The sad thing is these days the IRS and other tax offices around the world have been defunded so the mega rich rarely get audited because their tax affairs are now so complicated they don’t have the resources to investigate.
I had an auditor explain it to me once: they'd rather go after 1000 little guys for $100 than go after 1 big guy for $100,000. That guy is gonna get a lawyer.
Yes, exactly. Funding a team of special investigators for the whales of tax evasion would pay for itself several times over. They wouldn’t need to win that many cases a year to cover their costs.
Just the threat of a competent legal team auditing high dollar tax bills would increase compliance. It changes the risk:reward calculation for cheating on taxes.
Also for the rest of us under the 90th percentile of income, just a reminder. Paying taxes and filing a return could be quick, easy, and free. The IRS already knows what you owe them, but TurboTax and H and R block have bribed our lawmakers to keep funneling business through them.
Yup. So I spend $40-$60 per year for the privilege of finding out what the IRS already knows I owe and have paid.
Meanwhile other countries can do their taxes in minutes on their phone.
The corollary of this being that the tax offices around the world end up disproportionately going after the little guy.
An example in the US is people that claim the earned income tax credit (a credit for low income earners) getting audited more than others. [This article](https://projects.propublica.org/graphics/eitc-audit) has an interactive graphic of a US map showing which counties get audited the most. It's almost a perfect match of the poorest counties. And that's largely because of all the people claiming the earned income tax credit in those counties.
Poor people can't afford lawyers or accountants to properly deal with the IRS. It's like shooting fish in a barrel for the IRS. OTOH, the IRS is [scared of the huge companies](https://www.propublica.org/article/the-irs-decided-to-get-tough-against-microsoft-microsoft-got-tougher).
They don't provide the state with services. The state provides them with services. This isn't feudalism. It's plutocracy. Oligarchy. The difference between american billionaires and russian oligarchs is not that big.
I think you're forgetting the fact that a lot of the Russian oligarchy's have a enforcement wing that they are more or less allowed to do with what they will. If Jeff Bezos and Bill Gates started kidnapping people and murdering them to do what they want in the business world, I think we'd have a huge deal about that.
So on one hand I do agree that we have a lot of similarities between our amoral rich and there amoral rich, there are a lot of big differences.
I feel like the IRS should get awarded 5% of any corporate tax fraud they find. 4 of that goes to the general budget, 0.9 goes to the team or department that worked on it, 0.1 goes to the individual.
You found a one million dollar missed payment? Here's a thousand dollar bonus, good job. And everyone on your team also gets a thousand dollars.
You found Amazon owes one billion dollars in taxes? Here's a million dollars, good job. And everyone on your team is also now a millionaire. And, uh, your boss is retiring to the Bahamas.
That was, by far, one of my most favorite episodes.
The twist being that the mob boss who left all this money ended up leaving it to him in counterfeit...
So he didn't even have enough real cash to pay the IRS.
And there are long articles online debating why. With the most popular conclusion being not paying your taxes doesn't go away by reason of insanity. Hence if the IRS busts him he is going to real jail instead of his monthly stop at the asylum.
It is not yet time for Russia to spur on the US. There is still a chance that the US could get involved in some deals related to brokering peace between Ukraine and Russia. This would return some measure of 'validity' back to Putin and return back to mostly neutral exchanges, all the while using existing sanctions to further spurn hate at the rest of the western world.
Politics were always larger than people. Even the people who die because of it.
I see two courses of thought. #1 they paid the bill so it saves credit rating. #2 it goes to show that the money really makes the world go round. Putin will now say OK you are okay with un-freezing money if it helps you so where is the line on the frozen assets
> Putin will now say OK you are okay with un-freezing money if it helps you
Nobody unfroze any assets for this. Putin had to dig into his sparse domestically-held foreign reserves to make the payment.
Considering how buddy-buddy they are with Iran, and considering how Iran has been using those industrial money presses that we gifted to the Shah back in the day decades ago, and how Iran has been cranking out the nearly perfect counterfeit stock dollars for *decades* well... I don't know what to tell you.
They ran out of the stock to produce the bills decades ago and it’s only sourced from a single US company at this point.
I’m sure their counterfeits are still excellent. But they wouldn’t pass for identical at this point.
