Skip to comments.Russia's laughable economic threats against the U.S.A
Posted on 03/05/2014 5:37:37 AM PST by SeekAndFind
While stock markets believe that the U.S. and Russia will avoid an economy-destabilizing conflict, representatives of both countries continue to lob threats of sanctions at one another.
The latest came from Sergei Glazyev, an advisor to Russian President Vladamir Putin, who said on Tuesday that the Russian government would consider selling its stockpile of U.S. government debt if America and the EU went forward with threatened trade sanctions, according to the Russian news service RIA Novosti.
"We hold a decent amount of treasury bonds -- more than $200 billion -- and if the United States dares to freeze accounts of Russian businesses and citizens, we can no longer view America as a reliable partner," he said. "We will encourage everybody to dump U.S. Treasury bonds, get rid of dollars as an unreliable currency, and leave the U.S. market."
The saber rattling of great powers is often made up of empty threats, but this one is particularly laughable. Russia's $200 billion in U.S. government debt is part of its foreign exchange reserves, a fund built up by the Russian government to help protect it against financial crises, stabilize its own currency, and to enable banks and other businesses to function during financially stressful times.
In other words, Russian investment in U.S. government debt isn't some kind of altrusitic action to help their buddies over in North America pay their bills. It's a fund that the Russian government has built to help its economy function in a world that trades primarily with U.S. dollars.
(Excerpt) Read more at finance.fortune.cnn.com ...
We are weak, and Russia is strong. Elections have consequences. And this is it.
It won’t be so funny if the Russians responded to sanctions by curtailing energy supplies to Europe. The EU would go into an economic tailspin and the usual supplicants would be besieging Germany for aid. The bottom line is that Crimea will be bloodlessly reincorporated into Russia and Germany will never agree to serious sanctions against Russia. Putin is being portrayed in the West as a thug but within Russia he is a nationalist hero who is reassembling and reinvigorating Russia. The world is also noticing. The power of the West is declining.
The U.S. is also in too precarious a position to be starting a financial food fight. A run on the dollar would destroy us and then the world economy.
Calling it “laughable” isn’t wise. Russia holds a lot of the world’s oil supply and they are now getting friendlier with the ChiComs.
The man-child currently occupying the Oval Office is failing, and the mavens at Fortune Magazine ought to recognize the fact.
I wouldn’t take this article too seriously. Look at the author.
Kleptocracies are typically very weak economies. Russia is heavily dependent upon energy exports much of it thru ...wait for it ...wait ...Ukraine.
And the EU heavily depends on those exports...
Mostly Germany at, something like 26% which could be replaced with coal and oil at the great consternation of the communists, err, I mean Greens. They both serve the same master.
I've been saying this for quite some time. Crimea was part of Russia for hundreds of years before the Ukrainian Nikita Khrushchev gave it to the Ukraine in 1954 as part of his bid to succeed Joseph Stalin. Putin is methodically putting back together Greater Russia (not exactly the old Soviet Union), comprised of areas with small majorities or large minorities of ethnic Russians. This does not bode well for the Balkans, and is eerily reminiscent of Adolph Hitler's pre-war annexations of Austria and the Sudetenland.
If Russia cut off energy to Europe, where would they get the money they need to pay their bills? I don’t think they could find new customers very easily, and all the pipelines run from Russia to the EU.
Who's going to force them to pay those bills?
More like Hitler marching into the Rhineland. Donetsk, would be the Sudetenland.
Well, the bills already incurred, nobody. But if they expect new food imports, they’re going to have to pay for the food they’ve already eaten.
The author is not the same person as The MSNBC host, if that was the point. Thanks.
He needs to change his name - quick!!!
I am amazed reading the comments that many do not understand the concept of USD Reserves. Even the USSR needed a USD reserve. All the countries on the verge of collapse, Ukraine, Argentina and Venezuela all have one thing in common, they are running out of US Dollars. If you want a predictor of the next country in Crisis look at USD reserves and you will find India and Turkey with dwindling reserves.
First, if Putin is serious, they are just pipelines. They can rot for all he would care.
Second, Putin doesn't do things willy-nilly. I would suspect he has alternative plans...that will be "unexpected" as usual by the US regime. LOL.
Third, new customers? China is a hungry beast needing to be fed.
Prime Minister Vladimir Putins two-day trip to China, which provides a conspicuous footnote to Hillary Clintons coinciding European tour (or perhaps vice-versa it is Clintons trip that is the nagging footnote to Putins meeting), has once again witnessed Beijings eagerness to gobble up obscene amounts of Russian gas. China is a colossal market, Putin reminded reporters after his talks with Chinese Premier Wen Jiabao on Tuesday. The diversification of supplies is a very important direction for Gazprom. We have plenty of gas, said Vice Prime Minister Igor Sechin. We could give to the Chinese as much as they want. But Miller (Gazprom CEO Aleksey Miller) is in charge of negotiations. China and Russia: Allies of circumstance
I think many are falling for this MSM propaganda tripe and believe it. Be very much forewarned, that Putin has his ducks in a row as the article linked from 2009 points out. Actually, the article from CNN, demonstrates just how short lived public memory actually is and how much they do not comprehend the world around them.
I would just be careful depending on the USD reserve.
There’s been a lot of talk, even at the UN, about setting a new reserve currency.
I’d have to do a major search for it, but there have been articles posted here on FR regarding China’s currency as a potential new reserve.
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