The euro has tumbled near parity to the US dollar
bloomberg.com
bloomberg.com
- in time of a crisis, the world seems to ralley around the dollar, as it is backed by the strongest economy and the strongest military.
- this crisis has hit Europe hard, as it is not only close to the war, but of course, too dependant on Russian oil and especially gas.
- there was a lot of inflation internationally, the US federal bank was the first to raise interest to combat inflation. The EU lags behind and is limited in action due to the fear of destabilizing some of its member countries with too high of a debt.
Consequently, there is a lot of good reason for the Euro to be weak at these times. However, if the energy crisis can be solved and the war contained, a weak Euro also is also pushing exports from the EU. So there is a lot of reason for this trend to be stopped, if not reversed, until the other extreme is reached again.
All of it a result of moronic politics around nuclear and a failure to build out fossil fuel capacity while the green energy transition was still in progress.
Nuclear certainly is crucial in the mix. And used as such: Europe has a lot of nuclear power.
But nuclear is slow. Terribly so. Even an operational plant needs days to react to increasing or decreasing demands. And building such plants from scratch, or extending existing ones, takes decades. Never months.
you can read about this concept here: https://en.wikipedia.org/wiki/Heating_element
Anyone using electric baseboards is getting highly subsidized electricity because any other energy source is cheaper.
Only place I saw baseboard heating was in school portables.
It’s something I’ve always wondered:
At night, it might be more cost effective to heat a bedroom electrically than an entire household with gas. But that’s a forced air heating issue: you can’t block 75% of a furnace’s airflow and expect it to keep working. Europe usually has boilers and radiators so dialing down heating to just a room is possible.
Or better yet, heat the person with a mattress pad instead of the building air at night.
Electric water heaters and baseboard heaters are common, and extremely efficient. In fact, resistive heaters in the scientific sense (watts in vs. watts out) are the most efficient form of heating.
They're extremely reliable and cheap because of how simple they are.
They may not be _cost effective to run_ in many regions due to high cost of electricity (per watt as compared to gas). But here in BC Canada, resistive elements are extremely common due to relatively cheap power (Hydro in our case). For whole home heating, heat pumps are usually used in new builds because of their advantages, but they're still very tied to the grid and have elements in them for defrosting and the like.
If you scaled up nuclear you'd similarly see prices of electricity drop, and if you have the grid infrastructure (or build it), electric heating (for your home, water, cooking, whatever) becomes pretty attractive.
But I'm glad you've been convinced :)
Electric resistive heaters are 100% efficient - they convert 100% of the electricity into heat.
Electricity heating does produce a bunch of heat at other places though, and it all comes from work, whereas the gas could only produce maybe 70% as much work if used some other way.
Yes there are inefficiencies at generation and transportation. But I don't think those are usually counted when talking about the efficiency of a home device. And it certainly won't be enough to bring it down to 0%.
As an illustrative example, you could get the same heating effect by putting the electricity through a computer or other appliance, or by putting the gas through a heat engine to produce electricity which is used inside the home and warming the house with the waste heat.
I know about heating by computer because for the last several years I've heated my apartment solely by mining Ethereum on my computer. The only dedicated heaters that my apartment has are resistive electric heaters built into the walls, so it's better for me to get a little Ethereum plus heat than just heat.
You could frame it as fraction of the heating that is possible at carnot efficiency, I guess. Ie. the amount of heat you put into your room / the amount of heat you with a perfect machine could at typical temperature differentials.
Then an element would be about 10-15% efficient (as measured at the wall vs. an ideal heat pump) and gas would be...awkward to calculate (I'd have to open up a textbook if not just multiplying max COP and max thermal efficiency of a heat engine), but somewhere in the 20-30% efficient range. Electric including a thermal generator would be in the 8-10% range somewhere.
Electric heat pumps would be around 50-70% by this metric, or in the 25-40% range somewhere if using a thermal generator.
Thinking about it, I like this metric because it really highlights how much more wasteful burning gas to heat a home with electricity is if you're not using the waste heat for something. If you're not using renewable electricity, even heat pumps don't break even if they're not high quality and well maintained.
Really drives home the importance of insulation and good curtains in cold areas.
Edit: looking at absorption heat pumps, they seem to be a little better than my guesstimate. I think they outperform fossil fuel powered electric heat pumps.
Electric heating is about the simplest machine you can possibly make (it's just NiCr wire and a thermostat which is already there), and the cost would almost exclusively be the labour of installation. Even heat pumps (including for water) could be built in relatively short order.
The problem is it would entail quadrupling the electricity generating and transmission infrastructure. This is the hard part that takes decades.
- Large parts of the Uranium are coming from Russia
- Nuclear power is not competitive and nuclear power is very expensive (especially if you conside the costs the government will be left holding the bag on, becuase nuclear power plant companies will spin off their power plants to new companies to go bankrupt once the profiting is done and the cleaning up the nuclear remains starts), no matter how much the pro-nuclear people want to lie about it
- Nuclear power is statistically not dangerous compared to fossil fuels, but not compared to renewables.
- The world's uranium supply is running out. Already since the late 1980s, uranium mines have been unable to meet the world's annual demand. The nuclear industry has so far filled the fuel gap with material from military and civilian stockpiles.
- Nuclear waste is a problem no country except Finnland is anywhere near solving. Germany has been trying to find a permanent nuclear waste storage location since 1999 and have not come closer to finding one since then, because every time the current favorites are revealed the "not in my backyard" screeching starts and local politicials force a restart of the search.
- Many of the world's nuclear power plants are old, because hardly any new ones have been built in ages, because ...
- The construction of nuclear power plants is unbelievably expensive and takes decades, and much of the know-how on how to build nuclear power plants has been lost in europe over the past decades because so few are being built, which drives up the costs even further.
- We still have 7 years of CO2 budget in Germany, so why do some politicians talk about building new ones, although they would only be finished in 20 years at the earliest (and we in DE can't even get the berlin airport built in anything close to the deadline, how long does a nuclear power plant take then ?)
- Budgets for nuclear power plants take budget away from renewables
- We have to change from a centralised to a decentralised grid, nuclear power is a step in the wrong direction
- Nuclear power plants make us dependent on dictators
- Climate change has an impact on reactor operations. With global warming, extreme weather events are on the rise. Unlike renewables, however, nuclear power plants are not adaptable. Rather, their danger increases in our changing climatic conditions.
- Our neighbour france has heavily invested in nuclear power and is is a complete shtshow. There are constant headline to the extend of "Low temperatures caused another french nuclear power plant to go off the grid, worsening the skyrocketing energy prices in france" (The same with "too high temperatures" any many other reasons). Even before the war they had an energy shortage.
The 3 remaining nuclear power plants in germany are: - Emsland (1335 MW) - Isar/Ohu 2 (1410 MW) - Neckarwestheim 2 (1310 MW)
All three are pressurised water reactors and thus not as bad as boiling water reactors, but total rubbish compared to liquid salt reactors.
Moreover, all three have been in operation for over 30 years and all three are due for a "periodic safety review" (every 10 years), which was allowed to be ignored during their last 3 years of operation due to a "grace period under the Atomic Energy Act". If they were allowed to continue running, the operation time extension of the of all three would start with at least one month downtime, because these inspections would have to be started again. These inspections would most likely also reveal necessary repairs, wich would further delay the timeframe.
By the way, all three power plants have not been employing new staff for some time because they knew the would soon be shut down soon anyway.
In short: these nuclear power plants have been preparing for their shutdown since 2011 and have let everything slide over the last few years because everything will soon be demolished anyway. There are not the necessary fuel rods, not the necessary personnel, not the necessary will of the operating companies and no safety checks that would be necessary for continued operation.
Also: Merkel decided in 2011 (one day after the nuclear power plant disaster in Fukushima) to not allow nuclear power after the 31.12.2022. Merkel, famously in the green party . (for anybody with no clue about german politics: Merkel is in the conservative party)
The conservative opposition needs things to disagree on with the government, the current government had no scandals so far and the conservatives are still salty for being voted out of government, so they just make sh*t up and currently that is the myth of our magical saviour nuclear power.
There is no exploration going on to find new uranium deposits because there isn't much willingness to make new mines
Nuclear power is about as safe as wind and solar if looked at per TW. https://ourworldindata.org/safest-sources-of-energy
A nuclear reactor can be built in three years, though admittedly this hasn't happened in Europe. They are mostly (85%) built in under ten years. Figure 3 shows we should expect around 5 years. https://euanmearns.com/how-long-does-it-take-to-build-a-nucl...
Not immutable. There are other sources that are much friendlier
>- Nuclear power is not competitive and nuclear power is very expensive (especially if you conside the costs the government will be left holding the bag on, becuase nuclear power plant companies will spin off their power plants to new companies to go bankrupt once the profiting is done and the cleaning up the nuclear remains starts), no matter how much the pro-nuclear people want to lie about it
I doubt this hyperbolic assertion. Prove it.
>- Nuclear power is statistically not dangerous compared to fossil fuels, but not compared to renewables.
Again, prove it. This is unsupported, and in fact from what I've seen, false. So provide some evidence.
>- The world's uranium supply is running out. Already since the late 1980s, uranium mines have been unable to meet the world's annual demand. The nuclear industry has so far filled the fuel gap with material from military and civilian stockpiles.
This is again, an unsourced claim. In fact, a quick google shows: "There is not now, nor has there even been a shortage of uranium. Fear about reliability of the supply of uranium has been used in the past as an excuse to get something else done." Source: https://www.forbes.com/sites/llewellynking/2020/06/08/uraniu...
