Russia and economic war by the west #2

The new aristocracy with the same contempt for the peasants and detachment from reality. The new monarchy is hiding in shadows
and is not family based. They are wearing non-existent new clothes. This is a mental pathology when humans get everything they want
and have no restrictions. Power does not corrupt, it just exposes the mental deficiency.

The EU and US elites detachment from reality in the case of Russia is directly related to how out of touch they are with common people in their own countries, and how little idea they have of the typical issues that are on people's minds these days

The new British Prime Minister is a case in point, who was so used to living in his own ultra-rich bubble (seemingly to the point of being post-money) that he didn't even know that you could pay with a credit card by touching it to the terminal, and just recently asked a homeless person at a homeless shelter what line of business he was involved with

It's like something out of Louis XVI's France

Hahahaha... the goal of the price caps was to restrict Russias ability to generate income from energy exports, but this revision means they can sell their products to any country outside the oil cap group of losers and it reverts to not a Russian product, so Russia sells the oil and makes the product and the west buys the product the oil is refined into at any price that third country wants to sell it for... which has to be the price they bought it for plus the price of refinement and the extra shipping and also a profit to make it worth their while.

So at least two countries will profit from these new western rules and the western public... the tax payers will have to pay more for their oil based products... and worse than that.. those third countries might not do anything at all to that oil and just sell to oil refineries in the west and claim it is their oil so the price cap does not apply and make their profit for being a middle man in stupid western power games.

But of course they had to do this because the alternative is that no one would sell oil to them at the risk of being sanctioned by them for buying Russian oil...

How Russia shook the power of the dollar, by Olga Samofalova for VZGLYAD, 12.31.2022.

Russia has completely abandoned dollar investments in its reserves. New rules for saving money in the National Welfare Fund have been adopted. Now Russia will keep its savings in yuan and gold - and this became the most important signal for many other states, and also affected the very status of the American currency.

Russia deals another blow to the US dollar. Now Moscow will not keep its reserves in such a toxic currency. Russia has approved a new regulatory asset structure for the National Welfare Fund (NWF). The dollar and dollar assets are completely excluded from the sovereign fund. This was announced by the Ministry of Finance of the Russian Federation.

From now on, it is allowed to keep government savings only in the currency of a friendly country (the yuan) and in gold. The maximum share of the yuan in the assets of the NWF is now 60%, gold - 40%, and the balances on the accounts in pounds sterling and Japanese yen are now zeroed. If earlier, with oil and gas revenues exceeding those budgeted, Russia bought mainly dollars and euros, then in 2023 it is planned to buy Chinese yuan to replenish the NWF.

It is worth noting that in 2022, Russia has already specifically excluded dollars from the NWF, and since 2023, by a special order of the Ministry of Finance, investments in dollars are in principle prohibited. The current structure of the NWF is as follows: 40% of funds are placed in euros, 30% in yuan, 20% in gold, 5% in yen and British pounds sterling. The remaining funds are invested in Sberbank shares and Russian government securities.

“The Ministry of Finance made this decision primarily for reasons of national security. After blocking half of the gold and foreign exchange reserves of the Central Bank of the Russian Federation, the currencies of Western countries have already become toxic for Russia. But it is possible that the West may introduce new restrictions.

For example, Russians may be banned from any transactions with such currencies, including even cash. And the reserves of the National Welfare Fund in Western currencies may be blocked in the same way as the reserves of the Central Bank of the Russian Federation,” says Natalya Milchakova, Lead Analyst at Freedom Finance Global.

The US dollar has become a toxic currency due to sanctions, so the NWF has completely banned investments in it. Investments in euro, yen and the British pound in the structure of the NWF from 2023 are also not provided. “The Chinese yuan is the only world reserve currency that is not toxic to Russia. Keeping NWF funds in Chinese currency is safe from the point of view of protection from sanctions,” says Milchakova.

However, in terms of market risks, it cannot be said that the yuan is the safest currency. “The exchange rate of the yuan is regulated by the People's Bank of China, and if the Chinese regulator decides to depreciate the yuan on the recommendation of the PRC authorities in order, for example, to support Chinese exporters, then this will be done at once. In this case, the investments of the Russian NWF will also be exposed to the risk of impairment. In addition, the PRC has a large public debt, as a percentage of GDP, almost the same as that of the United States, and for the yuan this is also a certain risk, ”the expert talks about the risks.

