Lets see how things look right now over in loser land:

1) Russia - Ruble just crashed through 50 to the dollar. Up from 36 3 months ago. That means that the 100 Billion or so of Russian debt maturing in the next 12 months just became a LOT more expensive. Russia's reserves have fallen from 600 Billion down to around 410 Billion after Russia spent billions of dollars trying to defend their risible currency. Russia can't even all of that reserve, because a lot of it is illiquid. By March, Russia will be below 3 months of imports in their reserves. Russia faces a food inflation rate of 15%, a total inflation rate of 12%, a discount rate of 12%, and an economic recession. Over 150 Billion of hard currency has fled Russia in the last 12 months. Benchmark Russian crude is down 32% in the last 3 months. Russia got stuffed when they and the Venezuelans asked for production cuts from Saudi Arabia. And due to sanctions, Russian firms will experience extreme difficulty refinancing their debt. They did manage to sell some massively underpriced natgas to China, but that really isn't going to help them. Russia's government fiscal position is in tatters as the state can't really borrow from anyone and they just took a huge haircut in government receipts. Intellectual capital is fleeing too.

2) Venezuela - Has finally run out of cash. Seriously run out of cash. VZ reserves were down to 22 Billion. But observers have long pointed out that VZ had extra cash reserves hidden. It appears that VZ has finally exhausted those. They got a oil secured loan from China for 20 Billion, and when they got the first tranche of 5 Billion....they put it all into their reserve account and then spent 2 Billion of it. All in the span of 3 days. VZ has been hammered by the drop in oil prices and will see lower revenues per barrel and lower barrels sold due to high production costs and prior bad behavior on the part of VZ towards its investors. Inflation hasn't been tallied by the VZ Finance Ministry for some time now, but is estimated running at around 70%, its currency is now officially worthless (the highest denomination VZ note is now worth around 75 US cents). Maduro is circling the drain.

3) Cuba - is in the insane position of being an oil importer that is a loser as a result of lower oil prices. You see, Cuba gets free oil from VZ. If VZ can't afford to subsidize them due to lower oil prices, Cuba's fuel costs increase.

4) Nigeria - massive government cuts, a collapsing currency, and a recession are in the cards

5) Iran - already strangled by sanctions, Iran's budget assumes a price of 110 a bbl. Iranian oil sells for around 70.

A lib calling those countries "losers "? How refreshing.

Most libs hold up Cuba as an example of a country more evolved and sophisticated than us because they have universal health care.

You mistake us for being fools. Only a fool will support Maduro or Putin, Part of the oil price drop of that is increased production. But part of it is also flat consumption in the face of a growing economy.

(11-28-2014 05:01 PM)Tom in Lazybrook Wrote:  Lets see how things look right now over in loser land:

1) Russia - Ruble just crashed through 50 to the dollar. Up from 36 3 months ago. That means that the 100 Billion or so of Russian debt maturing in the next 12 months just became a LOT more expensive. Russia's reserves have fallen from 600 Billion down to around 410 Billion after Russia spent billions of dollars trying to defend their risible currency. Russia can't even all of that reserve, because a lot of it is illiquid. By March, Russia will be below 3 months of imports in their reserves. Russia faces a food inflation rate of 15%, a total inflation rate of 12%, a discount rate of 12%, and an economic recession. Over 150 Billion of hard currency has fled Russia in the last 12 months. Benchmark Russian crude is down 32% in the last 3 months. Russia got stuffed when they and the Venezuelans asked for production cuts from Saudi Arabia. And due to sanctions, Russian firms will experience extreme difficulty refinancing their debt. They did manage to sell some massively underpriced natgas to China, but that really isn't going to help them. Russia's government fiscal position is in tatters as the state can't really borrow from anyone and they just took a huge haircut in government receipts. Intellectual capital is fleeing too.

2) Venezuela - Has finally run out of cash. Seriously run out of cash. VZ reserves were down to 22 Billion. But observers have long pointed out that VZ had extra cash reserves hidden. It appears that VZ has finally exhausted those. They got a oil secured loan from China for 20 Billion, and when they got the first tranche of 5 Billion....they put it all into their reserve account and then spent 2 Billion of it. All in the span of 3 days. VZ has been hammered by the drop in oil prices and will see lower revenues per barrel and lower barrels sold due to high production costs and prior bad behavior on the part of VZ towards its investors. Inflation hasn't been tallied by the VZ Finance Ministry for some time now, but is estimated running at around 70%, its currency is now officially worthless (the highest denomination VZ note is now worth around 75 US cents). Maduro is circling the drain.