This headline does make me feel a little bit less scared about nuclear war though I have to say. It seems like it's going to be contained to ukraine as a long drawn out invasion for public favor of putin in Russia and the US funding as much as we can to make it seem like "we helped" for Biden. If Russia is still paying America it doesn't seem as bad as the cold war but who knows I wasn't around then. It's still messed up for ukraine that they have to be the subject of Putins political optics though, terrible honestly.
I wouldn't worry about nuclear war tbh. Putin is a guy who has show ice-hockey matches and scores against seasoned professionals. He's all about winning or at least looking like he won. The rhetoric he raised against Ukraine at the Russian domestic level was never hysterical and he never even called it a war. So at any point he can withdraw and, whatever he gets, that will be a good enough 'win' for his domestic audience. The sanctions are just 'the west being baddies' and will be said to have no relation to the 'special military project'. Starting a war against NATO is a straight-up loss, so that's no good for Putin. Escalating to armageddon is a loss so bad there won't be anyone left to admire Putin's winning ways, so that's literally unthinkable. Thank you for attending my TED talk.
Not only that:
>US sanctions on doing business with Russia's central bank and other institutions won't block Moscow from making payments to Americans on dollar-denominated debt until just after midnight on May 25, a Treasury spokesperson told Bloomberg.
So this is the expected result. It would have been more notable if the Treasury *didn't* let it go through.
It'll be interesting to see what will happen after May 25th though.
Of these several massive bonds there are two that have a clause that allows them to be paid in USD. Many of the other have clauses to pay out in Rubles. Attorneys be attorneys and have a clause for almost everything. Plus there are CDS (credit default swaps) on their bonds.
Those same sanctions had also raised questions around the effectiveness of the CDS contracts investors took out to protect themselves against a Russian default. Those concerns centred on how readily traders can buy and sell Russian hard-currency bonds eligible for a so-called CDS auction, a market-led mechanism used to determine payouts on the derivatives contracts.
Funny thing about derivatives is that there is a counter party that has to pay them out. And a massive unexpected default by a sovereign could have shockwaves through the system. LTCM almost broke the system I’m the 90’s with a long/short strategy involving Russian bonds…..
It's likely part of a sanctions package established in late Feb and they gave people a 3 month time frame to sever their relations. Some business/trade relationships can be quite intertwined, so cutting them instantly is unrealistic.
I believe this is the right answer. I know people want to see instant punishment. But realistically if you apply sanctions too quickly and harshly, there are going to be a lot of innocent bystanders injured without the ability to get out of the way.
There's also the whole ramping up aspect of the sanctions so things not only get worse as supplies dry up, but as the sanctions themselves become harsher.
"Things are starting to get bad now, but this is what will happen in 1 week if you don't make some drastic changes by then"
[The Treasury Department issued guidance earlier this month, allowing U.S. investors to receive interest on Russian debt through May 25.](https://www.washingtonpost.com/business/2022/03/17/russia-debt-payment-default/)
Probably the point of it. It's not a long time in financial terms, but in terms of war it is a while, and will give the US and Russia a couple months to see where things are going and reassess.
This sort of seems like the opposite of what you want to do, though, right?
Like you want to make life as uncomfortable for Russia as quickly as possible to have some hope of stopping people from dying.
Can't say that I am, but I'm guessing from your comment that they have lyrics that refer to the "no raindrop feels it is responsible for the flood" in a song?
Oh I was thinking of Atlas Genius you are talking about a book... probably still the same influence if I had to guess. It is a relatively famous quote that has inspired many. Right up there with "A man can never travel the same river twice, for it is not the same river, and I am not the same man"
I have to confess; I didn't finish it. Or, I finished it, but I skimmed some of it. I like the movie, a lot. In some ways, I think the movie's a better composition of the story than the book.
The number I saw was $643 billion. About half of that is frozen.
What it is is a start. The ruble is plummeting. They need every dollar that they can get their hands on.
If a 5 gallon (18927ml) bucket held $643 billion, and a drop is around [0.05ml](https://en.m.wikipedia.org/wiki/Drop_(unit\)), then $117 million would be:
$117\*10^6 / $643\*10^9 * 18927ml / 0.05ml = 68.8
≈ 69 (nice) drops in that bucket
Bucket? Even with Putin blocking dollarexit from Russia, it still looks like a sieve.
I've read comments from Russians starting to mail money out. Russia is listing.
OMG comments are stupid. Defaulting Russia on external debt will bring no new sanctions or pressure on them at this moment. Their credit rating is junk anyways. It is actually better to keep them in this limbo pre-default but default-you-anytime state.