The dollar so far looks to be a more stable and reliable currency than the yuan. But in the face of sanctions and the risk of new sanctions, one has to be guided not only by economic categories.

In this regard, investments in gold look more traditional, but in terms of size, the yuan is given a share of 60%, and gold - only 40%. But there are quite economic explanations for this. “In terms of risk reduction, including sanctions, gold is much more reliable than any fiat currency. These investments are not depreciated. However, this is a low-liquid asset compared to world reserve currencies and even compared to the ruble. This means that it is not always easy to sell it, and it is even more difficult to sell gold at a bargain price.

For long-term investments, for several years ahead, gold is an excellent option, but, for example, if the state needs to use the funds of the NWF to urgently pay for any imports, then gold will need to be sold for a currency, for example, for the same yuan. And how to do this is a big question, because there are restrictions against the operations of the Central Bank of the Russian Federation with gold on the stock exchange. That is, a large share of gold in the NWF will mean that the NWF's illiquid part of investments is increasing,” explains Natalia Milchakova.

Not only Russia has become afraid of the US dollar. Confidence in the US currency has also been shaken by other states. Because if today the US and the EU allowed themselves to freeze the colossal reserves of Russia, then tomorrow no one will be able to stop them from taking the same step against any other country in the world.

In 2022, world central banks bought up record volumes of gold over the past 55 years. Analysts of the World Gold Council came to this conclusion. Central banks are buying up gold at the fastest pace since 1967 . In 1967, record demand for gold led to an increase in the price of the precious metal and became one of the reasons for the collapse of the Bretton Woods system, which pegged the dollar to the price of gold.

The flight of central banks into gold assets is a sign that more and more countries do not trust the dollar after the US froze Russia's dollar reserves. According to the World Gold Council, in total, central banks purchased 673 tons of gold in 2022, of which 400 tons were purchased in the third quarter. The largest buyers of gold were Russia and China. At the same time, Russia has not disclosed data on reserves since the spring, and China's official data may not reflect the full picture. Turkey and Uzbekistan are also among the largest buyers of gold. The greatest interest in gold is shown by those countries that are not among the US allies in the geopolitical arena.

“Gold purchases by central banks in the third quarter of 2022 were an all-time record. Against the backdrop of high dollar inflation and rising geopolitical risks, gold is raising its status as a reserve asset,” the analysts of the Golden Mint House say.

Gold in 2022 remained virtually unchanged in price, although fluctuations reached 25% during the year. At the end of the year, an ounce costs almost as much as it did at the beginning of the year (around $1,800 an ounce).

“In the past year, gold did not perform well, but everything else that is usually considered by investors as protective and anti-inflationary assets turned out to be even worse. Judging by the violation of several important correlations, the decisive role in the fact that gold outperformed many assets was played by the demand of central banks against the backdrop of increased geopolitical risks. We should assume that the demand of central banks has formed a long-term “bottom”, from which gold will rebound, receiving additional growth drivers next year,” the Golden Mint House said in an analytical report.  

According to the forecast of analysts of the Golden Mint House, in autumn the high demand of central banks for gold stopped the fall in prices for this metal. “A realistic target for a possible move is $2,700 per troy ounce over the next two years. The minimum program next year is a breakdown of the historical maximum and consolidation above it,” the analytical report notes. The growth of gold will be supported by the weakness of the dollar, increased geopolitical risks, and a decrease in dollar yields.

In an alternative scenario, analysts assume that the economic downturn will be severe, the inflationary shock will be replaced by a deflationary one in the 2008 scenario. In this case, after an unsuccessful attempt to break through the historical maximum, the price of a troy ounce of gold will again go to the $1,800 area, after which it will begin to form a long-term bullish momentum after the Fed eases monetary policy again to stop the recession. At the same time, a drop in the price of gold below the lows set in the outgoing year seems very unlikely.

It is curious that not only central banks are switching to gold, but Russians are also transforming their savings from the spring of 2022. Instead of dollars, Russians are starting to buy gold bars, depersonalized metal accounts (OMS) and gold coins, which have shown a significant increase this year. “This is a good option, especially for those Russians who invest in CHI instead of physical gold, as there are no problems with the storage, safety and low quality of the purchased gold product, for example, coins. But you need to remember that it is unlikely that you will be able to get a high and at the same time fast return on investments in gold, this is not an asset of a speculator, but of a long-term investor,” says Milchakova.

