Eventually yes. But not soon enough to halt the war, and Russia’s creeping progress in Donbass. NATO needs to come through and fully support Ukraine.
He’s gonna fall out of a window
They dont need companies where they’re going. (The stone age)
“Sergey Chemezov, CEO of the state-owned Rostec, which produces much of Russia’s arms and military equipment, issued the warning while addressing the Federation Council earlier this week, according to Russian outlet Business Gazeta.
Chemezov criticized the Russian central bank’s elevated key interest rate, which, following his comments, was raised by an additional two percentage points on Friday to a record 21 percent.
“There is no 20 percent profitability anywhere. Maybe in the drug trade, but even the sale of weapons does not bring such a profit,” he said.
Chemezov said that the high key interest rate drives up borrowing costs for businesses, which hurts their profitability, including Rostec’s.
“It is simply not profitable for enterprises to use borrowed funds, as I have already said many times. It is just that if we continue to work like this, then practically the majority of enterprises will go bankrupt,” he said.
He added that high-tech companies with longer production cycles are particularly impacted, as they only receive advance payments of 30 to 40 percent from customers and have to cover the rest with a loan.
However, he noted that the high borrowing costs ultimately eat into their profit margins.
He warned that this situation could lead to “stagflation,” referring to economic conditions of slow growth, high unemployment, and rising prices.
Chemezov’s concerns echo those made recently by other Russian businessmen, who warn that the high borrowing costs could hamper economic growth.
Russian billionaire Alexey Mordashov, the largest shareholder of steelmaker Severstal, said earlier this month that the situation was precarious.
“The need to raise rates to limit inflation is clear, but we are starting to go too far,” Mordashov said, per Reuters. “We are coming to a situation where the medicine may become more dangerous than the disease.”
Cant happen soon enough
Reality is a harsh taskmaster.
Emergency financial measures can keep an economy going. Until one day, they don’t, and it all comes crashing down.
“…starting to go too far.”
Lol ‘starting’ – idiots!
It is either 21%, or inflation higher than current 8%, or, you know, stop the fracking war!
But seriously, what they expect? When significant portion of economy and people are reoriented on war, (and some people left the country, some killed) the private non-military related business has to contract. There is just no resources to maintain them. These rates and inflation are just the mechanism of how it is happening.
Somebody shall check the window latch
Putin no doubt expects them to suck it up and to use the vast amounts of past money that they have profited and/or laundered/stolen through corruption.
There will come a point when they will become unwilling to comply. And some won’t be able to comply regardless because their ill-gotten gains will not be in russia. I doubt many would have been foolish enough not to channel most of that wealth out of russia in preceding years.
And in some cases that money/those assets will be sanctioned – so they will be even less willing to suck it up and use whatever they still have available in the russian banking system.
Defections are sure to follow.
Everything In terroruzzia is colapsing
Sounds like the oligarchs can’t take their usual cut off the top now.
I believe that was the point of the sanctions.
I don’t believe it and a lot has to do with previous conditioning of similar hopeful stories about Russia collapsing whether the military, businesses, ruble, airline industry just fill in the gap! Yet here we are and nothing has occurred other than the strengthening of their relationship with Iran, China, North Korea, India and several African nations.
He be best to stay away from balconies before he accidentally falls.
> Chemezov criticized
welp, out the window you go
He needs to stay away from windows
So Sergey is looking forward for a good tee?
Why does a country that has essentially isolated itself from the global market even care about monetary policy? They can fix their currency to a certain value and remove or add currency that they need or don’t need. What are they trying to accomplish by raising interest rates? Are they trying to squeeze everyone out of the remains of the free market in Russia and ultimately make everyone more dependent on the larger state owned corporations? Their major trading partner China I doubt will ever truly audit Russia and truly devalue their currency considering China has basically thrown their hat in the ring to be a major world disruptor. Why even pretend to care about monetary policies? They could use corn flakes as rubles if they wanted to.
Chemezov is going to fall out of a window soon, I bet.
It’s Christmas coming up. Weird things can happen to the economy at Christmas, especially if people don’t have anything to celebrate.
23 comments
Good.