>- Nuclear waste is a problem no country except Finnland is anywhere near solving. Germany has been trying to find a permanent nuclear waste storage location since 1999 and have not come closer to finding one since then, because every time the current favorites are revealed the "not in my backyard" screeching starts and local politicials force a restart of the search.
I agree this is a problem, but it isn't one that is unsolvable. It's a cultural issue, not a physical one.
>- Many of the world's nuclear power plants are old, because hardly any new ones have been built in ages, because ... >- The construction of nuclear power plants is unbelievably expensive and takes decades, and much of the know-how on how to build nuclear power plants has been lost in europe over the past decades because so few are being built, which drives up the costs even further.
This isn't inherent, it can change, especially with political need.
>- We still have 7 years of CO2 budget in Germany, so why do some politicians talk about building new ones, although they would only be finished in 20 years at the earliest (and we in DE can't even get the berlin airport built in anything close to the deadline, how long does a nuclear power plant take then ?)
CO2 budgets are now irrelevant currently. China and Russia do not give a shit about CO2 emissions; their energy and GDP are heavily dependent on them. Globalization was the only mechanism that allowed the world to enforce these two countries to behave with emissions, and with the ongoing breakdown of the globalized system, there's no reason they'll reduce emissions. Why cripple Germany's economy to meet a target that the world's largest emitters aren't willing to get anywhere close to?
>- Budgets for nuclear power plants take budget away from renewables
Possible, but renewables have their own downsides, which are well articulated everywhere.
>- We have to change from a centralised to a decentralised grid, nuclear power is a step in the wrong direction
Why?
>- Nuclear power plants make us dependent on dictators
How? How does solar not do the same, in the case of China? 80% of the world's solar panels are made in China, in fact, that rely heavily on the consumption of Coal to produce. Source: https://foreignpolicy.com/2021/07/14/us-chinese-solar-panels...
>- Climate change has an impact on reactor operations. With global warming, extreme weather events are on the rise. Unlike renewables, however, nuclear power plants are not adaptable. Rather, their danger increases in our changing climatic conditions.
This makes sense, but I'd suggest that it's probably possible to take this into reactor design.
>- Our neighbour france has heavily invested in nuclear power and is is a complete shtshow.
Source on this, I don't know much about it. I've heard only good things about France's nuclear program.
I agree this is a problem too, and this is why people point out there is also a physical issue which transcends culture.
In terms of radioactive properties remaining over a period of millennia during which a culture can be expected to have lost its identity, or been forgotten completely.
If the problem is not truly unsolvable, a permanent solution may still not be possible without close co-operation with a future sympathetic culture.
Yes, there was some anti-nuclear sentiment after Fukushima which made for an opportunity. But it was long in the running. Both the SPD and CSU/CDU had interests here. Lots have been written on this in established media, should you wish to delve deeper.
The Merkel government then stopped it, then resumed it again.
And now Greens try to claim it wasn’t their fault, despite it being the foundation of their party since the mid-1980s.
It was reverted as soon as the CDU took over, and reverted back after Fukushima. But it is originally a "Green" idea and ideology, and it remains to be one today (see: Bavaria trying to get their plants recertified after 2022, because of the gas situation, and Berlin - staunchly Green - fighting it.)
Read up on your history once more. Schröder/Fischer were both voted out of office in 2005.
Let's respectfully disagree here.
Anyway, don't let this cloud your judgement. There are economic issues here, and economics concerns trumps environmental, in Germany and elsewhere. This would have happened even if no anti nuclear campaigning had ever taken place.
In fact, it might even have happened faster if there wasn't also a big push for renewables, which have taken a lot of resources. The people really responsible should answer for this and not some convenient scapegoats.
A non nuclear mix is also cheaper and isnt uninsurable without a catastrophe liability waiver.
The best time to build a nuclear plant is 40 years ago.
Everyone thinks about power like you need one big dam, or one big plant (coal or otherwise). There's a lot of small fast flowing streams that have potential to create extra energy.
I think hydro needs to be reimagined. IT always need to flood valleys to be in the mix.
I actually have no idea how to estimate that. Anyone have a good estimate on that? Intuitively, I'm thinking that most of those rivers are fed by many small streams, so it would be approximately equal. I'm entirely unsure of that though so treat it as having huge error bars.
Sure the water in that creek might be falling hundreds of meters, or even kilometers, but without a dam the height differential at your generator is only going to he a few metres at best. Enough to power the lighting, fridge, and washing machine in the houses that the creeks happen to run by, but not much else.
With the advent of long lasting perovskites and (hopefully) some less polluting battery technologies you're not even better off cost-wise.
You might be able to do something with a long pipe parallel to the creek to get more head, but then you're going to spend a lot of your energy on wall friction unless it's very wide.
Could be, but that's a bunch of stuff you don't have to power with the existing system. Given how many creeks there are, that seems like it could really add up.
> With the advent of long lasting perovskites and (hopefully) some less polluting battery technologies you're not even better off cost-wise.
That's fair. I've learned in my life that I don't have a good intuition for what the costs of large infrastructure projects are.
A nuclear plant will probably have multiple 1GW reactors, with very high capacity factors. I think your numbers are very optimistic.
1. https://en.m.wikipedia.org/wiki/Solar_Star
2. https://en.m.wikipedia.org/wiki/Desert_Sunlight_Solar_Farm
Plus transitioning to nuclear just builds another set of kochs and saudis.
Plus it makes your entire economy beholden to one of China, Russia, France, or the US.
Plus it just kicks the can down the road. If you consider direct thermal forcing. We are exactly where we were in the late 19th century with greenhouse gases. There is no option but to transition to a steady state economy, and starting a bunch of projects that only pay off if you use as much energy as possible from them (and even then, solar + storage will be a fraction of the cost by the time they open) isn't the way to get there.
Plus those same five countries won't even let half the world have nuclear power plants.
Plus the world's uranium reserves won't actually last very long if you carry on with exponential growth (doubly so without reprocessing and breeding).
Then there's all the usual risks people mention.
The solution is the same as it has ever been. Degrowth, stopping waste, and renewables.
Then comes storage, curtailment, and backup (always necessary: fossil-fuel plants always produce around 9% of electricity in fully-nuclearized France).
Moreover backup is now provided thanks to gas turbines, and we know to run them thanks to hydrogen (clean), which can be green hydrogen (cleanly produced thanks to renewable sources overproduction).
Sure. Let me just build hydro dam where there's no hills and dig some geothermal where's no geothermal activity and we're all set!
At any rate you could build nuclear faster than that will take to be ready for market in the best case.
Those benefiting from huge potential for hydro, offshore wind or solar (deserts...) are at an advantage. Those benefiting from a low production time-profile correlation with most other ones also are blessed.
Those totally unable to deploy anything probably don't need huge amounts of energy or are rich to the point of already importing it (is there a counter-example?).
If however Europe can't continue to burn gas and oil when demand exceeds supply because of the weather, then there is a major problem that is going to need fixing in a very expensive and time consuming way. If green hydrogen don't drop in price and no other storage solution can arrive to become cheap than gas and oil, then the climate change goals won't be achieved.
To add to the problem in northern Europe, the locations for hydropower is practically already at maxed utilization. They are also quite old and with large maintenance debts. They are also is causing extinction of several species, and fixing that would cost prohibitively much money, and the solutions will reduce outputs.
The thing is, 5x solar and wind sounds great but if I can specific the time and space for it, I would make a great profit of trading 5 units of energy for 1x at a different space and time. The price difference in northern Europe can be a factor of 10 or even higher between low and high. 5 kwh worth 3 cent each is worth much less than 1 kwh worth 40 cent.
Some added information so: The Green party pushed for an exit of nuclear power as part of a social-docrat government. This exit eas actually pretty well worked out and planned. When Merkel took, one of the forst things was to throw that rather good plan out. Only to revert that decision, hastly at that, after Fukushima. That second nuclear exit, the one Germany is currrently going through, was hastly done, ill planned and rushed.
And lastly, nuclear power does exactly nothing to compensate for reduced gas deliveries. Germany, as in deed a good portion of Europe, is heating with gas. And not nuclear power or electrical.
https://www.cleanenergywire.org/sites/default/files/styles/g...
The amount of flak that purple sliver garners is way disproportionate to its importance - especially since it's not even dispatchable.
Plus germany relies on natgas for a ton more than just electricity. Will we make fertilizer with nuclear power too?
But yeah, people are definitely being a little over dramatic on the severity.
(Yeah it's about that expensive).
Im not sure if shifting that allocation would have been such a good idea though coz theyd now be using even more gas and coal.
Heat is the main challenge and heating alone is problematic all by itself.
Gas dependence was a huge mistake, nuclear is not the short term solution we are looking for and getting away from gas dependence in the past couldn’t have relied on nuclear.
Think heating when you hear gas, not electricity.
Are you able to expound on why this is the case? Are you specifically talking about furnaces that use some kind of oil being very common in Europe?
Also, in an emergency situation, can't nuclear be used for heating, albeit through powering things like space heaters rather than the normal furnaces?
So no, nuclear power cannot be used for heating and Europe definitely doesn't have an electricity problem.
And stop spreading FUD about people freezing to death in there houses in winter, please.
Edit: Assuming a plug in wall-heater does all of that, just how many of them would you need by November this year to change something?
1. Cool, nuclear power, cheap electricity, great.
2. Hmm, looks like sometimes they explode in a pretty rude, nukey way. Maybe we should stick with coal, oil, and gas.
3. Yikes, climate change. But if we pull all our coal/oil/gas plants down we won't have enough energy and prices will skyrocket. Not enough wind/solar/hydro yet.
4. So... maybe nuclear is a good idea again? Cheap electricity?
We're here. So your argument is we can't use nuclear because electricity is too expensive in Europe, when the whole idea is to increase the supply of electricity and thus bring down the price?
