Sanctions on Russia

Let’s be real here—so far, these sanctions aren't doing a damn thing. We're talking six months in already...
The whole grand plan was that the sanctions would trigger a revolt from the American elite—you know, those oligarchs with their frozen bank accounts everywhere—and then eventually the public would follow suit.
The idea was that a critical mass would finally form and actually kick Putin out of power. But instead? His grip just tightened through pure terror, and that whole theory has completely fallen apart.

At this rate, this miserable status quo and this endless, drawn-out war will probably drag on until he dies—because there is zero chance he’s ever just stepping down on his own...

Honestly, I’m totally lost here—how big of a drop are we actually looking at by the end of this?

I was scrolling through some news site earlier and saw they were reporting a 2% annual increase for the BDI in the first quarter, but then it swung to a 4% annual decline for the half-year mark.
I’ll be the first to admit I don't know the first thing about this kind of nonsense, but if you just look at the logic, if this trend keeps up through the end of the year, that BDI drop should end up being way more significant than just 4%. 🤔

Larry Fox5 said:Let’s be real here—so far, these sanctions aren't doing a damn thing. We're talking six months in already...
The whole grand plan was that the sanctions would trigger a revolt from the American elite—you know, those oligarchs with their frozen bank accounts everywhere—and then eventually the public would follow suit.
The idea was that a critical mass would finally form and actually kick Putin out of power. But instead? His grip just tightened through pure terror, and that whole theory has completely fallen apart.

At this rate, this miserable status quo and this endless, drawn-out war will probably drag on until he dies—because there is zero chance he’s ever just stepping down on his own...

Yeah, there isn't much of a visible impact right now. But man, their reserves are getting absolutely hammered; I've already seen a few articles estimating how much longer those funds can actually last. Plus, they've pretty much lost the ability to borrow from abroad to soften the blow of the downturn.

Now it just comes down to who blinks first and cracks under the pressure. Or, if you want to put it in poker terms, Putin is raising the stakes while the West is footing the bill, and whoever folds first loses everything on the table.

Larry Fox5 said:Let’s be real here—so far, these sanctions aren't doing a damn thing. We're talking six months in already...
The whole grand plan was that the sanctions would trigger a revolt from the American elite—you know, those oligarchs with their frozen bank accounts everywhere—and then eventually the public would follow suit.
The idea was that a critical mass would finally form and actually kick Putin out of power. But instead? His grip just tightened through pure terror, and that whole theory has completely fallen apart.

At this rate, this miserable status quo and this endless, drawn-out war will probably drag on until he dies—because there is zero chance he’s ever just stepping down on his own...

Personally, I never saw that as the actual goal of sanctions, especially since that hasn't worked anywhere else in history. In every other country that has faced sanctions, this outcome just hasn't happened.

Lisa Jackson7 said:What do you even mean by that? Like, can you be any clearer?

Well, perhaps by pointing to the assassination of journalists, the systematic dismantling of the opposition, the shuttering of NGOs, those draconian foreign agent laws, and the relentless persecution and imprisonment of independent media outlets, among many other things...

Anthony Hill5 said:Well, perhaps by pointing to the assassination of journalists, the systematic dismantling of the opposition, the shuttering of NGOs, those draconian foreign agent laws, and the relentless persecution and imprisonment of independent media outlets, among many other things...

If the USSR could collapse, then Putin's Russia can too—not saying when, but... once they get weak enough economically that the elites start turning on each other, all those old questions from the 90s will resurface. Hopefully, this time The West actually has some better answers ready.

anamoonaj said:If sanctions don't actually work, then why doesn't everyone just slap sanctions on themselves? 🤔

I honestly have no clue where you're getting that idea about what the original goal of these sanctions was—whatever you think it is... 🤔
Look, I've been following this whole mess from day one, but I've never heard that theory once—not even from the people who love Russia.

Can anyone actually show me proof? Like, actual evidence that when they decided on these sanctions, they cited that "initial idea" you're talking about?
Who specifically claimed that was the purpose?
Best,

Of course they work—they crush the local economy, tank the GDP, and make life miserable for regular people by cutting off Western goods—but what does any of that have to do with stopping the war?

The whole point was to "nudge" the Russians into ending the fight in Ukraine. So far, I haven't seen a single thing change... or am I just missing something?

As for the second part, it's pretty obvious. It’s totally normal to have a hidden motive that nobody wants to talk about publicly because it's too controversial—but it makes perfect sense that they expected the pressure from sanctions to eventually trigger a collapse of the regime in Russia.

