Ukraine

[Loki]

It's sufficient proof when people already doubt its independence.

[Hazir]

It's sufficient proof when people already doubt its independence.

Eh, no it isn't.

[wiggin]

Russia may have oodles of foreign currency reserves now but it is burning through that and its unsustainable. When a position is unsustainable the markets will react accordingly.

If the price of oil returns to above $100 a barrel then Russia will be OK despite western sanctions. But if the price of oil remains at today's levels then in 12 months time Russian reserves will not be looking so healthy at all. The crisis won't be what happens in 2015 but in 2016 if nothing changes between now and then.

That is the cost of being a tin pot dictatorship relying upon commodity exports to bankroll your nation. Russian corruption has sabotaged the non-oil based portions of its economy and it can not handle this situation indefinitely.

Quite. Yet markets are often fairly forgiving of medium term concerns if they have confidence in the institutions of a country to handle a crisis. Russia has the luxury of time as well as plenty of flexibility on policy. Were there political will (essentially, if Putin decrees so) they could easily handle their current problems through any number of policies. The real problem here is that no one trusts Russian institutions or political will, with good reason.

I understand what you mean but that's not flooding the market with Rubles but accommodation of a need for foreign currency by big companies with close ties to the state. It reduces the need to dump rubles in the market and thus should have shored up the Ruble.

Uhm, I'm not certain I'm understanding you correctly, but I think you're arguing that the central bank's intervention to help Rosneft (and likely future interventions along similar lines) is actually a positive signal to markets, since those companies will have stronger balance sheets and they are important to the Russian economy. I think it's actually a negative signal for a number of reasons: first, it suggests the central bank (and, by extension, Putin) is not expecting Western sanctions to end any time soon - if sanctions ended, Rosneft could roll over dollar-denominated debt on the open market. This inflexibility bodes ill for Russia in the long run. Secondly, it suggests that these firms are indeed managed as poorly as believed, with inadequate cash cushions and cashflow to cover near term debt obligations. Lastly, as Loki suggested, it proves that the central bank is discarding any pretense at independence, and marching to the tune of Putin. This is an extremely negative signal to markets.

A quiet intervention is almost certainly wiser than a public one; no intervention at all (or policy changed to obviate the need for one) is, of course, even better.

[katsung47]

The I.M.F. hasidentified a $15bn shortfall in its bailout for war-torn Ukraine. The gap needto be filled within weeks to avoid financial collapse.

G. Osborne,the UK finance minister, saying the EU was now asking for help from Russia atthe same time it was sanctioning the Kremlin for its actions in Ukraine.


IMF warnsUkraine bailout at risk of collapse
December 9,2014 7:27 pm
Peter Spiegelin Brussels and Roman Olearchyk in Kiev


http://www.ft.com/intl/cms/s/0/9a3ef...#axzz3MBp60HiF

[katsung47]

Russia shifts to tougher economicrelationship with Ukraine


Russian PMsays Moscow’s relationship with Ukraine would now be based on purely ‘rationaland pragmatic’ terms that put Russian interests first
Reuters
Published:14:46 December 15, 2014

Moscow: Movingcloser to the European Union offers no panacea for Ukraine’s financial problemsand will mean big losses in economic ties with Moscow, Russian Prime MinisterDmitry Medvedev said in an article published on Monday.


He said Moscowhad for many years provided generous terms in deals with Kiev which had helpedbuild up Ukraine’s economy but the relationship would from now on be based onpurely “rational and pragmatic” terms that put Russian interests first.


“We will nolonger support the Ukrainian economy. It is a burden for us and to be honest,we are tired of it,” he wrote in Nezavisimaya Gazeta, a privately owned dailynewspaper.
http://gulfnews.com/business/economy...aine-1.1427069

[RandBlade]

Big deal, Russia is a bankrupt state that can't support itself, why would Ukraine possibly want to rely upon a nation as corrupt and economically incompetent as Russia?

[katsung47]

EU offers Ukraine more loans if it makespromised reforms
By RAFCASERTJanuary 8, 2015

BRUSSELS (AP)— The European Union has offered to give extra rescue loans to Ukraine, whichis struggling with recession and a costly war, but only if it makes its promisedeconomic and political reforms.

The EU says itcan give another 1.8 billion euros ($2.12 billion) in loans — on top of the 11billion euros already pledged — if Kiev respects the terms of its internationalbailout deal. In particular, it wants to see better progress in stamping outcorruption.

[katsung47]

U.S. to back $2 billion in loanguarantees for Ukraine

WASHINGTON TueJan 13,

(Reuters) -The United States plans to provide up to $2 billion in loan guarantees toUkraine this year, the U.S. Treasury said on Tuesday, as part of a broaderinternational package to stave off bankruptcy.

Like othermajor donors to the country, Treasury said the guarantees would be contingenton the former Soviet republic remaining on track to meet the conditions of itsloan program from the International Monetary Fund. IMF officials are in Kievthis week to resume negotiations on the package, currently worth $17 billion.

Ukraine'sgovernment hopes the IMF's visit will lead to a bigger aid program as itseconomy has been pushed close to bankruptcy by a pro-Russian separatist war inthe east and the government faces huge debt repayments.
http://www.reuters.com/article/2015/...0KM1HL20150113

[katsung47]

Merkel, Hollande and Poroshenko call forCeasefire as up to 8,000 Ukrainian Troops have been encircled

Mon, Feb 2nd,2015
Europe / News| By nsnbc

http://nsnbc.me/2015/02/02/merkel-ho...een-encircled/

[Loki]

A new low for Russia. Accepts a ceasefire, then instantly claims that it doesn't apply in areas where the rebels are winning. Then promises Ukrainian troops safe passage if they retreat, just to attack them with gunfire and artillery when they start retreating. Putin's response?

“Life is life; it just goes on,” Mr. Putin said. “No need to dwell on it.”

[earthJoker]

A new low for Russia. Accepts a ceasefire, then instantly claims that it doesn't apply in areas where the rebels are winning. Then promises Ukrainian troops safe passage if they retreat, just to attack them with gunfire and artillery when they start retreating. Putin's response?

I thought he's responds was:

[Loki]

http://www.nytimes.com/2015/06/07/ma...he-agency.html

Speaking of new lows.

[Flixy]

The nazi bit is a nice touch.

Then again, for all you know the usa is doing the same thing

[Loki]

The US method is to throw millions of dollars into public diplomacy programs that do absolutely nothing.

[Flixy]

That's what they want you to think!

[Loki]

http://www.marketwatch.com/story/10-...ost-2015-06-11

Didn't want to start a new thread and this is marginally Ukraine-related. Some interesting countries on that list. No idea about the credibility of the poll itself though.