3) Cuba - is in the insane position of being an oil importer that is a loser as a result of lower oil prices. You see, Cuba gets free oil from VZ. If VZ can't afford to subsidize them due to lower oil prices, Cuba's fuel costs increase.

4) Nigeria - massive government cuts, a collapsing currency, and a recession are in the cards

5) Iran - already strangled by sanctions, Iran's budget assumes a price of 110 a bbl. Iranian oil sells for around 70.

According to this, Iran assumes a much higher oil price for budgeting purposes. Of course,that just makes your point even more. Nevertheless, thought it was interesting given the OPEC meeting yesterday.

Oil price falls ahead of Opec meeting

(11-28-2014 05:16 PM)Tom in Lazybrook Wrote:  You mistake us for being fools. Only a fool will support Maduro or Putin, Part of the oil price drop of that is increased production. But part of it is also flat consumption in the face of a growing economy.

Historically it was Lenin who referred to American liberals, and wannabe communists, as "useful idiots."

And to be clear, I'm not referring to the artist that recorded "Imagine."

(11-28-2014 06:44 PM)QuestionSocratic Wrote:  

(11-28-2014 05:16 PM)Tom in Lazybrook Wrote:  You mistake us for being fools. Only a fool will support Maduro or Putin, Part of the oil price drop of that is increased production. But part of it is also flat consumption in the face of a growing economy.

Historically it was Lenin who referred to American liberals, and wannabe communists, as "useful idiots."

And to be clear, I'm not referring to the artist that recorded "Imagine."

I don't think the Maduro or Putin or Rouhani governments would publicly or privately accuse the Obama administration of being helpful in any way whatsoever. Obama hasn't played the role that all 3 want the US to play. For Venezuela, its to be a credible excuse for problems and to publicly call for his ouster so he can blame all his problems on US meddling. For Russia, its to ignore aggression and to become tied down in the Middle East as well as to act without making the Europeans act so he can foment strife in NATO. For Iran, its to get tied down in other wars and to publicly call Iran out. And for all of them, its to ensure that US oil consumption rises. Obama's had none of that.

(11-28-2014 06:15 PM)VA49er Wrote:  

(11-28-2014 05:01 PM)Tom in Lazybrook Wrote:  Lets see how things look right now over in loser land:

1) Russia - Ruble just crashed through 50 to the dollar. Up from 36 3 months ago. That means that the 100 Billion or so of Russian debt maturing in the next 12 months just became a LOT more expensive. Russia's reserves have fallen from 600 Billion down to around 410 Billion after Russia spent billions of dollars trying to defend their risible currency. Russia can't even all of that reserve, because a lot of it is illiquid. By March, Russia will be below 3 months of imports in their reserves. Russia faces a food inflation rate of 15%, a total inflation rate of 12%, a discount rate of 12%, and an economic recession. Over 150 Billion of hard currency has fled Russia in the last 12 months. Benchmark Russian crude is down 32% in the last 3 months. Russia got stuffed when they and the Venezuelans asked for production cuts from Saudi Arabia. And due to sanctions, Russian firms will experience extreme difficulty refinancing their debt. They did manage to sell some massively underpriced natgas to China, but that really isn't going to help them. Russia's government fiscal position is in tatters as the state can't really borrow from anyone and they just took a huge haircut in government receipts. Intellectual capital is fleeing too.

2) Venezuela - Has finally run out of cash. Seriously run out of cash. VZ reserves were down to 22 Billion. But observers have long pointed out that VZ had extra cash reserves hidden. It appears that VZ has finally exhausted those. They got a oil secured loan from China for 20 Billion, and when they got the first tranche of 5 Billion....they put it all into their reserve account and then spent 2 Billion of it. All in the span of 3 days. VZ has been hammered by the drop in oil prices and will see lower revenues per barrel and lower barrels sold due to high production costs and prior bad behavior on the part of VZ towards its investors. Inflation hasn't been tallied by the VZ Finance Ministry for some time now, but is estimated running at around 70%, its currency is now officially worthless (the highest denomination VZ note is now worth around 75 US cents). Maduro is circling the drain.

3) Cuba - is in the insane position of being an oil importer that is a loser as a result of lower oil prices. You see, Cuba gets free oil from VZ. If VZ can't afford to subsidize them due to lower oil prices, Cuba's fuel costs increase.

4) Nigeria - massive government cuts, a collapsing currency, and a recession are in the cards

5) Iran - already strangled by sanctions, Iran's budget assumes a price of 110 a bbl. Iranian oil sells for around 70.

According to this, Iran assumes a much higher oil price for budgeting purposes. Of course,that just makes your point even more. Nevertheless, thought it was interesting given the OPEC meeting yesterday.

