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[Ukrainian Ranger]

Let's take pensions as an example: Sure, with a falling rouble the government's spending on pensions will go down - but very soon they'll have to raise the nominal pensions so that the current real pensions are not too far below the old ones. The savings from devaluation are very much temporary.

Besides Russian budget needs to spend $, too

Simplest example: Any governments needs to buy computers and software. You can't buy that for rubles.

[Sergarr]

>Russia
>buy software

Uhhhhhh...

[LordSlowpoke]

just give putin a pirate hat and an eyepatch is what sergie is saying

[Ukrainian Ranger]

Pirated software in government institutions.... He-he. Good luck with security updates

[alway]

To be fair, the US government backdoors would be in the legit copies too.

[Sergarr]

Protip: nothing prevents people from pirating the security updates, too.

[Ukrainian Ranger]

Spoiler: It is fun to watch how Russian central bank spends money (click to show/hide)

[Sergarr]

What makes you think it's central bank and not some random speculators speculating?

[alway]

What makes you think it's central bank and not some random speculators speculating?

This. If it were the central bank, there would be announcements trumpeted to every corner of the world, as that could help raise confidence. The price is moving rapidly, and as such, spikes both up and down are to be expected. And those are hardly even spikes considering the largest is only about 1% on a day of multiple-percent change.

[Knit tie]

As much as it's fun to watch British TV pundits (and UR) orgasm from the sheer shadenfreude of expecting Russia to disintegrate, Putin to get cast out and the new Russian leader to incessantly fellate the economical and political penises of the western countries, I think the media here seriously overestimates both the "panic" in Russia and it's economical problems.

As Sheb has correctly mentioned, the majority of Russia's government's spending is in roubles, so falling oil prices are not that horrible, really. The Kremlin still gets the same number of roubles per barrel, and since it pays its expenses mostly in roubles as well, its intra-country budget is not hit as hard as many people in the west think.

As for the panic, there's is none whatsoever even in the economical circles, as the people who lived through to 90s are still alive and confident that this crisis won't be hearly that bad. Most commonly, comparisons are made with the 2008's recession.

Let's take pensions as an example: Sure, with a falling rouble the government's spending on pensions will go down - but very soon they'll have to raise the nominal pensions so that the current real pensions are not too far below the old ones. The savings from devaluation are very much temporary.

Could you elaborate here a bit, Helgo?

[Helgoland]

You can't create wealth by changing the numbers. Changes in exchange rates, inflation etc. only affect things in the short run - in the long run the numbers readjust to give the same situation in real terms.

[Knit tie]

You can't create wealth by changing the numbers. Changes in exchange rates, inflation etc. only affect things in the short run - in the long run the numbers readjust to give the same situation in real terms.

I see, thank you.

[Mictlantecuhtli]

Click your heels together and say 'the ruble devaluing at a record rate is a good thing' and it'll come true

[Knit tie]

Click your heels together and say 'the ruble devaluing at a record rate is a good thing' and it'll come true

Mictlan, maybe you should tone down your anti-Russia's sentiments a bit? Rouble devaluation is not a good think, and I don't even try to pretend that is is, but it's not as catastrophic as the western media, for example, makes us think either.

[Sergarr]

Rouble devaluation means we'll have to spend proportionally more on our imports, as far as I can understand, since that's the main utility of USD in Russian economy.

Sure, we import quite a lot, but not all and everything. Most of things we're importing come from China, and I think we've recently had some agreements about direct rouble-yuan exchanges, bypassing USD.


I have a question: what does a currency devaluation means to you?