Russia default imminent!

[Tomconroy]

Link to tweet

You mean I shouldn't have bought those Russian bonds?

[Achilleaze]

1. Who's gonna pay the rent at Trump Tower?

The Republican family-values role model and ripoff artiste is about to get stiffed, reamed, and re-evaluated.

[Grasswire2]

13. My new favorite name for a band. STIFFED, REAMED, and RE-EVALUATED. nt

[OMGWTF]

17. I've always fancied having a band called "The Extraditables" Sounds so punk.

[Kablooie]

19. Trump can solicit donations from fellow inmates.

[Joinfortmill]

47. 👍

[czarjak]

59. Pall Manafort. Thanks, for pushing Pence too. We wouldn't be here without you.

[dchill]

2. I bet you 20 rubles it won't happen!

[gratuitous]

7. Whoa, dial it back cowboy!

[dchill]

9. LOL!!

[Joinfortmill]

46. 💃

[boston bean]

8. Is that a half a penny?

[dchill]

10. On a good day.

[Irish_Dem]

50. Hey the ruble to dollar converter says it is 15 cents.

[dchill]

55. Then it's a great day. And I'll still make that bet!

[Irish_Dem]

60. Gosh you are a big spender. Flashy high roller.

[dchill]

61. Rubles always burn a hole in my pocket!

[Irish_Dem]

62. ....

[Diablo del sol]

34. Tightwad

I’ll cover 200

[Irish_Dem]

48. I think 20 rubles is only 15 cents. Big spender I see.

[honest.abe]

3. So what happens if a default?

Total economic collapse?

[former9thward]

29. No.

Bond holders do not get paid. That is about it. It happened before in 1998.

[honest.abe]

35. According to Forbes it will be worse than in 1998.

Imminent Russian Defaults Will Lead To An Economic Crisis Worse Than In 1998

On Friday, February 25th, S&P Global Ratings was the first rating agency to open the flood gates of Russian downgrades. In just one week, Russia’s local and foreign currency sovereign debt rated has plummeted from investment grade BBB- to CCC-, a level showing that a default is imminent. S&P also announced that it also downgraded its “transfer and convertibility assessment to 'CCC-' from 'BBB-'. The ratings remain on CreditWatch with negative implications.” CreditWatch Negative means that S&P could downgrade Russian debt even further.

On Wednesday, FitchRatings downgraded the Russian Sovereign from BBB to B, and this Friday, FitchRatings downgraded 100 Russian issuers including 32 banks’ local and foreign subsidiaries and six government related issuers, as well as companies in the consumer and health, homebuilding, insurance, natural resources, telecommunication, transport, and utilities sectors.

Defaults will push Russia even faster toward an economic crisis that will be far worse than the 1998 crisis. In the mid-1990s, Russia was an economy in transition from a centrally planned economy and embroiled in a costly conflict in Chechnya. The spillover from the Asian crisis and oil in the $10-25 range were the nails in the coffin for the Russian ruble. In that crisis, no government or company was closing off the Russian economy.

https://www.forbes.com/sites/mayrarodriguezvalladares/2022/03/05/imminent-russian-defaults-will-lead-to-an-economic-crisis-worse-than-in-1998/?sh=5db6a3f327bd

[former9thward]

41. Maybe.

But in 1998 China was not nearly as strong as it is now. China will be helping Russia this time. Also in 1998 as your post points out oil was in the $10-$25 range. It is touching $130 now. That will help the Russian economy.

[honest.abe]

42. Oil price only helps them if they can actually sell it.

We shall see.

[former9thward]

43. The world runs on oil.

The majority of the world's nations are not participating in the sanctions. President Biden mentioned today that even much of Europe will continue to use Russian oil and gas.

[honest.abe]

45. Yeah, oil sales will help but I doubt it will fully compensate for the effects of default.

Also see this..
https://financialpost.com/news/economy/russia-set-for-a-venezuela-style-default-morgan-stanley-says

[erronis]

49. I thought China was also looking at some large defaults on some of it's state-controlled enterprises

I know there were very large loan payments due - perhaps in the real-estate sector.

Of course there are these circular dependencies and layers of obfuscation that make tracing who owes/owns what very difficult.

[Igel]

58. Even if Russia didn't want to default ...

It would be fairly hard for them to pay the bondholders.

[Tomconroy]

65. Creditors get stiffed and try to come up with creative ways to

seize Russian assets. Private Russian debt will be shaky. Russia won't be able to finance basic infrastructure improvements. They will be barred from the world of credit and large Russian corps will suffer as well. Want to buy a Gazprom bond?

[Alexander Of Assyria]

4. Amazing how swiftly a nation without hard currency can be brought to its knees...ooops.

And the hard currency and reserves of all banks frozen…its economic Armageddon.

[Stuart G]

11. Could you briefly explain:".Armageddon " Some do not know what that is?

[Tomconroy]

14. It happened in Argentina. The country goes on.but it ain't fun

A Great Depression basically
Russia prints rubles and prints and prints and prints

[Captain Zero]

28. If they can buy any ink.

Ink might be embargoed.

[AZLD4Candidate]

30. Oh. . .because that worked out to well for Germany in 1923

Go it, Pootie Poo. Start a depression AND a hyper inflation.

