My predications for 2015 and beyond (Updated from Jan 6 and Jan 7, 2015) 1) N.B. I think Putin will be gone this year- he will be displaced by someone in his inner circle... or resign or will die from cancer in 2015 with Oil hitting $20-$30 per barrel. 2) USA covert military operations will help the Ukrainian military get Donbas back in 2015-16 and Crimea in 2016-17 once Putin falls and the RF economy collapses and breaks up into a dozen states and they can no longer afford the Black Sea Fleet in Crimea. 3) Nothing is going right for Putin, gold and rare earth metals prices are collapsing; credit rating at junk status soon; sanctions biting hard; oil/gas nose-diving, oil/gas glut; the ruble is in shambles & worthless; economy in taters; no diversification nor innovation; sovereign wealth fund depleting at $10B per month. Russia will be bankrupt by late 2015. Some massive catastrophic wildcard could also hit Russia ie weather? Siberian separation? China attacks Russia. All Putin will have to sell are nukes to failed rogue states. 4) UPDATE: Russia has lost $110 billion in oil revenue since June; oil and gas are 70 percent of Russias exports. And gas prices take about six months to reflect oil prices, which means they are about to tumble, too. 5) UPDATE: N.B. Sanctions prohibit refinancing the almost $700 billion of Russian bond debt. 6) UPDATE: Total reserves have fallen from $511bn to $388bn in a year. The Kremlin has already committed a third of what remains to bolster the domestic economy in 2015, greatly reducing the amount that can be used to defend the rouble. The Institute for International Finance (IIF) says the danger line is $330bn, given the dollar liabilities of Russian companies and chronic capital flight. 7) UPDATE: BNP’s Tatiana Tchembarova said the situation is more serious than in 2008, when Russia had to spend $170bn to rescue its banks. This time it no longer has enough reserves to cover external debt, and it enters the crisis “twice as levered”. 8) UPDATE: Mr Putin has imposed partial capital controls by forcing companies to repatriate foreign currency. This has bought time and shored up the ruble for a few days, but it is a disguised form of reserve depletion since many of these companies will need dollars to repay debt. Many of these companies are pillars of the Russian economy or energy sector(and PUTIN’s buddies). Their dollar debts are implicitly liabilities of the Russian state since these firms cannot be left to default. The oil giant Rosneft has requested $46bn in state aid to help meet repayments and cover investment. The total foreign debt of Russian companies and state entities is $654bn. They have to repay roughly $10bn a month since they are shut out of international capital markets and cannot roll over loans. 9) Ukraine is an economic basket case to because if the war but the EU, OECD, WB and IMF will step in with loans and bridge financing. RF is on its own and the west will allow it to collapse and break apart like the USSR did.
Posted on: Fri, 09 Jan 2015 04:43:59 +0000
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