Finance Minister Says Russia Has Full Confidence in Dollar

[blazespinnaker]

Your daily serving of cognitive dissonance:

http://www.bloomberg.com/apps/news?p...d=abKnXn3puSjY

- Russia has full confidence in the dollar and there are no immediate plans to switch to a new reserve currency, Finance Minister Alexei Kudrin said.

“It’s too early to speak of an alternative” to the dollar, Kudrin said in Lecce, Italy, in a television interview today after meeting with finance chiefs from the Group of Eight nations. The fundamentals of the dollar are still in “good shape.”

[sandwind]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Bank of Japan have full confidence in dollar as well.

[johngaltfla]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Of course once they dump all of their dollar denominated assets, the announcements about how they have the full faith and trust in the Euro and how the dollar is for loser 3rd world banana republics will be made daily.

[audrey_girl]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

it always concerns me when someone or some entity makes such an absolute statement"

"unshakeable confidence"


"i am not a crook"





"i did not have sex with that woman"

[c1ue]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Russia has been selling rubles like mad to keep its currency from appreciating too much against the dollar.

I've commented before, but since the 'controlled' devaluation of the ruble from 26 in October 2008 to its low of 36 in March 2009, the ruble has since recovered to 31-ish. But this last number is with 3 interest rates cut by the CBR (central bank of Russia) and also with $20B+ worth of ruble selling - hence a rise in currency reserves.

What is more interesting (again) is how little the ruble/euro rate is changing: 35.5 in October 2008 to peak of 47, presently 44-ish.

This behavior is fairly consistent across most currencies not in a de-facto tie to the dollar: i.e. Asian currencies like the RMB, the yen, SGP, etc.

What hasn't been talked about enough is what the ultimate effects of a reversal of the 'savings glut' means. There have been a few mentions on how Greenspan's stubbornly low rates due to the 'savings glut' could convert to stubbornly high rates due to said glut's reversal, but the extent is still unclear (to me).

Certainly stagflation or an inflationary, credit starved recession are both possible.

[Adeptus]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Bank of Japan have full confidence in dollar as well.

Japan: "We have *absolute* confidence in the US dollar"

Peter Schiff: "They [Japanese] must be, behind the scenes trying to contemplate an exit strategy [of the US dollar], some way to get out of this untenable position... like talking up the dollar in a pump and dump".

In other news: 2 Japanese nationals are caught transporting 134.5 Billion USD bonds across European boarders for unknown purposes.

Hmmmmm....

[jtabeb]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Of course once they dump all of their dollar denominated assets, the announcements about how they have the full faith and trust in the Euro and how the dollar is for loser 3rd world banana republics will be made daily.

Poom on monday, My Cash is back in uranium stocks for mon. open.

The eye of the Hurricane just passed overhead. Storm part II starts monday.

This time, IT WILL NOT DOLLAR supportive.

Edit:

Sorry, looks like I pulled a Mega.


guess I'm stuck, CNX'd orders. WTF, Chaos in Iran and the gold price DOWN, Dollar UP, OIL DOWN.

I think I will start going to fortune tellers as, nothing else seems to be working.

[blazespinnaker]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

heh heh heh ok ok good points all.

There is a prediction that we'll go up to 1.20 and then it'll crash hard. I wonder if it'll make that far.

I actually agree with a lot of sentiment on this board if these creditors feel the need to start pumping the dollar, something probably is dangerously awry.

Starting to wonder if the Japanese speaking up is a direct reaction to the bonds out of Switzerland fiasco.

[johngaltfla]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

heh heh heh ok ok good points all.

There is a prediction that we'll go up to 1.20 and then it'll crash hard. I wonder if it'll make that far.

I actually agree with a lot of sentiment on this board if these creditors feel the need to start pumping the dollar, something probably is dangerously awry.

Starting to wonder if the Japanese speaking up is a direct reaction to the bonds out of Switzerland fiasco.

There is. The rollovers of all the various garbage or postponements from last year's BSC/LEH fiasco along with tens of billions of more from FNM/FRE securities that either have to be monetized or allowed to float.

My money is that the Fed monetizes the entire thing rather than risking an "L" shaped recession and turning into a Wile E. Coyote recession/depression. They can not and will not allow another seizing up of the credit system and nobody has any faith in all of this recovery talk. For those that don't believe that last statement, look at the 1 year continuous yield charts for the 1 month, 3 month and 6 month Treasuries.