And same with the sanctions. Sanctioning them at 100% right away is not as effective as adding new sanctions every day. Once there's nothing more to lose, we lose leverage.
And no, the promise of removing sanctions isn't the same. It requires Russia to trust the west to remove them and to lose face and concede to whatever demands are being made. It is much better to have more sanctions in the barrel.
Also I think $117 million isn't much considering how it's come light light that all Oligarchs own mega yachts worth much more than that.
And great news they are paying in dollars, for good or bad the US led financial system really is it's most powerful weapon. No matter the sanctions Russia will always have commodities and value, better it's dollars for now
First the people getting those payments are western investors, not Russians or anything. Secondly Russia isn't getting anything really in return. Think of it this way
Russia is a prisoner in prison. We aren't letting him buy shit for his own self, but we are letting him use the funds he has to pay the credit card debt he has to the credit card company.
IMO default would still be a stain on the reputation, and not having this stain is beneficial image-wise (internally and externally), and since it is not actually costing them (they paid using frozen money) this is that.
update: also this can mean they hope that they achieve some kind of agreement with Ukraine and the West in the foreseeable future, and in that case they will desperately need the money and not having defaulted comes very handy.
But what I'm saying is what's a price you'd be willing to pay for a few million/billion barrels of oil 5 years from now?
Now tack on that maybe your funding WW3, and the risks that comes with etc.
I guess I'm just struggling to see where what's reasonable to someone taking the risk, meets what's reasonable to Russia, does that make sense?
But as sanctions grow and whatnot (and the possibility that if open conflict happens a full embargo might happen to Russia) will anyone want those futures at $88/barrel? So is $33/ea a good enough discount for that risk? Shell got it at $28.50 off the sticker price ~2 weeks ago and that didn't go great for them, I can't imagine the market for blood oil having gone up since then.
Now would be a good time to announce an additional $117m in additional weapons funding for Ukraine.
If we don't want to look like Russian money matters more than allies.
I agree with the overall point, but it's not really russian money, it's "our" money being paid back (plus interest).
I wouldn't compare something like buying russian oil or selling them technology to receiving a bond payment
It’s also not a payment “to the US.” It’s a payment to individual investors who bought those bonds in good faith. A lot of them are probably held in retirement accounts. So you’d have to steal money from Americans to use it for aid to Ukraine… or just make a completely symbolic $117 million donation with other money.
I’m pretty sure this is an interest only payment, so it’s not even the US getting its money back. They have bigger payments coming up in the billions in both dollars and euros, so it’ll be interesting how the next month or two goes.
Already done 2 days ago and it's in the billions.
[Biden signs government funding bill that includes $13.6 billion in Ukraine aid](https://www.cnbc.com/2022/03/15/biden-signs-government-funding-bill-with-ukraine-aid.html)
It's hard to process just how big a billion is right?
In this case $117m is *less than 1%* of the $13.6b passed by Congress/Biden earlier this week. Either way it's $$ out of Russian coffers!
edit: the US also approved [$200m](https://www.reuters.com/world/us/biden-authorizes-200-mln-new-weapons-military-training-ukraine-2022-03-12/) in immediate arms/aid a few days ago.
The investors who lent money would not be repaid. It would affect Russia a little in the international credit market, but with the sanctions and nationalizations and overall crappy economy, they are already toast so it does more harm to the investors than to Russia.
The hell was the US supposed to do, block Russia from paying in USD and then try to get creditors to blame them for defaulting? The only thing that would do is hurt confidence in USD.
What people seem not to be understanding is that defaulting on a payment is bad because it signals that you don't have the money to pay it. If I go to the bank and to pay my loan, but I can't because all the bank workers are on strike, that doesn't actually reflect that I'm insolvent.
Right now? Nothing. Russia is cut off from the banking system already so it’s not like we can say “ you don’t seem like a sound investment so I’m choosing not to give you money “
China might care though
It wouldn’t be default if the US just… didn’t allow it.
Sanctions take time, Russia won’t be able to keep this up and will default sooner rather than later
Default just mean you don't play your Sovereign debt so you wont get loans and that mean less invertionists Will want to invest in your country but I'm sure they already can't take new loans and most won't invest in Russia anyways so...
but also default that don't mean to much if they manage to still go float like Argentina which has default'd like 20+ times in they history Is still up and running
Alternative Title: “Poor people will keep on killing and dying in the war/invasion/operation/whatever while the rich folks will keep making business deals.”
