but when it comes to actual assets, there’s nothing to show for it.

If Germany can't get their gas situation sorted out, they’re headed straight into a recession, and honestly, that’s going to drag a massive chunk of the entire European Union right down with them.

Just imagine if the gas supply had been cut off six months ago—we wouldn't have had nearly enough time to get those storage facilities filled up to the brim like we have now.

Nathan Thomas12 said:Man, you totally slept through the part where they slapped limits on foreign currency savings.
Exporters are forced to swap 80% of their foreign inflows into rubles.
Interest rates were sitting at 20%!
Foreigners aren't even allowed to sell off their stocks!

The worst thing you can do is lie to yourself.

I honestly don't see the issue here; these are all standard maneuvers used by central banks to support the economy through monetary policy.

Interest rates aren't set in stone—if the FED raises them, why shouldn't the Russian Federation?
From what I understand, they actually dropped once the ruble strengthened to a level that started hurting Russian exports.
The real headache is that we grew up thinking the Federal Reserve wouldn't use monetary tools to actually help the economy, acting more like a simple currency exchange booth that blindly defended the exchange rate, regardless of how much damage it did to the American economy.

After slapping Russia with that massive wave of sanctions, most of which targeted the financial sector, these moves don't seem all that extreme; once it becomes clear they aren't needed anymore, they'll be lifted.

I’m not just talking about Russia, but rather what any Central Bank does—it's just that the Fed focuses on maintaining the dollar's peg (rather than juggling multiple currencies like the Swiss National Bank would)
and claims it's all to maintain price stability, which, looking back, feels like a complete failure and nothing more than pure demagoguery.

The sanctions have clearly exposed how poorly managed our monetary policy has been,
and starting next year, instead of the Fed handling things, the European Central Bank will take the lead—hopefully with better results, though they haven't exactly proven themselves to be highly efficient either.
It's obvious we have turbulent times ahead, especially with Europe and America constantly prepping new sanction packages, and it's perfectly reasonable to expect Elvira Nabiullina to strike back with countermeasures.
Sanctions are essentially a blunt political interference in economic flows, and it isn't surprising that shifts occurred—unfortunately for Europe and for us, those shifts were negative.

But there's no denying that the decision to continue paying for Russian gas and oil had the biggest impact on the recovery and the rise of the ruble.

gentlestag15 said:So what’s the actual endgame here?
Do we just unhook the Russian modules from the ISS or go ahead and shut down the whole space station?

If we’re being consistent about everything, shutting it down would be the obvious move. ☕

Michael Davis9 said:At its core, money is really nothing more than a tool—it’s just a practical way for us to make exchanging goods and services a whole lot easier.

Historically speaking, the Russian Federation has always relied on the European Union to supply those high-end, high-value goods—we're talking heavy machinery, specialized chemical products, intricate industrial components, and all sorts of sophisticated equipment used for everything from energy extraction to large-scale manufacturing.

When you look at the reality of these sanctions, it’s becoming pretty clear that Russia is hitting a massive wall. They're finding it increasingly difficult to actually buy and import most of what they need, which is why they're facing such an enormous deficit right now. I’ve been looking closely at the recent numbers, and honestly, seeing such a significant drop in imports really caught my eye. It’s one of those shifts that feels like more than just a minor fluctuation; it's a signal that deserves some real thought. When you see import volumes sliding like this, it usually points toward a deeper change in consumer demand or perhaps some tightening in the broader economic landscape here in the States. I can't help but wonder how much of this is a reaction to shifting domestic spending habits versus larger supply chain adjustments. It’s definitely a trend worth watching as we navigate the current economic climate. .

So, it looks like they’ve got plenty of cash on hand, but when it comes to actual assets, there’s nothing to show for it.

If Germany can't get their gas situation sorted out, they’re headed straight into a recession, and honestly, that’s going to drag a massive chunk of the entire European Union right down with them.

Just imagine if the gas supply had been cut off six months ago—we wouldn't have had nearly enough time to get those storage facilities filled up to the brim like we have now.

You can't know more than the Russians; they see everything. If they think you're criticizing them, you could end up behind bars.🙂

Michael Davis9 said:At its core, money is really nothing more than a tool—it’s just a practical way for us to make exchanging goods and services a whole lot easier.

Historically speaking, the Russian Federation has always relied on the European Union to supply those high-end, high-value goods—we're talking heavy machinery, specialized chemical products, intricate industrial components, and all sorts of sophisticated equipment used for everything from energy extraction to large-scale manufacturing.

When you look at the reality of these sanctions, it’s becoming pretty clear that Russia is hitting a massive wall. They're finding it increasingly difficult to actually buy and import most of what they need, which is why they're facing such an enormous deficit right now. I’ve been looking closely at the recent numbers, and honestly, seeing such a significant drop in imports really caught my eye. It’s one of those shifts that feels like more than just a minor fluctuation; it's a signal that deserves some real thought. When you see import volumes sliding like this, it usually points toward a deeper change in consumer demand or perhaps some tightening in the broader economic landscape here in the States. I can't help but wonder how much of this is a reaction to shifting domestic spending habits versus larger supply chain adjustments. It’s definitely a trend worth watching as we navigate the current economic climate. .

So, it looks like they’ve got plenty of cash on hand, but when it comes to actual assets, there’s nothing to show for it.

If Germany can't get their gas situation sorted out, they’re headed straight into a recession, and honestly, that’s going to drag a massive chunk of the entire European Union right down with them.

Just imagine if the gas supply had been cut off six months ago—we wouldn't have had nearly enough time to get those storage facilities filled up to the brim like we have now.

They aren't even going to turn it off; you're dreaming if you think that's happening.
War is an incredibly expensive toy to play with.
Lp