Russian Economy General News: #12

Arrow wrote:So why  Putin tolerate such traitors in CBR?

Putin came to power balancing the Siloviki against the western "moderates". He played that game for about 8 years. I think he genuinely doesn't really understand economics and finance and relies on the "expertise" of his western trained monetarists advisers. For years they argued against investing Russian surplus revenues into the real economy and advocated buying US treasuries with the surplus. Essentially financing the deficit of their geopolitical rival.

Arrow wrote:So why  Putin tolerate such traitors in CBR?

Because Putin is a 4 dimensional grandmaster chess player , this is what his fanboys will tell you.  

Sadly , blind fanatics will always make any excuse to praise Putin .

But when it comes to central bank , russia is a slave of the western central banking system ,
and not being part of this bank , means russia will have no way to sell anything to europe that
use the american central bank system and swift transanction network.

Russia don't have a system ,  does not lead the world on anything that societies around the world cares , and this is why is paying such a high price and needs to follow the western system too ,
when it comes to banking ,and trade.

To nationalize the Russian bank ,  as "Experts" have said in this forum is collective suicide ,
that is russia to disconnect from the world ,withotu having any alternative first , to the american system.  

Russia needs to disconect from the western system, but before they do that , they need to create
an alternative to the western business world and its banking industry , good enough to replace it.
but that will be impossible to do under a gas station focused and outdated president.


in more economic news about Russia "substitution program" , found an interesting report , from
a Russian ,that explain in detail the problems of Russia economy ,how is damaging the Russia aviation industry and the modernization of their civilian aviation industry and import substitution demanded by government  to the airliners. And what he describe is a massive level of incompetence of the russian government , in spending and modernizing the russian civilian aviation industry .

"Putin also mentioned that Russian engine builders should be congratulated on the creation of the PD-14 engine. According to the president, in Russia such engines have not been made for about three decades-since the 80s of the last century


This is our "import substitution", when Russian and Russian-Ukrainian engines are replaced with American ones!    

The first production engine after the Soviet era and the first admiration from the President! But it seems that the comment comes from the president of another state. Why? Yes, because the head of the RUSSIAN state seems to remember that during his long leadership, there were several engines of different purposes at the output, but another thing is that they were not allowed to enter the series. Here you can make a discount on the fact that the President has a shortage of time to work with the Internet:


"...So to be honest, the staff of my office, the Administration, of course, very actively use the Internet in all its guises, but I personally do not use it in practice " ...vladimir putin...

This probably explains the lack of awareness (of putin) about aircraft engines. It should be assumed that he also does not read, but still, dear Vladimir Vladimirovich, let me remind you that when you were President, engines were created: VK-800; TVD-1500; RD-600, NK-93. The only problem is that at the final stage, the government deprived them of funding, and therefore of mass production. But today, another one of them has a hope that in the near future it will be in the series: "CIAM approved equipping Baikal with the VK-800S engine."

If the government had spent its finances on creating its own aircraft, the Defense Ministry would now operate heavy Il-106 aircraft, and Il-76 aircraft to help them, not counting the AN-124. In Aeroflot, instead of Boeing and airbus, domestic Il-96, Tu-204, Tu-330, Tu-334, Su-80, "Rysachek" and remote-controlled An-2s would work profitably, which really deserve ADMIRATION!  

But the PD-14 was far from the promised capabilities, and " In general, Aeroflot said that it would buy MS-21 liners only with American engines.  It's strange to hear this news after all the shouting about what a wonderful PD-14 engine we created. The question arises - does the Russian government do anything other than World Championships and Universiades?

how horrible is that ? that the top airliner in Russia prefers the american engines ,over the gas putin ones , they ordered to be made. If this can be confirmed , it will be really bad news ,will show the massive failure on aviation industry of russia engine program , contrary to what putin claimed .

https://z5h64q92x9.net/proxy_u/ru-en.en.7357adc0-60a46829-04053936-74722d776562/https/avia.pro/blog/iskusstvennyy-zastoy-i-voshishcheniya

So why Putin tolerate such traitors in CBR?

Most economics theory and religion is created and taught in the west, so most Russian economists are infected with western bullshit.

Getting rid of the traitors makes no sense if they are only replaced with a fresh new brew of traitors, but then replacing them with actually incompetent idiots would be even worse...

Putin ain't no tyrant and has been balancing various factions as noted above. I do not think he is totally clueless on the economy, but
he does not impose his view on what the financial system should do. Originally this was an accommodation with the west. But over
time we have seen that monetarism did not become the dogma of the land and clowns like Illarionov and later Kudrin got sidelined.
I do not think we have yet seen the full economic policy under the current change of relations with the west. Russia still has to play
by the international financial "rules" but it looks like serious investment in the domestic economic (the real one) is in progress.