But with the transition from the dollar and the euro to the yuan, the situation is more complicated. “Many Russian banks have introduced a commission for keeping deposits in any foreign currencies, including in the currencies of friendly countries. If you need to keep funds in RMB, then the best option is to open a RMB account in a reliable bank in one of the friendly countries. And in Russia it is better to keep funds in rubles. In our opinion, the Ministry of Finance could also be provided for 20-30% of the NWF funds to be kept in rubles. This would increase the prestige of the Russian ruble among the population,” Milchakova concludes.

https://vz.ru/economy/2022/12/31/1193342.html

It's done.
700 mln barrels of storage construction is in progress.
Made by several companies under federal supervision.
Should be ready by 2026.

The NWF should also store reserves in other physical assets than gold like platinum or palladium.
Russia should in addition consider the creation of a strategic petroleum reserve. And use that to store oil. This would reduce the need to sell oil at low prices. Russia already has plentiful gas storage.

And currency reserves other than the yuan too. Particularly in reserves of countries it trades with, such as the rupee and the rial.
But I'm sure this is being worked on, especially with the advent of trade in mutual currencies

The West already recognizes it: the Russian economy is unbeatable and sanctions do not work, by Javier Benítez for SputnikNews.lat. 12.31.2022.

In 2022, the West shook the Russian branch of the economic tree, and the only thing it managed was to make the Western economies fall like overripe fruits, which are now lying on the side of its trunk spoiling, in a full state of putrefactive process.

The Power of China and Russia

The reality is that Russia and China are proving victorious in the war waged by the United States with its weapon of choice, that is, political and economic sanctions. And for the record, I'm not saying this, nor are the Moscow and Beijing governments saying it. This is an analysis carried out by Agatha Desmarais, director of global forecasts at The Economist Intelligence Unit.

According to the analyst, the ability to impose sanctions was due to the dominance of the US dollar in the global economy, but now, with time, other countries have found tools to counter the US power, including bilateral currency swaps that allow avoiding the use of the dollar, as well as the development of digital currency and independent analogues of the SWIFT payment system.

While they would not have great significance separately, together they provide Moscow and Beijing with more and more possibilities to circumvent the effects of Western sanctions, something that could be reduced to zero in about ten years, concludes Desmarais.

"We are referring to a specialized media [The Economist] quite a ‘guru’ on the subject of the world economy. It is not a fairground charlatan who talks about economics, but it is the media that are generally the ones with whom all the important economic groups are managed in their daily reading to draw conclusions," explains the director of Dossier Geopolítico Carlos Pereyra Mele.

"What this lady [Agatha Desmarais] is saying is a conclusion after having been for a long time dissembling and bringing confusion to her own readers about the reality that was being perceived," warns Mele.

Verified

It is also something that was corroborated by the speaker of the Russian Duma, Vyacheslav Volodin, who stated that Russia managed to resist the unprecedented pressure of the sanctions imposed on its economy and politics this year. "Despite the unprecedented pressure and the introduction of more than 13,000 sanctions against Russia, the political system created by our president, and the economic model resisted when testing its effectiveness," Volodin wrote on his Telegram channel.

He recalled that Washington and Brussels predicted the collapse of the Russian economy, with inflation of more than 100%, the exchange rate of 200 rubles to the dollar, the fall in GDP of 25% - forecasts that did not come true. According to Volodin, despite all the difficulties, Russia fulfills all social obligations to citizens. "Overcoming challenges, we become stronger [...] Next year should be a year of development," he said.

To this we must add more data of the reality that produce ardors to the West. And the fact is that the unemployment level in Russia in November this year fell to a historical low of 3.7%, the head of the Russian government, Mikhail Mishustin, declared on Wednesday, indicating that the situation in the labor market remains stable.

He noted that to a large extent the low level of this index is due to the work carried out by the authorities together with deputies of the State Duma [Lower House of the Russian Parliament] and senators against the background of unprecedented sanctions.

