Banned from paying for dinner, Putin retires for a night cap

🧵 What Russia’s debt default means for the world. Spoiler alert: not much. Who is affected?

Data from the Bank for International Settlements shows French banks held about $4.5bn of Russian government bonds as of last year, while US lenders held $3.8bn, Austria’s had $3.2bn and Italians $2.6bn. UK banks had just $520m of exposure.

Because this “default” is fake, investors who take their cues from long-term reality rather than Joe Biden’s attention span will be doing business with Russia as soon as practicable. As the Business Telegraph is forced to report – notwithstanding its dutiful recourse to the dumb ‘Putin humiliated’ angle – Russia’s fiscal strength, trade surpluses and low debt mean investors “may be very willing to rehabilitate Moscow when, or if, it returns to Western markets.”

Sooner or later, the grown-ups have to distract the neo-cons with ice cream while bringing Ukraine to the big people’s table to discuss terms. A post-Putin Russian Federation, cultivated rather than baited by Western Europe and the United States, is far more strategically important – even as a keep ’em guessing semi-friend against China – than Ukraine. America should have managed the war on that two-phase basis all along. The decision to instead ‘send a message’ to Beijing vis-à-vis Taiwan by sandbagging the Ukrainians with money and matériel but no troops has only affirmed China’s view of Western leaders as effete pretenders.

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14 Responses to Banned from paying for dinner, Putin retires for a night cap

  1. Not Trampis says:

    You are mixing up domestic debt with foreign debt. That is called doing a barnaby.
    Given Putin’s highly erratic behaviour and his use of his army committing war crimes I think people might just steer clear of Russian bonds. will Putin invade another country because he thinks he is a modern dat peter the great? who knows but given he cannot get the imports he so desperately needs things are not going to plan.

  2. C.L. says:

    You are mixing up domestic debt with foreign debt.

    Nope.

    Debt to GDP ratio is the reference and in Russia it’s low.
    Helpful graph at the link.

    Try again.

    Putin’s highly erratic behaviour

    Compared to who – Joe Biden and Boris Johnson?

    Try again.

    will Putin invade another country because he thinks he is a modern dat peter the great?

    Will the Americans?

    Try again.

    things are not going to plan.

    Wars rarely go “to plan.” His Ukrainian venture is about 500 times more successful already than the Democrat Party’s beloved Afghanistan War.

    Try again.

  3. Rub says:

    The west pissed away 30 years where there could have been a mending of fences, instead Russia was still treated as an outright enemy. Don’t reckon they’ll bite anything the western world offers now.

  4. Boambee John says:

    Poor old Non Mentis, as confused (or deliberately deceptive, it is hard to tell) as ever.

  5. Not Trampis says:

    you are mixing up up domestic and foreign debt. Yep.
    They defaulted on the latter and it was not very high at all. They had to default because of the sanctions!

    Invading a country is very erratic behaviour so was his peter the great statement.

    It is Russia under the pump not the USA.

    Err GW invaded Afghanistan. Had he just concentrated on that he might have succeeded alas he invaded Iraq on very specious grounds.

    you do write a lot on subjects you have little clue about as we have seen.

  6. Buccaneer says:

    Oh sage blogger with no commenters, please enlighten us with some evidence that proves your assertion. Because at the moment, you appear as economically literate as Katy Gallagher and Anthony Albanese.

  7. C.L. says:

    Whenever you start using exclamation marks, Homer, it’s always a sign you’ve been humiliated.

    Debt to GDP ratio is the reference and in Russia it’s low.
    Helpful graph at the link.

    Try again.

    On the subject of economics, you last read a book on the subject when Billy McMahon was in The Lodge.

  8. Lee says:

    you do write a lot on subjects you have little clue about as we have seen.

    Projecting again.

  9. C.L. says:

    Afghanistan was always the Democrats’ favourite war.
    Biden’s evacuation after losing was the worst in American military history.

  10. Boambee John says:

    Buccaneer

    Because at the moment, you appear as economically literate as Katy Gallagher and Anthony Albanese.

    You are far too flattering to Non Mentis.

  11. Not Trampis says:

    debt to GDP ratio is irrelevant as your link actually shows. Do you ever read anything you link?
    They defaulted on a very low amount. If the debt to GDP ratio was relevant they would not have defaulted!
    Sanctions working very well. No investor will go near Russia because of this and possible new sanctions given Putins erratic behaviour.
    all this is very easy to understand so it is a pity you c= do not.

  12. Buccaneer says:

    From the link, just to help you because literacy is not your strong point, the author explicitly makes the link you say is not there….

    he default was not for lack or willingness or means on Russia’s part. The country runs a huge trade surplus predominantly because of lucrative oil exports: it exported goods and services worth $58.2bn more than the value of its imports in the first quarter of 2022, according to the Central Bank of Russia. It also has relatively low debt levels.

    However, Russia’s coupon payments were rendered impossible by the United States. The Office for Foreign Asset Control – the branch of the US Treasury Department that deals with financial sanctions – had allowed Western investors to continue to receive debt payments as part of the initial volley of sanctions at the start of the war in Ukraine.

    That exemption was allowed to lapse last month, meaning payment became effectively impossible.

    Russia’s finance minister Anton Siluanov has called the situation a “farce”, claiming it is not a true default but rather a piece of financial engineering by the White House. Russia has tried to pay creditors with roubles, but doing so violates the bond terms.

  13. Boambee John says:

    Buccaneer

    Non Mentis sees what he wants to see, and ignores what does not support his “narrative”.

  14. Buccaneer says:

    They even have a graph for the fantasists trying to resurrect hieroglyphs.

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