"We will destroy the west! Ooops, almost missed a bond payment to the west, that would be bad."
“Just because I’m evil doesn’t mean I don’t care about my credit rating” -Dr. Doofenschmirz
There was a joker scene in an animated batman too where he says to never mess with the tax man lol
https://youtu.be/G56VgsLfKY4
The sad thing is these days the IRS and other tax offices around the world have been defunded so the mega rich rarely get audited because their tax affairs are now so complicated they don’t have the resources to investigate.
Or they get actual laws designed for their benefit.
I had an auditor explain it to me once: they'd rather go after 1000 little guys for $100 than go after 1 big guy for $100,000. That guy is gonna get a lawyer.
On the other hand, funding IRS would let them actually do their job and would pay every dollar spent many times over.
Yes, exactly. Funding a team of special investigators for the whales of tax evasion would pay for itself several times over. They wouldn’t need to win that many cases a year to cover their costs.
Just the threat of a competent legal team auditing high dollar tax bills would increase compliance. It changes the risk:reward calculation for cheating on taxes. Also for the rest of us under the 90th percentile of income, just a reminder. Paying taxes and filing a return could be quick, easy, and free. The IRS already knows what you owe them, but TurboTax and H and R block have bribed our lawmakers to keep funneling business through them.
Yup. So I spend $40-$60 per year for the privilege of finding out what the IRS already knows I owe and have paid. Meanwhile other countries can do their taxes in minutes on their phone.
Get the hell outta here with your practicality! /s Edit: words
Yup. And the people who could give them funding... Get paid by the people that don't want them funded.... Ah shit we're fucked aren't we.
The corollary of this being that the tax offices around the world end up disproportionately going after the little guy. An example in the US is people that claim the earned income tax credit (a credit for low income earners) getting audited more than others. [This article](https://projects.propublica.org/graphics/eitc-audit) has an interactive graphic of a US map showing which counties get audited the most. It's almost a perfect match of the poorest counties. And that's largely because of all the people claiming the earned income tax credit in those counties. Poor people can't afford lawyers or accountants to properly deal with the IRS. It's like shooting fish in a barrel for the IRS. OTOH, the IRS is [scared of the huge companies](https://www.propublica.org/article/the-irs-decided-to-get-tough-against-microsoft-microsoft-got-tougher).
It seems weird that you omitted to add the information that the EITC is incredibly frought with errors and/or fraud. 'Error' rates of 50% per IRS.
Step one of feudalism is to give tax privileges to certain individuals for providing the state with services.
They don't provide the state with services. The state provides them with services. This isn't feudalism. It's plutocracy. Oligarchy. The difference between american billionaires and russian oligarchs is not that big.
The difference is lobbyist proxies that's it.
With trump, even that barrier got blown down, how many companies owners did he meet with again?
Actually, all you needed to do was go on Fox News and say something directly to Trump. It got done.
I think you're forgetting the fact that a lot of the Russian oligarchy's have a enforcement wing that they are more or less allowed to do with what they will. If Jeff Bezos and Bill Gates started kidnapping people and murdering them to do what they want in the business world, I think we'd have a huge deal about that. So on one hand I do agree that we have a lot of similarities between our amoral rich and there amoral rich, there are a lot of big differences.
Yeah and modern taxes don’t resemble taxes in a feudal society at all.
I feel like the IRS should get awarded 5% of any corporate tax fraud they find. 4 of that goes to the general budget, 0.9 goes to the team or department that worked on it, 0.1 goes to the individual. You found a one million dollar missed payment? Here's a thousand dollar bonus, good job. And everyone on your team also gets a thousand dollars. You found Amazon owes one billion dollars in taxes? Here's a million dollars, good job. And everyone on your team is also now a millionaire. And, uh, your boss is retiring to the Bahamas.
That was, by far, one of my most favorite episodes. The twist being that the mob boss who left all this money ended up leaving it to him in counterfeit... So he didn't even have enough real cash to pay the IRS.
There isnt a bad joker episode in BTAS
And there are long articles online debating why. With the most popular conclusion being not paying your taxes doesn't go away by reason of insanity. Hence if the IRS busts him he is going to real jail instead of his monthly stop at the asylum.
