[Pops]

Things are bad: 5% GDP contraction, 17% inflation

$this->bbcode_second_pass_quote('', 'R')ussia has fallen into full-blown depression and faces a mounting fiscal crisis as oil and gas revenues plummet.
Output from country’s state-owned gas giant Gazprom has collapsed by 19pc over the past year as demand shrivels in Europe, falling to levels not seen since the creation of the company at the end of the Cold War.
A report by Sberbank warned that Gazprom’s revenues are likely to drop by almost a third to $106bn this year from $146bn in 2014, seriously eroding Russia’s economic base.
• Shoplifting in Russia is soaring as the economy crumbles
Gazprom alone generates a tenth of Russian GDP and a fifth of all budget revenues. It will be several years at best before the country benefits from a new pipeline deal with China.

Russia is already in dire straits. The economy has contracted by 4.9pc over the past year and the downturn is certain to drag on as oil prices crumble after a tentative rally. Half of Russia’s tax income comes from oil and gas.
Core inflation is running at 16.7pc and real incomes have fallen by 8.4pc over the past year, a far deeper cut to living standards than occurred following the Lehman crisis. This time there is no recovery in sight as Western sanctions remain in place and US shale production limits any rebound in global oil prices.
“We’ve seen the full impact of the crisis in the second quarter. It is now hitting light industry and manufacturing,” said Dmitri Petrov from Nomura.
“Russia is going to be in a very difficult fiscal situation by 2017,” said Lubomir Mitov from Unicredit. “By the end of next year there won’t be any money left in the oil reserve fund and there is a humongous deficit in the pension fund. They are running a budget deficit of 3.7pc of GDP but without developed capital markets Russia can't really afford to run a deficit at all.”
A report by the Higher School of Economics in Moscow warned that a quarter of Russia’s 83 regions are effectively in default as they struggle to cope with salary increases and welfare costs dumped on them by President Vladimir Putin before his election in 2012. “The regions in the far east are basically bankrupt,” said Mr Mitov.

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$this->bbcode_second_pass_quote('Pops', 'T')hings are bad: 5% GDP contraction, 17% inflation

$this->bbcode_second_pass_quote('', 'R')ussia has fallen into full-blown depression and faces a mounting fiscal crisis as oil and gas revenues plummet.
Output from country’s state-owned gas giant Gazprom has collapsed by 19pc over the past year as demand shrivels in Europe, falling to levels not seen since the creation of the company at the end of the Cold War.
A report by Sberbank warned that Gazprom’s revenues are likely to drop by almost a third to $106bn this year from $146bn in 2014, seriously eroding Russia’s economic base.
• Shoplifting in Russia is soaring as the economy crumbles
Gazprom alone generates a tenth of Russian GDP and a fifth of all budget revenues. It will be several years at best before the country benefits from a new pipeline deal with China.

Russia is already in dire straits. The economy has contracted by 4.9pc over the past year and the downturn is certain to drag on as oil prices crumble after a tentative rally. Half of Russia’s tax income comes from oil and gas.
Core inflation is running at 16.7pc and real incomes have fallen by 8.4pc over the past year, a far deeper cut to living standards than occurred following the Lehman crisis. This time there is no recovery in sight as Western sanctions remain in place and US shale production limits any rebound in global oil prices.
“We’ve seen the full impact of the crisis in the second quarter. It is now hitting light industry and manufacturing,” said Dmitri Petrov from Nomura.
“Russia is going to be in a very difficult fiscal situation by 2017,” said Lubomir Mitov from Unicredit. “By the end of next year there won’t be any money left in the oil reserve fund and there is a humongous deficit in the pension fund. They are running a budget deficit of 3.7pc of GDP but without developed capital markets Russia can't really afford to run a deficit at all.”
A report by the Higher School of Economics in Moscow warned that a quarter of Russia’s 83 regions are effectively in default as they struggle to cope with salary increases and welfare costs dumped on them by President Vladimir Putin before his election in 2012. “The regions in the far east are basically bankrupt,” said Mr Mitov.

[GHung]

Russian austerity: Putin fires 110,000 officials

http://money.cnn.com/2015/07/24/news/ru ... -stack-dom

$this->bbcode_second_pass_quote('', 'T')his is what belt-tightening looks like in Russia: Vladimir Putin has fired 110,000 government officials at a stroke.

The Russian president signed a decree last week limiting the number of staff employed by the Interior Ministry to just over one million. That requires massive layoffs that will bring total headcount down by 10%.

Administrative staff will bear the brunt of the cuts at the ministry, which controls the Russian police, paramilitary security forces and the road traffic safety agency.

Russia is slashing government spending by 10% across the board this year as it suffers its worst economic crisis in years.

The double whammy of tumbling oil prices and Western sanctions, imposed on Russia over its involvement in the crisis in Ukraine, has hit hard.....

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$this->bbcode_second_pass_quote('GHung', '[')b]Russian austerity: Putin fires 110,000 officials

http://money.cnn.com/2015/07/24/news/ru ... -stack-dom

$this->bbcode_second_pass_quote('', 'T')his is what belt-tightening looks like in Russia: Vladimir Putin has fired 110,000 government officials at a stroke.