[portobellovcs3]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Personally, as a non-American, I understand everyone's concern over the dollar. However, short term, I'm betting on a dollar rally and commodities (including p.m.'s) and equity markets taking a dive (how big a dive I won't try to guess). Longer term the US and its currency are in serious trouble, but I wouldn't want to bet against the Fed and the other CB's trying to prop up the dollar in the shorter term. If the US Dollar did tank short term can you imagine the fallout? It would kill everybody and equity markets would tank. However, that in turn could then bring the dollar back for a while on safe-haven buying. Don't count out the USD if there happened to be another panic in the equity markets. What will people want to own in a panic? I think the usual suspects - USD, Yen, Euro, etc. I think Americans need to remember how much the rest of the world depends on the dollar and US demand. The world can't just suddenly abandon the US Dollar. It has to be done gradually. I was in Hong Kong a few months ago and there were piles of shipping containers just sitting there when a year ago they would all be out. The port in Yokohama was also eerily quiet. That's the impact. All of you in the USA should remember how important the US still is and will be for some time. I feel for you guys and wish you all the best. Luckily for me, my wife and her family are in Asia and I have Canadian and European citizenship. I pretty much have all the options.

[makimanos]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

The oil game again. If oil stays above 70 look a break in the BRIK.

[waysouth]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

"No one lies like a Minister of Finance on the eve of a devaluation...

something must be up!

[big67]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

"No one lies like a Minister of Finance on the eve of a devaluation...

something must be up!

Can somebody point me to the USA source of this new?
It says that in April 2009 53.2 billion dollars went out of US$ denominated assets, in particular 44.5 Billin $ out of treasuries, with China treasuries holdings decreasing for the first time in 11 months.
Can this be the effect of the stimulus in China on reserves?

Usa: 53,2 mld$ deflussi netti capitale estero in aprile (RCO)

Calano per 1ma volta in 11 mesi i Treasury detenuti da Cina

(Il Sole 24 Ore Radiocor) - Washington, 15 giu - I flussi netti di capitale dagli Stati Uniti sono risultati negativi per 53,2 miliardi di dollari in aprile con un calo dei titoli del Tesoro detenuti dagli investitori internazionali pari a 44,5 miliardi. In particolare per la prima volta in 11 mesi sono calati gli asset detenuti in titoli del Tesoro Usa dalla Cina

[touchring]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Personally, as a non-American, I understand everyone's concern over the dollar. However, short term, I'm betting on a dollar rally and commodities (including p.m.'s) and equity markets taking a dive (how big a dive I won't try to guess). Longer term the US and its currency are in serious trouble, but I wouldn't want to bet against the Fed and the other CB's trying to prop up the dollar in the shorter term. If the US Dollar did tank short term can you imagine the fallout? It would kill everybody and equity markets would tank. However, that in turn could then bring the dollar back for a while on safe-haven buying. Don't count out the USD if there happened to be another panic in the equity markets. What will people want to own in a panic? I think the usual suspects - USD, Yen, Euro, etc. I think Americans need to remember how much the rest of the world depends on the dollar and US demand. The world can't just suddenly abandon the US Dollar. It has to be done gradually. I was in Hong Kong a few months ago and there were piles of shipping containers just sitting there when a year ago they would all be out. The port in Yokohama was also eerily quiet. That's the impact. All of you in the USA should remember how important the US still is and will be for some time. I feel for you guys and wish you all the best. Luckily for me, my wife and her family are in Asia and I have Canadian and European citizenship. I pretty much have all the options.

Do not think that the old men in CCP politburo will act rationally. These hardened people have gone thru the famine and cultural revolution. To them, eating rice water with cabbage everyday is good enough.

China can produce enough rice and cabbages even if they were to stop exporting to the US entirely.

[Slimprofits]

Re: Finance Minister Says Russia Has Full Confidence in Dollar

Can somebody point me to the USA source of this new?
It says that in April 2009 53.2 billion dollars went out of US$ denominated assets, in particular 44.5 Billin $ out of treasuries, with China treasuries holdings decreasing for the first time in 11 months.

http://www.treas.gov/tic/mfh.txt