How is Russia not Financially Crippled?

Submitted ⁨⁨10⁩ ⁨months⁩ ago⁩ by ⁨Art3sian@lemmy.world⁩ to ⁨[deleted]⁩

When the war started it was seizure-this and sanction-that. I’ve read that $350B in Russian assets were seized and held, while major companies exited the Russian market, the ruble crashed, and inflation rocketed.

Meanwhile the cost of the Russian war must be astronomical to maintain, imports/exports have halted with Europe, there’s no financial aid to Russia (that I’m aware of) and multi-billion dollar resource supplies were cancelled.

All this, and Russia seems to still be having a good old time. Russians are on holidays en mass, the country is buying up arms and fossil fuels like its church Sunday, and their war machine still powers away and is prepared to keep fighting for a decade it has to.

How? How does a country take that much of a financial beating and still be thriving? Where is the point of being broke and not being able to find a war anymore?

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Thekingoflorda@lemmy.world ⁨10⁩ ⁨months⁩ ago
As far as I understand they had prepared a pretty big warchest, and gas is still worth a lot and is being sold to countries that didn’t commit to sanctions (like China and India).

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- Jaysyn@kbin.social ⁨10⁩ ⁨months⁩ ago
  
  had prepared a pretty big warchest
  
  And stupidly kept 1/2 of it in Western financial institutions.
  
  We're about to start selling Ukraine NATO weapon systems with what used to be Russian money.
  
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  - labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
    Pootin also launders oil money offshore, so… all means are good for him.
    
    And yet, he is a “former” KGB officer, a bandit from St. Petersburg who has been involved in dubious schemes since the 90s, so what else could you expect from him…
    
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  - shortwavesurfer@lemmy.zip ⁨10⁩ ⁨months⁩ ago
    And if that actually happens, then very few countries will trust the US dollar as they reserve anymore and buy up gold as they are already doing.
    
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- Dehydrated@lemmy.world ⁨10⁩ ⁨months⁩ ago
  Well, their warchest mostly consisted of assets in western countries. Most of these were immediately seized. That didn’t completely destroy Russia, but it put them in a far worse situation.
  
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Candelestine@lemmy.world ⁨10⁩ ⁨months⁩ ago
Because even if they actually had an income of zero, they had saved up enough money over the years to be able to survive off it for some time. Commonly referred to as a “war chest”. They don’t actually have an income of zero though, their income is actually quite significant since they still have major trading partners like Iran, India and China to sell their fossil fuels and other resources to. They don’t buy fossil fuels, incidentally, they sell them. Like Saudi Arabia.

Also, you can buy things with more than just money. People figure that Kim Jong Un probably isn’t trading his stuff to them for money, but instead is getting technological assistance from them. Just one of their modern fighter-bomber tech, for instance, would be immeasurably valuable to N Korea, where their own tech has lagged behind a good bit over the years.

Lastly, people in the west have been doing sanctions evasion. I recall some German financial/tech company has its CEO now wanted by Interpol for being a Russian agent. So, when your own people are playing fast and loose with the law, that’s going to make things like sanctions more difficult.

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infinitevalence@discuss.online ⁨10⁩ ⁨months⁩ ago
They are still selling literal boat loads of Oil, just not as much to Europe.

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- Marty_TF@lemmy.zip ⁨10⁩ ⁨months⁩ ago
  they are selling it to countries which then sell it to europe so we just pay more for the same thing but can be happy we do definitely not fund the russian invasion :D :D :D
  
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  - CaptainBlagbird@lemmy.world ⁨10⁩ ⁨months⁩ ago
    As I understand it, China/etc can buy the oil cheaper because there’s no competition from Europe anymore. Then they can sell it to us more expensive because we don’t have an alternative. So China/India profit from it, while Europe and especially Russia lose in comparison to how it was before. This is not ideal, but still better than supporting Russia by buying from them directly.
    
    Please someone correct me who knows how that actually works…
    
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- Alimentar@lemm.ee ⁨10⁩ ⁨months⁩ ago
  They’re still selling it to europe, but because of the sanctions, Russia sells it to India and then India sells it to Europe.
  