The monthly report of the Russian Statistics Service [Rosstat] confirmed the figure provided by Mishustin, revealing that the number of unemployed decreased in November by about 152,000 in annual terms.

"In November 2022, 2.7 million people over the age of 15 were classified as unemployed, according to the methodology of the International Labor Organization," the agency reported. The previous historical low of the index was reached in August 2022 - it stood at 3.8%.

Yandex Translate from Spanish

https://sputniknews.lat/20221231/occidente-ya-lo-reconoce-la-economia-rusa-es-imbatible-y-las-sanciones-no-funcionan-1134202048.html

At the same time, Western lovers in Russia say that 2.5 k euros is the average salary in the EU, and that in more "respectable" EU countries it is normal to receive 4.5-5k euros per month.
By the way, I earned 27 thousand euros in Russia in 2022 in terms of the current exchange rate. That is, on average, about 2.25 k per month AFTER taxes. And I'm not counting the purchasing power factor yet, because, you know, my monthly spending on housing, transport and food is maybe 700 euros in total.

That is utter bullshit.
A police officer in Germany gets some 2200 euro net. High ranking and experienced - "even 3700".
The same for Poland starts with ... 800 euro, and a detective's net salary is ... 1200 euro.
For the army, in the Bundeswehra one starts with "amazing" 1300 euro. Some 3500 euro is officer's salary.
In the Polish armed forces we talk some 1000-1300 euro for officers.
Retail sales is actually worse. Big shops like let's say LIDL are advertising themselves with some 1200 euro per month, and in Germany a cash desk worker in ALDI gets 1500-1700 euro.
Sure there are better rates in industry, IT - but it is just same for any country.
And we don't even talk about the shitholes like Bulgaria or Romania, but some average when Germany constitutes a high salary profile for the EU, while Poland is a middle one. Czech, Slovakia, Hungary, Portugal will be alike.
On the other hand, if you compare the prices ...
I was watching a cooking blog from the US I like. Fresh new, he was preparing a beef Wellington for Xmas using the cheapest Wallmart available products. First, he could not find the beef tenderloin at all - that already shows something, right? So he moved to the other cut of choice, a beef fillet. The price of it was $20+. I have opened my eyes wide open, as this price is about double of my price here. Suddenly I realized, that we are talking about the US, and the price is given for a POUND, not a kilo
So the real price tag is FOUR times more expensive.
In Wallmart.
Now imagine, that a police officer in the US gets some 68k a year.
And divide it by 4.
Not much impressive anymore, right?

ALAMO wrote:I was watching a cooking blog from the US I like. Fresh new, he was preparing a beef Wellington for Xmas using the cheapest Wallmart available products. First, he could not find the beef tenderloin at all - that already shows something, right? So he moved to the other cut of choice, a beef fillet. The price of it was $20+. I have opened my eyes wide open, as this price is about double of my price here. Suddenly I realized, that we are talking about the US, and the price is given for a POUND, not a kilo

For comparison, a kilogram of beef in the Moscow region costs 700-1000 rubles, which at the current exchange rate is about $ 10 to $ 15.
Hell, here's literally an example - a one pound marble beef steak, $7.5: https://www.auchan.ru/product/steyk-top-bleyd-skin-mb-450g/

At the same time, many continue to claim that food in the West is cheaper than in Russia. Even after I tell them that I didn't notice anything like this on my trips to Europe.

Holly shit, I had to activate VPN to be able to follow your link, imagine that
No no no you free Europeans, you can't see the prices in Russkie on line stores, because you will get a crazy face!
Here is a new dose of daily lobotomy and electroshocks.
Freshly delivered for you, to make you feel the Euro values!

Edit : here you go :

https://zakupy.auchan.pl/shop/wolowina-stek-z-antrykotu-wolowego-bez-kosci.p-570677

It is a beef steak, but not even close in quality... 650 rubles if we convert.

@ALAMO:

It's done.
700 mln barrels of storage construction is in progress.
Made by several companies under federal supervision.
Should be ready by 2026.

Can you share a source which has more details of these constructions?

https://oilprice.com/Latest-Energy-News/World-News/Russia-Says-It-Needs-Oil-Storage-Facilities-Amid-Western-Sanctions.html

The best you can find I guess.

And it seems that they have increased the plans much, as 140mln t is about 1000 000 barrels, not 700k that was claimed in April.

