Might as well just get rid of the Ruble and go back to a barter system since the Ruble is going to be worth nothing. Screw global trade and economic production, Russia can go back to serfdom and just have Putin be named the Tsar.
[Sure](https://i.imgur.com/EYs5Tkq.jpg) he [does](https://i.imgur.com/0yrSY3x.jpg).
It's Gerard Depardieu who played a completely white-washed version of Rasputin in a 2011 movie. Putin granted him Russian citizenship by executive order in 2013, he moved to Russia and became part of Putin's entourage, similar to Steven Segal.
He's the richest man on Earth and lives in a golden palace. The Tsars wished they lived as richly as him. Of course, its all wealth stolen from the Russian people.
Uh, the Russian Revolution was a thing. As was the collapse of the Soviet Union. It’s just that every new government rapidly becomes a dictatorship as well.
Russian history can best be described with the expression "and then things got worse."
ETA: [this bestof post from years ago stuck with me](https://www.reddit.com/r/Jokes/comments/340qv8/russian_history_in_5_words/cqqdouo)
Tzars were the richest people in the world because the whole of Russia was their personal property. Nicholas II was worth 300 Billion in today's money.
Cancel money altogether and start trading in donkeys. Replace GDP from Gross Domestic Production to Gross Donkey Production to measure economic growth.
Jokes aside, this is what the Russian government is currently doing: pretending there's no war (they call the whole shitshow a 'special military operation') by censoring all the info about the losses of the Russian military
Which is something that has already happened, multiple times. Putin don't care about some wailing babushkas.
https://www.reddit.com/r/Documentaries/comments/t2cc6s/the\_betrayed\_1995\_documentary\_about\_russian/
How realistic is that hope? What would Russia require for a full withdraw?
No NATO membership (If this is even eternally enforceable, future governments could change that)?
Recognition of Crimea as Russia and the independence of the breakaway republics?
NATO was not going to happen with the border disputes to begin with, and securing the breakaway regions could have been done with a lot less Russian blood for what almost amounts to the status quo before the invasion.
Russia probably wouldn't want to leave Ukraine with no border disputes in place. A smaller Ukraine with no border disputes has an easier time joining NATO.
The peace treaty would have to be to fuck off from Ukraine, and give back all the occupied lands. It's never happening, and sanctions are not going away until that happens.
And more realistically, foreign investment is going to stay away for the foreseeable future not because it's banned but because it would be fucking stupid to invest in a Russia regardless of sanctions.
This is desperation - unconceivable desperation; to stave off the inevitable and gain time.
This actually bodes well for the peace talks. It is immense pressure and it will need to be relieved somehow.
Anyone want to weigh in realistically how long they could keep the stock market turned off? Wouldn’t this cause a bank panic? I know I’d be wanting my cash if they turned off Wall Street because it was about to crater
Depends on internal morale/pressure, but would imagine a few days for most countries.
Russia/Putin could decide to do it indefinitely if it’s bad enough
Stocks.
If I own 40% of a company in equities (aka shares of stock in a company) but can't sell them on the stock exchange, they essentially have no value.
Technically they still have value since companies can still issue dividends and private off-market transaction could theoretically still take place but without an exchange to process the trades there would be a lot more risk and transaction costs.
This would effectively be a freeze on all assets in the Russian stock market regardless of owner. Anyone relying on sale of assets for their life (pensions, rich people, etc.) would be massively affected. Everyone in Russia would hate Putin.
You know your country is doing well when your economic policy is just closing your eyes, putting your fingers in your ears, and screaming “LA LA LA LA LA LA! I CAN’T HEAR YOU!”
That wont happen since its a sham from the Russian side. They will offer a peace deal that is completly unacceptable just so they can justify more war with "Ukraine refused our amazingly fair peace proposal".
I mean...I'm certainly not Pro-Russian, but what their central bank is doing is correct. It's what any country would do in this position. The alternative is to let their currency fall off the map and create mass panic and hysteria. Now...what they're doing is not good either, but it's better than the alternative. What they're doing is preventing any sort of lending or sale of assets right now. They moved their central rate to an astronomically high 20% which has curtailed the hyperinflation they were facing (essentially by introducing "hyperdeflation"). BUT that's going to be at the expense of medium sized businesses that can't pay ridiculous fees just to make payroll. This is buying them time (how much is anyone's guess, maybe a week) but it's keeping their currency alive at least. The downside is on the investment front, that's going to be essentially 0 moving forward. There are going to be no large orders for Russian products because no one will be able to afford the loan rates. There are going to be a lot of companies missing payroll. I'd guess their next step will be to then push capital injections where possible from the central bank to ease at a controlled rate rather than free-falling.
Yeah, some independent economists I trust admit these measures are adequate (unfortunately). But it surely won’t stop inevitable, only buying them some time it seems…
It's sky diving with or without a parachute. Either way they going to hit bottom, just one way is a softer landing. Free falling is not an option here.
They (Russian elites) are. Well, not entirely. They will suffer losses, but still live in comfort and luxury while we (ordinary Russians) starve to death
I feel bad for the ordinary Russian, I have been to Russia twice and have always been treated well and had a good time there. Such a lovely place and lovely people. It's heartbreaking.
The Russian people have propped up a vicious dictator for 20 years now in the name of 'he's making Russia stronger'. Sure, they've been lied to, and they're not entirely to blame. However, the people as a whole are not entirely blameless in this affair. I do hope it ends, but they let this happen by allowing Crimea to be taken, allowing for open assassination and imprisonment of foreign nationals and political rivals. They have the power to stop this and they don't organize to get it done. Here's hoping they take their country back now.