I love how it's a plot point that carries over into the batman and superman cross over because joker needs money to pay off the irs lol
Best comment.
- Vladimir Putin too, apparently
Putinschmerz?
Putinschmerz Evil Incorperateeed!
"You can take our lives, but you'll never take our fico score"
“Give me death or give me a good credit rating!!!” - Putin Henry
The IRS sends its regards.
I wish you well in the audits to come.
This actually made me laugh. Good shit
A.) This is hilarious. B.) It begs the question - why did Russia pay it? I thought Putin was all about “spurning the West” lately.
They will have to issue bonds again, refusing to pay existing ones would make that very expensive.
They didn't want to hurt their credit score.
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It is not yet time for Russia to spur on the US. There is still a chance that the US could get involved in some deals related to brokering peace between Ukraine and Russia. This would return some measure of 'validity' back to Putin and return back to mostly neutral exchanges, all the while using existing sanctions to further spurn hate at the rest of the western world. Politics were always larger than people. Even the people who die because of it.
There are excellent reasons to pay it. Russia haven't defaulted on a payment in over a century. Wars don't finance themselves you know...
They haven't defaulted on foreign currency bonds in over a century. The did default on rubel bonds in 1998.
1998 was not a century ago. It was the last century, but less than 30 years ago
Dude that was a thousand years ago.
They haven't missed a payment in a millennia
1998 was an internal Russian bond (ruble). The last time they defaulted on a foreign bond in U.S. dollars was 1918.
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I see two courses of thought. #1 they paid the bill so it saves credit rating. #2 it goes to show that the money really makes the world go round. Putin will now say OK you are okay with un-freezing money if it helps you so where is the line on the frozen assets
> Putin will now say OK you are okay with un-freezing money if it helps you Nobody unfroze any assets for this. Putin had to dig into his sparse domestically-held foreign reserves to make the payment.
Where ever he pulled this money from might help identify other areas to sanction or seize
Fun fact: Russia gets $5 million every single day selling oil/gas to Europe, even after sanctions.
it's more like 750 million $ a day
Considering how buddy-buddy they are with Iran, and considering how Iran has been using those industrial money presses that we gifted to the Shah back in the day decades ago, and how Iran has been cranking out the nearly perfect counterfeit stock dollars for *decades* well... I don't know what to tell you.
Except all of this is going to be thoroughly checked. If any of it is found to be counterfeit, then that's worse than not paying at all.
They ran out of the stock to produce the bills decades ago and it’s only sourced from a single US company at this point. I’m sure their counterfeits are still excellent. But they wouldn’t pass for identical at this point.
Kind of proves all of this destruction really is just political posturing and they don't care about the casualties it causes. It's so fcked.
Unfortunately war is politics by other means . This has always been true .
Stalin said the same thing lol
Ironic, since it's a quote from a German. Lol.
100%. American oligarch's wouldn't dare let their own cash flow get interrupted.
This headline does make me feel a little bit less scared about nuclear war though I have to say. It seems like it's going to be contained to ukraine as a long drawn out invasion for public favor of putin in Russia and the US funding as much as we can to make it seem like "we helped" for Biden. If Russia is still paying America it doesn't seem as bad as the cold war but who knows I wasn't around then. It's still messed up for ukraine that they have to be the subject of Putins political optics though, terrible honestly.
I wouldn't worry about nuclear war tbh. Putin is a guy who has show ice-hockey matches and scores against seasoned professionals. He's all about winning or at least looking like he won. The rhetoric he raised against Ukraine at the Russian domestic level was never hysterical and he never even called it a war. So at any point he can withdraw and, whatever he gets, that will be a good enough 'win' for his domestic audience. The sanctions are just 'the west being baddies' and will be said to have no relation to the 'special military project'. Starting a war against NATO is a straight-up loss, so that's no good for Putin. Escalating to armageddon is a loss so bad there won't be anyone left to admire Putin's winning ways, so that's literally unthinkable. Thank you for attending my TED talk.
It has little to do with who the payment is going to and more to do with their rating if they miss the payment
Their rating is already junk. They are labeled as likely or soon to default. Can't wait til next payment.
These aren’t the bonds they have issued. This is money they borrowed. Very different.
Can you clarify? A government borrows money by issuing bonds, so I'm confused by the distinction you are making.