[FakeNoose]

22. It means that rubles became "Monopoly money" last week

Nobody else will accept the Monopoly money, but it still means something within their own borders. I guess maybe Putin has enough bitcoin to pay Deutsche Bank. But if he doesn't, the game is over.

I can guarantee you that Deutsche won't accept rubles.

[LetMyPeopleVote]

5. Who is surprised by this?

[Achilleaze]

6. What will become of Republican Russian bagman Robbie G?

[Achilleaze]

12. The Russian lawyer who's butt the Repubes shamelessly smooch could come up short

[NightWatcher]

15. *Pst, come here.

Anybody else think now would be a sweet time to finish that Cold War and just go in there and hang Old Glory from every flagpole in sight? I think that once putty's gone, we can take the place with no bullets, just the promise to bring cannabis and re-open the McDonalds.

Lets finish this with a W.

[ProudMNDemocrat]

16. He will demand the Military fight for FREE...

No money, no war.

[AZLD4Candidate]

31. That always works too. Soldiers with no pay and no food always fight hard

Come on, Pootie poo. Do it!

[erronis]

53. Nah. Putin will double their pay. Still worth around $10/month. Better spend it soon, comrades!

[PortTack]

18. Intelligence today said pootie still had 95% of its military might to throw at Ukraine

Okay...but if they have no money, how is he going to resupply these forces? Rocket launchers, jets, helicopters and tanks need fuel, soldiers need to eat.

As of right now Russian factory workers are being half salaries, russian citizens that had any savings find their savings now being taken by the state.

[erronis]

54. Bet Putin's internal security forces are being paid in non-rubles.

No tyrant wants to see his henchmen staring at him hungrily....

[TomSlick]

20. So many questions. Maybe someone here knows the answers.

How much sovereign debt does Russia have? Who holds the notes? What is the remedy (if any) for the debt holders in the event of default? Why would anyone loan money to Russia or buy Russian debt?

I'm not being snarky. I am sincerely curious.

[PortTack]

25. I did read Russia has very little international debt. Now how much is very little? Don't know

Seems Putin planned it knowing this invasion was part of his plan

[Yo_Mama_Been_Loggin]

21. Hope Trumpy bought a bunch of them

[leftieNanner]

23. If he did

He probably gave Putler (love that name) an IOU.

I will gladly pay you Tuesday............

[ToxMarz]

24. Vlad may have to start selling some of his

'trump' golf courses.

[WarGamer]

26. They've also announced they're paying ALL debt in Rubles.

So the lender gets screwed.

[Kaleva]

32. Fredrick the Great did this to fund his wars.

He devalued the currency by half, IFIRC, thereby reducing what Prussia owed by 50% and doubled taxes so state income remained the same.

[WarGamer]

33. interesting, thanks!

I wouldn't be surprised if the gov't institutes price controls too.

They will lose access to SOME foreign products, those from the EU and USA... but they can get all that from China and India.

[honest.abe]

37. LOL.. You sound like Pravda.

[honest.abe]

39. Why did you delete your most recent post to me??

[panader0]

27. About 140 rubles to the dollar today.

It'll be less soon.

[Evolve Dammit]

36. Not sure how much this moves the needle, but hoping it does

[honest.abe]

40. Its a big deal according to global financial experts

In case of default, it is unlikely to be like a normal one, with Venezuela instead perhaps the most relevant comparison

SIMON WAEVER
The South American nation and its state-oil company, Petroleos de Venezuela S.A., defaulted on a combined US$60 billion more than four years ago. The U.S. imposed sanctions forbidding trading of the securities in 2019, following a contested presidential election the year prior. Now, some of the bonds trade at just pennies on the dollar.

JPMorgan Chase & Co. said on Monday it will remove Russian bonds from all of its widely tracked indexes, further isolating the nation’s assets from global investors. Venezuela’s dollar bonds were also removed from the bank’s benchmark indexes in 2019 after sanctions curbed trading.

Nonpayment could be tied to Russia’s unwillingness to pay foreign creditors because of sanctions imposed by the U.S. and its allies. There is some uncertainty surrounding whether U.S. banks will be allowed to accept coupon payments from Russia’s Ministry of Finance, according to Morgan Stanley. Payments to foreign investors will depend on sanctions introduced against Russia and “exemptions established by the relevant licenses and permits,” according to the Finance Ministry in Moscow.

“The potential for significant further selling will put additional downside pressure on prices,” Waever wrote. “We see very little incentive for any investor to step into Russian sovereign bonds at this point.”

https://financialpost.com/news/economy/russia-set-for-a-venezuela-style-default-morgan-stanley-says

Also see here:
https://www.democraticunderground.com/?com=view_post&forum=1002&pid=16459384

[Evolve Dammit]

66. Thinking more in terms of the unprovoked slaughter that is taking place in a peaceful country.

Money and sanctions will hurt, but not stop the insanity.

[Joinfortmill]

44. Good

[IronLionZion]

51. Might be fewer rubles donated to the GOP this election year

[iemanja]

52. What are they defaulting on?

Is this a bank loan? A loan from the IMF? Their deficit?

[honest.abe]

56. Bonds.

https://fortune.com/2022/03/08/morgan-stanley-russia-default-april-venezuela/

[iemanja]

57. Thank you

An article is always preferable to a tweet because it provides information.

[sarcasmo]

63. One dollar is worth 130 Rubles. Womp! Womp!

[UTUSN]

64. K&R