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The Saker holds that the "real problem is the lack of credibility of the Russian Central Bank and the Kremlin. Thus the key factor in the fall of the Ruble is distrust of the Russian authorities." Many commenting on the Saker's blog seem to take a similarly psychological view of the problem.
A more prosaic explanation is that Russia has engaged in a serious bout of inflationary finance (e.g., consumer credit creation by private banks) at the same time that Russian corporations were taking on massive debts denominated in foreign currency, which will now cost twice as many rubles to repay as the loans were originally worth.
Under those circumstances, the decline in oil price which has driven down Russia's foreign currency earnings by around $3 billion a week, was sufficient to set off panic selling of the ruble.
Recovery of the ruble will depend on:
(1) a decline in imports as the result of a doubling in the price of Mercedes, BMW's, etc.;
(2) a resolution of the foreign debt problem of the corporate sector, which will come either through widespread bankruptcies, that will punish shareholders and foreign lenders alike, or through government bailouts comparable to the Western government bank bailouts;
(3) a recovery in the price of oil, which is unlikely to come anytime soon;
(4) not least, government austerity, which will mean printing fewer rubles, holding wages down in the face of double digit inflation, and cutting welfare and other spending programs.
The sooner Russians accept economic reality, the sooner the present disaster will be effectively dealt with. Realism means acknowledging the errors that have been made (too much consumer credit creation, rash foreign borrowing by the corporate sector, and currently massive bailouts with printed money to the corporate sector, e.g., a quarter trillion rubles to Rosneft this week alone). The expectation of further corporate bailouts must account for the most recent decline in the value of the ruble. It remains to be seen, therefore, whether the Putin government can restore the value of the ruble without devaluing its own credibility.
Russia's need for logical actions to deal with real economic problems is urgent, since those devious Anglo-Saxons are no doubt doing everything in their power to make things worse for Russia and for Putin in particular.
Zero Hedge: Back To Basic Fundamentals - The Dollar Versus The Ruble