USD/RUB

Turn it into one if you like. I have known quite a few Russians for someone who has never been there. I've known them through my time in the Hare Krishna movement - they got attracted into it, for whatever reason, and I knew them because we ended up on the same Hawaiian island in that movement - they are in the past now for me. In any case: I've liked them all for their complex intelligent characters.

Your posts are excellent reading. So, now I shall go back and read.

I think that you shouldn't pay attention to ordinary Russians, but to Oligarchs. They have real influence in Russia and as long as Putin can keep them quiet and satisfied this situation can be sustained. However if they realize that this policy is going to a death end Putin's faith can be very gloomy. I would not overestimate Putin's power, if bad economical situation persists I expect that Putin will resign within 6 monts.

I would bet everything I own that that doesn't happen.

I have to disagree. The idea that Russia's oligarchs have a real ability to influence Putin, while a popular theory, does not appear to be supported by any reality. Almost all of Russian oligarchs became rich during the Wild West days of the 90's privatization debacle. As such, they all mostly have very checkered pasts (and are disliked by ordinary Russians), both facts Putin can (and has in the past) easily exploit.

Putin's attitude toward oligarchs has been very consistent: stay out of oppositional politics and I won't meddle in your affairs and will continue to turn a blind eye to your past and present shady/corrupt dealings. In fact, this attitude is what is responsible for much of the large-scale corruption that still persists in Russia and answers the question of why Putin hasn't been "able" to end it.

What better example of this then the jailing of Russia's most powerful and richest oligarch Khadorkovsky, who tried to get into oppositional politics and ended up spending 10 years in jail. Putin (or more appropriately, vice-versa) maintains a very close and warm relationship with many of the oligarchs (e.g. Abramovich, whom he made governor of Chukotka). If they go against him their "career" will be over quickly (amd the people wpuld all rally behind Putin for doing that). Further, like him or hate him - the oligarchs have no other option. Unless they move overseas to Russian London, in which case they can criticize Putin all they want, at the expense of having no actual influence within Russia (e.g. Berezovsky).

Put simply, Putin isn't going anywhere until he wants to. He rallied people behind him through a renewed sense of national pride and because all of his predecessors have set the bar so low he appears like a national hero. His greatest achievements has been moving the people's focus away from the economy. And the oligarchs will never go against him (or even sponsor a viable alternative) because they will end up in the same place as Khadorkovsky. If Putin was able to punish the wealthiest oligarch, who would think they're an exception? Further the oligarchs rally behind Putin even as it hurts their pocket books because any politically viable alternative to Putin would be a complete disaster for them (next in line in terms of popular support is the Communist Party - and I don't think you need to have read Marx to understand what that means for ours affluent friends. Following the Communist Party, it's Zhirinovsky, an ultra-nationalist whose rhetoric is that he's willing to start WW3 if necessary).

59 and 60 done already today! C'mon 70!

Edit: Just done 61 and now the CRB has intervened.

Next big number to aim for. It's done 40, 50 and 60 now. We're not far off 63 so it's not unrealistic to suggest we could see 70 this year.

Edit: Wow! 5 mins later and we've gone to the 63's.

total crazy this pair... i don't understand !! fuck*** manipulation !!

Welcome to forex.
Nice censoring btw.

wow 58 to 66 in less than a day. this is insane.

50 to 66 in 15 days...

- USAIZRAEL to weaken Russias, because they EURO-ASIA creates an and want to go away from the USD Dolarsssss

I hear a lot of talk about CBR intervening massively to stabilize things. If there's truth to this, I think it would be ill-advised and very likely counter-productive. The RF has to wait for oil prices to stabilize before intervening and for the political situation to have a positive trend (at least as perceived by the media). I think if they intervene significantly too early, the market bulls will simply overtake whatever positive effects the CBR makes on the ruble and it would simply signal that CBR has no control, nor is willing to play by its own rules. It's impossible for the CBR to fight market panic.

Personally, I don't see any fundamental reason for the run-up. As I've said before however, don't trade this pair unless you have the $$ to avoid getting liquidated due to massive market movements that don't necessarily reflect any fundamental reasons, particularly if you're shorting USD/RUB. In my personal opinion, if you're going long, you're just gambling (nothing wrong with that, so long as you understand that once the trend reverses, you will probably be irreversibly wiped out).

Here's an interesting article from a Forbes contributor about the correlation of Oil prices to Ruble prices - written in 2012:
http://www.forbes.com/sites/markadom...-price-of-oil/

Today's move is absolutely extraordinary. A potential blow-off top? There are supposed to be some talks about sanctions later on Tuesday that may provide some relief. Russia also need to consider raising rates like Turkey did earlier this year in an emergency meeting that helped stabilize the Lira.

As far as the political situation: there is still a lot of silly rhetoric, but here are the most recent facts:

One development over the weekend was Medvedev's (Putin Jr.) article regarding Ukraine, something that didn't get much coverage in the western press. For the first time he said very explicitly that Russia will no longer support Ukraine financially (speaking more than likely in reference to existing free-trade agreements between Ukraine & Russia valued at over $15 billion for Ukraine). Further, Medvedev said Russia will be imposing restrictions on Ukrainian workers coming to work inside of Russia, which represents a significant part of Ukrainians (a hit to Ukraine estimated by the RF to be above $13 billion per year). As mentioned, the RF has many economic levers over Ukraine and Medvedev's statement was probably to illustrate that point. Since the west is politically invested into Ukraine not collapsing, but has no desire to extend free charity (as evidenced by the "hot-potato" game between the IMF and EU Commission "encouraging" each other publicly to give Ukraine more money and Russia pushing the Europeans), I think the Europeans and US will be seeking to get Russia's cooperation more and more.

Medvedev's statement was probably in response to Congress passing legislation to allow the president to impose new sanctions. Meanwhile, Obama has already said before Congress voted on the bill that he doesn't support it because the Europeans aren't likely to impose similar sanctions and the US shouldn't take actions unilaterally. I think the Europeans are likely to introduce new sanctions, but these will all be symbolic (probably restricting investment in Crimea), not anything like Congress has proposed (sectoral sanctions). Medvedev's statement is most likely just rhetoric in response to Congress's rhetoric of more potential sanctions. In other words, as I had predicted, Russia's message is that so long as the west doesn't impose new sanctions, Russia won't cancel the free trade agreement with Ukraine and will continue pushing for the ceasefire to hold. Hence whey I don't think new sectoral sanctions are anywhere on the horizon.

Meanwhile, the ceasefire appears to be holding and Russian Minister of Foreign Affairs (Lavrov) gave a statement after a meeting with Kerry that Russia wants East Ukraine to remain a part of Ukraine, a statement echoed by Medvedev's letter. Further, Ukrainian army commander of the hottest zone (the Donetsk Airport) recently gave a statement on camera that he doesn't think the war should continue.

P.S. Looking at charts, it doesn't look like CBR has intervened significantly today yet.

Is the Moscow Exchange getting desperate?

http://www.forexlive.com/blog/2014/1...ound-of-64-44/

But it is- and will.

This website may come in as a handy screensaver for those trading this pair (turn on volume): http://zenrus.ru. - From left to right: USD/RUB, EUR/RUB, USD/bbl (Brent).

A buddy of mine who is a banker in Russia emailed this to me yesterday. He said half of his coworkers have this playing all the time on their backup monitors. Clever.

Good points!

Thanks Grin.

Oh dear, that does put this soap opera on one page for us.

CBR Russia raises key rate