Eventually yes. But not soon enough to halt the war, and Russia’s creeping progress in Donbass. NATO needs to come through and fully support Ukraine.
He’s gonna fall out of a window
They dont need companies where they’re going. (The stone age)
“Sergey Chemezov, CEO of the state-owned Rostec, which produces much of Russia’s arms and military equipment, issued the warning while addressing the Federation Council earlier this week, according to Russian outlet Business Gazeta.
Chemezov criticized the Russian central bank’s elevated key interest rate, which, following his comments, was raised by an additional two percentage points on Friday to a record 21 percent.
“There is no 20 percent profitability anywhere. Maybe in the drug trade, but even the sale of weapons does not bring such a profit,” he said.
Chemezov said that the high key interest rate drives up borrowing costs for businesses, which hurts their profitability, including Rostec’s.
“It is simply not profitable for enterprises to use borrowed funds, as I have already said many times. It is just that if we continue to work like this, then practically the majority of enterprises will go bankrupt,” he said.
He added that high-tech companies with longer production cycles are particularly impacted, as they only receive advance payments of 30 to 40 percent from customers and have to cover the rest with a loan.
However, he noted that the high borrowing costs ultimately eat into their profit margins.
He warned that this situation could lead to “stagflation,” referring to economic conditions of slow growth, high unemployment, and rising prices.
Chemezov’s concerns echo those made recently by other Russian businessmen, who warn that the high borrowing costs could hamper economic growth.
Russian billionaire Alexey Mordashov, the largest shareholder of steelmaker Severstal, said earlier this month that the situation was precarious.
“The need to raise rates to limit inflation is clear, but we are starting to go too far,” Mordashov said, per Reuters. “We are coming to a situation where the medicine may become more dangerous than the disease.”
Cant happen soon enough
Reality is a harsh taskmaster.
Emergency financial measures can keep an economy going.
Until one day, they don’t, and it all comes crashing down.
“…starting to go too far.”
Lol ‘starting’ – idiots!
It is either 21%, or inflation higher than current 8%, or, you know, stop the fracking war!
But seriously, what they expect? When significant portion of economy and people are reoriented on war, (and some people left the country, some killed) the private non-military related business has to contract. There is just no resources to maintain them. These rates and inflation are just the mechanism of how it is happening.
Somebody shall check the window latch
Putin no doubt expects them to suck it up and to use the vast amounts of past money that they have profited and/or laundered/stolen through corruption.
There will come a point when they will become unwilling to comply. And some won’t be able to comply regardless because their ill-gotten gains will not be in russia. I doubt many would have been foolish enough not to channel most of that wealth out of russia in preceding years.
And in some cases that money/those assets will be sanctioned – so they will be even less willing to suck it up and use whatever they still have available in the russian banking system.
Defections are sure to follow.
Everything In terroruzzia is colapsing
Sounds like the oligarchs can’t take their usual cut off the top now.
I believe that was the point of the sanctions.
I don’t believe it and a lot has to do with previous conditioning of similar hopeful stories about Russia collapsing whether the military, businesses, ruble, airline industry just fill in the gap! Yet here we are and nothing has occurred other than the strengthening of their relationship with Iran, China, North Korea, India and several African nations.
He be best to stay away from balconies before he accidentally falls.
> Chemezov criticized
welp, out the window you go
He needs to stay away from windows
So Sergey is looking forward for a good tee?
Why does a country that has essentially isolated itself from the global market even care about monetary policy? They can fix their currency to a certain value and remove or add currency that they need or don’t need. What are they trying to accomplish by raising interest rates? Are they trying to squeeze everyone out of the remains of the free market in Russia and ultimately make everyone more dependent on the larger state owned corporations? Their major trading partner China I doubt will ever truly audit Russia and truly devalue their currency considering China has basically thrown their hat in the ring to be a major world disruptor. Why even pretend to care about monetary policies? They could use corn flakes as rubles if they wanted to.
Chemezov is going to fall out of a window soon, I bet.
It’s Christmas coming up. Weird things can happen to the economy at Christmas, especially if people don’t have anything to celebrate.
Pity. What’s for lunch?
Comments are closed.