However, I think it is time to give Nabiullina the pink slip together with her monetarist crew. Putin should have kept the same "regime"
at the CBR that existed before 2010 under Gerasimov (I think that is the right name). Nabiullina has been riding the success of her
predecessor and taking as much credit as she can grab. Monetarists are such phonies which goes together with their contempt for
objective reality and empirical data. They have have beloved theories to shove down everyone's throats.

All in due time. They are still fixing their economy with new investments, industries and infrastructure. The banking sector will get it's due. In due time.

Putin isn't oblivious to it. He had advisors and still does who are not in favor of the siloviki moneterists. Instead, he will deal with them at the right time.

The biggest change was with the constitution change. That was probably the one thing that made sure stability will exist, even in harder times.

It is the CBR that was interested in normalizing ties and giving in to the west. Putin said no and they are forced into the diversification and modernization of Russia's economy, industries and Infrastructure.

Give it a bit more time.

miketheterrible wrote:All in due time. They are still fixing their economy with new investments, industries and infrastructure.  The banking sector will get it's due. In due time.

Yes because 20 years of putin ,had not enough time , to fix their economy or even his banking system ,that exist , as consequences of Russia weakness , lack of business power to create an alternative system to the western one .

Putin isn't oblivious to it. He had advisors and still does who are not in favor of the siloviki moneterists.  Instead, he will deal with them at the right time.

Yes , at the right time , in the year 2030 , when he dies of age on his desk and no longer
can ruin the nation if russia is not destroyed earlier ,the soviet union way and lucky enough to survive that long.

It is the CBR that was interested in normalizing ties and giving in to the west. Putin said no and they are forced into the diversification and modernization of Russia's economy, industries and Infrastructure.

yep , the putin's way , replace russian engines , or ukraine engines for american ones..
this is what "diversification" means for the grandmaster chess president.

Give it a bit more time.

[/quote]

Yep . about the year 2050 , if russia did not collapse earlier and is lucky to survive Putin's clueless and outdated regime , with luck new generations of russians will completely reverse all putin's outdated and disastrous development of russia on this 20 years he have been in power , and one day , have a clear goal of true independence of Russia from the west , by building a true modern and advanced economy , no longer dependent on gas stations.

Lol Van7

https://www.bloomberg.com/opinion/articles/2018-07-09/russia-deserves-top-grades-for-prudent-economic-management

By several key measures it has the world’s best economic management, says the IMF’s former top man in the country.- the article

https://tass.com/economy/924770

IMF: Russia managed to avoid serious economic instability

No ideology driven economics policy or system is viable in the long term.   Putin's actual brilliance has been not to have any ideology rule
Russia.   This miracle is pissed on by critical maggots who claim it is a "fail".   Funny, failures bitching about others failing.  Typical.

So Russia lets market mechanisms function without drinking the koolaid that there is some invisible hand that creates order out of
chaos.   Again, it is funny since Adam Smith used the term in a sarcastic way.   Some clowns down the historical road decided it was
a profound feature of economic reality.   Lunatics.   We saw the break with this inanity back in 1998 when Chernomyrdin asserted
that the era of market romanticism is over.    In the "free market" west, star chambers engage in command economy style management
to create order out of chaos.   In Russia, the elected government is doing this.   People who think that the government is the source
of all evil are detached from reality.   Corporate mafias are no less dangerous and there are no elections for corporate management.
And oligarch dominated regimes such as in the USA and Ukraine are indeed quite bad.

The post 2014 sanctions era has been a boon to Russian small and medium sized business.   Lots of food imports were replaced by
small companies such as those making cheeses, both foreign and Russian types.   This is why I wish Putin cracked the whip on the
CBR.  The CBR is suppressing the development of SMEs.   It is not affecting large companies as much.   Since over most of the last
30 years, Russia has been a land of large companies, the leader can be leisurely about CBR shenanigans.   But if that leader is serious
about Russia's development, then a more proactive policy is needed to make domestic financing sane.  

The CBR is infested with maggots form the "Higher School of Economics".    This is a 5th column toilet that is brazen in its anti-Russian
agenda.   For example, it produces development rankings where Poland is placed much higher than Russia, even though it is a German
branch plant economy.   A country like Russia that can build leading edge nuclear reactors, produce hypersonic missile systems, and
a slew of other tech (e.g. the PD-14 engine) is ranked lower than some second rate country like Poland that has value primarily as
a dog yapping at Russia.   Clowns who produce such rankings have no business being staff in critical elements of the government and
financial system.   Their opinions are and activity are poison.