  Basically all these sanctions did was add a middle man for Europe making it more expensive but still financially supporting Russia.
  
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RusAD@lemm.ee ⁨10⁩ ⁨months⁩ ago
Adding to all the reasons already listed, Russia isn’t striving. For example, right now there is a number of towns and cities experiencing outages in central heating (with houses designed around central heating so basically no other option to heat their appartments) while the weather dips to -20°C (around -4°F). All because the centralized boiler facilities weren’t properly maintained due to the lack of money (or, to be more precise, due to money being diverted towards the war).

There are other signs, like plains malfunctioning and flights getting delayed because some component broke and cannot be replaced due to sanctions, and they happen more and more often. Also the less noticeable stuff like prices of common goods increasing by a factor of two in the last couple of years while salaries barely increased at all.

So yeah, Russia is keeping itself afloat, but it isn’t striving at all

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- grue@lemmy.world ⁨10⁩ ⁨months⁩ ago
  Did you mean “thriving?”
  
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- labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
  By the way, the RuSSians thought that if they could no longer fly to vacation in Europe or the USA, they would be able to vacation in Dubai, but after they bought tickets for the return trip, they could not even (there was news recently) return to RuSSia by plane, because the plane (RuSSian plane) broke down and they, as always, were “stuck” at the airport for several hours, ha-ha
  
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trebuchet@lemmy.ml ⁨10⁩ ⁨months⁩ ago

How? How does a country take that much of a financial beating and still be thriving? Where is the point of being broke and not being able to fund a war anymore?

Not only that but I remember reading a lot of articles about how Russia was going to economically collapse as a result…almost two years ago.

Also a lot of articles about how weak Russia was militarily, how they lost all their troops and equipment already, how morale in their military was so poor the army was just going to run away at any moment…for almost two years now.

Yet here they are still, not collapsed, not defeated. It probably is a good idea to take the media with a grain of salt and realize just because they’re the so-called free press doesn’t make them necessarily the truthful press.

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- nbafantest@lemmy.world ⁨10⁩ ⁨months⁩ ago
  Russia is like 7x the size of Ukraine and has been losing for over a year.
  
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Rentlar@lemmy.ca ⁨10⁩ ⁨months⁩ ago
They have a decent source of their own fossil fuels, and certain deals go through non-sanctioned countries to countries that sanctioned Russia.

They have control of their rouble so they can promise soldiers a big payday and stiff the payment when they went “missing”. In particular their ex-con division.

I’m pretty sure their overall stocks of military equipment are dwindling, as you heard a few high-value targets were downed in the last month that are irreplaceable in the medium term. They still have their own production of tanks and ammunition, and China, NK and Iran trade various equipment to them such as drones, missiles, artillery. They are happy to get whatever Russia has left to offer.

Rich Russians will stay rich for the most part but poor Russians will be stuck in their miserable situation.

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- ZILtoid1991@kbin.social ⁨10⁩ ⁨months⁩ ago
  Long term is where things can fall apart. Yeah, currently stuff goes well to Putin, but the moment the Russians realize their emperor is naked, Russia will have a very bad time, with the worst thing that can happen to them is a Balkanization with all of its nastiness.
  
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  - labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
    And there why there will be civil wars in RuSSia…
    
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- Jaysyn@kbin.social ⁨10⁩ ⁨months⁩ ago
  Yup, 9 just more destroyed A-50's & Russia is blinded on the battlefield & out $3.3B in materiel
  
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Hexagon@feddit.it ⁨10⁩ ⁨months⁩ ago
Why Russia isn’t actually collapsing (RealLifeLore on YT)

It’s a bit long and I don’t remember everything, but a good part is that Saudi Arabia reduced their oil production so that the price goes up, and Russia is still selling a lot of oil to China and others

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- Badeendje@lemmy.world ⁨10⁩ ⁨months⁩ ago
  There is also a Perun Video that talks about war economies more in general and the Russian and Ukrainian economies specifically.
  