Michael Ortiz68 said:Personally, I never saw that as the actual goal of sanctions, especially since that hasn't worked anywhere else in history. In every other country that has faced sanctions, this outcome just hasn't happened.

It’s always the same story with these authoritarian regimes—they don't care about anything, and they just use the pressure as an excuse to tighten their grip on terror. But look, with Russia, the oligarchs used to hold all the cards... so it’s no surprise they were the main targets in the first wave, right?...

Lisa Jackson7 said:If the USSR could collapse, then Putin's Russia can too—not saying when, but... once they get weak enough economically that the elites start turning on each other, all those old questions from the 90s will resurface. Hopefully, this time The West actually has some better answers ready.

The USSR didn't just collapse overnight; it was crumbling for over five years. Ukraine doesn't have that kind of luxury, and neither does Europe. ☕

It’s absolute chaos over in Los Angeles right now—NextEra Energy is trading at a full 10% premium compared to just a couple of days ago. 🙏

quietviper0 said:What actually fluctuates is real GDP, not nominal figures, and it shouldn't be calculated using some arbitrary currency you've picked out to make a point... In truth, GDP isn't really about currency at all; it represents the actual volume of goods produced and services rendered, and to compare that over time, we use constant prices.

The thing that fell for the Russians was 4%, and that is the only metric that truly rises or falls—real GDP, specifically products and services.

If they had 1,000 products and services last year, and there is a 4% drop this year, they now have 960, regardless of whatever their nominal value might be...

Let's take a hypothetical scenario from last year to illustrate this:
100 products = 100 rubles = 10 dollars

This year, applying that 4% drop, the only thing we can actually map that decrease onto is the component representing products. That percentage doesn't apply to currencies. However, if you factor in inflation/deflation (the base rate) and depreciation/appreciation (all other currencies), then you can derive the other nominal data points.

In Russia's case, if we account for 15% inflation and a 20% appreciation of the ruble, those top figures would look roughly like this:
96 products = 110 rubles = 13 dollars

Any attempt to manipulate those numbers, other than acknowledging that products and services fell by 4%, is simply incorrect... It is wrong to claim there was a 10% increase in rubles, and it is equally wrong to claim a 30% increase in dollars. Currencies are irrelevant to the core fact.
They fell by 4%. In terms of products and services.
And all these little gymnastics you're doing with exchange rates... well, it's really just economic voodoo...

It is the exact same situation in the US where we just received data showing 7.7% growth.
In terms of local currency adjusted for inflation, it was actually 15%, and in dollars, it was "only" 5% due to depreciation. Using anything other than that 7.7% figure is a mistake because the currency fluctuations are secondary.

P.S. I sincerely hope life never sends me to you for any banking or financial services...

Man, you've cooked up a whole lot of nonsense and you're fundamentally wrong. GDP is never measured in quantity; it is exclusively measured in currency.
GDP = C + I + G + (Imports - Exports).
C is household and business consumption.
I is investment.
G is government spending.
All of that is valued in currency, not volume. Let's say you and I live in a tiny 1,000 sq. ft. shack and produce 100 liters of oil a month. Is it the same whether we sell it for $5 a liter or $500 a liter?!

The only thing that skyrocketed in Russia was export value for oil and gas, even though the actual volume of exports decreased. Price is everything—it's about the value. Because oil and gas prices went through the roof, real GDP fell 4%, which means everything else crashed by double digits. Car production alone dropped by 97%.
Just look at how much higher gas prices are now compared to before the war.

I was looking at the nominal GDP, which fell 30% when measured in rubles, because that includes the currency's value.
Nominal GDP accounts for price fluctuations and exchange rates, making it a better indicator of actual purchasing power.

quietviper0 said:What actually fluctuates is real GDP, not nominal figures, and it shouldn't be calculated using some arbitrary currency you've picked out to make a point... In truth, GDP isn't really about currency at all; it represents the actual volume of goods produced and services rendered, and to compare that over time, we use constant prices.

The thing that fell for the Russians was 4%, and that is the only metric that truly rises or falls—real GDP, specifically products and services.

If they had 1,000 products and services last year, and there is a 4% drop this year, they now have 960, regardless of whatever their nominal value might be...

Let's take a hypothetical scenario from last year to illustrate this:
100 products = 100 rubles = 10 dollars

This year, applying that 4% drop, the only thing we can actually map that decrease onto is the component representing products. That percentage doesn't apply to currencies. However, if you factor in inflation/deflation (the base rate) and depreciation/appreciation (all other currencies), then you can derive the other nominal data points.