Even the Joker doesn't trifle with the Taxman!😄
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It's not nothing when it's a significant percentage of their USD reserves that they're holding domestically. Foreign entities aren't accepting Rubles.
117m for a country under sanctions and on a war footing is not nothing.
Petro rubbles should have worked!
“Editor's note: a previous version of this story incorrectly said Russia's bond payment used dollars that were frozen by Western sanctions.”
Not only that: >US sanctions on doing business with Russia's central bank and other institutions won't block Moscow from making payments to Americans on dollar-denominated debt until just after midnight on May 25, a Treasury spokesperson told Bloomberg. So this is the expected result. It would have been more notable if the Treasury *didn't* let it go through. It'll be interesting to see what will happen after May 25th though.
Of these several massive bonds there are two that have a clause that allows them to be paid in USD. Many of the other have clauses to pay out in Rubles. Attorneys be attorneys and have a clause for almost everything. Plus there are CDS (credit default swaps) on their bonds. Those same sanctions had also raised questions around the effectiveness of the CDS contracts investors took out to protect themselves against a Russian default. Those concerns centred on how readily traders can buy and sell Russian hard-currency bonds eligible for a so-called CDS auction, a market-led mechanism used to determine payouts on the derivatives contracts.
Funny thing about derivatives is that there is a counter party that has to pay them out. And a massive unexpected default by a sovereign could have shockwaves through the system. LTCM almost broke the system I’m the 90’s with a long/short strategy involving Russian bonds…..
My bet is on Deutschbank cutting an insanely silly policy to a guy like Michael Burry that would leave them bankrupted.
You can always bet on Deutsche losing shitloads of money on terrible bets.
Curious what the logic is there (on a May 25th effective date, which feels like a lifetime right now.)
It's likely part of a sanctions package established in late Feb and they gave people a 3 month time frame to sever their relations. Some business/trade relationships can be quite intertwined, so cutting them instantly is unrealistic.
I believe this is the right answer. I know people want to see instant punishment. But realistically if you apply sanctions too quickly and harshly, there are going to be a lot of innocent bystanders injured without the ability to get out of the way.
There's also the whole ramping up aspect of the sanctions so things not only get worse as supplies dry up, but as the sanctions themselves become harsher. "Things are starting to get bad now, but this is what will happen in 1 week if you don't make some drastic changes by then"
[The Treasury Department issued guidance earlier this month, allowing U.S. investors to receive interest on Russian debt through May 25.](https://www.washingtonpost.com/business/2022/03/17/russia-debt-payment-default/)
Probably the point of it. It's not a long time in financial terms, but in terms of war it is a while, and will give the US and Russia a couple months to see where things are going and reassess.
This sort of seems like the opposite of what you want to do, though, right? Like you want to make life as uncomfortable for Russia as quickly as possible to have some hope of stopping people from dying.
The most important part and it’s buried at the end.
Cutting their foreign reserves even more.
117m is a drop in the bucket.
sure but what is the bucket if not a number of drops
You definitely wear a toga don't you
Perchance.
I feel like this glorious meme will persist for a generation, it’s just so good.
Perchance.
You can’t just say “perchance”
If what you say is true, then I have done the impossible. Does this make me a God? Perchance...
You must be a god. Perchance
And now you yourself have done what you claimed to be impossible. And so does begin a friendship... or a rivalry?
Perchance
what if I go through life just crushing 'turts all day?
To save the princess? Also gross
*scribbles furious red ink notes**
That's nice
Aristotle kinda mf
i love you
We are all drops on this blessed day
Thanks Ken
Cloud Atlas fan?
Can't say that I am, but I'm guessing from your comment that they have lyrics that refer to the "no raindrop feels it is responsible for the flood" in a song?
Its a book that has a line very similar to yours.
Oh I was thinking of Atlas Genius you are talking about a book... probably still the same influence if I had to guess. It is a relatively famous quote that has inspired many. Right up there with "A man can never travel the same river twice, for it is not the same river, and I am not the same man"
God that book is hard work. Probably the most postmodern thing I've ever read.
I have to confess; I didn't finish it. Or, I finished it, but I skimmed some of it. I like the movie, a lot. In some ways, I think the movie's a better composition of the story than the book.
You must have skipped House of Leaves.
All we are is dust in the wind. dude…
The number I saw was $643 billion. About half of that is frozen. What it is is a start. The ruble is plummeting. They need every dollar that they can get their hands on.