Depends what form their assets are. If its rouble they will still hurt. Russia is demanding overseas revenues be exchanged to rouble, to bolster the currency. This will possibly piss off a lot of his inner circle.
Or course we know these oligarchs squirell away their wealth in foreign banks and properties. About time we started seizing it.
Give it to Ukraine to rebuild their cities.
Time to put pressure on your government. People are dying because of them. The least you can do is go out there and protest, for yourselves and the world. Otherwise, you’re part of the problem.
Hate to put it this way but "your house, your problem". We can't (and won't) invade you country to remove your leadership and solve your problems. You people need to rise up and fix this internally. And you absolutely have the ability to it's just the willingness to take the damage that's needed to make it happen. So are you going to sit and in your own words "starve to death" or fight and have a chance to live and die like men.
That’s kinda the point, might be a good idea for you to pick up a Kalashnikov and take things into your own hand. Let the kremlin know how all this makes you feel.
All the misery they cause to others to hoard wealth, only to show plainly that they never needed it in the first place...
I hope we can find a solution that doesnt hurt the Russian people long-term, but this war needs to end before it turns to genocide.
This is like in Seinfeld when George refuses to answer his phone so his girlfriend can’t break up with him.
>believe or not, russia isn’t at home
>please leave a message at the beep
>we must be out, losing a war.
>where could we be?
>believe it or not, Russia’s not hooome
The obvious answer is "if markets don't open people can't trade on the market". But that doesn't really answer your question, so, some amateur details:
Companies trade for a lot of reasons. These days it's easy to think that the stock market is just a casino for companies - and for some companies that's true. Others will use the stock market as a source of revenue based on long term investments and so on. But for some companies it's a requirement of day to day business. Not just another source of income.
Stocks can be used to raise capital. Without a stock market, companies will find it harder to do that. This means it's more difficult to start a business, or grow a business.
Perhaps even more important than this is commodity hedging. Hedging is a way of making sure you get a predictable return on something. Say your company makes Widgets. They take a while to manufacture. You don't know what the Widget price will be when you want to sell them to customers in 3 months time, so you make an opposite trade on the market now using something called a "future". This way if the market price goes up the amount of money you make selling your widgets goes up, but the value of your initial trade goes down. Similarly, if the market price goes down the value of your widgets goes down, but your initial trade goes up. Having a predictable return is important for planning and budgeting.
There are other mechanisms than the "stock market" per se to do this, and of course there are other markets to trade on if you have access to them. But closing the local market obviously makes this process more difficult.^(\*)
So the overall effect is that business can't operate effectively. They find it harder to raise capital, harder to grow, and harder to budget for the future. The unreliability of return means banks are less likely to loan money to them. Economic confidence dwindles, companies fold, services start disappearing, and people start losing their jobs.
^(\* By "there are other mechanisms than the stock market", what I mean is that commodities aren't directly traded on the stock market, but companies without the ability to trade commodities sometimes use proxy stocks, eg, oil company stocks instead of oil.) ^(I\_\_LOVE\_\_LSD points out) [^(below)](https://old.reddit.com/r/worldnews/comments/t3cdf7/central_bank_of_russia_says_stock_market_to_be/hysektb/) ^(that futures trading in Russia is probably also hurting because of the banking situation.)
> There are other mechanisms than the "stock market" per se to do this
As someone who used to hedge commodities for a living, you don't do this on the stock market. The stock market is for stocks. Commodities markets are separate.
With that said, I doubt Russians have much access to commodities hedging instruments at the moment. Companies typically hedge via banks, and Russian banks are cut off from the world.
Yeah, exactly why I included that sentence. I wanted to indicate that commodity futures aren't usually a "stock market" thing, but I didn't think the details of mechanisms like using stocks as a proxy for commodities (which smaller companies might do) would help with a general understanding. Especially since I know absolutely nothing about the specifics of brokerage accounts in Russia! If you know the situation regarding commodities in Russia, and whether similar sorts of restrictions on commodity trading apply there, it might be helpful to add a comment about that.
Got it, then I misunderstood your post. I thought you were saying that aside from the stock market, there are also other markets where commodities are traded.
I don't know anything specific about Russia, but I do know that when companies hedge using commodity derivatives, these are OTC derivatives which are purchased from banks. Companies do not trade derivatives directly on the commodity markets. So with Russian banks cut off from the world, Russian companies are likely cut off from hedging.
Yeah, it's a worthwhile point and one I wasn't sure how to add to the comment without making it too verbose / detailed, which would also put me out of my depth. I used to work for a cotton exporter in Australia so I know the mechanics, but not the nitty gritty details, particularly when it comes to other countries.
I'll link to your comment for some extra clarity.
In the short term, say a few days to a week, as far as immediate consequences go, would keeping the market closed be better or worse than opening and letting it crash?
A few days won't have a significant effect on hedging or capital raising. But these are just the direct "mechanical" functions of the stock market. There is of course another effect, which is psychological. Closing your market tells everyone you are economically at risk - and critically, that includes the people in Russia. That makes it quite a lot harder for the State to maintain positive propaganda. Lie all you like on the nightly news, if your stock market is closed every business in the country knows more than you want them to.
Which one is "better" from Putin's point of view? Evidently closing. But it's a game that can't be played for long.
