Here is another angle regarding Russia and US economy
Let me explain something to you about Russia and their rubleFirst, you must realize that all the mainstream financial news outlets are propaganda organs for the west. The lie about most every financial number coming out of the USA to try to con the world into trusting in the US economy, and thus the hegemony of the US dollar.
Second, you have always heard that a country is in better shape when its currency is relatively weak compared to its trading partner, causing its exports to be cheaper and imports more expensive, and so it can export more and import less. This causes a country’s trade balance to be positive.
However, in the case of the USA, its financial condition has deteriorated to the point where increasing its trade balance is less important than reducing its debt payments to a manageable number. The USA is in so much debt at this point that it must try to keep a strong dollar, even at the expense of its trade balance. If the dollar were to lose strength, the US bonds would have to fall in price and so the interest earned, or yield, would go up. This yield, or interest, whatever level it is any particular moment, is transferred to the US treasury because the treasury is constantly creating new bonds to replace maturing bonds, and also creating new bonds to cover the continuously rising deficit, which is about a trillion dollars per year now.
In summary, the USA has reached the end game of its business life cycle. Its debt burden is so great there is no mathematical way to escape it. It is an Enron. It is a ship that has struck an iceberg and the band is playing but the ship is sinking and the deck is awash…it won’t be long now until it slips below the surface forever. It is an airplane that has lost all engines and is in a flat spin accelerating towards the earth and complete obliteration. The odds of saving the USA financially now would be like trying to save a person that has jumped off the empire state building and is half-way to the ground before anyone even noticed. There is no chance to save the US economy at all, and if you understand economics to any appreciable degree, you will have embraced this eventuality as fact. The US will default on its debt, and this is not an opinion, it is a fact based on math. The politicians know this, the only question is when it will happen. If the dollar can be maintained strong, the cost of the interest will be low, however should the interest the US treasury have to pay on its debt ($18 trillion) rise by just one percent, the US debt market would break because of math…it simply cannot afford to pay any more debt. The rate the treasury pays on its debt cannot even go back to its historical norm, nor no where near it or collapse would be immediate. Incidentally, $18 trillion equates to $56,000 per person and $154,000 per person that actually pays taxes (about one in three). What chance do you think there is that every single person in the USA will ever be able to pay $56,000 more dollars to the treasury so the treasury can pay off the debt? The work force of the USA is down to under 50% of the population…
Before looking at Russia, note that the European economy is about in the same shape as the USA economy. The debt to GDP ratio is on the same order of magnitude…the debt itself is about the same value…give or take a few trillion.
Now let’s look at Russia. Russia does not have a lot of debt (way less than one trillion dollars). Although it has a smaller economy than the USA or Euroland, its debt to GDP ratio is only 17%, which compared to the USA and Euroland is quite low…by a actor of 4 or more. Another way to put it is that Russia is a smaller business that has only ¼ the debt-to-revenue ratio of its bigger competitors. In an economic downturn, would you rather be an employee of which of these businesses? Russia of course.
Read more at http://investmentwatchblog.com/let-me-explain-something-to-you-about-russia-and-their-ruble/#epFiO2Mh4fkvi5Q8.99
Love Always
mudra