PapaDragon wrote:

Backman wrote:https://tass.com/economy/924770

IMF: Russia managed to avoid serious economic instability

Can you post the article?

I get the paywall

It's a 2017 article... still want it?

Even NATzO funded Moscow Times have no choice but to report Russia's continued economic success  

Russia’s Economy Almost Hits Pre-Coronavirus Levels

Russia’s economy shrank by 1% in the first quarter of 2021, the Rosstat statistics agency estimated, in the best quarterly performance for the economy since the outbreak of the coronavirus pandemic.

Russia’s economy saw one of the smallest declines in the world last year, as the economy was cushioned by a short lockdown at the beginning of the pandemic, the government’s large footprint in the economy and a quick rebound in domestic travel and consumer spending.

The Rosstat figures were better than economists expected and show the Russian economy is on track to hit pre-coronavirus levels by the end of the year.

Russia’s GDP in the first quarter of 2021 was 0.4% higher than in the same period of 2019 and Sova Capital’s Chief Economist Artem Zaigrin said the strong performance means Russia’s economy is “now just an inch below its pre-pandemic level.”

Russia’s Economy Ministry estimated that March 2021 was the first month when the Russian economy was in positive territory since the start of the pandemic.

Russia entered a six-week nationwide lockdown in the final week of March 2020 as it battled rising coronavirus cases — pushing the economy into recession for the rest of the year.

Yes because 20 years of putin ,had not enough time , to fix their economy or even his banking system ,that exist , as consequences of Russia weakness , lack of business power to create an alternative system to the western one

There is nothing wrong with the Russian economy... the accusation that it is not helping the poor people at the bottom or the retired elderly whose pensions are not keeping up is to blame Russia for being in the same situation as many other western countries on the planet...

They are operating in the same environment and used different tools to solve their problems that mostly centred around spending and borrowing and have no reserves to dip in to for situations like Covid.

Russia was supposed to be a third world gas station... that was the plan... they were supposed to live well on their energy and mineral and resource wealth and squander away their industry so they spent the money they made selling energy to the west on western products because they didn't make anything themselves.

Putin screwed that up for the west... that is why they hate him because now they buy energy but Russia actually now makes more money exporting food than they make selling weapons which was the other commodity they could sell for dollars.

Domestic food production does not just mean protection from outside sanctions that target food, it also means a domestic market for agricultural machinery and equipment... a John Deere tractor is not cheap and if you are paying in rubles it is even more unaffordable, so the domestic products become the tools of choice... previously the few agricultural businesses could be overwhelmed with cheap foreign products that undercut the local machinery maker to put them out of business, so there was less competition internationally... the western company might even buy that local maker and start making their own equipment there that they can make cheaply and stop making it at home with more expensive wages and costs... they could then use those savings to break in to other markets.

Well not only can't they do that now, it is the Russian tractor makers that can sell to third world countries at much more affordable prices without losing money.

Losing money on a sale only matters if it leads to the elimination of your rivals as competition... then you put the prices up and start recovering the money you lost to overwhelm the market and eliminate opposition.

It is how the really big companies get big... after a while instead of crushing them economically you just offer to buy them out and use their local production facilities and workers to make your product and their product to give the locals the illusion of choice.

PapaDragon wrote:

Backman wrote:https://tass.com/economy/924770

IMF: Russia managed to avoid serious economic instability

Can you post the article?

I get the paywall

I presume you are referring to the Bloomberg article?  Tass doesn't have a paywall.

Russian central bank sees 2021 economic growth close to 4%

MOSCOW, May 13 (Reuters) - Russia’s economy is on track to grow by nearly 4% in 2021, the upper boundary of the previously expected range, the central bank’s head of monetary policy, Kirill Tremasov, said on Thursday.

The Russian economy is recovering from its sharpest contraction in 11 years, caused by the COVID-19 pandemic and a sharp drop in the oil price.

In forecasts issued last month, the central bank said that, after a 3% contraction in 2020, the economy was on track to grow by 3.0-4.0% in 2021, and by 2.5-3.5% in 2022.

It also raised its benchmark interest rate to 5% in April and has said it is ready to make lending even more expensive if necessary. (Reporting by Elena Fabrichnaya; Writing by Anna Rzhevkina; Editing by Kevin Liffey)

I was just posting old articles as a retort to Van7's big declarations that there has been broad economic policy failures throughout the Putin admin. It's just not true.

Backman wrote:I was just posting old articles as a retort to Van7's big declarations that there has been broad economic policy failures throughout the Putin admin. It's just not true.

Vann is a troll. The definition of troll is ignoring any evidence that goes against the trolling agenda.