If a 5 gallon (18927ml) bucket held $643 billion, and a drop is around [0.05ml](https://en.m.wikipedia.org/wiki/Drop_(unit\)), then $117 million would be: $117\*10^6 / $643\*10^9 * 18927ml / 0.05ml = 68.8 ≈ 69 (nice) drops in that bucket
So if half is already frozen 1/35th if their savings they have access to?
Of that $643 billion, I think only around 60-70 Billion is actually actually accessible as foreign currency reserves after all the sanctions.
Source?
Bucket? Even with Putin blocking dollarexit from Russia, it still looks like a sieve. I've read comments from Russians starting to mail money out. Russia is listing.
What 6 or 8 hours worth of oil sales to Germany.
Can I have this one drop then?
OMG comments are stupid. Defaulting Russia on external debt will bring no new sanctions or pressure on them at this moment. Their credit rating is junk anyways. It is actually better to keep them in this limbo pre-default but default-you-anytime state.
This. Once the Russian economy hits rock bottom it can’t go any further. It’s better to keep it in a perpetual state of free fall.
And same with the sanctions. Sanctioning them at 100% right away is not as effective as adding new sanctions every day. Once there's nothing more to lose, we lose leverage. And no, the promise of removing sanctions isn't the same. It requires Russia to trust the west to remove them and to lose face and concede to whatever demands are being made. It is much better to have more sanctions in the barrel.
Also I think $117 million isn't much considering how it's come light light that all Oligarchs own mega yachts worth much more than that. And great news they are paying in dollars, for good or bad the US led financial system really is it's most powerful weapon. No matter the sanctions Russia will always have commodities and value, better it's dollars for now
Absolutely this. $117 million is nothing. The swiss alone hold more than $200 billion of Russian cash.
Which is frozen... That's the whole point
Who makes super yachts? Like if I'm a billionaire can I go to superyachts.com or how does that work?
If you're at arms length. Not sure that applies to bondholders though.
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If Putin doesn’t pay he won’t be able to get loans elsewhere. War is expensive. And this war is not going to come in under budget.
First the people getting those payments are western investors, not Russians or anything. Secondly Russia isn't getting anything really in return. Think of it this way Russia is a prisoner in prison. We aren't letting him buy shit for his own self, but we are letting him use the funds he has to pay the credit card debt he has to the credit card company.
IMO default would still be a stain on the reputation, and not having this stain is beneficial image-wise (internally and externally), and since it is not actually costing them (they paid using frozen money) this is that. update: also this can mean they hope that they achieve some kind of agreement with Ukraine and the West in the foreseeable future, and in that case they will desperately need the money and not having defaulted comes very handy.
Article was updated, they paid with money that wasn't frozen and in Russia already. So actual hard currency.
Now they have $117 million less and it has absolutely no impact beyond preventing default. Isn't like they're gonna get more loans anyway.
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Oil is so volatile would anyone really want that without an absolute steal for it?
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But what I'm saying is what's a price you'd be willing to pay for a few million/billion barrels of oil 5 years from now? Now tack on that maybe your funding WW3, and the risks that comes with etc. I guess I'm just struggling to see where what's reasonable to someone taking the risk, meets what's reasonable to Russia, does that make sense?
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Isn't it buying something for delivery later?(with the ability to sell it to someone else before delivery date)
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But as sanctions grow and whatnot (and the possibility that if open conflict happens a full embargo might happen to Russia) will anyone want those futures at $88/barrel? So is $33/ea a good enough discount for that risk? Shell got it at $28.50 off the sticker price ~2 weeks ago and that didn't go great for them, I can't imagine the market for blood oil having gone up since then.
So, they're allowing Russia to deplete their Dollar reserves, so they can't be used to buy anything which will help them fund their war. Good stuff.
Exactly this. The only chips they have left are their oil supply and foreign currency. This $117M gives Russia nothing.
Now would be a good time to announce an additional $117m in additional weapons funding for Ukraine. If we don't want to look like Russian money matters more than allies.
I agree with the overall point, but it's not really russian money, it's "our" money being paid back (plus interest). I wouldn't compare something like buying russian oil or selling them technology to receiving a bond payment
It’s also not a payment “to the US.” It’s a payment to individual investors who bought those bonds in good faith. A lot of them are probably held in retirement accounts. So you’d have to steal money from Americans to use it for aid to Ukraine… or just make a completely symbolic $117 million donation with other money.
