>>519760393
Yes. It's not quite magic money/printing because the securities are sold at market rate or close to what one could imagine market rates to be insofar as a financial market works properly in that country.
The net consequence of this however is, instead of immediate hyperinflation, you instead get very expensive money and a crowding out credit to the private sector. Which is why you get headlines like this in .ru media by the CEO of the biggest bank there.
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>>519369545
I think news about the banking sector is the most interesting to follow.
You can only pay for war, any war going back to prehistory, with either taxes or debt or loot. Russians are maxing out their credit card and there's not much loot to be had after bombing all the land they're taking and no government has the ability to raise taxes indefinitely without revolt, even autocratic ones.
What happens when you need money but no-one will lend to you? Not just the government but for Russian businesses more widely?
I think news about the banking sector is the most interesting to follow.
You can only pay for war, any war going back to prehistory, with either taxes or debt or loot. Russians are maxing out their credit card and there's not much loot to be had after bombing all the land they're taking and no government has the ability to raise taxes indefinitely without revolt, even autocratic ones.
What happens when you need money but no-one will lend to you? Not just the government but for Russian businesses more widely?
>>518938576
>but it has so for quite a while now
No this is wrong. Look at these repo auctions dated from January 2023, a point at which you could say that the sanctioned Russian economy had become settled. Notice how absent bidding is? When there are auctions, the volumes of rubles bid for is very small compared to 2025.
Why is this important? Back then banks had cash and peer to peer lending was stable. Banks could borrow cash from each other if they needed and they trusted each other to pay their debts back. These interbank loans are often overnight lending or other short-term loans. To ask the central bank for a loan is a sign of desperation, it means you can't get a loan from other banks.
Why are banks refusing to lend to other banks and forcing them to run to mummy to beg for cash? That's what's happening this year and it began in earnest this year.
https://www.cbr.ru/eng/hd_base/repo/?UniDbQuery.Posted=True&UniDbQuery.From=01.01.2023&UniDbQuery.To=14.10.2025&UniDbQuery.P1=0
To use your own analogy, the wheels aren't really spinning that well. New credit issued is pitiful this year. Picrel is what the CEO of the biggest bank in Russia said. All significant credit activity in 2025 is just loan restructuring.
And what about all those workers getting paycuts and forced into unpaid leave and 3 or 4 day work weeks? They took out loans over the past few years and bought houses. House prices in Russia have exploded. They aren't going to be able to make their mortage payments which is a huge portion of banking assets.
IMO the situation with China and refineries is less likely to happen than the above scenario of a big bank suddenly discovering that their entire asset portfolio is rotten and they've lent trillions of rubles to millions of people who are de facto unsalaried and jobless.
https://www.bloomberg.com/news/articles/2025-06-26/russian-banks-fear-debt-crisis-is-coming-as-war-strains-economy
>but it has so for quite a while now
No this is wrong. Look at these repo auctions dated from January 2023, a point at which you could say that the sanctioned Russian economy had become settled. Notice how absent bidding is? When there are auctions, the volumes of rubles bid for is very small compared to 2025.
Why is this important? Back then banks had cash and peer to peer lending was stable. Banks could borrow cash from each other if they needed and they trusted each other to pay their debts back. These interbank loans are often overnight lending or other short-term loans. To ask the central bank for a loan is a sign of desperation, it means you can't get a loan from other banks.
Why are banks refusing to lend to other banks and forcing them to run to mummy to beg for cash? That's what's happening this year and it began in earnest this year.
https://www.cbr.ru/eng/hd_base/repo/?UniDbQuery.Posted=True&UniDbQuery.From=01.01.2023&UniDbQuery.To=14.10.2025&UniDbQuery.P1=0
To use your own analogy, the wheels aren't really spinning that well. New credit issued is pitiful this year. Picrel is what the CEO of the biggest bank in Russia said. All significant credit activity in 2025 is just loan restructuring.
And what about all those workers getting paycuts and forced into unpaid leave and 3 or 4 day work weeks? They took out loans over the past few years and bought houses. House prices in Russia have exploded. They aren't going to be able to make their mortage payments which is a huge portion of banking assets.
IMO the situation with China and refineries is less likely to happen than the above scenario of a big bank suddenly discovering that their entire asset portfolio is rotten and they've lent trillions of rubles to millions of people who are de facto unsalaried and jobless.
https://www.bloomberg.com/news/articles/2025-06-26/russian-banks-fear-debt-crisis-is-coming-as-war-strains-economy