In Russia's case, if we account for 15% inflation and a 20% appreciation of the ruble, those top figures would look roughly like this:
96 products = 110 rubles = 13 dollars

Any attempt to manipulate those numbers, other than acknowledging that products and services fell by 4%, is simply incorrect... It is wrong to claim there was a 10% increase in rubles, and it is equally wrong to claim a 30% increase in dollars. Currencies are irrelevant to the core fact.
They fell by 4%. In terms of products and services.
And all these little gymnastics you're doing with exchange rates... well, it's really just economic voodoo...

It is the exact same situation in the US where we just received data showing 7.7% growth.
In terms of local currency adjusted for inflation, it was actually 15%, and in dollars, it was "only" 5% due to depreciation. Using anything other than that 7.7% figure is a mistake because the currency fluctuations are secondary.

P.S. I sincerely hope life never sends me to you for any banking or financial services...

Ever since the conflict broke out, Russia has been cherry-picking its data—releasing what fits their narrative and burying the rest.
Regarding your point about the 1,000 products dropping to 960 in nominal value: watch this. You're citing a 4% real decline in goods and services, but imports make up 20% of their GDP, which has plummeted by 50%. Furthermore, those 1,000 foreign companies that accounted for 40% of their GDP vanished overnight. I don't know how much of that they've managed to replace... maybe some of it, I guess. They mostly buffered the blow through gas prices, because—by their own choice, if I'm reading this right—capacity is at 20%, and it looks like it'll stay within those limits (at least according to Europe).
The moment Europe adjusts to this new gas reality and fuel becomes a standard commodity rather than a strategic lever, Russia will be in a freefall.
You don't need expert analysis; just look at what happened back in 2014 and 2015. If it hadn't been for Putin-esque financial acrobatics regarding payments, I suspect we'd be seeing a similar mess right now.

Noah Martin2 said:Ever since the conflict broke out, Russia has been cherry-picking its data—releasing what fits their narrative and burying the rest.
Regarding your point about the 1,000 products dropping to 960 in nominal value: watch this. You're citing a 4% real decline in goods and services, but imports make up 20% of their GDP, which has plummeted by 50%. Furthermore, those 1,000 foreign companies that accounted for 40% of their GDP vanished overnight. I don't know how much of that they've managed to replace... maybe some of it, I guess. They mostly buffered the blow through gas prices, because—by their own choice, if I'm reading this right—capacity is at 20%, and it looks like it'll stay within those limits (at least according to Europe).
The moment Europe adjusts to this new gas reality and fuel becomes a standard commodity rather than a strategic lever, Russia will be in a freefall.
You don't need expert analysis; just look at what happened back in 2014 and 2015. If it hadn't been for Putin-esque financial acrobatics regarding payments, I suspect we'd be seeing a similar mess right now.

Janet Yellen, for real.

Larry Fox5 said:Of course they work—they crush the local economy, tank the GDP, and make life miserable for regular people by cutting off Western goods—but what does any of that have to do with stopping the war?

The whole point was to "nudge" the Russians into ending the fight in Ukraine. So far, I haven't seen a single thing change... or am I just missing something?

As for the second part, it's pretty obvious. It’s totally normal to have a hidden motive that nobody wants to talk about publicly because it's too controversial—but it makes perfect sense that they expected the pressure from sanctions to eventually trigger a collapse of the regime in Russia.

For heaven's sake, can we please just pick a side and stick to it? You either believe that these sanctions actually have teeth and produce a tangible effect, or you don't. It can't be both! Are we actually seeing results here, or is this all just performative political theater designed to make us feel better while nothing changes on the ground? Make up your minds!
You’re telling me I’m contradicting myself across two different posts? Really? Are we actually doing this right now? It's funny how people jump to conclusions when they think they've caught someone in a slip-up, but let's be clear: nuance isn't a contradiction. If you look closely—and I mean *really* look—you'll see that my points evolve as the context changes. How can you claim I'm saying opposite things when the entire framework of the argument has shifted? Is it possible you're just reading the surface level without grasping the deeper logic I'm laying out?🤔
As far as I can tell, absolutely nobody—not one single soul among those responsible for pulling the trigger on these sanctions—has ever actually cited what you’re calling the "initial idea." Everything you're claiming is nothing more than pure, unadulterated speculation on your part. Are we really supposed to believe this is based on fact? It isn't. It's just your own guesswork!
Correct me if I'm wrong.

The entire point of these sanctions is to punish Russia for its unprovoked aggression against Ukraine. Let’s be clear about that. This isn't some novel concept or a modern invention; economic warfare and punitive measures like these have been used throughout human history to hold aggressors accountable. Why should we act as if this is unprecedented? It's simply a tool in the arsenal of international diplomacy, used whenever a nation decides to cross the line.
Of course, Russia will go ahead and claim that sanctions aren't doing a damn thing to them and that they aren't feeling any of the heat. How else are they supposed to save face?
Honestly, I’d be more surprised if it actually turned out any other way.