This moron and similar are not convincing Russians that their daily life experience is one big lie and that they are worse off today than in 1999.
But this is exactly what Nahalny, Vann and other trash are trying to do.

Russian cabinet validates possibility to invest funds of National Wealth Fund in gold

MOSCOW, May 22. /TASS/. Russian Prime Minister Mikhail Mishustin has signed a decree validating the possibility of investing the funds of the National Wealth Fund (NWF) in gold, according to a statement released on the website of the government.

"It will be possible to place the funds of the National Wealth Fund (NWF) on bank accounts with the Bank of Russia in precious metals, particularly in gold, which is traditionally a defensive asset," the explanatory note to the document said.

The earnings of the NWF’s funds invested in gold will be formed based on transactions on its purchase and sale considering the gold prices effective on the day of payment, the government said.

The decision will make it possible to diversify the investments by the Fund in a move to guard them against loss, as well as increase yield, according to the explanatory note.

The Russian Financial Ministry announced plans in late March to expand the possibility of investing the funds of the National Wealth Fund in gold as a traditional ‘defensive’ asset.

PhSt wrote:Russian cabinet validates possibility to invest funds of National Wealth Fund in gold

MOSCOW, May 22. /TASS/. Russian Prime Minister Mikhail Mishustin has signed a decree validating the possibility of investing the funds of the National Wealth Fund (NWF) in gold, according to a statement released on the website of the government.

"It will be possible to place the funds of the National Wealth Fund (NWF) on bank accounts with the Bank of Russia in precious metals, particularly in gold, which is traditionally a defensive asset," the explanatory note to the document said.

The earnings of the NWF’s funds invested in gold will be formed based on transactions on its purchase and sale considering the gold prices effective on the day of payment, the government said.

The decision will make it possible to diversify the investments by the Fund in a move to guard them against loss, as well as increase yield, according to the explanatory note.

The Russian Financial Ministry announced plans in late March to expand the possibility of investing the funds of the National Wealth Fund in gold as a traditional ‘defensive’ asset.

Russia needs a long term strategy to unload paper funny money "assets" such as the euro and what they lave left of the dollar.   Those are not
long term assets and can disappear overnight.    Gold is a long term asset since it is always going to be in short supply and humans grub for it
likely based on genetics.    So pooling Russia's gold production instead of selling it for foreign fiat is a good idea.

Russian govt gives go-ahead for piling of National Wealth Fund into gold bullion

The National Wealth Fund (NWF) has received the green light to diversify assets by investing in gold as the country’s Prime Minister Mikhail Mishustin signed the relevant order on Friday.

“Financial reserves of the NWF can be allocated in the accounts of the Bank of Russia in the form of precious metals, gold in particular, which is traditionally seen as one of the defensive assets,” the cabinet’s press office said.

According to the government, the decision, proposed in late 2020, will allow the diversification of the fund’s investments to ensure their safety and increase the yields of allocations.

The NWF is a part of Russia’s federal budget assets. It was created to support the national pension system, and the funds can also be used to cover budget deficits in times of crisis. As of January 1, the assets of the fund amounted to more than 13.5 trillion ruble, or nearly $184 billion, according to the Ministry of Finance.

In the long-term, precious metals are much more sustainable for investments than financial market assets.

Earlier this year, the Russian Central Bank reported that in 2020 the value of Russia’s gold reserves topped its US dollar holdings for the first time ever. At the end of June 2020, Russia reportedly held $128.5 billion in gold, which accounts for 22.9% of its international reserves, exceeding the value of US dollars in the holdings by nearly $4 billion.

https://sdelanounas.ru/blogs/141648/

Russia is opening the piggy bank of the FNB. What our money will be spent on?

Russia has decided to open the reserves of the National Welfare Fund contrary to the recommendations of the International Monetary Fund and is ready to send almost a trillion rubles to the first seven projects. Why this is good news and how accumulated petrodollars will help to revive our economy - we will show in this issue. And also tell how each of you can get a free domain in the .RUS zone and other positive news of the week.

This is exactly how this money should be spent. Vital infrastructure is essential for development of the GDP. The IMF bitching about
keeping the money parked in western investments is self serving BS. The video lists the various large scale projects which will be
financed by this oil fund money, and they include upgrading the trans-Russia (Siberia) railway capacity. This work is already underway
and is attracting foreign goods transit from the Orient to Europe bypassing the Suez Canal.

BTW, Russian rail is mostly electrified. Since it feeds off clean power like natural gas and nuclear, this rail transit not only saves CO2 and
sulfate emissions by having a shorter route, but also using a much cleaner mode of transport than any existing shipping. I bet you will
never hear about this from all the Greta Thunbergs in the west.