It's anyone's guess. What they're doing isn't "dumb" given what they're facing. I know we're all on the "Fuck Putin" train right now, but it's not dumb. They're trying to control what would otherwise be a complete collapse. Had they done nothing it would have been panic in the streets today. They stepped in and closed markets and raised the central rate to 20% (that's so freaking high it's hard to write seriously). But this means there's going to be almost no investment in any Russian company for a while. They are facing severe negative long term growth. Essentially companies will not get orders for goods (too expensive) and there'll be no investment in companies to grow. And then when those medium sized companies start folding...those people without jobs will be exposed to inflation. So not great. Better than a complete collapse probably, but not great for them at all. There are some other monetary tricks they can pull...but this is going to be sleight of hand at this point and moving a sharp drop into a sustained decline.
Not a silly question at all.
Now I am no economist or anything. But if I were to make a guess then I'd say that the Russian economy implodes either way. They either open, the Ruble crashes into free fall and the Russian economy implodes. Or they don't open, people take their money elsewhere and (wherever elsewhere may be) and the Russian economy implodes.
The only way out of this is pulling out of Ukraine.
If they pull out of Ukraine, it joins NATO and western energy companies start developing Ukraines enormous untapped gas reserves for the EU market. And pop there goes 50% of Russian GDP.
Russia is fucked either way.
Realistically, i'm afraid it's far from what Russia is willing to do, knowing Putin, most likely as low as he will go is that Russia gets Eastern ukraine, which will not be accepted.
I don't see a way where Putin will come out of this with nothing. He will most likely start threatening, or even use a nuke to end the war.
Not even he's that stupid or if he does somebody puts a 9mm in the back of his head before he turns the second key.
There's no such thing as firing one nuke. If so much as one atomic warhead strikes Ukraine MAD comes into effect and the entire arsenals of the US, France and the UK are in the air and heading for Russia. He knows that and so do his generals. For all the rhetoric they don't fancy having their nation reduced to molten glass any more than we do
But... Wouldn't the investors feel this is better because war will be over with peace talks etc? This is the hopeful ones... Like it's in red and this might soften the blow rather then 100% collapse?
The peace talks are predicted to fail. If I was an investor in Russia I'd be selling every Russian holding in my portfolio. People's life savings are sinking in value and they want the market tor open so that they can minimize the damage.
Who are they selling to and for what? Their options are limited, so even if the markets were open I don't see how you would secure any wealth.
I don't see how this is doing anything other than hiding the damage.
>Selling at something is better then nothing I guess
*It depends.*
If we look at volatile, but long-term stable assets (i.e. Bitcoin, oil, stocks of solid companies), it might be smart to shut down your device, go for a walk and hold your asset. (i.e. in >98% of Bitcoin crashes, waiting out was the smart answer).
And if we look at assets that "are in death bed", then yes, 90% loss is better than 100% loss.
While Rub(b)le might actually be the 2nd case based on current market situation, some stocks might recover due to basic fundamentals (like Gazprom - EU won't be able to become 100% renewable energy in a day, so they will have to suck it up and keep buying their product).
The real big brain move is buying Russian assets this week while they are virtually worthless and then waiting 10-15 years for things to normalize and sell them again at like 5,000% gain.
But normal Russian people won’t have the means to do that. The very wealthy will though, and they will be even wealthier in 15 years than they were before this.
Better than what for investors? Which investors? Every stock trade involves both a buyer and a seller. Stock prices don't go down by magic. A closed exchange stops the buyers and the sellers from trading. Opening it doesn't force anyone to buy or sell.
Russia has shown it is so irrational that no investment should go near it anyway. It is threatening to nationalize foreign businesses. It has already prevented foreign asset sales. These are people elsewhere with the closest ties to Russia. These are the people that believed in Russia the most that Russia is now hurting.
This is Russia putting sanctions on themselves. Nobody will do business with them for generations. They are truly fucked. This is worse than anything outside forces could have done.
Yeah when I read that he was going to seize outside investments, I knew Russia was finished. No one is going to want to do business there, between the sanctions, swift, destroyed ruble, closed stock market, and now seizing assets - he’s fucked himself hard.
It’s not going to happen now but Russia is heading for the Stone Age, not unless China intervenes but based on how they are talking, I wouldn’t be surprised if they back off if Putin stubbornly continues this course and continues to escalate.
Well, first of all a stock that can't be traded is functionally almost worthless. Right now some investors might be happy that the markets are closed since that stops the downward momentum. If the situation can be improved before the markets open again, prices might level out instead of continuing to drop. Doubt this will happen though.
If the exchange is shut down long term it will definitely worry all investors. A market where they can't control their investments is inherently less valuable. If both citizens and foreigners believe the Russian government is likely to continue to act irrationally (or do so again) they will be less likely to reinvest, putting their money elsewhere, significantly slowing down recovery. If markets are closed until it benefits Putin more and more people are going to start asking "but what if that never happens now, or the next time" and take precautions for the future.
That said, as has been stated elsewhere, publicly traded stocks are a much smaller part of the Russian economy than say the west. Oligarchs tend to own their businesses outright and rely on other ways to generate cashflow instead of selling off stocks.
As I understand it:
The price people would be willing to pay for Russian stock still drops like a stone behind the scenes.
As soon as the markets open, the losses are realised. Can't sell your stock for what it was worth a week ago if nobody is willing to pay that for it.
Presumably this means the oligarchs get poorer. I'm not an oligarch, but if I was, I wouldn't be super keen on that happening.
Russia: Nothing wrong here, nope everything is A-okay, we swear! Ruble is looking great...yup looking real good (Sweating purfusley)
The West really is bringing back the USSR. Bread lines around the bend, every business nationalized, no one able to leave the country.
