Thread by @bucktron2021

Not breaking news. Common knowledge: Russia's economy is _really_ fucked and it's all because of Putin's disastrous war.🧵

1. Every month the "market rate" for new russian recruits rises exponentially. Cheap, gullible soldiers are already dead. Remaining men understand how few of them will return alive to spend their money.

2. Unemployment is very, very low. No free labour means companies have to poach other companies' workers by promising higher wages. It's a bidding contest for workers. Higher wages are good, right?
tradingeconomics.com/russia/unemplo…

3. Higher wages chasing fewer products produced by fewer workers causes inflation. Reported inflation figures were 7.4% this time last year and 9.5% today. Actual inflation is higher.
tradingeconomics.com/russia/inflati…

4. russia's Central Bank is trying to control 9.5% inflation by offering 21% on russian bonds. Convince buyers to save their money rather than bid against each other for goods and services. 11.5% interest after inflation. Great deal, right?
tradingeconomics.com/russia/interes…

5. Markets thinks it's a bad deal. russia can't get a loan. russia only sold 5% of their bonds this time. The market doesn't think russia will pay them back. Or they think real russian inflation is higher than 21% and their investment will lose money.

6. Russia has also been burning through its national wealth fund, particularly for foreign purchases. Foreign sellers won't take rubles from a country whose currency is on the brink of collapse.

7. Putin needs more money to hire more soldiers, so he's resorting to theft. Here's Alexey Nechayev explaining that if russian people won't invest their money to prolong the stalemate, Putin will just confiscate the funds from every citizen's bank account.

8. Corporations can't confiscate funds from private accounts like Putin can. They sell bonds to raise money. But russian businesses can't afford to pay >21% for bonds. They also can't afford to pay high wages to compete with Putin's recruitment offers.

9. Even Gazprom is laying off half of its St Petersburg staff because they can't make ends meet.

10. Ukraine cannot beat russia. Only russia can beat russia. Putin is repeating Muscovites' mistake in Afghanistan by emptying the treasury, destroying his economy, and killing his workers in an aggressive imperialist war of choice that nobody can justify.

4a. Here's US, EU, and russian interest rates. The EU and US are easily raising money selling bonds at 3.1% and 4.5% respectively. russia is promising 21% and can't find buyers.
tradingeconomics.com/russia/interes…