Let’s be real for a second—if you apply even a shred of common sense to this situation, you have to realize that sanctions and the total isolation of a nation are blunt instruments that hit every single country in their crosshairs. It isn't just some theoretical political move; it has massive, tangible consequences. Just look at the historical precedent! We have seen how devastating this can be for the economies of places like Cuba, Iran, Venezuela, South Korea, and Iraq. When you decide to cut a country off from the global stage, you aren't just making a point; you are triggering a domino effect of economic hardship that ripples through every level of society. Is anyone actually stopping to consider the long-term fallout?
To suggest that sanctions will somehow trigger the collapse of a Putin-esque regime, or act as some magic wand to end this war, is nothing short of delusional. It’s honestly just as naive as claiming that these sanctions aren't doing a single thing to hurt the Russian economy. Are we really still playing this game?
War is an incredibly expensive mess, isn't it? And let’s be honest—adding massive sanctions on top of that chaos just makes the whole damn thing even more outrageously pricey. Is anyone actually surprised at how much this is driving everything up?
When the money runs dry—and let’s be honest, it always does eventually—the side that hits a financial wall first is going to start looking for an exit strategy. It’s simple math, isn't it? You can talk about ideology, territory, or glory all you want, but once the coffers are empty and the funding evaporates, the conversation changes instantly. Who stays in a fight when they can no longer afford to pay the bill? Not them. They’ll be scrambling for any possible way out.
On one side, you have a deeply isolated Russia, struggling to keep its economy afloat while suffocating under a mountain of sanctions. On the other hand, you have Ukraine, bolstered by an endless stream of support from the West and the massive, deep-pocketed economies that back them up. How can anyone expect a fair fight when the scales are tipped so drastically in one direction?
Whose is actually bigger? Honestly, we’ll just have to wait and see who comes out on top in the end.
LP? Seriously? Is that really all we're going to get here? A two-letter acronym tossed out like it’s some profound insight? If you're trying to kick off a discussion about liquidity providers or perhaps some specific market positioning, you might want to actually put some meat on those bones first! How am I supposed to engage with a vacuum? Are we talking about institutional players, or are you just testing to see if anyone is even awake at this hour? Give us some context! Give us a reason to care! We can't have meaningful discourse if we're communicating in shorthand. Let's see some actual substance next time, shall we?

Nathan Thomas12 said:It’s funny how the Kremlin sycophants collectively decided to ignore my post about how Russian GDP has tanked by 40% when measured in rubles due to sanctions.
Facts clearly don't matter to them—they just want to hear the same tired nonsense over and over, like a broken record. :doubleslap:

Lol
And what do you think the GDP for China, the US, or Germany looks like if we measured it in rubles?

Nathan Thomas12 said:Man, you've cooked up a whole lot of nonsense and you're fundamentally wrong. GDP is never measured in quantity; it is exclusively measured in currency.
GDP = C + I + G + (Imports - Exports).
C is household and business consumption.
I is investment.
G is government spending.
All of that is valued in currency, not volume. Let's say you and I live in a tiny 1,000 sq. ft. shack and produce 100 liters of oil a month. Is it the same whether we sell it for $5 a liter or $500 a liter?!

The only thing that skyrocketed in Russia was export value for oil and gas, even though the actual volume of exports decreased. Price is everything—it's about the value. Because oil and gas prices went through the roof, real GDP fell 4%, which means everything else crashed by double digits. Car production alone dropped by 97%.
Just look at how much higher gas prices are now compared to before the war.

I was looking at the nominal GDP, which fell 30% when measured in rubles, because that includes the currency's value.
Nominal GDP accounts for price fluctuations and exchange rates, making it a better indicator of actual purchasing power.

So, if I’m following your logic correctly: you took a percentage of growth or decline that applies specifically to real GDP, applied it to an entirely different metric—nominal GDP—then adjusted it for a specific currency, and now you’re claiming that this specific calculation somehow gives us a completely different eleventh parameter: purchasing power? 🙏

Let me walk through your example...

If we sell 100 barrels of oil at $5 each, we’ll end up having to take out loans just to cover our extraction costs and keep our heads above water... By taking on debt, we reduce available capital, the cost of capital rises, and investments dry up everywhere...
Total output: 100 barrels of oil.