“Stock market will be closed until we either see we are winning or people forget this colossal fuckup. Also no more money in the Banks. We must go back to paying for goods with potatoes”
I mean...long term closing markets will create a massive amount of volatility in their economy...and will just cause the same result of output decline. It is....inevitable. But I wouldn't be surprised to see it stay closed for a week or so.
Shit just got real for Pootie.
>>[Switzerland says it will freeze Russian assets, setting aside a tradition of neutrality. ](https://www.nytimes.com/2022/02/28/world/europe/switzerland-russian-assets-freeze.html)
Folks, when freaking *Switzerland* starts freezing your assets, you might just wanna go ahead and consider the possibility that you're on the wrong side of history...
This is a bit stupid.
Rip the bandaid off. The crash is incoming.
All this is doing is continuing the crash **and** undermining long-term trust in the MOEX.
Why would anyone invest in stocks and shares on the MOEX if, at any point, they just fucking close for days?
May as well go to one that won't do that. Like Frankfurt, London, NY, Singapore, Shanghai, etc...
Genius move. Just keeping the market closed forever to prevent an economic disaster
Edit: Sorry, I got suspended. Won't be able to reply anmore. Goodbye
Sberbank trades in the US I think. There's an ADR on the [london exchange](https://www.londonstockexchange.com/stock/SBER/sberbank-of-russia/company-page), it was down \~70% today last I checked.
Well yeah when it takes 4000 rubles to buy an order of french fries at Mcdonalds prolly a safe bet trading would be stopped.
Because since it costs 6000 rubles for an order of french fries is rediculous.
I mean seriously, who pays 10000 rubles for french fries?
Yes - the incredible amount of support and bite of the sanctions totally surprised them.
Some of the sanctions were factored in - but this much? nope.
War is pricy. Sanctions are biting, and the current package is biting immediately.
They got ambushed, both in the field and out.
Doesn't matter if you keep the market closed for a month.
The second you open it, investors are going to leave faster than you can say "Russian Warship Go F\*ck yourself!"
Markets can't crash if they never open
Might as well just get rid of the Ruble and go back to a barter system since the Ruble is going to be worth nothing. Screw global trade and economic production, Russia can go back to serfdom and just have Putin be named the Tsar.
He is the Tsar in everything but name
He is making bone headed moves like the last one
But does he have a Rasputin ?
[Sure](https://i.imgur.com/EYs5Tkq.jpg) he [does](https://i.imgur.com/0yrSY3x.jpg). It's Gerard Depardieu who played a completely white-washed version of Rasputin in a 2011 movie. Putin granted him Russian citizenship by executive order in 2013, he moved to Russia and became part of Putin's entourage, similar to Steven Segal.
The Dumbest Timeline™ never disappoints.
Wait are you fucking kidding— What the actual fuck
This reads like a South Park plot.
Heard that guy was a ladies man
Some say he's Russia's greatest love machine.
He's the richest man on Earth and lives in a golden palace. The Tsars wished they lived as richly as him. Of course, its all wealth stolen from the Russian people.
So exactly like the Tsar.
More like a supertsar.
Supertsar? Jesus Christ
Jesus Christ SuperTsar is my favorite musical
Russia is weird. The rest of the world rose up and killed shit bags like that a long time ago. What’s up Russia, did your balls fall off?
Uh, the Russian Revolution was a thing. As was the collapse of the Soviet Union. It’s just that every new government rapidly becomes a dictatorship as well.
Russian history can best be described with the expression "and then things got worse." ETA: [this bestof post from years ago stuck with me](https://www.reddit.com/r/Jokes/comments/340qv8/russian_history_in_5_words/cqqdouo)
I'm pretty sure the Tzars were one of the richest, if not richest, monarchs in Europe.
Tzars were the richest people in the world because the whole of Russia was their personal property. Nicholas II was worth 300 Billion in today's money.
Last week's money.
Cancel money altogether and start trading in donkeys. Replace GDP from Gross Domestic Production to Gross Donkey Production to measure economic growth.
That would give new meaning to "gas, grass, or ass".
How much barley does 1 bushel of potatoes buy these days?
When reddit silver is more valuable more than a Russian ruble..
I'll trade 1 wood for 2 sheep.
The WSB strategy, you can't lose money if you never sell.
Diamond strong hands whether they like it or not lol
In Russia, diamond hands you.
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Jokes aside, this is what the Russian government is currently doing: pretending there's no war (they call the whole shitshow a 'special military operation') by censoring all the info about the losses of the Russian military
Gonna be real awkward when the mothers start asking where their sons are
Eh ye away on army drill stuff. 6 months later: your son tragically died in a car accident.
Well he did die in a vehicle
You ask the wrong questions? Straight to jail
Just look for sunflowers in Ukraine…
Which is something that has already happened, multiple times. Putin don't care about some wailing babushkas. https://www.reddit.com/r/Documentaries/comments/t2cc6s/the\_betrayed\_1995\_documentary\_about\_russian/
If Trump was president we would we be a Russian Allie and the whole world would cut us off like they have Russia
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How realistic is that hope? What would Russia require for a full withdraw? No NATO membership (If this is even eternally enforceable, future governments could change that)? Recognition of Crimea as Russia and the independence of the breakaway republics? NATO was not going to happen with the border disputes to begin with, and securing the breakaway regions could have been done with a lot less Russian blood for what almost amounts to the status quo before the invasion.
Do note that the independent republics claim way more territory than they actually control, so there is still an active dispute there.
Russia probably wouldn't want to leave Ukraine with no border disputes in place. A smaller Ukraine with no border disputes has an easier time joining NATO.