> Also, that wall heater doesn't heat your water supply
There are electric water heaters.
> how many of them would you need by November this year to change something
Maybe someone in this thread is arguing that we can both build a bunch of nuclear plants and distribute electrical heaters to people in ~4 months, but I'm not. This is all a long term thing isn't it? Don't we have to do this anyway for green energy?
Also, nobody will freeze to death in his house over this.
Please don't condescend! I agree this is a big job.
> Of course you can heat with electricity, in the case of heat pumps even sustainable. Thing is, there are millions of house holds, commercial and industrial users that have decades of infrastructure in place heating with gas. No way to replace that in mid, let alone short term.
Again we agree. My point is that we have to electrify for green energy anyway. May as well do it, right? Is your argument that we should only ever heat with gas, and electrification is a waste of time and money? Is there enough gas to do that?
> Also, nobody will freeze to death in his house over this.
The thing you're referring to is someone saying "In an emergency situation (a matter of life and death for the vulnerable)". Isn't it reasonable to consider this scenario? Why is it FUD?
Electric heaters are extremely expensive to run relative to gas or heat pumps.
Heat pumps are great and extremely efficient, but not they are as hard to install as air conditioners (because they are air conditioners that work in reverse).
Same with portable air conditioners.
But heat pumps are also available in single units now. They're getting quite popular because they can be self installed (no refrigerant engineer necessary).
Home heating is primarily a luxury for comfort, not survival. Given sufficient insulation, we generate enough heat from food to muddle through.
Is it fun to shiver under blankets during an energy crisis? No, not at all. But are people going to die? Not likely, assuming access to space alien technology like blankets and coats.
Public Health England say:
> The most recent data on fuel poverty in England indicates that there were 2.28 million fuel-poor households in 2012. 5. Cold homes can affect or exacerbate a range of health problems including respiratory problems, circulatory problems and increased risk of poor mental health. Estimates suggest that some 10% of excess winter deaths are directly attributable to fuel poverty and a fifth of excess winter deaths are attributable to the coldest quarter of homes. 6. Cold homes can also affect wider determinants of health, such as educational performance among children and young people, as well as work absences
in the summary at https://assets.publishing.service.gov.uk/government/uploads/...
Excell winter deaths (excluding COVID19) were in the ~29,000 region in 2019, which makes for ~2,900 deaths even though blankets and coats exist.
Europe is still going to have access to gas if Russia cuts its whole supply come winter -- in fact, 60% of the European gas supply will still be present. Probably a bit more, since lots of crisis efforts have been made to provide gas from other sources. Only part of the heating needs have to be replaced.
Let's say Germany still had the, what, 8000 gigawatts of nuclear power online that it has shut down during the last decade? Wild-ass guess, but it's a lot. That's base load, of course. Electric power.
Resistive heating is dirt cheap to deploy in terms of capital costs. You can buy a 2000W heater for $20, perfect for domestic use. So the operating costs dominate. Using a heat pump is 3-4 times better in terms of operating costs; that's not as easy to deploy but many places will already have A/C installed and that's usually the same thing.
So then it becomes a question of economics; many industrial processes cannot be replaced with electricity. But as we've seen, heating of living spaces can easily be done with electricity.
So in the kind of crisis we're discussing here, those thousands of gigawatts of nuclear electricity would be pretty damn useful for emergency heating of German homes and businesses, during months where the gas would be more profitably used for the industrial processes that require it.
It sure as hell wouldn't have been cheap, but it would be cheaper than shutting down half the economy, which is what we're preparing for right now.
It's a moot point, of course, because those ~17 nuclear plants are already shut down. But it would very much have made the issue dramatically less painful.
Population Germany: 80+ million
https://www.reuters.com/business/energy/could-germany-keep-i...
https://www.eia.gov/tools/faqs/faq.php?id=104&t=3
Also probably helpful to think about it on a per person basis. Another comment corrected me that Germany has 80 million people, so let's use that. 8000 gigawatts (8 terawatts) divided by 80 million looks like 8,000,000,000,000 watts / 80,000,000 persons gives you 100,000 watts per person which does not seem realistic. With my air conditioner running at full blast, that's probably just a couple kilowatts, and that covers 3 people. Lights use a few watts. A beefy computer is around 100 watts.
It's possible that Reuters got gigawatts and gigawatt hours confused.
But I don't think it ruins the core of my argument; it wasn't hinging on Germany having reduced their annual power production by 99%. If Germany in fact shut down 15GW of nuclear production (15 plants), that's still on the order of 200 watts for every person in Germany, or one new 1000W resistive heater running 24/7 for every fifth household.
That's the kind of "on the margins" capacity that would indeed make a Russian gas embargo dramatically less painful.
Different types of power have different characteristics. Nuclear power plants runs at constant load and changes in power are slow. They take on the order of days to start and stop, and can not on their own follow load changes on a country wide network.
This isn't good or bad, it just is. They can manage the same base load day every day until they need servicing. But that also means you need other power sources to take the top load. That's usually natural gas turbines, even if it could be other things. Hydro is optimal, but most countries have a limited capacity for that. Which is, somewhat ironically, a similar situation as wind and solar have, but for completely different reasons.
Keep that in mind when people talk about replacing natural gas with nuclear. They do different things.
This mostly isn't physics, but rather a reflection of nuclear power's high capital costs. Nuclear plants have demonstrated that they can ramp up and down pretty quickly compared to e.g. most combined cycle natural gas plants.
https://www.oecd-nea.org/upload/docs/application/pdf/2021-12...
"For example, according to the current version of the European Utilities Requirements (EUR) the NPP must at least be capable of daily load cycling operation between 50% and 100 % of its rated power Pr , with a rate of change of electric output of 3-5% of Pr per minute. " - it goes on to discuss how most modern light water plants significantly outperform this requirement.
"Most of the modern designs implement even higher manoeuvrability capabilities, with the possibility of planned and unplanned load-following in a wide power range and with ramps of 5% Pr per minute. Some designs are capable of extremely fast power modulations in the frequency regulation mode with ramps of several percent of the rated power per second, but in a narrow band around the rated power level. "
> Keep that in mind when people talk about replacing natural gas with nuclear. They do different things.
Having some nuclear base load certainly helps, though, if natural gas is disrupted. Instead of having both the dispatchable power and variable power impacted from reduced natural gas supply, you instead only have a portion impacted.
One strategy is to build a bunch of renewable for during the day. Add some nuclear base load. And then with the surplus power you get sometimes, do power-to-gas with electrolyzer cells. Finally, use natural gas peaker plants and burn natural gas where justified in industry. This is a nice diverse mix with storage.
Yes, last winter France imported a lot, because more than 4 reactors were shut down for maintenance due to corrosions problems that has been found. These problem should had been found earlier, and would allowed to make the maintenance before the winter, but due to covid, inspections have been postponed.
If you look at previous years winter: https://www.rte-france.com/eco2mix/synthese-des-donnees?type...
For example, 01/11/20 to 26/12/20 (their website allow only 8 weeks period graph) you can see that overall France exported a lot of electricity to other EU countries in the middle of the winter.
That is not a law of Physics. Electric heating is perfectly fine. It’s true that we cannot do it quick enough to matter in this case, but that is not a good reason to just shrug and not learn anything from this. We will need a long-term strategy, because even if we manage to come up with a temporary solution, it’s clear that these things will happen again in the future. It’s just too good as a way of applying pressure on European countries. Long term, it will have to be electric if we want to improve our energy supply and have a remote chance of not staying too far from our climate goals.
We should have seen this coming for quite a while. It was in fact predicted, but mostly ignored by politicians who seemed to thing that oil crises from the 1970s were fun and that energy independence was irrelevant.
If a Jumbo crashes you expect around 400 death. If 2 crash into each other it's twice as many (search for Tenerife if you are too young to remember). If you build 2 skyscrapers for 16,000 employees you risk 16,000 deaths if the worst happens ("Less" than 3000 died, so the cold facts aren't that bad after all.) If you build build a nuclear power station with millions of people around, you risk many more deaths. Not everyone of them immediately, but cancers caused by radiation will continue for decades. Building such things is engineer hubris and some day something worse than what we have seen so far will happen.
Dramatic, sure, but nuclear power kills far, far, far fewer people than buckets of water or BIC lighters.
For Chernobyl the overall death toll is estimated between 50 and 4000. Nobody knows and nobody knows how to even count. How do you count the disabled and sick babies born after it?
For Fukushima 1600 fatalities were reported during evacution. I am not an expert, but I guess it's difficult to attribute because the whole area was devastated already by the tsunami.
There will be lucky outcomes also in the future. But if you have hundreds of thousands or millions of people around, some day we'll be out of luck.
> "If you build build a nuclear power station with millions of people around, you risk many more deaths."
Don't build it near millions of people. See this map of the UK[2]; London, Birmingham, Liverpool, Sheffield are where the most people are, and where the nuclear power plants aren't.
[1] https://www.theguardian.com/environment/2021/feb/09/fossil-f...
[2] https://assets.publishing.service.gov.uk/government/uploads/...
"People will die" from this mistake is hysteria. Nobody informed about the energy problems will take that seriously. Gas is not electrical power to start with.
Blaming the greens is internationally some kind of dumb idea that likes to reduce politics to stereotypes. The real effects will be much more subtle and indirect.
Could still end up with the greens losing votes. Currently it doesn’t look that way at all. (German perspective here.)
I don't know about Germany, but it is my impression that opposition to nuclear power was a common theme among the green movement in general for decades.
Obviously their agenda also included investing in renewables, as well as reducing consumption, but that wasn't going to happen fast enough, either for political or technological reasons.
