Putin’s Unsustainable Spending Spree: How the War in Ukraine Will Overheat the Russian Economy
Alexandra Prokopenko skrev:Rather than signaling economic health, however, these figures are symptomatic of overheating. The Russian economy’s problems, in fact, are such that Putin is facing an impossible trilemma. His challenges are threefold: he must fund his ongoing war against Ukraine, maintain his populace’s living standards, and safeguard macroeconomic stability. Achieving the first and second goals will require higher spending, which will fuel inflation and thus prevent the achievement of the third goal. High oil and gas revenues, adept financial management by the Russian authorities, and lax enforcement of Western restrictions have all played their part in Russia’s economic growth, but they mask growing imbalances in the economy.
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As the Russian economy has become more focused on the war, Russians have also become unsustainably reliant on war-related payments. The government refuses to curtail subsidized mortgages because of a powerful lobby of property developers. Although the terms have been slightly tightened, and the down payment raised by five percent, the program has remained. The arguments from the central bank that these loans create an additional inflation pressure, cementing inequality and distorting property prices, have been ignored by the Kremlin. These subsidized loans are paid for by all income categories, meaning that working-class taxpayers are subsidizing middle-class mortgages. More than 60 percent of loans are issued to people who will spend more than half their income repaying them. Increasingly, the loan programs are being accessed by recipients of war-related payments. If the war ended, it would become extremely difficult for them to service their loans, especially in the face of rising prices.
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Inflation is also fast becoming a problem. Russia’s inflation rate has already surpassed seven percent, forcing the Bank of Russia to maintain interest rates at 16 percent. Despite these high interest rates, businesses and households continue to borrow, indicating high inflation expectations. This means that the key rate will not return to single digits any time soon. This has prompted industrial giants such as AvtoVAZ and Russian Railways to seek subsidies to service their corporate debt. The Russian energy company Rosneft’s CEO, Igor Sechin, has gone further, urging Putin to influence the independent central bank’s decisions. He has not done so. Despite the attacks from oligarchs, the government, and even Putin’s economic aide Maxim Oreshkin, the central bank governor Elvira Nabiullina has maintained her independence in monetary policy decision-making. For the Kremlin, high interest rates constitute an image problem, undermining Putin’s narrative that the Russian economy is stable. A healthy economy, after all, does not need a double-digit key rate.
Den ryska ekonomin har stora problem som bara kommer att öka med tiden. Putin kan dock inte stanna tiden. Verkligheten kommer ikapp förr eller senare.
U.S. crude oil falls 4% as Saudi price cut heightens global demand worries
CNBC skrev:U.S. crude exports also rose by more than 1 million barrels per day to 5.2 million barrels per day in the same period. Saudi Arabia is slashing prices to stop customers from buying U.S. crude as well as to undercut cheap Iranian and Russian barrels, said Bob Yawger, energy futures strategist at Mizuho.
“Obviously they’re hitting the panic button a little,” Yawger said of Riyadh. The question is what happens if the Saudi strategy does not work, he said.
“You’re getting closer and closer to a 2020 situation here where they try to claw back market share by cutting everything to bare bones minimum and sparking a price war,” Yawger said.
Dessutom kan Saudiarabien vara på väg att inleda ett nytt priskrig på olja. USA pumpar olja till rekordnivåer medan Kina spottar ur sig rekordmånga elbilar.
Russians Rage Against Putin's Officials Amid Cold Snap: 'We're Freezing!'
Newsweek skrev:At least 21,000 residents of around 180 high-rise buildings in the city of Podolsk, around 30 miles south of central Moscow, were left freezing after the power was knocked out in their homes when a heating main burst at the Klimovsk Specialized Ammunition Plant on Thursday January 4, Russian media reported.
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Moscow regional authorities have blamed utility problems on abnormal frosts with the average daily temperature up to -15 C degrees (5 F) below normal. There were also heating problems which started on January 2 in buildings in nearby towns, including Khimki, Solnechnogorsk, Balashikha and Lyubertsy.
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Adviser to the Minister of Internal Affairs Anton Gerashchenko wrote about the heating problems afflicting Moscow on X. "While Russian authorities and propagandists were making up horror stories about Europe freezing without Russian gas, they completely forgot about their own citizens," he wrote on Sunday.
Samtidigt fryser tiotusentals ryssar. Däremot har Newsweek misslyckats med konverteringen. -15 °C är förvisso 5 °F, men 15 °C kallare är 27 °F kallare.
Enceladus skrev: ↑onsdag 29 november 2023 13:39
Russian major general killed in Ukraine after triggering mine
Senior Russian Military Officer Killed in Ukraine: An Increasing Toll on Leadership
BNN Breaking skrev:Adding to the growing list of high-ranking casualties in the ongoing conflict in Ukraine, Colonel Arman Ospanov, a senior officer in the Russian military, has reportedly been killed. Ospanov, head of the armoured service of the Russian Airborne Forces, was in the occupied territories of Ukraine with a mission to boost troop morale when he met his untimely demise.
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Alongside Ospanov’s tragic end, reports have also mentioned the death of Sergeant Alexander Krasnov from the same division. These deaths further emphasize the increasing toll on Russian military leadership as the war in Ukraine continues unabated.
The conflict has witnessed the death of an alarmingly significant number of high-ranking Russian officers, including Major General Vladimir Zavadsky and several others in key positions. The exact number of Russian military casualties remains unverified, with some sources estimating the figure to be over 365,000 since the invasion began. These losses underscore the heavy toll on Russian military leadership, potentially impacting their capabilities in the ongoing conflict.
Utnötningen av ryska officerare fortsätter. Enligt uppgifter på sociala medier
dödades Ospanov nära Kozachi Laheri på den ockuperade sidan av floden Dnipro.