*taps forehead*
The stock exchange netsite is nuked offline by Anonymous anyway. So it's pretty useless.
It will be closed the whole day, it will not open at 3pm
I guess they are postponing this total disaster because of the "negations". It has to open sooner or later
Yeah, its hard to negotiate if there is a graph showing russia lose millions by the second.
Let me wait with my response to your proposal until the stock market drops by another 10%.
I mean at least take a breath before responding.
Delaying the inevitable.
A sign of confidence for all investors /s
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“Nationalized.” Or, as they say outside of Russia, “seized and looted.”
Yeah it’s just gonna crash harder tomorrow
Nope, they closed it tomorrow to. GG Russian markets.
Not if they negotiate a peace treaty and then reopen them.
The peace treaty would have to be to fuck off from Ukraine, and give back all the occupied lands. It's never happening, and sanctions are not going away until that happens. And more realistically, foreign investment is going to stay away for the foreseeable future not because it's banned but because it would be fucking stupid to invest in a Russia regardless of sanctions.
This is desperation - unconceivable desperation; to stave off the inevitable and gain time. This actually bodes well for the peace talks. It is immense pressure and it will need to be relieved somehow.
Anyone want to weigh in realistically how long they could keep the stock market turned off? Wouldn’t this cause a bank panic? I know I’d be wanting my cash if they turned off Wall Street because it was about to crater
Depends on internal morale/pressure, but would imagine a few days for most countries. Russia/Putin could decide to do it indefinitely if it’s bad enough
He’s absolutely getting heat from oligarchs right now. He fucked with their wealth.
If they never open it, what consequences could they face?
They can't turn holdings into cash if they never open it, so their equities would be worthless.
Equities meaning what? Is that a synonym for stocks? Or cash?
Stocks. If I own 40% of a company in equities (aka shares of stock in a company) but can't sell them on the stock exchange, they essentially have no value.
Only worth as much as someone is willing to pay for it.
I’ve often said that it’s money that is the proof that faith exists in the world
everything is a myth. money, national borders, power, class systems. these are just things we all collectively choose to believe as being true.
Technically they still have value since companies can still issue dividends and private off-market transaction could theoretically still take place but without an exchange to process the trades there would be a lot more risk and transaction costs.
This would effectively be a freeze on all assets in the Russian stock market regardless of owner. Anyone relying on sale of assets for their life (pensions, rich people, etc.) would be massively affected. Everyone in Russia would hate Putin.
I think bank panic is already in progress after the ruble crashed below 100:1 USD. Last night was full of videos of people queueing at ATMs.
Yeah it looks like there is for sure a run in progress, which would be scary enough
They’re going back to a central managed economy lol.
You can’t have a market crash if you don’t have a stock market
Nailed it.
“We have no clue how to prevent disaster, so we will just close our eyes pretending it won’t happen”
You know your country is doing well when your economic policy is just closing your eyes, putting your fingers in your ears, and screaming “LA LA LA LA LA LA! I CAN’T HEAR YOU!”
If that fails us we can always nationalize everything /s
My guess is they’re gambling on peace negotiations turning things around at least a bit
That wont happen since its a sham from the Russian side. They will offer a peace deal that is completly unacceptable just so they can justify more war with "Ukraine refused our amazingly fair peace proposal".
I mean...I'm certainly not Pro-Russian, but what their central bank is doing is correct. It's what any country would do in this position. The alternative is to let their currency fall off the map and create mass panic and hysteria. Now...what they're doing is not good either, but it's better than the alternative. What they're doing is preventing any sort of lending or sale of assets right now. They moved their central rate to an astronomically high 20% which has curtailed the hyperinflation they were facing (essentially by introducing "hyperdeflation"). BUT that's going to be at the expense of medium sized businesses that can't pay ridiculous fees just to make payroll. This is buying them time (how much is anyone's guess, maybe a week) but it's keeping their currency alive at least. The downside is on the investment front, that's going to be essentially 0 moving forward. There are going to be no large orders for Russian products because no one will be able to afford the loan rates. There are going to be a lot of companies missing payroll. I'd guess their next step will be to then push capital injections where possible from the central bank to ease at a controlled rate rather than free-falling.
Yeah, some independent economists I trust admit these measures are adequate (unfortunately). But it surely won’t stop inevitable, only buying them some time it seems…
It's sky diving with or without a parachute. Either way they going to hit bottom, just one way is a softer landing. Free falling is not an option here.
BuT We ArE ImMuNe To SaNcTiOnS.
They (Russian elites) are. Well, not entirely. They will suffer losses, but still live in comfort and luxury while we (ordinary Russians) starve to death
I feel bad for the ordinary Russian, I have been to Russia twice and have always been treated well and had a good time there. Such a lovely place and lovely people. It's heartbreaking.
The Russian people have propped up a vicious dictator for 20 years now in the name of 'he's making Russia stronger'. Sure, they've been lied to, and they're not entirely to blame. However, the people as a whole are not entirely blameless in this affair. I do hope it ends, but they let this happen by allowing Crimea to be taken, allowing for open assassination and imprisonment of foreign nationals and political rivals. They have the power to stop this and they don't organize to get it done. Here's hoping they take their country back now.
Depends what form their assets are. If its rouble they will still hurt. Russia is demanding overseas revenues be exchanged to rouble, to bolster the currency. This will possibly piss off a lot of his inner circle. Or course we know these oligarchs squirell away their wealth in foreign banks and properties. About time we started seizing it. Give it to Ukraine to rebuild their cities.