I have voted for the local Greens several times over the last couple of decades even though I disagreed with and was frustrated with the views they held on nuclear power until recently.
I'm also unfortunately familiar with many of the common and overblown negative stereotypes towards the greens in general.
Insofar as nuclear power could have played a part in reducing our dependency on fossil fuels over the lasts couple of decades, though, I don't think it's unfair to say the greens in many countries did a lot to hinder that.
If we’re going for the cheapest option, then why not fuck the planet completely and all burn coal?
There are many parts in Europe where the homes are not heated by gas, but by the waste heat from the local power plants, regardless whether they are gas-based, coal-based or nuclear.
Any existing nuclear plant could be converted to also provide heating for the nearby houses, if the infrastructure of plumbing for the transport of hot water would be built.
However, the last part of the heating infrastructure, where the hot water pipes would have to be passed through the house walls and through the walls of all rooms, would be extremely costly in comparison with an electric heater, even if the operating cost would be lower.
So it is very unlikely that such a conversion would ever be done to already existing houses, even if it is possible.
Heat pumps would have much lower installation costs, while still being more efficient than resistive heaters.
Green parties did not win that much direct power, but they totally won the energy debate and their policies have become the mainstream consensus among European elites.
Over the past years, European governments (not just the German one) have been busy closing down any energy source that was not renewable or relied on imports from other countries.
Now it turns out that renewable energy sources are still not able to cover the basic needs of the population and the economy, and the dependence on imported fossil fuels has allowed an authoritarian government to launch the largest war on European soil since the World Wars.
I don't know if Green parties will actually face a backslash, but it seems clear that the energy transition in Europe will end up making the continent poorer and far less secure in exchange for little, if any, actual benefit for the environment.
In Germany, coal was pushed by the conservatives.
Makes sense.
It has to be said tho that the Green party is doing "realpolitik" now. While they aim at one hand to drastically accelerate renewables, right now they also invest heavily in getting a more secure energy situation in the near future still using a lot of fossil fuels, including rapidly building up LNG terminals and securing deals with parties they previously frowned upon, e.g. a gas deal with Qatar, the government of which the Green party previously heavily criticized for the human rights situation in the country. And e.g. they accepted - with some bickering - the temporary gas (as in petrol) price subventions the other coalition parties wanted, in exchange for temporary public transport price subventions (a 9-Euro regional ticket, that is valid for a month at a time, 21M sold by July 1, population 83M).
They are still rejecting nuclear power generation, neither wanting to build new plants, nor keeping old plants running (the operators of said old plants already called the idea of keeping those plants running "infeasible" to outright "stupid").
It remains to be seen what the blowback will be if inflation doesn't at least slow down, or if autumn and winter come and people start getting cold. Tho right now, the politicians and leading experts and "experts" say, it doesn't look like there there will be a shortage on a scale that gets life-threatening to some people.
[0] 20-24% share in recent polls, vs the 14.8% they actually got in the last election in Sep 2021. They are actually slightly ahead of the SPD (social democrats) in the polls now. The SPD is the majority partner in the coalition.
It boggles the mind that a so called Green Party is investing in fossil fuels.
All in all, quite reasonable and well thought through under the current circumstances.
The current government that has the Greens as a major coalition partner isn't really investing in new fossil fuel stuff, but replacements of existing fossil fuel stuff. E.g. the LNG terminals are meant to replace the capacity lost from ceased imports from Russia.
Building nuclear now isn't really an option anyway, at least not to deal with the current situation.
The operators of nuclear plants already signaled that running their plants longer is not an option. That would require a lot of investment, and more importantly a lot of time to renovate, modernize and re-certify these things. An effort I believe they said was in the range of 3 or more years.
Building entirely new plants, even with existing designs, would require at least 4 years even on a very expedited schedule.
So in the short term the only option is to keep using fossils - sourced from some place not-Russia. The Greens, while they certainly do not like that, understood this.
Would we Germans be better off if we had some nuclear plants left? Sure. But we'd also be better off if we instead had that energy mix that the Greens envisioned at the start of the century, that entailed renewables at the core, a bit of carbon (mostly from renewable sources, with tech to make it more or less carbon-neutral in totality) and storage, and investments (driven by government incentives) to use less energy in the first place.
If I had to blame anybody, it would be the 16 years of Merkel governments which managed to fuck up both nuclear and renewables, not the Green party.
They were right all along and are now the ones fixing the situation, after only recently being voted into government.
The polls show: The two most popular politicians in germany are both greens. They are the second biggest party in current polls with 22%, 6% behind the biggest party. In the polls they are the biggest party in the current government (when the current term started a few months ago they were the second biggest party in the current government)
Things are going great for them and there are no signs of that changing.
I agree with your sentiment on massive incompetence regarding Energy policy but this is an exageration.
1. Russia won't cut off gas despite it's threats because gas is quite literally one of the few revenue sources for the Russian economy. Much like Qatar, Russia would implode without Gas money.
2. There are plenty of other gas providers Qatar, Norway, Algeria, even US/Canada LNG, who can sell to the EU.
What they likely won't sell is at the cost of Russian gas which is the pressing point for Central and Eastern European countries.
But the point is, you would shut down heavy industry and go into deficit before you were faced with a doomsday scenario of people freezing during winter.
> Russia would implode without Gas money
Russia can sell to China and India. US/CAN has insufficient LNG transport capacity to completely replace pipelines from Russia. Germany has insufficient import terminal capacity.
Yes, they wouldn't run out of gas, but the price would likely spike 5-10x and crater the EU economy which is equally as bad.
Regarding import terminals: there are LNG terminals all over Europe that are far from their full capacity which all have connections to the German net. That alone would suffice in delivering enough LNG. Apart from that, we're on the fast track of having extra terminals ready by autumn.
Also price spikes as massive as those you mentioned will be prevented by emergency government regulation of the market (already announced).
As someone who works in the industry, I have a lot of confidence stating that we will be fine, thank you.
Russia literally shut down Nordstream today for at least 10 days.
Getting paid for gas in Euros or dollars they can't spend is worse than not selling it.
It is also worth noting that Gazprom has already stopped supplying gas to countries and companies refusing to bow to the rubles demand—Poland, Bulgaria, Finland, as well as some customers in the Netherlands, Denmark, and Germany.
Just to be clear despite autocorrect, Russia did not shut down a major western clothing retailer, but the Nord Stream 1 pipeline.
https://www.upi.com/Top_News/World-News/2022/07/11/nord-stre...
German govt bonds are still being purchased by the ECB under QE so it makes sense their yields are suppressed.
He said that we should be more friendly with Russia and that Russia has been trated unfairly. And then said we should buy more gas and oil from the U.S. What do you make of that? Why would you buy LNG from the U.S if Russia is such a great friend and its gas pipes are nearby?
Then went at great lengths to say how Europe is the biggest foe for the United States and not Russia.
Not to mention that fiasco at the Helsinky summit. If you talk a lot of nonsese people stop treating you seriously.
If I remember right he fancied NK leader as well. Just a clown or showmen or whatever you want to call him but definitly a reliable adviser.
Germany has been warned about its dependency on Russian gas by its EU neighbours and past U.S administrations long before that clown. It's just that Germany thought Russia is not completely stupid and made a risky and bad bet. Now it has to pay. It may be for the better because now it can invest in more renewables(i.e has a cleaner slate)
* In 1974, Washington and Riyadh struck a deal by which Saudi Arabia could buy US treasury bills before they were auctioned. In return, Saudi Arabia would sell its oil in dollars—not only enlarging the currency's liquidity but also using those dollars to buy US debt and products.*
[0] https://www.google.com/amp/s/qz.com/2143450/saudi-arabia-wan...
I think there also was the (possibly implied) promise of military protection by the USA
The country which was in midst of protests which their government, dictatorial btw, decided to violently suppress?[7]
Yeah, nice guy all around that Gaddaffi. Oils the only reason anybody would want him gone.
[0]https://en.wikipedia.org/wiki/Pan_Am_Flight_103
[1]https://en.wikipedia.org/wiki/UTA_Flight_772
[2]https://en.wikipedia.org/wiki/Murder_of_Yvonne_Fletcher
[3]https://en.wikipedia.org/wiki/Uganda%E2%80%93Tanzania_War
[4]https://en.wikipedia.org/wiki/Chadian%E2%80%93Libyan_conflic...
[5]https://en.wikipedia.org/wiki/Egyptian%E2%80%93Libyan_War
[6]https://en.wikipedia.org/wiki/Libya%E2%80%93Switzerland_rela...
[7]https://en.wikipedia.org/wiki/First_Libyan_Civil_War
[8]https://en.wikipedia.org/wiki/West_Berlin_discotheque_bombin...
Defensive military alliance - NATO - go!
Gee, I wonder how many similar incidents we can count among NATO states going back from 1988
> So in exchange to gaining access to US treasuries (debt) before action, they had to buy US treasuries?
I have no knowledge about this besides what's been written in this thread, but I assume that having the ability to buy before the auction means they get a good deal.
US forces nearly all countries to buy USD that eventually get returned as SA-owned debt (huge monetary policy benefits). SA gets more or less bribed by the worlds largest military.
Awkwardness is when SA wants to do stuff that’s is against US morals (like murdering journalists) or when China firmly but politely asks to buy in RMB (like it has recently).
US generally sees petrodollar regime as second only to the military (as evidenced by their eagerness to invade Iraq and gain leverage over SA).
Which currencies are as strong or are in a better position, and are backed by stronger economies than the euro?
Easy, initial answers are the Swiss Franc and the Norwegian Krone.