Income

The "international community" is in deep trouble.

The "international community" is in deep trouble.

And now, can we combine this map with the one showing the anti Russian hysteria?

Make Peace Now; alternative news
@DoctorGerhard
·
2h
UK stops Russian gas imports. Instead, the UK will import gas from India, who is a major buyer of Russian gas.

Russia gets the same $, but we pay more.

In 2021, the UK imported 3.12bn cubic meters of Russian gas, which accounted for some 4% of the nation’s total consumption.



The West continues to self destruct...

@ALAMO:
https://oilprice.com/Latest-Energy-News/World-News/Russia-Says-It-Needs-Oil-Storage-Facilities-Amid-Western-Sanctions.html

The best you can find I guess.

And it seems that they have increased the plans much, as 140mln t is about 1000 000 barrels, not 700k that was claimed in April.

I know about that oilprice article. I was looking for a Russian language source which mentions details of the actual contruction being carried on specific locations along with some pictures.

Sorry, never saw anything like that.
The closest one would be some TASS if I remember stating some big fish from the govt with S surname I cant remember now. He was talking about several companies involved and a federal project applied to that.

After all, problems with food began in Mordor, which Ukrainians warned about. Look at the queues for food. The result of Putin's rule.

People are standing in queues hoping to get at least eggs. Even if they are fishy.
The inscription above the entrance: Red caviar

The situation with supply is so bad, that all shops in Russia have mostly the last year's stock!

Ukro-tardia has been living off the "it is worse in Russia" delusion for years. Even here in Turdope's Kanada my relatives and their friends
were trying to feed me this BS. Pathetic losers.

Countries need populations who have at least a reasonable level of a clue. If they live in some bubble of fantasy fiction, then they are
just disposable resources at the leisure of countries that have the appropriate level of coherence. It is a dog eat dog world, after all.

Russia had vastly better general living standards than Ukraine prior to 2022, and now they're lightyears ahead. Obviously.

I do however love the constant trolling/spam in every Twitter thread, on lots of forums etc, by UA fans, who think it's a great "comeback" to post some 12-year old photo of a rundown backalley in Irkutsk or whatever.

As if those particular views weren't ubiquitous all over Ukraine 12 years ago too, and indeed still are.

My favorite is the recurring meme of "[some random percentage, usually around 20%] of Russians don't have toilets", that has been spammed all over the internet for years now. It's an idea that is based on some lazy reporting on an old Rosstat statistical study, but nobody seems to have read the actual study.

The statistics don't say what people think they say, and furthermore, Ukraine and Russia are pretty much identical, which paints Ukraine in a particularly bad light, actually. The Rosstat study said that around 20% in Russia lack access to centralized sewage, that is, not connected to communal piping. Most of these 20% have localized piping, local water- and septic tanks that get taken care of by trucks on a regular basis, it's a service. This is very common all over the planet. In Russia this solution is common even in opulent villa neighborhoods.

Then, out of these 20% that lack access to centralized sewage, a quarter actually lack piping altogether. That's around 5% of the total population. Almost everyone of these 5% live in areas where piping simply isn't an option in any way. Way out in the outback, often in Siberia.

Ukraine shows similar numbers, but they can't blame it on living in the remote reaches of the world's largest country, with vast expanses of permafrost etc.

But delusions are delusions, they're delusional by definition. I recall the incredible "intercepted phonecalls" that the SBU published last year. "Russian soldiers in Ukraine are amazed at seeing electric lights and paved roads and call home about it"... It would be funny if it wasn't so tragically messed up that loads of people actually buy into it. Well, okay, it is still funny.

Regarding the sewage system. There is the example of Dubai. The old city has a central one, large underground pipes, but the shiny new area with all those huge buildings and 
expensive hotels, uses a de-centralized system. There was a famous picture some years ago with long lines of sewage trucks waiting their turn.

Remind me, this indian gas is made od Holly cows farts, right? Fully Eco green?

The Kanadian CBC, a state owned propaganda orifice, was filming the inside of an outhouse in some Russian farm village back in the
middle 1990s and posing this as some sort of norm for all of Russia.

The people who had the outhouse did not look particularly destitute and miserable to me. Quality of life is not about western designated
material garbage. Choke on it, assholes.