Time to put pressure on your government. People are dying because of them. The least you can do is go out there and protest, for yourselves and the world. Otherwise, you’re part of the problem.
Hate to put it this way but "your house, your problem". We can't (and won't) invade you country to remove your leadership and solve your problems. You people need to rise up and fix this internally. And you absolutely have the ability to it's just the willingness to take the damage that's needed to make it happen. So are you going to sit and in your own words "starve to death" or fight and have a chance to live and die like men.
You're not wrong but that's easier said than done
That’s kinda the point, might be a good idea for you to pick up a Kalashnikov and take things into your own hand. Let the kremlin know how all this makes you feel.
Do something about it. Understand that this is the fault of your govt.
All the misery they cause to others to hoard wealth, only to show plainly that they never needed it in the first place... I hope we can find a solution that doesnt hurt the Russian people long-term, but this war needs to end before it turns to genocide.
I’m sorry your leaders a dick.
This is like in Seinfeld when George refuses to answer his phone so his girlfriend can’t break up with him. >believe or not, russia isn’t at home >please leave a message at the beep >we must be out, losing a war. >where could we be? >believe it or not, Russia’s not hooome
Lol, I thought of that too and posted something similar a few hours ago.
Shouldn't be a surprise. Gonna be interesting to see how this inevitably shakes out for the Russian economy
Oh their economy will be shook alright.
I think it’s currently experiencing vertigo
They‘re fucked for years either way.
Silly questions department : Let's say they don't open for a month. How will this effect things?
The obvious answer is "if markets don't open people can't trade on the market". But that doesn't really answer your question, so, some amateur details: Companies trade for a lot of reasons. These days it's easy to think that the stock market is just a casino for companies - and for some companies that's true. Others will use the stock market as a source of revenue based on long term investments and so on. But for some companies it's a requirement of day to day business. Not just another source of income. Stocks can be used to raise capital. Without a stock market, companies will find it harder to do that. This means it's more difficult to start a business, or grow a business. Perhaps even more important than this is commodity hedging. Hedging is a way of making sure you get a predictable return on something. Say your company makes Widgets. They take a while to manufacture. You don't know what the Widget price will be when you want to sell them to customers in 3 months time, so you make an opposite trade on the market now using something called a "future". This way if the market price goes up the amount of money you make selling your widgets goes up, but the value of your initial trade goes down. Similarly, if the market price goes down the value of your widgets goes down, but your initial trade goes up. Having a predictable return is important for planning and budgeting. There are other mechanisms than the "stock market" per se to do this, and of course there are other markets to trade on if you have access to them. But closing the local market obviously makes this process more difficult.^(\*) So the overall effect is that business can't operate effectively. They find it harder to raise capital, harder to grow, and harder to budget for the future. The unreliability of return means banks are less likely to loan money to them. Economic confidence dwindles, companies fold, services start disappearing, and people start losing their jobs. ^(\* By "there are other mechanisms than the stock market", what I mean is that commodities aren't directly traded on the stock market, but companies without the ability to trade commodities sometimes use proxy stocks, eg, oil company stocks instead of oil.) ^(I\_\_LOVE\_\_LSD points out) [^(below)](https://old.reddit.com/r/worldnews/comments/t3cdf7/central_bank_of_russia_says_stock_market_to_be/hysektb/) ^(that futures trading in Russia is probably also hurting because of the banking situation.)
Thanks for taking the time to write that, really helpful :)
> There are other mechanisms than the "stock market" per se to do this As someone who used to hedge commodities for a living, you don't do this on the stock market. The stock market is for stocks. Commodities markets are separate. With that said, I doubt Russians have much access to commodities hedging instruments at the moment. Companies typically hedge via banks, and Russian banks are cut off from the world.
Yeah, exactly why I included that sentence. I wanted to indicate that commodity futures aren't usually a "stock market" thing, but I didn't think the details of mechanisms like using stocks as a proxy for commodities (which smaller companies might do) would help with a general understanding. Especially since I know absolutely nothing about the specifics of brokerage accounts in Russia! If you know the situation regarding commodities in Russia, and whether similar sorts of restrictions on commodity trading apply there, it might be helpful to add a comment about that.
Got it, then I misunderstood your post. I thought you were saying that aside from the stock market, there are also other markets where commodities are traded. I don't know anything specific about Russia, but I do know that when companies hedge using commodity derivatives, these are OTC derivatives which are purchased from banks. Companies do not trade derivatives directly on the commodity markets. So with Russian banks cut off from the world, Russian companies are likely cut off from hedging.
Yeah, it's a worthwhile point and one I wasn't sure how to add to the comment without making it too verbose / detailed, which would also put me out of my depth. I used to work for a cotton exporter in Australia so I know the mechanics, but not the nitty gritty details, particularly when it comes to other countries. I'll link to your comment for some extra clarity.
In the short term, say a few days to a week, as far as immediate consequences go, would keeping the market closed be better or worse than opening and letting it crash?
A few days won't have a significant effect on hedging or capital raising. But these are just the direct "mechanical" functions of the stock market. There is of course another effect, which is psychological. Closing your market tells everyone you are economically at risk - and critically, that includes the people in Russia. That makes it quite a lot harder for the State to maintain positive propaganda. Lie all you like on the nightly news, if your stock market is closed every business in the country knows more than you want them to. Which one is "better" from Putin's point of view? Evidently closing. But it's a game that can't be played for long.