Expanding the thought experiment a bit, it's possible that CAD is, big picture and long term, in even a better position. Probably AUD as well.
The GDP of .ch and .no put together are 6% of the EU's.
I'm sorry, but they just aren't significant in the large picture.
"... are as strong or are in a better position, and are backed by stronger economies ..."
... and I would argue that .ch and .no are in quite a bit better position and are backed by stronger economies.
If the saudi and other arab nations' deals with china and their acquiring of yuans are significant, it could signal the end of the petroldollar.
I highly doubt they will stop using it now, but if any big producers from the middle east stop using the dollar its basically worthless overnight.
At least the euro can't be insta-killed by some dude half-way across the world.
The dollar is on a house of cards, its a dumb way to structure the currency's worth.
Sounds like a propaganda meme, at least for Iraq that I know a little about.
Iraq was invaded for failure to fulfill WMD disarmament requirements, which was known and very _legal_ reason for invasion, according to the agreement made after Desert Storm. Iraq not just failed to prove that it destroyed all WMDs and precursors, it actively and blatantly prevented UN investigations, which is documented in UN resolutions in 1992, 1995, 1996, 1998 and 2002.
Note it's not just US, those are UN resolutions.
The propaganda meme keeps floating around because UN weren't able to find WMD after invasion, but the point is that the reason was not whether they find or not. It was Iraq's responsibility to provide proofs of WMD destruction, but instead they actively interfered with that. Who knows, maybe there are still WMD stockpiles, hidden somewhere in the vast country.
our tiny economy makes no difference to global spasms.
But the flagellatory "everything is terrible and we are merely worms" attitude that prevails among the bien-pensant class right now is so saddening. The UK does have an influence on the world, a pretty outsized one at that, because it is one of the larger and more modern economies. Ahead of it are the US, the world's two most populous nations (China, India), and two comparative economic powerhouses, Germany and Japan. That's it. If you want to count the EU as one economy, great, it takes Germany's place.
Does this mean where Britain goes all must follow? No, of course not. But neither does it mean total insignificance.
* inflation is mostly imported
* cost of living crisis
* incoming recession
So they are under pressure to both try to contain inflation (but see above) and prop up economy.
Couple that with their slow-ish response speed, because the monetary policy committee only meets 8 times a year, and you get a recipe for a lacklustre response. IMHO.
[1] https://techstartups.com/2021/12/18/80-us-dollars-existence-...
They were not. Minor changes to official definitions can make graphs look funny but doesn't change much else https://fredblog.stlouisfed.org/2021/01/whats-behind-the-rec...
Why not? Intuition says that it should. So I think that’s what GP is trying to understand.
It seems like you’ve substituted their model with yours but haven’t explained how yours works.
Velocity [1].
Ignoring it is like sticking a water wheel in the ocean and asking why it doesn’t turn given the depth. Quantity doesn’t turn it. Flow does. And that depends on more than how much water is present.
There's a very simple mathematical identity: MV=PQ
M is money supply, V is velocity, P is price level, and Q is all goods and services.
So if the economy produces the same amount of stuff (Q is constant) and if V falls in the inverse ratio as the increase in M, then the price level will not change.
There is still a lot of inflation outside of energy prices. All of the demand-pull inflation from the pandemic is still there. A weak Euro does not automatically translate to "pushing exports" here. From the article:
>"For years, policy makers have welcomed a weaker currency as a means to stimulate economic growth, since it makes the bloc’s exports more competitive. But now, with inflation in the euro zone at the highest since such records began, its weakness is undesirable as it fans price gains by making imports more expensive. In June, euro-area consumer prices jumped 8.6% from a year earlier. Some policy makers have highlighted a weaker euro as a risk to the central bank’s goal to return inflation to 2% over the medium term, ..."
Means at the moment until salaries get inflation adjusted that we pay a premium price for everything.
This isn't true. A certain well-known politician made this claim, but it turns out she counted everyone who had medical debt when they declared personal bankruptcy as a "bankruptcy caused by medical debt." If someone gambled away their home and incidentally had an unpaid doctor's bill, it's a stretch to call that a medical bankruptcy.
https://www.theatlantic.com/business/archive/2009/06/why-eli...
I’ve literally never used my health insurance. I expect the vast majority of people are in the same boat.
I never used medical care in my 20s. In my 30s, my wife and I needed a bit. In my 40s, slightly more.
On average Americans use a lot of health care.
For example, people I was paying $190k in the USA were making around $110 in Europe and this was well before parity - $1.25 per euro, etc.
It’s probably around 50% of an Americans salary today or there about.
Then many states do not have income taxes, Washington, Nevada, Florida and Texas for example.
Sales tax is also not that high, topping around 10% for the most expensive of cities, but as low as 5%.
Then on income tax, we have very favorable tax brackets that allow us to reduce our tax liabilities. Someone making 250K w/ an LLC can easily drop their bracket to as low as 13%.
As an American, we have pros. You being an European, you have pros - but if you're experienced in the game and have time - there is a reason why USA can have very favorable tax, income
Now if you talk about your public transit, rails and trains - yes I'll concede and say that is much much ahead of USA. :)
Bit of an unusual thing to include weekends to make 20 actual vacation days sound 40% better than it is.
Edit: to be clear, in my experience, when someone in Europe says “4 weeks holiday” they mean 28 actual vacation days, not including weekend days.
VAT is broadly much higher than sales tax, property taxes are not exactly unknown in Europe, and if you are an employed professional, your health insurance burden is typically pretty close to zero.
If you live in a no-income-tax state like Washington or Texas, and you are single making $200,000 a year, your effective (not marginal) tax rate, including FICA, is around 26%. I doubt that anywhere in Europe comes close.
The flip side is that poor people in America absolutely get shafted.
The 26% figure above does include the FICA payroll tax.
Will richer EU country and US companies pay you better than your local wage bracket in the EU? How do you find that? This sounds like the best of both worlds. I'm guessing its tricky?
Of course. Competition to find better remote talent.
> How do you find that? This sounds like the best of both worlds. I'm guessing its tricky?
You have less bargaining power because you are competing in a bigger pool of remote workers. There is a little problem with timezones. But you can get $100K+. If you're good and got connections you can get SF/NY wage wherever you are.
I know those are difficult questions to answer but I want to put themnout there
I simply only apply to jobs where I work on my timezone. We have some meetings that end at 6PM locally.
> 2) tax: should I take my earning into a personal account in the US/EU?
Depends on your residency. And depends on the law of the country you end up residing in.
> Or alternatively start a corp and do corp to corp without and only pay myself minimum amount? 3) tax: do I pay taxes in the US and in the EU? Do they go after my US corporate?
You'll maybe need a VISA on the new country were you reside. Easiest would be a working visa. The country may have an agreement with USA where they run a sql-query to find tax-evaders and join it with a table of residents.
You might be found out. The USA may come after you for taxes on revenue of I believe +$150K/year. The USA has some fancy global taxation.
As a US citizen, you still have to file taxes. But can save a bunch depending on your situation.
I'm curious are you an EU citizen already? If not I believe you would need a US company that has an EU entity which could supply you with Blue Card in order to work in the EU.
I would guess my effective tax rate including sales and local and healthcare and everything else is ~40%
Being able to save 50% of your income is a level of privilege many don't have regardless of effective tax rates.
- Working professionals making low 6 figures (espicially in states with income taxes) pay much closer to EU taxes than most people think.
- Non professional jobs (service industry and blue-collar) are taxed very lightly, but have worse benefits, less job protection, and an extremely limited social safety net.
- Government jobs have better benefits than other non-professional jobs, but often the pay is not great (I suspect no better than EU, but honestly have no clue what e.g. a postal worker in the EU makes).
- The very wealthy are taxed very lightly compared to the EU.
Not sure what you mean by the last point, though, it kind of conflicts with your first point. And in e.g. France the capital gains rate is 19% I believe vs 20% in the US. Various countries in Europe have experimented with a wealth tax, but they've now all gotten rid of it. In what ways are the very wealthy taxed heavier in the EU?
> the main gap is just that for working-aged people there is no universal healthcare in the US
What about those who have health insurance but have huge medical bills?
Most upper middle class jobs offer different plans with different maximums and monthly payments.
No way. It's almost impossible to become homeless in Sweden while you have the entire homeless villages everywhere. People with disability get paid a living income and are allowed to save money, which they aren't in the US. Then we have tons of other services like child care, health care and universally just way better everything regarding infrastructure and social service. I've lived half my life in each place and honestly the difference is Grand Canyon sized. Even Portugal, one of the poorest still has great free healthcare and all kinds of social safety net sand services.
You might get two or three days or something like that, and then everyone pats themselves on the back saying how progressive we are.
It's absolutely horrific when you consider people may have medical issues which cause them to need to take a bit more time off.
But guess what, you now have insane medical bills, and pressure to get back to work. It's not unheard of for a woman to just get fired if she takes off too much time for a pregnancy.
Sure, that's illegal, but workers are treated so horribly in America. You're lucky to get your paycheck half the time.
For Sweden it's close to 100%.
https://www.bbc.com/worklife/article/20210624-why-doesnt-the...
https://en.m.wikipedia.org/wiki/List_of_countries_by_homeles...
edit: Digging into the sources, the US has 6.4 unsheltered homeless per 10k, but Sweden doesn't even track unsheltered homeless, the most acute category (at 4.5/10k) also contains people in immediate access shelter/hospice.
I think a more general statement could be made. It's nearly useless to make comparisons between countries. The United States cannot adopt Swedish policies and expect to achieve Swedish outcomes. I'd much prefer we discuss policies for our countries in our own contexts rather than introducing comparisons between them.