But, if we sell those 100 barrels at $50 each, we have enough for bread, we pay some customs to the state, we don't have to dip into our savings just to survive, and thanks to taxes, we’ve funded the salary of a clerk at the local DMV who also gets to buy bread...
Total output: 100 barrels of oil, two loaves of bread, and a few investments from the rest of the population...

Now, if we sell those 100 barrels at $500 each, besides the bread, we’re buying lamb, we’re buying cars, we’re investing heavily, the government collects massive tax revenue, politicians are busy arguing over budget cuts, and we’ve created ten new jobs for clerks at the DMV...
Total output: 100 barrels of oil, plenty of bread, various investments, some lamb, a new car, a built oil reservoir, and maybe 10 miles of newly paved highway...

Yes, price can influence things (though it doesn't always have to), but the impact is indirect, and price isn't factored into real GDP... And real GDP is the only thing used to compare economic health over time...
It doesn't necessarily have to drive growth because you might not need to invest or indulge in luxury... It also might not work because inflation could simply eat up all your price gains, leaving you right back where you started with just enough for bread, despite selling at 10x the price... Or perhaps the appreciation of your currency will swallow the value of your exported oil, and you'll find you can still only afford bread in your own local currency...

And no, we haven't gained any insight into purchasing power from this... That’s something the experts will measure using entirely different methods...

Anyway, you go ahead and keep playing with your numbers, I won't bother you anymore...

wiredseal7 said:Lol
And what do you think the GDP for China, the US, or Germany looks like if we measured it in rubles?

🤣🤣

God, seriously... is it even possible for people to write such absolute nonsense or ask questions this brainless?

https://www.dw.com/en/germany-econom...war/a-62920092

So, according to this piece, Germany’s economy actually managed to grow and finally clawed its way back to where things were before the pandemic hit.

Brenda Murphy3 said:🤣🤣

God, seriously... is it even possible for people to write such absolute nonsense or ask questions this brainless?

And of course, nobody seems to get the irony.

wiredseal7 said:And of course, nobody seems to get the irony.

The guy talking about irony is the same one spouting absolute nonsense about NATO servers, claiming Chinese cars are going to wipe out the European Union and Japanese brands, and so on and so forth...

Seriously, man, if that's the case, then your entire body of work regarding Russia is just one big irony. If that's how you feel—my bad, I apologize.🙂

quietviper0 said:So, if I’m following your logic correctly: you took a percentage of growth or decline that applies specifically to real GDP, applied it to an entirely different metric—nominal GDP—then adjusted it for a specific currency, and now you’re claiming that this specific calculation somehow gives us a completely different eleventh parameter: purchasing power? 🙏

Let me walk through your example...

If we sell 100 barrels of oil at $5 each, we’ll end up having to take out loans just to cover our extraction costs and keep our heads above water... By taking on debt, we reduce available capital, the cost of capital rises, and investments dry up everywhere...
Total output: 100 barrels of oil.

But, if we sell those 100 barrels at $50 each, we have enough for bread, we pay some customs to the state, we don't have to dip into our savings just to survive, and thanks to taxes, we’ve funded the salary of a clerk at the local DMV who also gets to buy bread...
Total output: 100 barrels of oil, two loaves of bread, and a few investments from the rest of the population...

Now, if we sell those 100 barrels at $500 each, besides the bread, we’re buying lamb, we’re buying cars, we’re investing heavily, the government collects massive tax revenue, politicians are busy arguing over budget cuts, and we’ve created ten new jobs for clerks at the DMV...
Total output: 100 barrels of oil, plenty of bread, various investments, some lamb, a new car, a built oil reservoir, and maybe 10 miles of newly paved highway...

Yes, price can influence things (though it doesn't always have to), but the impact is indirect, and price isn't factored into real GDP... And real GDP is the only thing used to compare economic health over time...
It doesn't necessarily have to drive growth because you might not need to invest or indulge in luxury... It also might not work because inflation could simply eat up all your price gains, leaving you right back where you started with just enough for bread, despite selling at 10x the price... Or perhaps the appreciation of your currency will swallow the value of your exported oil, and you'll find you can still only afford bread in your own local currency...

And no, we haven't gained any insight into purchasing power from this... That’s something the experts will measure using entirely different methods...

Anyway, you go ahead and keep playing with your numbers, I won't bother you anymore...

I addressed the actual drop in production—whether caused by their own policy choices or sanctions—based on data available to the public that impacts GDP projections, yet you keep pivoting back to real GDP. We don't have access to their internal metrics because they don't release them. If you were personally sent those figures, feel free to share them with us.
How do you explain the idea that price may or may not affect the GDP of a nation that has tied its entire development solely to hydrocarbon exports?