Oil price falls ahead of Opec meeting

Yea and Iran, like Russia, has very limited avenues for external financing.

Actually the OPEC meeting was a slam dunk prediction.. Here's why.

1) Many of the oil producing nations are living hand to mouth. They couldn't afford to reduce production when Brent was at 110 in June. They can afford it less now. If you need to sell 100 bbls at 100 USD a bbl to get 10,000 USD to spend on your government, you now need to sell 130 bbls at 70 USD a bbl to get the same amount. For broke and desperate nations like Iran, Venezuela, Egypt, Nigeria, Cameroon, Argentina, Iraq, and Libya, this is their problem. Even though VZ is screaming for production cuts, no one actually believes they'd actually be able to cut.

2) Other oil producing nations cant shut down oil based upon physical constraints. Russia would be included as one of those nations. Russia can't cut production until spring because if they tried to cut production, their wells would freeze. Russia could store the oil to remove it from production, if they had any storage available. So Russia, which like Venezuela, wants higher prices, can't really contribute to those cuts for several months.

3) Other oil producing entities have to produce a lot of crude (and might need to attempt to sell even more oil) in order to service their huge debt obligations. Brazil's Petrobras is broke, overleveraged, and Dilma's government is in no position to help them.

4) So do you think the Saudis are going to cut off their market access when its obvious that just about everyone else is going to cheat?

By the way, Brent touched 70 and some change today. WTI is in the 60's

People are dumber for having read that.

(11-28-2014 07:36 PM)HeartOfDixie Wrote:  People are dumber for having read that.

And why would that be....

I'm awaiting your critique of my analysis.

That is if you actually have something to contribute to the discussion other than shade.

(11-28-2014 08:38 PM)Tom in Lazybrook Wrote:  

(11-28-2014 07:36 PM)HeartOfDixie Wrote:  People are dumber for having read that.

And why would that be....

I'm awaiting your critique of my analysis.

That is if you actually have something to contribute to the discussion other than shade.

Well I won't go as far as HOD went but the analysis while interesting all points to instability. And while the Victor David Hanson's of the world like to agrue that stability is America's enemy, I think the events that transpired during the Arab Spring prove that it can always be worse. You have even stated yourself that a Putin ouster could result in a worse leader in Russia. Cuba is honestly a non-issue that the US could easily resolve by lifting the embargo. A Venezuelan collapse will likely topple what little economic stability exists in South and Central America, especially Brazil. I don't think anyone would consider Nigeria a major threat and while people see Iran as a problem, it is only one due to America's relationship with Israel.

So from a geopolitical perspective, there are some hits and some misses, which of course gets down to your real issue. You consider these nations losers because of their human rights violations, especially their positions on homosexuality. And that is an acceptable POV, but let's not wave Pom Pom's around like the USSR just collapsed. S#!t around the globe is about to get real.

(11-28-2014 05:14 PM)UConn-SMU Wrote:  A lib calling those countries "losers "? How refreshing.

Most libs hold up Cuba as an example of a country more evolved and sophisticated than us because they have universal health care.

You don't get it. There are many levels of liberalism.

Russia has been on a trajectory towards demographic decline and strategic irrelevance for more than 30 years. The elevation of Gorbachev back in 1985 was -- in retrospect -- evidence that the Politburo could privately see this was true, even at that early date. But by then, Russia had already sipped for seven decades from the poisoned chalice of Marx/Lenin/Stalin and their protégés. It was too late for Gorbachev (and for Yeltsin and for Putin) to really do anything about it, although they have probably played their cards about as well as it was possible to do.

It is curious how the Western academic/media class have (almost always) been willfully blind about Russia's basic malevolence towards the West, especially during the Soviet era. Only when Putin started saying rude things about homosexuals did the attitudes change, and even that change, I suspect, will prove temporary. Time will tell.

Russia's seizure of Ukrainian territory went unchallenged beyond the ritual denunciations at the UN and various press-conferences. The economic sanctions have not even remotely threatened Russia's regime and show not the slightest signs of doing so.

(11-28-2014 10:31 PM)Native Georgian Wrote:  Russia has been on a trajectory towards demographic decline and strategic irrelevance for more than 30 years. The elevation of Gorbachev back in 1985 was -- in retrospect -- evidence that the Politburo could privately see this was true, even at that early date. But by then, Russia had already sipped for seven decades from the poisoned chalice of Marx/Lenin/Stalin and their protégés. It was too late for Gorbachev (and for Yeltsin and for Putin) to really do anything about it, although they have probably played their cards about as well as it was possible to do.