The parent comment introduced a comparison, though. So, I think it's only fair to introduce some form of statistics.
Thanks for providing a more founded empirical interpretation of the facts! It seems Sweden has some edge on the USA, but the original claim (that it's almost impossible to be homeless in Sweden) still seems as unfounded as I expected.
As another commentator noted, I think climate is something to consider. I expect that you'll find higher concentrations of shelter-less people in more temperate (or at least warm) places. Cultures will evolve to prevent people from needlessly dying, but we aren't inclined to give more than the bare minimum.
And this isn't what anyone seriously proposing for the US to take control of its social issues to do. The mention of other countries usually is just to show it can be done, to be inspired by it and forge your own way to solve social issues.
I don't know why it's usually taken in this absolutist view, where solutions should be implemented as-is because it worked somewhere else. It worked, get inspired by it and figure a way out of the hole in your own local environment...
Yeah, Sweden and the US are different, people are still people and have some overlapping needs, learn how others have done instead of this hubris of "we're different". Everyone is.
GP probably meant it's almost impossible to become homeless in Sweden because of a lack of a social safety net alone.
And one bit of Swedish society that is a bit invisible to the outside: it has an extremely draconian approach to drug abuse. Even though it's a Nordic country and touted for being socially progressive, drug policy here is extremely regressive when compared to Portugal or the Netherlands.
So usually the homeless I see in Stockholm are addicts (alcohol, heroin, amphetamines) that fall through the cracks of the system as they won't stop abusing substances which Swedish policies have no way around to help them, it's extremely punitive for drug use, as even use is a criminal offence. In the case you are taken in custody by the police they may force a drug test and if detected you'll be punished.
This all compounds to leave a marginalised population that has inadequate support to fight their addictions (usually caused by mental health issues) and kept in limbo between the streets and courts to be ordered to get clean.
Sweden: 36 homeless + 7 incarcerated per 10k
U.S.: 17 homeless + 64 incarcerated per 10k
All that list means is the US vastly under-counts actual homeless people. This is the same well known effect we see in suicide statistics: Sweden just keeps far more accurate statistics.
For example, I used someone in New Jersey (a US state known to be high-tax) vs France at a salary of 100K (which is the same in Euros now!): In NJ, including Federal, state and sales taxes, total tax is $27K. That seems to be a far cry from the $41K (sorry, Euro) I get in France from a very basic calculator that only includes country-level taxes AFAICT.
At that level you will pay 800€ per month for public health insurance (it's a percentage up to about 65K income, then capped). Public health insurance allows you to cover children and non-working spouses for free.
If you are curious about US insurance plans, here is California website for estimating insurance costs. Basically the costs scale with income, number of individuals and their age and their desired level of coverage.
For comparison, Germany is at 51%, UK at 50%, Netherlands at 47%.
Belgium is close to France at about 61%...
The US (not in Europe, obviously) is at 46%.
And Switzerland at 36%; this is the European outlier in the opposite direction from France.
But a priori, just from this data I would expect French taxes to be about 1.4x US taxes and Dutch taxes to be similar to US ones...
For example, in Estonia the minimum you have to pay per month just to health insurance is 201.20 EUR and this barely covers anything except extreme injuries, so on top you add a private insurance :|
You can very much opt out from the "public system" in Germany. I'm privately insured.
Although I pay most of my urgent stuff in cash, and get it back later (not everything), because otherwise I have to wait 3 months + for a simple scan :/
Like Public health insurance being mandated, or the GIS.
That is a system I want to live in. Since the locust capitalists took over (11th January 1987!) it is going downhill though.
Of course I can afford one of best health care, for me, but I want a social system, not an asocial one.
I think that the downwards movement is more based in the population aging though.
And the reason I hate it, is literally because there is no opt out at all. Hell, I'd use the public option if there were an opt out because it works well enough for me.
Leading my own company I hate having to pay the Wirtschaftskammer a mandatory fee.
I don't need those lobbyists!
Yeah, from what I've read, they are pretty awful in terms of costs/benefits.
I am curious about the 300-500. If this is per house hold or per employed adult.
Estonia seems like a tax haven in comparison.
- the state & local taxes (can be as high as 12-15%)
- social security (6.2%, tapers off after 150k)
- medicare (2% generally)
- net investment income tax (3.8%)
- different tax treatments of short and long term capital gains
Sure, if you just look at the federal rate, the US tax rate does seem a lot lower...
VAT are generally higher in Europe though. Even in the "high sales tax" areas in the US, you'd typically get ~10% compared with 22% in Europe.
Why "have to"? Because it's by law forbidden to bully employees into taking money instead of going on vacation. To never have to deal with this, most employers are very strict wrt vacation days :)
Health insurance (for dumb, path dependent, historical reasons) for individuals and their families are not taxable, haven't been since WW2.
What you may have seen is the AMA line item that just tells you how much your employer spent on your healthcare. This is a weird attempt to get people to realize how much their employers are paying (much more than the premiums people generally think of as covering their health insurance).
If your employer happened to pay you more than the maximum allowable cost per employee, then your employer had to pay a 40% excise tax on the amount above the limit, but even then, it wouldn't be taxable to you. The roll out of this tax was delayed several times, it may have been repealed, I wasn't paying attention during the pandemic.
20% (assuming that's what it is) is still no small amount but I'm personally doubtful there would be some sort of sea change in what's possible if it were cut in half or even eliminated.
We can’t even afford what we’ve got now.
And now that buys less and less.
We can't afford to be playing world police or pretend to be the world's refuge.
The tax brackets in the US tend to be much progressive though, so for people earning lower salaries their taxes in the US are much lower.
At $600k, it's 37% effective tax rate (again, with zero deductions).
You have to make $817k, with zero deductions, before you'll pay 40% effective tax rate in California.
None of this includes sales tax, which is 10-11% depending on municipality in California. Europe's lowest VAT is 17% in Luxembourg.
It is not my impression that "a lot of people" in tech are making that much, even by the extreme standards of the Bay Area these days.
So yeah it's not the majority of people in the Bay Area paying 40% but if both spouses are working at big tech companies and they're more than a few years into their career then they will likely be somewhere in this range and paying close to 40%
A single earner (again, with the unusual state of no deductions) has to make $690k to reach 40%.
For a dual-high-income earner households I concede 40% effective isn't going to be uncommon.
In developed countries, the majority of the costs for goods and services (and taxes) come from labor, which means they're not affected by currency fluctuations too much.
Not a good time to vacation to the US, nor is it a good deal for Americans working in the EU and paid in Euros who need to pay past bills back in the US
A tech worker in Silicon Valley will easily hit >40% income tax (30+ federal, 10 Cali). Sales tax is up to 10%. Many places have affordable property tax due to American laws on home ownership. California may be a state with laws closer to Europe than many other American states (eg texas). Massachusetts/New England generally have “better” laws too (eg MA has stronger healthcare protections than most states).
Not sure what ordinary Europeans actual pay, but an internet search says German taxes go up to 40s, which seems pretty inline with Cali.
Obviously a tech worker in SV will be top few % for American salaries, but you need to be a well paid urban worker in America to be able to get healthcare and an income that affords college for children and good public transit and other things Europeans get from their governments.
Using https://www.arbeitnow.com/tools/salary-calculator/germany and https://smartasset.com/taxes/income-taxes#9jiRJIN31w
In Berlin, 200k nets you 113k after taxes
In California, 200k nets 132k after taxes
That is 43.5% vs 33%
But there are differences in sales taxes/VAT, property taxes (and deductions for such), mortgage interest deduction, etc.
A $1M mortgage loan at 3% could reduce your taxable income by 30k, saving you almost 10k in taxes per year in the US.
The calculator I used also included payments for social security and medicare contributions, which you would use if you eventually fell below security security income bracket (knock on wood) or if you need medical as a senior (I believe age 65+)
For other health coverage, that is paid for by the employer so also wouldn't come out of your compensation.
Which is fine if you're comparing equivalent "headline" numbers. But for other purposes the ratio of take-home pay to what the employer has to pay out (so including all the employer-side taxes) might be more relevant in terms of determining your likelihood of receiving a certain level of take-home pay.
And yet incomes are much higher in the US than in Germany.
I think headline numbers are the only useful thing to compare here.
Which leaves base pay, I assume the 200k in Berlin were choosen to make the comparison easier. On the surface, lower base pay in Berlin is offset by lower living costs, especially housing (I am aware Berlin is getting more expensive, it is still far from SV so).
Just shows that money isn't everything.
As for health and unemployment insurance, both of those are paid for by the employer in the US.
I think relying on (taking advantage of?) cheap Russian gas is only a mistake if you also think that giving Russia a pass over annexing Crimea was acceptable. In reality choosing to do both was a catastrophic error. You can make deals with your enemies (and both Russia and China as oppressive expansionist autocracies are choosing to be our enemies), as long as you make it clear where your boundaries are. We didn't do that clearly enough with Russia, and cannot afford to make the same mistake with China.
Western democracies can do that only to a very limited degree. That’s why economic interdependence doesn’t work with autocracies.
Edit — sorry, misread the graph scale there. At any rate, the euro has been more stable against the pound in the last few years than either of them have been against the dollar.
- the EU currently has a trade deficit. This is the first time ever. Reason is the energy crisis due to sanctions against Russia: energy prices have skyrocketed and EU is importing loads of energy
- the ECB has been printing money like crazy in the last 14 years. So far this money had been absorbed mostly by banks but slowly but surely it is starting to trickle into the real economy. Recently the ECB has finally increased interest rates and stopped buying Southern European bonds, however they had to start up their bond buying program again because Southern European government bond interest rates went up dangerously fast. This has undermined the belief that the ECB will be able to effectively battle inflation
Did they? I thought they agreed (or iterated) that a rate increase is almost certain. But the increase itself is yet to happen (and it's not clear they are going to increase it by how much)
This is wrong, none of the money the ECB "prints" goes out into the real economy (see [1] e.g.).
