Russia will just do what they always do in a crisis. They just take private companies and assets. They did it to an oil tycoon a few years ago. They are also getting onboard against shale with united nations with environment concerns...when is the last time Russia worried the environment?

(11-16-2014 03:02 PM)KNIGHTTIME Wrote:  Russia will just do what they always do in a crisis. They just take private companies and assets. They did it to an oil tycoon a few years ago. They are also getting onboard against shale with united nations with environment concerns...when is the last time Russia worried the environment?

They've run out of those to nationalize. Now its becoming a feeding frenzy as Putin controlled oligarchs start to cannibalize each other. Last month, Putin controlled oil company Rosneft asked for a 50 BILLION (!) dollar bailout from the state (they have lots of debt coming due that they need to repay in dollars). The Bank of Russia turned them down. But Rosneft is headed up by a former KGB buddy of Putins. So they found another oil company with lots of spare cash. So that company's CEO was purged by Putin and his company will be given to Rosneft.

But there's a limit to how many companies can do that. Pretty much all that can be nationalized easily is gone now.

Russia will get through the 60 Billion in debt maturing in the next 2 months. But its unclear whether the Bank of Russia can avoid direct bailouts for the 100 Billion coming due for the next 18 months in the private sector.

Next week, the Ruble "should" rise next week as a result of people converting USD to Rubles to pay Russian taxes. But if it falls instead......it is a sign that the rout will continue.

My guess is that Ruble stays range bound in the 45-55 range to the USD for a while. But there's always the panic scenario, where the Ruble could go much lower. That scenario is not the most likely scenario, but it is a real possibility. Ruble falls beyond 55 and default becomes a very likely result. And that could cause a 1998 collapse or even worse, because the IMF or the World Bank will not be intervening.

The sad thing is that even a default and economic collapse will not bring Putin down (better bad news - If Putin fell tomorrow, his replacement could be even worse - and yes - its possible). But it will cripple their ability to finance their military.

Thumping Russia might not have been the intent, but it's definitely thumped them.