The Russian president signed a decree last week limiting the number of staff employed by the Interior Ministry to just over one million. That requires massive layoffs that will bring total headcount down by 10%.

Administrative staff will bear the brunt of the cuts at the ministry, which controls the Russian police, paramilitary security forces and the road traffic safety agency.

Russia is slashing government spending by 10% across the board this year as it suffers its worst economic crisis in years.

The double whammy of tumbling oil prices and Western sanctions, imposed on Russia over its involvement in the crisis in Ukraine, has hit hard.....

[GHung]

Firstly, Ghung didn't write it; someone at CNN did. Anyhow, having studied in the USSR in the '70s, I know how adept the Russians are at tightening their belts. On the other hand, I doubt these are your Daddy's Russians. Having gotten used to rising standards of living, I'm not sure how well they'll take contraction on any level (same as Americans). They'll be looking for someone to blame soon enough.

I look at these things as being more indicators of the systemic decline of industrial civilization; all-inclusive eventually, incremental, sometimes excruciatingly slow, sometimes not. Not much "good news" out there these days. The trend is quite clear to those not trying to explain it away. OVERSHOOT.......

[radon1]

$this->bbcode_second_pass_quote('GHung', '[')b]Russian austerity: Putin fires 110,000 officials

http://money.cnn.com/2015/07/24/news/ru ... -stack-dom

$this->bbcode_second_pass_quote('', 'T')his is what belt-tightening looks like in Russia: Vladimir Putin has fired 110,000 government officials at a stroke.

[dissident]

A 5% decline is not a depression. What inane hyperbole. An example of depression scale economic collapse can be seen in Ukraine, where the GDP fell 17.6% year on year in the 1st quarter of 2015 (official statistics from the NATO-sponsored regime, BTW).

http://www.businessinsider.com/afp-ukra ... 015-2015-5

The 5.5% figure for Russia has been bandied about by Moody's and others who predicted a 2.0% decline in Ukraine's GDP in 2015.

http://www.credo-line.com/en/media/news ... t-year.htm

http://www.ibtimes.com/russias-gdp-esti ... ys-1785574

Excuse me while I laugh at Moody's and all the other "legitimate sources" who predict a 5% GDP decline for Russian in 2015.

[Strummer]

$this->bbcode_second_pass_quote('Withnail', 'D')emand for gas is plummeting in Europe, according to the article. Really? Do we not need gas any more? What are the mechanics of this supposed sudden fall?

[dissident]

Warm winters don't reduce consumption of Russian gas by the EU by any large factor:



Russian gas consumption is not just for heating.

[Strummer]

Those numbers do not represent demand, as most contracts are fixed. They also do not represent true consumption, as the imported gas can be re-sold (like for example recently through reverse-flow into Ukraine).

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$this->bbcode_second_pass_quote('Strummer', 'T')hose numbers do not represent demand, as most contracts are fixed. They also do not represent true consumption, as the imported gas can be re-sold (like for example recently through reverse-flow into Ukraine).

[Pops]

LoL, 5% drop in GDP is not a depression?
17% is not high inflation?
8% drop in real income is laughable?


$this->bbcode_second_pass_quote('', 'I')n March, exports totaled USD 29.9 billion, which were 36.3% lower compared to the same month last year. The reading marked the ninth contraction in the last 10 months and was worse than the revised 19.9% decrease registered in February (previously reported: -14.6% year-on-year). Imports reached USD 18.2 billion, which marked a 33.6% plunge in annual terms and registered the sixth consecutive month with a double-digit rate of contraction.

http://www.focus-economics.com/news/rus ... t-over-two

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$this->bbcode_second_pass_quote('Pops', 'L')oL, 5% drop in GDP is not a depression?

[radon1]

Let's face it - dear motherland is in deep trouble economically, and is sliding down the hole. No condemnation of right wing rags will change a simple fact - a good part of the Russian economy is resource trade, and the rest is "services" and government spending, both being redistribution of the proceeds from the resource trade. If the resource revenue is slumping, then the entire economy is in tatters. The slump be temporarily masked by the drawings from the reserve funds, but once those are over, "5%" will look like blessing. Unless the oil prices recover dramatically.

What's the point in trying to talk down the reality.

The article may be overly optimistic regarding another aspect - they believe that the reserve fund will be depleted by the end of 2017. More likely, Pu and co will try to let it last till the elections in 2018. They will have to, somehow.

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$this->bbcode_second_pass_quote('radon1', '.') If the resource revenue is slumping, then the entire economy is in tatters.

[radon1]

$this->bbcode_second_pass_quote('Withnail', '')$this->bbcode_second_pass_quote('radon1', '.') If the resource revenue is slumping, then the entire economy is in tatters.

[Withnail]

$this->bbcode_second_pass_quote('radon1', '')$this->bbcode_second_pass_quote('Withnail', '')$this->bbcode_second_pass_quote('radon1', '.') If the resource revenue is slumping, then the entire economy is in tatters.

[Pops]

$this->bbcode_second_pass_quote('Withnail', '.')..

[radon1]

$this->bbcode_second_pass_quote('Withnail', '
')If you want a laptop or phone get it from China. THat'll be done in roubles/yuan.

Just some adjustments. Don't buy from the West.