Russian Economy General News: #5

Russias reserves are also in FOREX which part of the welfare fund and reserve fund are part of as well. Russia can borrow from the FOREX but CBR will make it difficult. And no one here maybe besides Austin is worried about it, because even spending habits change too. For instance, they may not have a deficit at all next year thus not a kopek is spent from the reserves. Or maybe they wont use it at all and use something else. Maybe they will change the tax system and gain more money through that? Or cut spending so there isnt a deficit. There are a huge multitude of options available. They decided not to cut it for whatever reason now. In the future maybe they will. Maybe after minimum wage increase, people will be spending more again so more tax money available. Etc etc etc.

They are a little late at reporting.

It is up by .3% from -4.6% in Q2. So lets see how Q4 handles out.

Nah, it was on Trading Economics about it. But it was there for a bit. As I recall hearing it for a while. Hence why they believe this year it will be total around 4% gdp drop.  As KVS said, a lot of that has to do to the inflation that made people pretty much stop purchasing (scary enough, there was a large drop in terms of purchases of food. How can people not eat? Unless they purchase much cheaper foods).  Since the domestic consumer is main contributor to Russian economy (in a lot of more advanced economies it is the same), and if they stop purchasing or cut back, there is a major problem.  And the even funnier part of that is the fault of both the government and CBR whom told everyone to tighten their belts. It is like that south park episode about the homeless people making their way into south park and are acting like zombies. And the message in it was that to fix the economic woes was not to stop spending but to continue spending as money will circulate and keep businesses going.

Russia is doing exact same mistake US and such did back in 2008 - convince people to stop spending. But the spenders account for 80%+ of the GDP, isnt really a pretty effect.

The idea may be is that they want to gear people up to purchase during times like Christmas or something.  They are even increasing minimum wage (it is a good idea, to help meet inflation) which will give people more so they can roughlt spend the same as before.

As for Yahoo, it was always filled with SJW nitwits whom have no aspect of the real world. But here is some food for thought: when this whole anti Russian crap started, there was a massive surge in anti Russian comments and commentators in Reddit. After reaserch was done, apparently a massive portion of such sh** posting was coming from an airforce base in Florida. I imagine it isnt any different anywere else.

max steel wrote:

sepheronx wrote:They are a little late at reporting.

It is up by .3% from -4.6% in Q2.  So lets see how Q4 handles out.

I told ya already. Glad you acknowledged it.

You said it was september gdp growth of 0.3%. I am saying gdp declined by 4.3% which is .3% less of a decline than Q2.  There is a difference. Sept falls in Q4.

max steel wrote:Nope. i said RUSSIAN ECONOMY EXPANDED 0.3% M/M IN SEPT.

Hmm. Maybe I am getting my terminology wrong then. Cause expanded would mean growth but the gdp still contracted but by 0.3% less than Q2. So now I figured out that yes, sept falls under Q3, it would mean that I dont think there was a growth in just sept but overall. But still only a decline. Neither is really good. Russia shot itself in the foot by constantly telling people to tighten their belts.

kvs wrote:

sepheronx wrote:


Austin is saying that 50% of the budget is oil and gas.  Not GDP.  Which I think you posted something much earlier that showed something much lower like 38%.

It was about 40%, now it is less thanks to the drop in oil taxes.    This 50% "dependence" fixation is tiresome and irrelevant.
Oil consumption will not disappear next year or 20 years from now.   The oil price will not collapse to $5 since it physically can't.
It would require most of the oil consumers to simply stop consuming.   In fact, the slack between production and consumption is
very small (around 3 million barrels per day out of a consumption of crude and condensate of 77 million barrels per day).   Russia's
economy is just too diversified for it to collapse like the Saudi economy.

BTW, there are many other export tax targets for Russia's government.   It appears that the bulk of the fish caught by Russian companies
is exported frozen abroad without any processing.   Putin has already issued a directive to his ministers and bureaucrats to fix this
nonsense.  All unprocessed exports should be taxed to the max, including wood products.

Exactly. While the oil/gas/minerals extraction taxes and export taxes existed, the other goods were pretty much un-taxed. As well, timber sales are massive in Russia, same with other goods like agriculture, which are pretty much left with small taxes. I recall reading about the fish market that you are mentioned. As well, I have just read that they are opening a new fish processing plant.

http://sdelanounas.ru/blogs/65080/

Coincidence?

Anyway, there seems to be a growing demand (I think you had the pic which I hope you post) that shows the exports growth of other areas. Wood processing is a massive one. So you are right, tons of options to tax. They even opted for increasing taxes on the extraction of oil and gas. The oil and gas companies are making huge profits. They are just trying to stir trouble with the government to prevent them from upping it.

There is another option. They COULD merge some of the other oil and gas companies as they all seem to be controlled by the government. So instead of keeping so many different ones, why not merge some, as it increases their liquidity as well as their revenues, so that they have much more money to work with and more room to maneuver? This would guarantee the investments in the far east as well as they can easily afford the tax increases.

