Russia Is Overstating The Funds At Its Disposal

Russia Is Overstating The Funds At Its Disposal

"WE HANDLE our gold and currency reserves and government reserves sparingly." So said Vladimir Putin on November 13th.

Mr Putin is wrong. In the past year Russia's foreign-exchange reserves have fallen by 20% as the central bank has tried to prop up the rouble.

They stand at around $370 billion, with $12 billion more at the IMF (see chart). The central bank claims all of this is readily available. But there is some reason to doubt that.

Foreign-exchange reserves have assumed a new importance for Russia in recent months. As Western sanctions have shut Russian companies out of foreign debt markets, they struggle to raise money.

That makes it harder to pay back the $130 billion of external debt that comes due between now and the end of next year. The Kremlin can step in: but if it helps Rosneft, a giant oil company, as it is being asked to, calls for more bail-outs will get louder.

Some people argue that Russia's reserves are so big that they can accommodate such demands and weather the economic storm. But the central bank exaggerates the reserves at its disposal. About $170 billion of its assets sit in two giant wealth funds, the Reserve Fund and the National Wealth Fund (NWF), and much of what is in these funds could prove illiquid or inaccessible if called on to meet short-term financing needs.

.......

In terms of money that could actually be put to use, Russia's reserves could be more than $100 billion lower than the headline figures suggest. Mikhail Zadornov, a former finance minister, said in a recent interview with Dozhd, a television channel, that the usable amount could be as low as $200 billion.

If current trends continue Russia may soon have enough for just three months' worth of imports: below that level, financiers start to panic. That is bad news for a country that will struggle to find cash elsewhere.

If verified its bad news for Russia...

If they are lying about their finances one has to ask what else is Russia lying about.

a reply to: Xcathdra

Research Done Well.

Good for You!

Thanks for your time and effort.


S&F

a reply to: Xcathdra


It's all paper money these days. Worthless, worthless and worthless in times of major disasters.

a reply to: Xcathdra

Hah, I was waiting for this. Like clockwork...

So, is this like, compared with the USA then?

Because heck, now there's a story.

IF these debts are tied into the whole sanction mess who is really going to be missing out in the short time as these liabilities become due? What knock on effect did housing loans have when they stopped getting paid?

Maybe in the long term some late penalties and higher interest rates get put on, but such rewards are generally left to the victor of such conflicts so there is some wait and see here.

For now it looks like the EU and Russia have been taking most of the trade attack with these growing tensions.

originally posted by: Wildmanimal
a reply to: Xcathdra

Research Done Well.

Good for You!

Thanks for your time and effort.


S&F

Xcathdra grabs anything anti russian that is available and posts it here for the last what 6 months? Motives speak less to research done well than you may like. It's copy paste. I wouldn't be so thankful for such things.

I wouldn't be excited about Russia losing economic power to a point of desperation either.

You are watching power plays that could be a bit too much over our heads.

Europe and Russia would be the first losers but not the last.

It is one planet.

a reply to: KnightLight

and instead of refuting the info you go for the personal attack. I don't care ofr Putin nor his lies, just as you guys take exception to the other side of the fence. Failing to see you doing the very thing you accuse me of is sad.

Do you not think its important if Russia is lying about its finances? Do you not think it would cause massive issues with the Russian economy? Do you not think it cold be a cause for the massive uptick in Russian aggression?

You guys need to get off the personal attack in order to cover for inability to refute facts. People can read and make up their own mind. Maybe if you refuted facts you might sway some of the people in their position.

a reply to: Xcathdra

I didn't say anything like that did I?

Read my post I did not attack you. I said you grab anti Russia articles and post those. It's basically all your threads.

I did not weigh in on the topic except to a poster who thinks you research a lot. So if me saying I don't think you put much work into this thread is an attack then I attacked you, but anything else is untrue.


READ Xcathdra's post history if you do not notice what I am talking about.

And the economist shareholders haha. Pearson Cadbury Rothschild.... That's obvious western banking and publishing connections... It's kind of a duh bias.




Heres the timing.. OIL is about to go up... It's almost december... Russia is fine but now is when to say they are weak. Make sure you pick a random picture to make the feeling of worry to the reader.

Minds are the most important resource.

a reply to: Xcathdra

When you don't like something just attack it. They act a lot like Putin.

originally posted by: OccamsRazor04
a reply to: Xcathdra

When you don't like something just attack it. They act a lot like Putin.

was that an attack on people who like putin? You must be like putin. I can't tell by the way you're acting. Irony from all inclusive statements is a given.

Or is it not ok to attack things?

I always have questions.

You posted lines and lines of copy and paste propaganda...

Then you added three lines:

If verified its bad news for Russia...
If they are lying about their finances one has to ask what else is Russia lying about.

It seems that you yourself have not much to add. What is your expert economic analysis? Does it match the copy and paste version? Why? What are the intricacies of managing a globally-linked national economy? What about comparisons? Are the EU, USA and other (OSCE?) doing any better? I could go on and on, alas this is your thread.

What is your opinion? Dare I ask.

a reply to: Blister

That if Russia is lying about its finances what else are they lying about?

Are they lying about their presence in Ukraine?
Are they lying about their presence in Moldova?
Are they lying to the Russia people?

If its propaganda then there is absolutely no reason you cant post information that demonstrates the info in the article is not correct.

The article is not anti Russian. The article discusses Russian finances.

a reply to: KnightLight

and yet you asked no questions about the op article.

originally posted by: Xcathdra
a reply to: Blister

That if Russia is lying about its finances what else are they lying about?

the article doesn't source it's numbers. I can't tell if Russia is lying or not. That's your jump to make. And EVERYONE is Lying in that game right now. It's the timing to me that shows a weakness in the west. Saudi Arabia might be getting antsy.

This would be the EXACT time for the USA to EXPORT OIL.... But it's not happening. I think the numbers are a lie.

a reply to: Xcathdra

All you are doing is copy and pasting an article and then asking other ATS members to analyse it for you.

Don't you have an opinion? Heck, the first thing I asked myself was how are the numbers effected by the weakening of the USD and of the Rouble...

Surely you can read the article and deconstruct it? Yes?

a reply to: KnightLight

Why is the time to export oil when prices are low?

a reply to: OccamsRazor04
Some are advocating that to further create surplus supply the US should increase its own output (decrease market price of oil). On the other hand, there is suggestion that Russia may cut its production to try and reduce supply (increase market price).

originally posted by: OccamsRazor04
a reply to: KnightLight

Why is the time to export oil when prices are low?

To make them lower..

Russia weaker and lying economically..

Russia.. Europe.. Winter.

Russia Exports... Energy... Energy lower price... Russia already weak...

It's time to strike, but I don't think the numbers are true.. It's still a false swipe.


Economic news in the public sector written in plain english? That's meant for consumption as a product.

I dont think this is much of a big deal. The article just says Russia has in practice $100 billion less in cash than it has in reserves. There is no issue of lying. Its just government BS talking up their financial strength.

Interesting article.

a reply to: KnightLight
I am not sure. It seems to me that Russia has adequate national reserves to pay debt through to the foreseeable future (beyond 2016).

The question is can Russia access the funds it has? If the US and it's poodles in the EU and elsewhere further block Russian funds then liquidity may become an issue.

Disregarding the ethical and questions and serious legal issues that arise from such actions I think Russia would simply readjust financial strategy to official move away from the Bretton Woods system and the US Dollar hegemony.

Just my opinions though...