Monday, August 22, 2022

Russia thinks US will default on its debt. LOLOLOL!!!!

When you have idiots like this at the top of your leadership?? (Yes, we have them, too.)

Russia's done. It's a f*ckng clown show over there. It's like they're praying now for something totally unrelated to get them out of the mess they created.

I hope Ukraine kicks their ass. 

(If you are still listening to Martyanov, Macgregor and Ritter you are nuts.

-Nikolai Patrushev


Marian Ruccius said...

The Ukraine War was won by Russia on February 27. Voluntary default is exactly the kind of brainless activity that a Republican congress is likely to pursue. Russia is wise if it is not overestimating US politicians' intelligence.

mike norman said...

Russia is getting picked apart. You cannot win a war when you don't fight to win. SMO my ass.

Domenic said...

Why such change of heart Mike?? Just for an idiotic statement by an official?? It's not like we have shortage of idiots in government...
Russia cannot bomb indiscriminately because this would kill a lot of civilians. Do you want carpet bombing and a final tally of 1 mil death a' la American Style in Iraq? Sure, send wave after wave of missiles and strategic bombers and reduce the place to rubble...
Crimea attacks are less than pinpricks, they are designed for PR and psycho-war purpose you you fell for it. Mental Game Mike, remember??

Marian Ruccius said...

I think that one key to Moscow's strategy, in line with its evocation of the principle of mutual defence or mutual assistance, can be gleaned from the fact that up until now, with some exception for key engagements, the vast majority of ground troops fighting have been from the Lugansk and Donetsk people's republics, and that explains in part the slow advance (they don't attack their own people, as they see it). That will continue to be a crucial feature of the SMO, as Russians and their allies take over region by region. For instance, soon, a Zaporozhye people's militia will be formed to seek to drive Ukrainian forces back towards the Dnieper. We heard already that Odessa and Kharkov militias have been formed to do the same in those regions. This is a political strategy -- Russia will be able to say -- look, this a fight of local people who want to rid their regions of "oppressors". It also provides the basis for future regional governments (or independent peoples' republics, as the case may be) and potentially for a "grass-roots" (although Western Ukrainians will dispute that) administration to be established to govern what will remain of the Ukraine.

NeilW said...

From Russia's point of view the US has already defaulted on its debt.

What's the difference between freezing access to US dollar reserves, preventing transactions in US Treasuries and simply confiscating them?

The US and the UK have both built up a huge amount of 'promises' to the rest of the world that they are not physically able to deliver upon.

We now have the same situation with dollar derivatives as we had with fiat money in the first place when it was a derivative of silver coins. (which morphed into the gold standard). There isn't enough underlying specie to go around.

What happened then was a suspension and elimination of the conversion into specie. One side saw that as a default. The other side saw it as floating the exchange rate.

We're going to see restrictions on using foreign reserve holdings in a vain attempt to control the Russians and the Chinese.

Matt Franko said...

Looks like he’s a monetarist:

“He drew attention to the fact that food and energy prices in the world have risen mainly because of "the printing press operating in the US and Europe." "The main reason for the surge in food and energy prices is the printing press operating in the US and Europe. During the pandemic, the largest emission of money in 40 years took place. The United States printed $5.9 trillion. “

Tom Hickey said...

Looks like he’s a monetarist

Just about everyone still is at this point. This is significant because it means that just about everyone operates on this assumption. So in effect it becomes self-fulfilling. "Reality is perception" until actually reality results in a shift in perception. This is why many if not most think that MMT has been disproven by inflation resulting from the huge stimulus.

Tom Hickey said...

@ Marian Ruccius

Andrei Raevsky (the Saker) has been saying this from the get-go. There are many details involved in this strategy, some of which is legal to avoid cupablity as an aggressor state based on the UN Charter. Russia main argument that it and China are baking a world order based on the US Charter as the basis for international law rather than a rules-based order, where the US makes the rules and as ruler-maker is absolved from following them itself.

All this together is a complicated issue and Russia has not explained all of it or even much of it, so others try to figure it out from what they read or hear in the language they understand.

As Andrei Martyanov warns, this is a fool's errands especially if one doesn’t know Russian and have Russian connections. Even then it is just guessing. He harps on the point that most of the people in the West doing the guessing don't have the qualifications to make an educated guess. They are boneheads pushing an agenda or engaged in wishful thinking— in Matt's terminology "artists." Martyanov is a graduate in military science and engineering (missiles) and served as a naval officer (coastal defense) in the Soviet military, so he is qualified to make the criticism.

Konrad said...

It’s disappointing to see someone so high up in the Russian government (Nikolay Patrushev) spout nonsense like this. Mike Norman is correct. With stupidity like this, Russia deserves to lose.

In the original TASS dispatch, Mr. Patrushev also says that food and energy prices in the world have risen mainly because of "the printing press operating in the US and Europe."

This is more silliness. Let’s correct it.

If inflation is caused by “too much money chasing too few goods and services,” then the cause of inflation is too much money and / or too few goods and services. Therefore the cure for inflation is to reduce the money supply and / or increase the supply of good and serves.

Milton Friedman famously said: “Inflation is always and everywhere a monetary phenomenon, in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output” (of goods and services).

Friedman was correct, but most people misunderstand him. Most people wrongly focus only on the monetary side of the equation. People ignore the output side, or the material supply side.

The U.S. government has been printing money like mad (e.g. the $2.2 trillion CARES Act in March 2020) but it is also true that supply lines have been disrupted by the pandemic hoax, plus the economic war on Russia and its allies.

Furthermore the monopoly power of large corporations in the food industry, the energy industry, and so on, allows them to engineer shortages.

Therefore, contrary to most people’s beliefs, the current inflation is not simply the result of printing too much money. Nor can inflation be cured by simply reducing the money supply. We must also look at the output side, i.e. the availability of goods and services.

Tom Hickey said...

@ Konrad

Someone tell US, UK, and EU political elite. They, too, are all monetarists that fear fiscal deficits, or at least talk and act that way. Do I think they know better? No.

I was just reading an article that explained the US lagging in hypersonic weapons development. Why so? Too expensive. Really.

Peter Pan said...

Cutting the F-35 to work on hypersonics would be a zero sum game.

Now, if they could agree to do both...

Konrad said...

@Tom Hickey

Hypersonic U.S. missiles? No. Sorry. The USA is no longer able to manufacture any effective weapons system, because all moneys for such systems are siphoned off by corruption. Military contractors intentionally keep new systems in development hell, in order to stretch out cost overruns forever. And a lot of those dollars are kicked back to politicians that keep authorizing the dollars.

For example, Lockheed began its F-35 fighter program 25 years ago, and still the F-35 is not functional. This scam keeps the dollars rolling in to Lockheed. Such corruption is one reason why the U.S. military is weak despite having the world biggest budget.

China’s military does not have the same problem with corruption. Therefore China develops and deploys new weapons systems six times faster than does the USA, while spending only 5% of the money that the USA does.

Matt Franko said...

“ Someone tell US, UK, and EU political elite.”

Those others know it’s only the US that is reacting to the supply disruptions with severe rate increases …

Because Biden is listening to Larry summers and he want to deflect blame for the high prices on thecFed not Democrats directly…