Karl Haushofer wrote:The current retirement age of Russian men is 60 while the average life span for Russian men is around 65 or 66. So if Russia raises the retirement age for two or three years it means that most of Russian men will not have time to enjoy their retirement for more than a year or two. I see why this would be highly unpopular thing to do.

Sigh....... I think it is best people like you go elsewhere.

Do you understand what the term average means? Do you also understand the differences between regions of Russia? Are you aware there is living differences between lets say Chechnya vs Moscow region? What about Siberia vs Moscow region or even Rostov on Don?

Are you also aware that all people are different and people die of various ages? Or are you this inept in knowledge? I seriously am annoyed by you beyond recognition.

Karl Haushofer wrote:

sepheronx wrote:

Karl Haushofer wrote:The current retirement age of Russian men is 60 while the average life span for Russian men is around 65 or 66. So if Russia raises the retirement age for two or three years it means that most of Russian men will not have time to enjoy their retirement for more than a year or two. I see why this would be highly unpopular thing to do.

Sigh....... I think it is best people like you go elsewhere.

Do you understand what the term average means?  Do you also understand the differences between regions of Russia?  Are you aware there is living differences between lets say Chechnya vs Moscow region?  What about Siberia vs Moscow region or even Rostov on Don?

Are you also aware that all people are different and people die of various ages?  Or are you this inept in knowledge?  I seriously am annoyed by you beyond recognition.

I was just referring to the average life span for Russian men.

If the retirement age for men is lifted to 65 then in some region most men do not live to see their retirement and in other regions most men get to enjoy maybe five years of their retirement.

I'm not saying that Russia should not raise the retirement age, if the economic conditions do now allow other choices. But it sucks for the older Russian generation.

And guess what, Retirement age in Canada is 67. Our life expectancy is pretty brutal regarding differences between regions. It has become a somewhat of a myth that once you retire, you are dead. A lot of people seem to die not long after retirement for whatever reason. But it really doesn't matter as it is coincidence or simply one cannot pre-determine someones death. It is true that if a person who isn't healthy will clearly die young, but one isn't supposed to anticipate that.

http://sputniknews.com/business/20151020/1028808471/russia-platinum-precious-metal-markets.html

So it isnt just Gold, but now Platinum. Russia is aiming to be a major controller of the Platinum market.

http://sdelanounas.ru/blogs/69342/

So domestic drugs production increased to over 60%. As well, savings for the state when buying (as it falls under the healthcare system) saves upwards to 25% from buying domestic! This is very good news on both fronts (healthcare and economic).

Rmf wrote:

sepheronx wrote:Nah, it was on Trading Economics about it. But it was there for a bit. As I recall hearing it for a while. Hence why they believe this year it will be total around 4% gdp drop.  As KVS said, a lot of that has to do to the inflation that made people pretty much stop purchasing (scary enough, there was a large drop in terms of purchases of food. How can people not eat? Unless they purchase much cheaper foods).  Since the domestic consumer is main contributor to Russian economy (in a lot of more advanced economies it is the same), and if they stop purchasing or cut back, there is a major problem.  And the even funnier part of that is the fault of both the government and CBR whom told everyone to tighten their belts. It is like that south park episode about the homeless people making their way into south park and are acting like zombies. And the message in it was that to fix the economic woes was not to stop spending but to continue spending as money will circulate and keep businesses going.

Russia is doing exact same mistake US and such did back in 2008 - convince people to stop spending. But the spenders account for 80%+ of the GDP, isnt really a pretty effect.

The idea may be is that they want to gear people up to purchase during times like Christmas or something.  They are even increasing minimum wage (it is a good idea, to help meet inflation) which will give people more so they can roughlt spend the same as before.

As for Yahoo, it was always filled with SJW nitwits whom have no aspect of the real world. But here is some food for thought: when this whole anti Russian crap started, there was a massive surge in anti Russian comments and commentators in Reddit. After reaserch was done, apparently a massive portion of such sh** posting was coming from an airforce base in Florida.  I imagine it isnt any different anywere else.

people have been growing their food much more ,land outside cities is cultivated ,dachas etc, that food is for own purposes doesnt get taxed or into gdp, simmilar happend in early 90s food deprivation, system collapsed ,food stopped coming to stores. so people this time were anxious about sanctions and crysis and prepared.

Yes, for some reason I forgot about that.  You are correct.  In 2011 the dacha gardens of Russia produced 40% of the nation's food.

Man, that looks comfy as heck! I would totally love to do that. Wish I was Russian to obtain the land like the government is handing out (3 acres is more than enough for me).

The company "AstraZeneca" opened a pharmaceutical plant in Kaluga region

In Varna district of Chelyabinsk region opened a factory for the production of lime

KAMAZ share in the segment of long-haul tractors increased from 4% to 14%