[1] https://themacrocompass.substack.com/p/tmc-6-all-they-told-y...
Psychological effects can come into play, of course.
There's nothing special about it being worth less than a dollar; it's an arbitrary mark not unlike a year ending in zero. But it only happens when the euro is significantly weaker than it was intended to be.
This isn't how central banks value their fiat currency.
If for some reason the Fed puts 20% interest on the USD, the value of the USD would increase dramatically. The Euro is under no obligation to set its value with respect to the USD or the Pound.
There is no "intended" value of the Euro with respect to other currencies.
There's an "intended" value of the Euro with respect to keeping European governments solvent and keeping prices steadily increasing.
If the Euro has to drop to $0.01 to achieve those goals, it will. If it has to climb to $100 to achieve those goals, it will.
Central banks do have some thumb on that scale, but as you say, it's entirely about keeping the economies healthy, not maintaining any specific ratio to other currencies. If it has fallen so far that the ratio is 1.0, that's not a problem for the currency itself, but it does happen because the economy is struggling more than the American economy is.
This is just a baseless assertion you’ve made repeatedly. You should provide some source and be a tad less aggressive about it if you want to be convincing.
This is completely false. For example, the ECB targets 1 EUR = 7.46038 DKK.
Supply shortages are something Western policy makers haven't had to contend with for quite some tine, certainly not in the lifetime of the policy makers!
My understanding that the US stimulus was generally unparalleled
In 2021, EU total amount of quantitative easing was 2.947 trillion euro's. https://en.wikipedia.org/wiki/European_Central_Bank#Low_infl...
US: $4.5 trillion https://en.wikipedia.org/wiki/Quantitative_easing#:~:text=Th....
EU: 3.4 trillion euro (https://www.ecb.europa.eu/mopo/pdf/APP_cumulative_net_purcha...)
US: 8.9 trillion usd (https://www.statista.com/statistics/1121416/quantitative-eas...)
3 trillion euros / ≈14.5 trillion euro gdp of the eurozone ≈ 20.6% of gdp
4.5 trillion USD / ≈23 trillion US gdp ≈ 19.5% of gdp
But again, this is not at all my area of expertise; I'm a rank amateur with barely any skin in the game. I'm very happy to learn other opinions and ways these things are determined.
[1] https://www.euronews.com/my-europe/2022/07/01/inflation-in-t...
[1] https://www.bloomberg.com/news/articles/2022-05-03/europe-in...
Just curious, how would supply constraints lead to inflation? I'd expect lower supply would cause deflation
When there's a supply constraint - not enough hamburgers to go around - the price of hamburgers goes up and as such there is inflation.
Inflation refers to the price of goods increasing.
If supply reduces and/or demand increases, all else equal, prices increase. If supply increases and/or demand decreases, all else equal, prices decrease.
No reason it can't be both. Plus USD is still viewed as the safe haven fiat currency (deserved or not), so USD always displays relative strength vs. other fiat currencies when there is stress in the markets.
Just an example, as part of the CARES act, congress allocated 800 billion for PPP loans that were supposed to go towards payroll. Now the Federal Reserve finds only 25% went to employees. So that was basically an unnecessary infusion of 600 billion into the economy over a really short time window. And that money went to people who already had plenty of money. Is it a surprise why the housing stock is so low?
My new treadmill at the business was supposed to be delivered last April. They have not provided a new date.
It took LG 6-7 months to replace (ship) the broken TV under warranty.
My franchise changed towel/linen manufacturing 3 times as old suppliers are not able to deliver. New prices have more than doubled.
Lotion order I put in Nov was delivered in June.
Some might say this is anecdotal but this is the case at every single hotel in America. A lot of small hotel owners are buying supplies from local Walmart stores too.
https://tradingeconomics.com/russia/foreign-exchange-reserve...
So not sustainable. They are selling foreign currencies to keep the ruble alive.
1. https://www.federalreserve.gov/data/intlsumm/current.htm
2. https://home.treasury.gov/data/us-international-reserve-posi...
I'm not so sure about that. There were a bunch of news outlets warning that Gazprom is on the brink of a massive default. Gazprom, of all companies.
If the company that subsidizes Russia's ruling regime can't make their payments in spite of sitting on a huge pile of oil and gas, that does not bode well for Russia's economy.
As for the Euro, it's currently at a 20-year low, if that's an answer to you. Since the balance of payment is positive, there's probably no reason to be pessimistic in the long term.
The Yen is at a 24 year low vs USD. The Yen is down 15.9% YTD. That is just an incredibly fast erosion and we're only halfway through the year.
Is there a yearly pendulum that I'm not aware of? Because if not, we've also only 21% through the century, and we've barely scratched the millenium.
https://tradingeconomics.com/russia/gold-reserves
Or roughly $128.9 billion USD in gold reserves:
https://www.wolframalpha.com/input?i=2301.64+Tonnes+of+gold+...
https://m.timesofindia.com/business/cryptocurrency/blockchai...
It is far from trivial to move that kind of stock.
There is so much propaganda and "Russia-bad" going around in the media, whether you think it's deserved or not is irrelevant to the quality of journalism taking an extreme nosedive.
Elvira Nabiullina (Russia central bank chair) is IMHO one of the smartest central bankers in the world right now. Much better than "transitory" Powell.
She tried to quit at the end of February but was not permitted to.
Actually it isn't that much of a joke today - according to the new wartime law Russian government can compel any business to produce the amount of product/service the government wants with the business having no right to refuse, and the government can force people to work overtime, weekends, holidays with the government defining what payment, if any, to happen to the business and the people.
Going back to Russia's economy, the future investment is dying. Its airplanes are not getting new parts. Siemens isn't repairing any equipment. The full effects of the sanctions won't hit for another few years.
This only works if you have a developed enough domestic economy to supply everything you need. Assuming you’re exporting more than food, you’ll need resources to produce anything, and if that’s expensive then your theoretically cheap export pricing can’t be so low.
Russia’s domestic suppliers aren’t well rounded, but they do have energy independence which is a major factor going for them.
so before you dismiss all that "propaganda" make sure you don't spread it yourself.
Yes, it means no luxury goods from the EU and no tech from NorthAm. But the embargo isn’t as broad as one might imagine.
There are some important tool and equipment from the EU and NA that if sanctions remain for years could result in a mega Cuba situation where lots of things are under maintained.
Russia has capital controls. Exporters are forced to buy roubles with 80% of their foreign currency, among other restraints to the free trading of roubles.
If you traded roubles on the black market, you'd get the actual price, and it's much lower there.
Edit: also, 80% export rule was lifted recently
This is simply not true. "Black market", in the form of p2p crypto, had the rate close to the official one since the beginning of the war. Check your sources, they might be biased and feed you bullshit
The prices in Russia reflect about 1.5-2x ruble fall against dollar since the invasion. The official ruble/dollar ratio is maintained by draconian measures/restrictions against exporters and population (plus significant depression of economy which was consuming a lot of imports, like the car market falling 6 times because most of the foreign car makers/traders are gone, similar situation in IT for example, ie. Russian economy collapsed to becoming only natural gas and oil pump). Very similar to the situation back in USSR when dollar was only 0.63 of ruble, yet it wasn't possible to buy any dollars at that price.
Wrt. original post - it was obvious even back in February that the faster Ukraine wins the less hit Europe will take. Europe has been dragging its feet on military help for Ukraine and as a result dragging itself deeper an deeper into an economical crisis. Leaders of France, Germany, Italy still seem to hope that Russia will take a piece of Ukraine, and after that the things will be back to the good old times. This naïve thinking has already obviously failed, yet they are still clinging to it.
[0] https://www.bloomberg.com/news/articles/2022-05-17/in-ussr-f...
I actually banked on that a bit, enough to offset losses on other parts of my portfolio.
A massive economic sanctions package, which eliminates their ability to import goods and services while having their sole export stockpile foreign currencies, does help level the balance of trade.
But that does not mean the economy is not tanking though.
Outside of Russia, nobody will take your ruble. In Russia, somebody may, but that's not going to be a bank and the actual cost will be much steeper than advertised rate.
(US dollar skyrocketed to almost 100 ruble in March until Russian government decreed its officially worth 60 except now you basically can't legally buy western currency. HODL mode I guess?)
I say this only because I have a sizable amount of rubles from an earlier trade, and *I have no way to exchange them for USD despite the exchange rate.*
The price you see is a reflection of the price accepted by those able and willing to trade rubles which is currently *a limited subset of the world*. Sure, they have a massive trade surplus due to the commodity shortage, but a lot of the move is engineered through capital controls.
(1) Western Ruble electronic trading is dead. It's near impossible to move rubles with any size. [https://www.risk.net/our-take/7946561/russian-ruble-trading-...]
(2) Moscow is forcing companies to buy rubles.
(3) Moscow limited the amount of dollars that Russians could withdraw from foreign-currency bank accounts and barred banks from selling foreign currencies to customers. [https://www.wsj.com/articles/russias-economy-is-tankingbut-t...]
(4) Moscow has fixed the price of gold. [https://www.kitco.com/news/2022-03-28/Russia-sets-fixed-gold...]
So really, the "appreciation" you see is compensating you for the headache you'll have to go through to do anything meaningful with rubles.
Meanwhile, Russian inflation is at 15% and GDP is collapsing. Russian imports have collapsed because *no one really wants rubles*.
All of the world's central banks are printing like mad. Both the EU and Japan both have negative interest rates atm.