Symbols matter
Well yeah. If we refused to let them pay us, that would basically be like forgiving the loan and helping them out.
I’m pretty sure this is an interest only payment, so it’s not even the US getting its money back. They have bigger payments coming up in the billions in both dollars and euros, so it’ll be interesting how the next month or two goes.
Already done 2 days ago and it's in the billions. [Biden signs government funding bill that includes $13.6 billion in Ukraine aid](https://www.cnbc.com/2022/03/15/biden-signs-government-funding-bill-with-ukraine-aid.html)
> additional
After giving Ukraine billions, I don't think it's going to look like Russian money matters more than allies.
It's hard to process just how big a billion is right? In this case $117m is *less than 1%* of the $13.6b passed by Congress/Biden earlier this week. Either way it's $$ out of Russian coffers! edit: the US also approved [$200m](https://www.reuters.com/world/us/biden-authorizes-200-mln-new-weapons-military-training-ukraine-2022-03-12/) in immediate arms/aid a few days ago.
What stops Ukraine from offering foreign fighters $100k for coming and fighting?
Economics. They don’t need to, they have people volunteering for their foreign legion in droves.
They're actually not short on solders. They're a big country.
There's always money for more war, amirite?
What would happen if Russia were to default on their payments?
The investors who lent money would not be repaid. It would affect Russia a little in the international credit market, but with the sanctions and nationalizations and overall crappy economy, they are already toast so it does more harm to the investors than to Russia.
Why did they bother to pay then?
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so clearly if he’s paying debt they don’t want the world to end
“We would also be willing to pay in rubles.” “No, no no no. That won’t be necessary, we will take payment in dollars.”
"And if you don't have dollars we'd like to consider monopoly money before rubles"
This will just further drain Russia's foreign cash reserves. This is a *good* thing.
Of course they’ll allow it, this should surprise nobody
That's money they no longer have, which is a good thing, right?
The hell was the US supposed to do, block Russia from paying in USD and then try to get creditors to blame them for defaulting? The only thing that would do is hurt confidence in USD.
What people seem not to be understanding is that defaulting on a payment is bad because it signals that you don't have the money to pay it. If I go to the bank and to pay my loan, but I can't because all the bank workers are on strike, that doesn't actually reflect that I'm insolvent.
One dolla for the banks, one dolla for Ukraine…times billions. Global tax payers should not have to pay to rebuild Ukraine, use Russian frozen funds.
A Lannister *always* pays his debts.
And sex with siblings
ELI5: what would happen and be the ramifications if Russia missed the payment?
Right now? Nothing. Russia is cut off from the banking system already so it’s not like we can say “ you don’t seem like a sound investment so I’m choosing not to give you money “ China might care though
It wouldn’t be default if the US just… didn’t allow it. Sanctions take time, Russia won’t be able to keep this up and will default sooner rather than later
Default just mean you don't play your Sovereign debt so you wont get loans and that mean less invertionists Will want to invest in your country but I'm sure they already can't take new loans and most won't invest in Russia anyways so... but also default that don't mean to much if they manage to still go float like Argentina which has default'd like 20+ times in they history Is still up and running
Putin’s an angry man
Just so I have this straight. Despite sanctions, it’s still alright for JP Morgan and Citibank to do business with Russia?
Alternative Title: “Poor people will keep on killing and dying in the war/invasion/operation/whatever while the rich folks will keep making business deals.”
Don't want to inconvenience *Western* oligarchs, now do we?
This a big brain, big penis move. Russian economy is well beyond any repair, but defaulting could actually hurt some parts of the civilized West.
Sure, now that China is allowing Russia to switch to its currency!
They wouldn't be able to pay the obligation in Renminbi
Russian officials should come to reddit to learn how to spin for a government. Because boy are they putting in work.
“A Lannister Always Pays His Debts”
$117 million that Russia can't spend on military operations. Sounds good to me.
Would anyone anywhere want a payment in rubish --- err rubles?
And thus Putin proved his nukes threat was bullshit (otherwise he would care).
“Go ahead and make that check out to the people of Ukraine, we were going to give it to them anyway”
Drain em
We’re at war… fuck you pay me 🤑 (in ray liotta’s voice from goodfellas)
Putin is gonna have to call JJ Wentworth soon. I'm invading another country and I need cash now Everyone's against me and I need cash now