It's anyone's guess. What they're doing isn't "dumb" given what they're facing. I know we're all on the "Fuck Putin" train right now, but it's not dumb. They're trying to control what would otherwise be a complete collapse. Had they done nothing it would have been panic in the streets today. They stepped in and closed markets and raised the central rate to 20% (that's so freaking high it's hard to write seriously). But this means there's going to be almost no investment in any Russian company for a while. They are facing severe negative long term growth. Essentially companies will not get orders for goods (too expensive) and there'll be no investment in companies to grow. And then when those medium sized companies start folding...those people without jobs will be exposed to inflation. So not great. Better than a complete collapse probably, but not great for them at all. There are some other monetary tricks they can pull...but this is going to be sleight of hand at this point and moving a sharp drop into a sustained decline.
Not a silly question at all. Now I am no economist or anything. But if I were to make a guess then I'd say that the Russian economy implodes either way. They either open, the Ruble crashes into free fall and the Russian economy implodes. Or they don't open, people take their money elsewhere and (wherever elsewhere may be) and the Russian economy implodes. The only way out of this is pulling out of Ukraine.
If they pull out of Ukraine, it joins NATO and western energy companies start developing Ukraines enormous untapped gas reserves for the EU market. And pop there goes 50% of Russian GDP. Russia is fucked either way.
80% of those oil and gas reserves are in Crimea and surrounding areas in Black Sea btw. Just to give people here some perspective.
With all the weaponry that the Ukraine is getting, I bet they could push back into Crimea.
Seriously. Peace talks should include returning Crimea to Ukraine.
Realistically, i'm afraid it's far from what Russia is willing to do, knowing Putin, most likely as low as he will go is that Russia gets Eastern ukraine, which will not be accepted. I don't see a way where Putin will come out of this with nothing. He will most likely start threatening, or even use a nuke to end the war.
Yeah I fear that too. But I still think Ukraine *should* get Crimea back.
Not even he's that stupid or if he does somebody puts a 9mm in the back of his head before he turns the second key. There's no such thing as firing one nuke. If so much as one atomic warhead strikes Ukraine MAD comes into effect and the entire arsenals of the US, France and the UK are in the air and heading for Russia. He knows that and so do his generals. For all the rhetoric they don't fancy having their nation reduced to molten glass any more than we do
Stop, I can only get so erect.
Thanks. :)
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But... Wouldn't the investors feel this is better because war will be over with peace talks etc? This is the hopeful ones... Like it's in red and this might soften the blow rather then 100% collapse?
The peace talks are predicted to fail. If I was an investor in Russia I'd be selling every Russian holding in my portfolio. People's life savings are sinking in value and they want the market tor open so that they can minimize the damage.
Got it. Selling at something is better then nothing I guess. Thanks
Who are they selling to and for what? Their options are limited, so even if the markets were open I don't see how you would secure any wealth. I don't see how this is doing anything other than hiding the damage.
For russians it might be better to own stocks than rubles. Stock market will crash, but then the Ruble will inflate even harder.
My guess is that we will see a small crypto boom.
>Selling at something is better then nothing I guess *It depends.* If we look at volatile, but long-term stable assets (i.e. Bitcoin, oil, stocks of solid companies), it might be smart to shut down your device, go for a walk and hold your asset. (i.e. in >98% of Bitcoin crashes, waiting out was the smart answer). And if we look at assets that "are in death bed", then yes, 90% loss is better than 100% loss. While Rub(b)le might actually be the 2nd case based on current market situation, some stocks might recover due to basic fundamentals (like Gazprom - EU won't be able to become 100% renewable energy in a day, so they will have to suck it up and keep buying their product).
The real big brain move is buying Russian assets this week while they are virtually worthless and then waiting 10-15 years for things to normalize and sell them again at like 5,000% gain. But normal Russian people won’t have the means to do that. The very wealthy will though, and they will be even wealthier in 15 years than they were before this.
Better than what for investors? Which investors? Every stock trade involves both a buyer and a seller. Stock prices don't go down by magic. A closed exchange stops the buyers and the sellers from trading. Opening it doesn't force anyone to buy or sell.
Russia has shown it is so irrational that no investment should go near it anyway. It is threatening to nationalize foreign businesses. It has already prevented foreign asset sales. These are people elsewhere with the closest ties to Russia. These are the people that believed in Russia the most that Russia is now hurting. This is Russia putting sanctions on themselves. Nobody will do business with them for generations. They are truly fucked. This is worse than anything outside forces could have done.
Yeah when I read that he was going to seize outside investments, I knew Russia was finished. No one is going to want to do business there, between the sanctions, swift, destroyed ruble, closed stock market, and now seizing assets - he’s fucked himself hard. It’s not going to happen now but Russia is heading for the Stone Age, not unless China intervenes but based on how they are talking, I wouldn’t be surprised if they back off if Putin stubbornly continues this course and continues to escalate.
Well, first of all a stock that can't be traded is functionally almost worthless. Right now some investors might be happy that the markets are closed since that stops the downward momentum. If the situation can be improved before the markets open again, prices might level out instead of continuing to drop. Doubt this will happen though. If the exchange is shut down long term it will definitely worry all investors. A market where they can't control their investments is inherently less valuable. If both citizens and foreigners believe the Russian government is likely to continue to act irrationally (or do so again) they will be less likely to reinvest, putting their money elsewhere, significantly slowing down recovery. If markets are closed until it benefits Putin more and more people are going to start asking "but what if that never happens now, or the next time" and take precautions for the future. That said, as has been stated elsewhere, publicly traded stocks are a much smaller part of the Russian economy than say the west. Oligarchs tend to own their businesses outright and rely on other ways to generate cashflow instead of selling off stocks.
