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0 sats \ 6 replies \ @Bell_curve 5 Mar \ parent \ on: Kremlin announces creation of blockchain-based payment system in BRICS news
The ruble is so dependent on the price of crude oil.
When USA 🇺🇸 oil production is high then ruble is weak because oil prices are low.
You saw this during the Cold War especially the 1980s.
The 1970s oil shocks made USA 🇺🇸 weaker most of it self inflicted. Price controls discourage production. Conversely the oil shocks made ruble stronger
The ruble is so dependent on the price of crude oil.
I agree that this was once largely true (and agree with your historical analysis).
However I don't believe it is nearly so true today. Russia now has more productive industrial capacity than Germany, at least according to this source. As more intelligent observers forecast, and as most have now conceded with hindsight, the economic sanctions have helped boost Russia's industrial base, as they have been forced to make a lot more stuff themselves. There's a manufacturing boom going on in Russia right now, even as Europe undergoes deindustralisation. Indeed, I've heard of some German industry moving to Russia (e.g. the chemical industry, which is heavily energy intensive), along with it moving to the USA and China.
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Interesting
Thanks for sharing
I guess western sanctions backfired big time
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This is a very good summary of how the sanctions backfired, by Professor James Galbraith :
(13 minute video)
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Not sure I properly understand your question but with or without the Donbas (where the resource richness of Ukraine mostly lies) Russia is already a superpower across a range of commodities. But while they may have suffered 'Dutch Disease' in the past (commodity wealth suffocating economic development) I don't think that's such a problem for them going forward, mainly because Putin has seen off or reversed the attempted neoliberal takeover of the 90s (which would have turned Russia into a commodity oligarchy ultimately controlled by Western interests, and came close to doing so). With the right political structures / leadership in place, a nation can see off commodity wealth degrading its economy. Norway being a good example of how to do it, on a smaller scale. (Although Norway is starting to show worrying signs these days.)
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Norway 🇳🇴 is not EU member
Norway 🇳🇴 is the largest exporter of oil and natural gas in Western Europe
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