  war economics 101.
  There are few things people have been keener to predict throughout history than ‘quick’ wars. Pro Russian commentators after February 24th 2022 expected a rapid victory - while Western media was quick to suggest that Russia’s economy was collapsing soon after sanctions were implemented.
  Instead, both Ukraine and Russia show signs of increasing their wartime production and scaling up their armed forces. That should not come as a surprise. Historically, the process of converting from a civilian to a wartime economy has yielded more than enough results to overcome even significant trauma inflicted on the industrial base (for example, strategic bombing attacks).
  Russia’s economy is suffering, it’s long term economic prospects have been badly wounded by a collapse in international trust, market denial, and a barrage of sanctions. Ukraine’s economy is likewise under immense pressure - primarily from physical attacks by the Russian armed forces. But it would be naïve to think that either is likely to collapse in the coming weeks and months. As long as the will to go on (and foreign support) remains in play, there is every reason to think that both nations will find a way to keep their economies going.
  In this episode, we look at the basics of war-economics, industry conversion, and try to understand why ‘short wars’ are so hard to win between peer opponents, once the economic struggle begins in earnest.
  
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- Jaderick@lemmy.world ⁨10⁩ ⁨months⁩ ago
  The comments on that video are cancer. That level of astroturfing reminded me of why I left Reddit lmao.
  
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Uranium3006@kbin.social ⁨10⁩ ⁨months⁩ ago
half their economy is oil. the other half's bleeding out

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Rookwood@lemmy.world ⁨10⁩ ⁨months⁩ ago
They are being financed by China and India. Their long time prospects are pretty terrible because they will rack up massive debts to those countries. But I suspect they will be able to continue the war longer than Ukraine can stay politically favored in the West. If Trump is elected, it’s over for Ukraine.

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Jaysyn@kbin.social ⁨10⁩ ⁨months⁩ ago
There are a lot of actions they can take to prop themselves up in the short term.

Nothing they can do about their dying demographics though.

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nbafantest@lemmy.world ⁨10⁩ ⁨months⁩ ago
Russians are not having a good old time. Things are very bad in Russia since the invasion.

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Hyperreality@kbin.social ⁨10⁩ ⁨months⁩ ago
One of their sources is Sudanese gold. Basically, they're helping to exacerbate the genocide in Sudan, so they can fund their genocide in Ukraine.

Russia has arguably won the sanctions war. They've shifted trade to China and India. Or they're exporting raw materials through third countries to Europe, or transfering oil at sea, bypassing sanctions at a relatively low cost.

Made deals with other oil producing countries to not increase production, so that prices remain stable.

War isn't that expensive, unless you're the US. North Korea. Dirt poor country, almost entirely cut off from the world, still manages to maintain a sizeable military and even develop nuclear weapons. Russia? Old soviet stock that was rusting in a barn, troops you only pay if they survive, or don't pay at all. Send prisoners to the front, saves money on prisons. Send people from the poorest regions, so you don't have to pay them much, and it doesn't negatively affect productivity that much.

Do like the Russians did during and after WW2. Rape and pillage. Russia is actively stealing Ukrainian resources, equipment and grain from the occupied territories.

Sell (or barter with) pariah states like North Korea or Iran military technology they would otherwise not have access too, like nuclear or ballistic tech.
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- labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
  It would be funny if, for example, Iran did not fulfill/deceived its obligations, as Russia did with the West and, in my opinion, one day even with Iran itself.
  
  But these countries may also be terrorist states, like Russia, but they probably still have a “credit of trust”, unlike unreliable Russia
  
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  - feedum_sneedson@lemmy.world ⁨10⁩ ⁨months⁩ ago
    That’s annoying, please stop it.
    