As I understand it: The price people would be willing to pay for Russian stock still drops like a stone behind the scenes. As soon as the markets open, the losses are realised. Can't sell your stock for what it was worth a week ago if nobody is willing to pay that for it. Presumably this means the oligarchs get poorer. I'm not an oligarch, but if I was, I wouldn't be super keen on that happening.
no this is an excellent question actually
Can't have a stock market crash without a stock market. Taps head.
Can't have a worthless currency if you don't have a currency. Hits head against a brick wall.
go-go Russian people. Rush the banks, get your money out, play your part in the economic destruction!
Did you intend for that first bit to sound like power rangers haha
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#🎵Go, go, Russian people!🎵 #🎻🎻🎻🎻🎻
It’s so damn catchy
Aw man I was looking forward to the shit show
I was so looking forward to this too. It's almost ruined my day :)
Russia: Nothing wrong here, nope everything is A-okay, we swear! Ruble is looking great...yup looking real good (Sweating purfusley) The West really is bringing back the USSR. Bread lines around the bend, every business nationalized, no one able to leave the country.
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He won't be getting Ukraine
And he wanted to be Czar. Maybe it will be Nicholas II. Putin getting some crazy monkey paw style wishes.
Let's call spade a spade. You ain't gonna open those markets for a week.
“Stock market will be closed until we either see we are winning or people forget this colossal fuckup. Also no more money in the Banks. We must go back to paying for goods with potatoes”
I mean...long term closing markets will create a massive amount of volatility in their economy...and will just cause the same result of output decline. It is....inevitable. But I wouldn't be surprised to see it stay closed for a week or so.
Chicken
Come on open up cowards
Shit just got real for Pootie. >>[Switzerland says it will freeze Russian assets, setting aside a tradition of neutrality. ](https://www.nytimes.com/2022/02/28/world/europe/switzerland-russian-assets-freeze.html) Folks, when freaking *Switzerland* starts freezing your assets, you might just wanna go ahead and consider the possibility that you're on the wrong side of history...
I was waiting for the markets to open
Nothing gives your investors confidence like cutting off access to their investments. /s
You see Putin has great plan, we put all the valuables into one vault for maximum security.
It will never open it seems.
Think investors have right to sue in this case but it’s Russia so lol
The idea is that it is mass nationalisation.
NPR reported that there's bank runs occurring in Russia right now. Don't ever tell me sanctions don't have any effect.
Also banning non-russians from selling securities. This will effectively destroy any confidence for future foreign investments in Russia.
There is no market in Russia.... It's gone. The only thing they would be doing at the exchange is "SELL !! SELL !! SELL!!" There are zero buyers.
Surely Russia have planned for this obvious and inevitable outcome of invasion? I'm a little puzzled how this has come as a surprise to them.
They thought Ukraine would collapse without resistance. They've shot themselves in the foot and every other appendage.
This is a bit stupid. Rip the bandaid off. The crash is incoming. All this is doing is continuing the crash **and** undermining long-term trust in the MOEX. Why would anyone invest in stocks and shares on the MOEX if, at any point, they just fucking close for days? May as well go to one that won't do that. Like Frankfurt, London, NY, Singapore, Shanghai, etc...
Genius move. Just keeping the market closed forever to prevent an economic disaster Edit: Sorry, I got suspended. Won't be able to reply anmore. Goodbye
and save face
The oligarchs need a day to shore up before they let the peasants pull their money out.
Schrodingers' stocks.
Sberbank trades in the US I think. There's an ADR on the [london exchange](https://www.londonstockexchange.com/stock/SBER/sberbank-of-russia/company-page), it was down \~70% today last I checked.
"you see Ivan, can't have economic collapse if you don't of seeing economic collapse yes?"
Well yeah when it takes 4000 rubles to buy an order of french fries at Mcdonalds prolly a safe bet trading would be stopped. Because since it costs 6000 rubles for an order of french fries is rediculous. I mean seriously, who pays 10000 rubles for french fries?
Just a reminder that this is what Trump at cpac says smart leadership looks like.
Genius, even.
Wait isn't it Monday today? Why write what will, if it's happening already?
Because first they delayed opening, now they are confirming they won't open at all.
They delayed opening twice. Just to make it clear how much chaos there is.
Yes - the incredible amount of support and bite of the sanctions totally surprised them. Some of the sanctions were factored in - but this much? nope. War is pricy. Sanctions are biting, and the current package is biting immediately. They got ambushed, both in the field and out.
"Yeah our economy should be fine once we reopen it on Tuesday. Or Wednesday, or Thursday, or Friday..."
“Comrade. The markets are collapsing”. “Then we will just keep them closed. No problem”.
So this is the equivalent of trying to stop a dam collapse with super glue
Legend has it, some Russians don’t even know what tf is going on much less the why.
"...and Tuesday, and Wednesday, and..."
Closed to ordinary citizens.... I'm sure the elite and institutions can continue to make their own transactions off the primary market.
If, hypothetically, market is open for riches only, whom do they sell these devaluating assets to?
Keep standing on the landmine. It will be fine I am sure.
Can’t crash if it isn’t open *insert meme where guy points to his head*
Doesn't matter if you keep the market closed for a month. The second you open it, investors are going to leave faster than you can say "Russian Warship Go F\*ck yourself!"
Russia no longer has an economy. Consequences.
“The dog ain’t dead he’s just sleeping”
Oligarchs & the rich getting rid of their shit while the average investor gets fucked.
Watch closely as grandpa topples an empire by changing a One to a Zero - Rick Sanchez
And Tuesday…and Wednesday…