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nfig77
Joined: 20 Jun 2011
Posts: 52
Location: ITB Research Facility in Shenzhen
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 Posted: Thu Mar 26, 2015 8:49 pm Post subject: |
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| Deats wrote: |
Oil is traded in $USD not in Roubles. All transactions with foreign countries are done in USD, GBP or EUR. So how many roubles you can change for these makes absolutely no difference, because you need to change them straight back to buy things from these countries! The gvnt/a company can change $100 into 5700 roubles today, then tomorrow when they want to buy something they change 5700 roubles to get their $100 back!
Let me also show this.
Company A sold a barrel of oil last year for $110. They converted it to roubles and got 3300 roubles. Now, they must use this money to pay their overheads. Let's say those products cost $50/1500r. The company was left with $60/1800r
Company A today sells a barrel of oil for $55/3157r. Now they must pay their overheads $50/2870r. The company is left with $5/287r
The company is $55/1513r worse off for every barrel of oil they sell, so the gvnt ISN'T making a load of extra money or benefiting in any way, like you claim! They are FAR worse off than last year. Hence oil production has risen and they still can't balance the books!!! Haven't you been following the news?!
This is because in the oil industry almost everything is traded in $, not in roubles. Why do you think Russia has financial problems?
You are getting confused by the fact you think the gvnt makes money because they get more roubles for the dollar - but if the rouble is worth less, then these roubles can't buy as much!
A weak rouble only benefits companies that sell products overseas in $, £ or EUR and the price has not moved. And it only benefits a company if their shareholders only want to spend this money in Russia and never spend it overseas - which is almost never the case.
Let's say I am English but own a Russian company. Last year I sold my product abroad for £100/6000r. Today I sell it for £100/8500r. I have more money in Russia, but no more £. Taking into account inflation is 20% then if my expenditure last year was 6000r, this year it will be 7200r. So even then I only have a few more roubles, but still no more pounds! I am richer in Russia, but not in world terms.
If I want to sell my product internally within Russia then last year I got £100/6000r, this year I get £70/6000r. Then there is 20% inflation... Ouch. I'm poorer everywhere!
No win.
Why do you think GOVERNMENTS prop up their own currency? They sell their foreign reserves and buy their own currency? Because a really weak currency (like the rouble is now) is a DISASTER for a country. Yes a minority will benefit but the majority will suffer. |
First, I'm well aware oil is traded in $. And if you had carefully read my post you would have understood that. Common sense says that if one can bring in more rubles, for a given barrel price, that's a good thing from a domestic standpoint. The point is not that Russia's making less, but that the weak ruble serves to offset what those losses otherwise would have been. It also has the effect of making imports more expensive, but Russia has run huge trade surpluses for years. Sure it will always need dollars and euros, but not as much as you think.
Last edited by nfig77 on Thu Mar 26, 2015 9:04 pm; edited 1 time in total |
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Foma87
Joined: 13 Sep 2011
Posts: 116
Location: Moscow
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| Posted: Thu Mar 26, 2015 8:59 pm Post subject: |
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About the economy, I remain optimistic. I think we will see Russia, against all odds, make a robust recovery. When this will happen (sooner or later), is up for debate. As is whether Russia will ever return to her pre-crisis levels of affluence.
Has the crisis in Russia been overblown? I think by some, yes. Yet very rational people inside Russia, ex-finance minister Kudrin among them, have spoke on the economic difficulties Russia faces, and their predictions for the future are far from rosy.
I think Sasha is right in pointing out that economics is cyclical. After all, he witnessed firsthand the 2008-09 crises -- saw the Russian economy collapse and then recover seemingly stronger than ever. Comparing 2015 to 2008-09, though, is very problematic, for many reasons. Nevertheless, I'm with Pushkin in thinking Russia is something which you can never really understand, but only believe in. And I'm a believer! |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:04 pm Post subject: |
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| I think you may be conflating a couple of differwnt posters and issues there. But while the legality or lack of legality may not differ between them, the chances of getting caught, and the massive impact resulting, does differ. Passports and visas are checked everyday by pc plod. But it is rare for under the table work to be scrutinised. |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:05 pm Post subject: |
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| Was that Pushkin? |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:08 pm Post subject: |
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| Lots of misattributions going on here, hic! |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:11 pm Post subject: |
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| Tyutchev, hic! |
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Foma87
Joined: 13 Sep 2011
Posts: 116
Location: Moscow
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| Posted: Thu Mar 26, 2015 9:11 pm Post subject: |
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I have never had my visa checked by police, nor have I heard of anybody ever being caught for teaching without proper visa. I myself teach legally, though, either way.
Working without permission is an administrative offence, while tax dodging is a criminal one and carries with it huge fines and possible jail time for repeat offenders. These are fact. I can't speak to enforceability factually, but I'd say neither offence in the case of English teacher is worrisome. |
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Foma87
Joined: 13 Sep 2011
Posts: 116
Location: Moscow
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| Posted: Thu Mar 26, 2015 9:12 pm Post subject: |
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Was it Tyutchev? Mmmm. I stand corrected  |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:13 pm Post subject: |
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| Confusing your poets, though, is liable to garner a public flogging at the very least. Maybe even a stoning... |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:14 pm Post subject: |
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| Atlantic just last year. Mass deportstions... |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:16 pm Post subject: |
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And the odd caning.
All for the wrong visa... |
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Foma87
Joined: 13 Sep 2011
Posts: 116
Location: Moscow
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| Posted: Thu Mar 26, 2015 9:16 pm Post subject: |
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| A far worse violation and affront to the country than breaking any economic laws is, I agree. And I mean that literally. I apologize. |
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Sashadroogie
Joined: 17 Apr 2007
Posts: 11061
Location: Moskva, The Workers' Paradise
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| Posted: Thu Mar 26, 2015 9:18 pm Post subject: |
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| And rightly so. But I think we might have got away with it. For now. But that was just luck. And we can't rely on luck... |
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Foma87
Joined: 13 Sep 2011
Posts: 116
Location: Moscow
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| Posted: Thu Mar 26, 2015 9:21 pm Post subject: |
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| Who knows what went down at Atlantic, but it wasn't good. Taking privates without a proper visa and working full-time at a school are different, though, in my opinion, especially when said school has been audited by migration most likely by a rival. |
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nfig77
Joined: 20 Jun 2011
Posts: 52
Location: ITB Research Facility in Shenzhen
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| Posted: Thu Mar 26, 2015 9:24 pm Post subject: |
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http://www.russia-direct.org/fate-russian-ruble#explanation-6
Maybe this article will help clarify what I've been saying - see question 6.
"So, if at the beginning of the year, a barrel of crude oil was $107 and the U.S. dollar was trading at 33.2 rubles, the budget received 3,552 rubles. Now (December 17, 2014), with a price of $59.07 per barrel of Brent crude oil and the U.S. dollar trading at above 60 rubles (on the Moscow exchange), the budget receives more than 3,750 rubles. Thus, a weak ruble with decreasing oil prices is to the advantage of the Russian government, which will be able to fill the budget with necessary funds and to keep its social commitments."
Last edited by nfig77 on Thu Mar 26, 2015 9:27 pm; edited 2 times in total |
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