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- labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
  I like your explanation, and it’s true
  
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psud@lemmy.world ⁨10⁩ ⁨months⁩ ago
They’re a petro state. Attempts to keep them from profiting from oil have completely failed, as Russia can sell it to their friendly countries

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theodewere@kbin.social ⁨10⁩ ⁨months⁩ ago
India has used it as an opportunity to get a lot of cheap oil from them

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Kaput@lemmy.world ⁨10⁩ ⁨months⁩ ago
I wonder how much of it was just good old propaganda. I know it’s a lot, just curious to what extent. What proportion of Russia’s GDP the sanction represented. Also eVen Europe kept buying fuel from Russia. i m sure they still do to some extent. War is a funny thing you would think it’s all pure hatred , but the older I get more I see it as just kinetic négociation between the owners. With a bit of marketing sprinkled on it. To quote Lord Faarquad " Some of you may die, but that’s a sacrifice I am willing to make"

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- ivanafterall@kbin.social ⁨10⁩ ⁨months⁩ ago
  
  Proceeds from oil and gas sales for Russia's federal budget fell by about 24% to 8.822 trillion roubles ($99.4 billion) last year, finance ministry data showed on Thursday, following weaker oil prices and reduced gas sales to Europe.
  
  Reuters
  
  Whether that's "enough" or as much as expected, I don't know. But it gives some context on what's happened.
  
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sharkfucker420@lemmy.ml ⁨10⁩ ⁨months⁩ ago
I mean I’m no expert but the US has only had 17 years of peacetime in its 247 ish years of existence and it’s still going. War can often be profitable though I couldn’t tell you if that’s the case here.

I do know, however, that Russia is a huge oil and gas provider and despite the hand wringing that politicians do over human rights they almost always ignore them when it comes to fossil fuels.

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- lurch@sh.itjust.works ⁨10⁩ ⁨months⁩ ago
  well yeah, but the US had barely any sanctions against it. (unlike russia.) everyone was just “they helped us in this war. they must be the good guys. let’s import more Fords and Boeings”
  
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  - sharkfucker420@lemmy.ml ⁨10⁩ ⁨months⁩ ago
    I don’t think sanctions really work that well if I’m honest. Cuba has been sanctioned for what 60? 70? years now and while it isn’t exactly a world superpower it’s still here and doing pretty well given the circumstances
    
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Pounddc1@lemm.ee ⁨9⁩ ⁨months⁩ ago
HMU on telegram if you got verified Id.me let hit $100k upwards and split @pounddc1

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OpenStars@startrek.website ⁨10⁩ ⁨months⁩ ago
In addition to stockpiling, do not underestimate the oil thing. In another few years Germany would have become independent on needing oil from them, hence their time to strike was NOW (well, you know, back then I mean).

As it was, Russia extorted people like old grandma and grandpas in northern Germany when they hiked the prices so high they consigned them to just die in the dead of winter unless they paid their life savings or the German government stepped in, handing the cash to Russia in order to keep those old folks alive.

They knew what they were doing - they are greedy and murderous but not all THAT dumb. Plus Russia takes from neighboring states too, especially their citizenry to send to the front lines - every little bit helps!? It also “helps” that they don’t mind consigning their own citizens to die if it would save enough money for the oligarchs to justify the loss of those workers - they are not like how we ~~are~~ used to be. But don’t worry, dead or not, I’m sure that their “votes” will still be counted, when it comes time to reelect Putin!

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labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
I can only say from the point of view of sanctions why.

Yes, many normal companies have left Russia (unlike, for example, Nestle, P&G and Colgate, which make their products in China, lol), yes, sanctions will put more and more pressure on the Russian economy over time…

BUT, the sanctions, in my opinion, are “soft” compared to those that the United States, Europe and their partners have imposed on North Korea, Syria and Iran.

I am sure that no one (if we talk about consumer goods at least) from European or American companies can EVEN trade in such third world countries as Iran (with their terrorist government), Syria or North Korea (the last two are also terrorist states). That is, I think, even Nestle, which is hated throughout Reddit, cannot legally trade there, but if you look, every “dirty” and unethical transnational corporation trades with/sells their goods in Russia.

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labbbb@thelemmy.club ⁨10⁩ ⁨months⁩ ago
The neo-Nazi Pootin believed in RuSSian power so much that he ordered the mafia from the Central Bank of the country to once again artificially “freeze” the ruble from falling so that the RuSSian economy would not collapse, HA. Unfortunately, it was a joke.

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