It is curious how the Western academic/media class have (almost always) been willfully blind about Russia's basic malevolence towards the West, especially during the Soviet era. Only when Putin started saying rude things about homosexuals did the attitudes change, and even that change, I suspect, will prove temporary. Time will tell.

Russia's seizure of Ukrainian territory went unchallenged beyond the ritual denunciations at the UN and various press-conferences. The economic sanctions have not even remotely threatened Russia's regime and show not the slightest signs of doing so.

One point of economic sanctions isn't to engender regime change in the short run, but to harm Russia's ability to engage in bad behavior. You can have a persistently strong economy without a strong military, but its really much harder to have a strong military if you have a weak economy in the long run.

I think everyone recognizes we're in for a long run scenario lasting years.

(11-28-2014 10:00 PM)vandiver49 Wrote:  

(11-28-2014 08:38 PM)Tom in Lazybrook Wrote:  

(11-28-2014 07:36 PM)HeartOfDixie Wrote:  People are dumber for having read that.

And why would that be....

I'm awaiting your critique of my analysis.

That is if you actually have something to contribute to the discussion other than shade.

Well I won't go as far as HOD went but the analysis while interesting all points to instability. And while the Victor David Hanson's of the world like to agrue that stability is America's enemy, I think the events that transpired during the Arab Spring prove that it can always be worse. You have even stated yourself that a Putin ouster could result in a worse leader in Russia. Cuba is honestly a non-issue that the US could easily resolve by lifting the embargo. A Venezuelan collapse will likely topple what little economic stability exists in South and Central America, especially Brazil. I don't think anyone would consider Nigeria a major threat and while people see Iran as a problem, it is only one due to America's relationship with Israel.

So from a geopolitical perspective, there are some hits and some misses, which of course gets down to your real issue. You consider these nations losers because of their human rights violations, especially their positions on homosexuality. And that is an acceptable POV, but let's not wave Pom Pom's around like the USSR just collapsed. S#!t around the globe is about to get real.

I'm not seeing much linkage between Brazil and Venezuela. There's really not that much trade. As far as the other nations involved in Latin America, there would be issues if Maduro fell, but its not what you think. You see, the way Venezuela structured its aid was to sell oil at a discount and provide loans to some poor LatAm/Carribean countries in return for influence. The problem for those nations now is that they, in effect, have to pay for oil at a higher rate than the spot rate. Several nations have voluntarily withdrawn from the program seeing this problem. Venezuela isn't going to invade Colombia or its other neighbors and wouldn't be able to do so successfully even if it wanted to. Maduro falls, and Brazil would most likely just shrug. Besides, its not like his fellow travelers in Latin America are doing well.

The problem with Putin is that his economic model doesn't work, mainly due to massive levels of corruption and disincentives to innovation and accumulation of intellectual capital. But he could cause a lot more trouble with strong financial reserves and strong crude prices. And Putin has shown, time and time again, that he will cause trouble. Part of his strategic game is to attempt to wrest apart the NATO alliance and to create a new multipolar society where Russia is one of the poles. His behavior has set back that goal. And with a years long situation of economic stagnation and recession in the cards for Russia, its going to be even harder. To be clear, I dislike Putin's regime much like African Americans would dislike George Wallace's regime in 1960's Alabama (there really is little difference), but that is a minor issue in this. By the way, it is believed in Europe that Putin is funding right leaning organizations and movements, not left leaning ones.

The real issue that has been impacted by this new reality is really more about corruption than human rights. Because if you have a corrupt society, its really hard to protect yourself from commodity price changes once those commodity prices no longer protect your from the normal consequences of that behavior. Those nations will suffer terribly or have to restructure their societies in order to reward innovation, change, and independence from the state.

You are correct that this new world will be a bit more unstable. But I'd argue that since Putin is already ignoring economic issues, that the instability was going to happen anyway. Better now that his economy, upon which his ability to cause trouble is dependent upon, is in a much worse position.

Quote:Owing to gross mismanagement, Venezuela’s economy is already in chaos, its political system in crisis and unrest is mounting. And Venezuela would be the No. 1 loser if the Keystone XL pipeline is built, as production from Canadian oil sands would displace Venezuelan heavy oil from its largest single market, the U.S. Gulf Coast refineries.

Damn good reason to build the Keystone IMO.

(11-28-2014 05:16 PM)Tom in Lazybrook Wrote:  You mistake us for being fools. Only a fool will support Maduro or Putin, Part of the oil price drop of that is increased production. But part of it is also flat consumption in the face of a growing economy.

Wow. The old school liberals still live. Refreshing.