[0]: https://fred.stlouisfed.org/series/ECBASSETSW
[1]: https://www.federalreserve.gov/monetarypolicy/bst_recenttren...
[2]: https://blocnotesdeleco.banque-france.fr/en/blog-entry/under...
You can look components of inflation in both regions and see exactly how much is hydrocarbons.
The Eurozone is facing war and an energy insufficiently.
The ECB is lagging behind US federal reserve in tightening monetary policy. (They are just about to implement their first rate hike in 11 years)
Monetary policy is shifting, Fed has said they will keep tightening until inflation is back to 2%. For whatever reason a lot of people keep betting on a pivot. I don't see this happening, even if the end result is a recession (may already be in one). Inflation continuing to rise is ultimately worse than another recession if the Fed pivots.
At some point the US has to print to outrun its debts. There will be a pivot.
EU and Russia are playing .... the Russian Roulette
US has a higher interest rates.
US has a stronger economy (relatively).
US Dollar is where people go in times of trouble.
US central bank is turning off QE ("money printing")
US central bank is planning on reversing QE ("money destruction")
Both regions need to improve renewables for national security reasons, and work on winterizing and migration to residential/commercial heat-pump technology to both reduce usage but also move to electrical-based heating/cooling which can be sourced from multiple vectors (renewables, gas, nuclear, et al.).
People frame renewables around global climate change, which while true, isn't the elephant in the room. The elephant is national security and stability, and renewables are a key element.
There is going to be economic carnage if we keep turning the heat up.
https://www.washingtonpost.com/politics/2022/06/28/zelensky-...
Their nukes don't mean that you let them do whatever they want. But it means that you have to take limited actions that keep the warfare conventional. And sometimes that means settling with them.
Heck, finding something that Putin can claim is a victory is probably important if you want the war to end. It doesn't matter if it's real, and it may not matter if he thinks it's something he won. It certainly matters that he can tell the Russian people that the cost they bore to "denazify" Ukraine worked. Otherwise, he failed and that way lies bad consequences for dictators.
It really is a good question why has the world leaders have settled with a person like that in charge of a nuclear power. I wonder if cheap energy had something to do with that.
The majority of those territories were already occupied for the last 8 years, it would have been better to negotiate that at the start.
The west refused to even accept the result of a landslide referendum whose veracity was confirmed by our own polls.
It's a good thing respect for democracy isnt a cornerstone of what we stand for coz one of those three demands was just "respect a democratic vote". Imagine the optics of pensioners dying of cold in the German winter because the Americans rejected democracy.
Russia needs to be dismantled military and ideally should be denuclearised they have proven they cannot play at the table with adults.
This is a rough war for everyone, but its a war that unfortunately needs to happen, Russia must have a decisive defeat or they will continue behaving how they have been for years now which is bad for the entire world.
Now our gang is fighting a proxy war with another nuclear gang because we cant deal with the result of a democratic vote to join Russia in a place that speaks exclusively Russian.
And we're being asked to freeze to death out of sympathy.
The Russians aren't soldiers like the west expects.
Im sure your opinion would be different if it was your friends and family be executed and raped.
In Yemen we dont even really try to justify the war crimes we just ignore them and keep sending weapons in Saudi's war of aggression.
The war crimes committed by Azov since 2014 we are equally indifferent to because hey, it's Russia and those Nazis are good fighters.
This war is purely a clash of empires. NATO are happy to discard all of the principles we purport to represent AND sacrifice the wellbeing of all Europeans even if all we do is give Russia a black eye.
This war is purely Russias, it is a war of aggression designed to wipe out a cultural, a people, its genocide.
That Russia is committing genocide in Ukraine is unsurprising they already did this before during the USSR with the holodomor.
Russia is solely responsible for this war.
It's lucky that a lot of Europe is happy to sacrifice both its weapons and some of its economy to stop the authoritarian beast just like they did in WW2.
Genocide has quite a high bar. Biden's opinion is currently that what Russia is doing doesnt meet it.
https://en.wikipedia.org/wiki/Sexual_violence_in_the_2022_Ru... just pick anyone of them.
> Genocide has quite a high bar. Biden's opinion is currently that what Russia is doing doesnt meet it.
Genocide is certainly a high bar and the Russians are certainly doing their very best to meet it, its arguable if they are meeting it but per the definition of the UN they are easily meeting it.
https://www.un.org/en/genocideprevention/genocide.shtml
Even without anything else Russia is already doing.
> Forcibly transferring children of the group to another group.
That one is notable because she had zero evidence and said she was doing it to ensure Ukraine got more weapons.
Wikipedia refers to her accusations but leaves the part out where she was fired for doing that.
Your team (Azov) committed rape all the way back in 2014, as documented by OHCHR: http://www.ohchr.org/Documents/Countries/UA/Ukraine_14th_HRM...
Why did you need evidence anyway according to you mass rape is a standard part of war no?. So we can expect the Russian armed forces to mass rape in every war yes?.
I'll wait.
This kind of aggressive know-nothing 'naivety on the warpath' is all too common at the moment. It might get us all killed.
Putin has lied since day 1. His words betrayed his motives and the facts about his actions are clear to everyone. Russia under Putin is a terrorist state. And the sooner the west fully isolates them fully the better.
> The majority of those territories were already occupied for the last 8 years
How do you have an invasion, occupation by one country of large sections of the territory of another, with shelling and other fighting between the parties, without a war?
You don't; you are confused as to what the beginning of the war is.
It’s a certified shit show and the only thing preventing conventional war in all of Eastern Europe right now is NATO. Economic war (and cyber and psyops) is what’s left, so that’s what they’re fighting with. Looks like they ran out of stuff to steal from their own citizens, so had to start looking outwards.
The two things that caused this war are:
1) NATO the "defensive" alliance tearing libya to shreds like a rabid dog, basically for sport. This signaled the start of Putin's paranoia.
2) NATO putting Ukraine on the path to membership and refusing to back off.
Joining a gang is dangerous. Ukraine paid dearly for trying to join ours.
2) NATO never put Ukraine on the path to membership, although as a result of this invasion they're changing their mind.
2) This is what NATO itself said at the 2021 summit. It was crystal clear about its intention to continue the admission process for Ukraine.
2) Please, don't embarrass yourself. Ukraine was explicitly on the path to NATO membership (as of 2008), and the place was crawling with NATO trainers and advisors.
NATO probably won't exist in a decade. The US is not that committed to European security, and nobody else is worth a spit.
If Russia cannot handle its neighbours making decisions as a sovereign nation, then thats there problem.
It's possible Russia would have accepted their membership if NATO hadnt underscored its status as an offensive alliance with the destruction of Libya in 2011. Sadly this confirmed the reality to every Russian that NATO is an imperial threat.
Oil follows the "law of one price" globally; https://public.wsu.edu/~hallagan/EconS327/weeks/week9/LOOP.p... global prices converge since it's an identical commodity that can be transported with low friction.
When the EU restricts russian oil, India and China buy more, and then EU buys more oil from elsewhere -- it's a global market that readjusts relatively quickly.
There is some short term friction around switching costs and infrastructure, moreso for volatile-to-transport gas than for oil, but this shouldn't be a meaningful factor to currency. There are tons of other impacts of war, such as general destruction of capital and people's productivity, as well as plenty of other explanatory factors that would have a bigger effect here.
Oil heating in Germany isn't supper common, it depends a bit on the region as it was trendy during some time in the past but most oil heating which had been build in the past has been replaced by gas at some point in the last 20 years.
Both USD and EUR are losing value relative to real goods, just at different rates
- Germany facing record deficit spending to offset energy shortages due to Ukraine war.
- Massive US-denominated debt in Europe, requiring USD to service and/or payoff at a time when the US has raised interest rates and decreases liquidity. This is a huge reversion of a bubble that has enlarged for over a decade.
- Greatly decreased USD revenue from exports to US due to inflation, adjusting EURO downward in a somewhat autonomous rebalancing (meaning not necessarily central bank led).
- Inflation over imports of food, energy & other goods settled in dollars.
- Fissures in the EU over German and Hungarian reluctance to participate meaningfully in defense of Ukraine as a proxy for defense of countries like Poland and Lithuania.
- Risk premiums across the board.
That is effectively what is driving up the price of the dollar - more people are moving their money over to take advantage of rates that they expect will pay more than other currencies.
Think of it like this - Would you move your money to a bank paying 2% interest versus a bank paying 0% interest? Not everyone would, but many would.
The EU is inflating their currency more.
People seem to think that if Ukraine collapses and Russia just takes it that the EU/US will just be able to back off, but that's not in the cards.
I've had a completely unfounded theory about it for years that the tighter two economies are linked, the more likely this is to happen. People dealing in both being more willing just to round one way or the other bringing it into some sort of homeostasis due to simpler in-head math.
But, I decided to link to the bloomberg article since it gives a better context.
To my non-expert intuition, it seems a double-edge. Currency devaluation brings the cost of European manufactured G&S cheaper and brings a boost to the economy, and hurts US exports. On the other hand, Bloomberg cites devaluation of Euro would bring more investments in the US as it is now a parity.
It's actually since December 2002.
1999 is the first time the EUR reached parity with (then dipped below) the USD.
I may still have this issue in my memorandum box. But no, I won't go looking for it. ;)
Basically it's just: high currency is good if you're importing, bad if you're exporting.
These prices are the opinion of a relatively small number of people, some of whom - like certain well known banks - have a long record of bad faith price fixing.
For example:
complete rubbish, FX is the most liquid and actively traded instruments there are
> In terms of trading volume, it is by far the largest market in the world, followed by the credit market.
Furthermore:
> Trades between foreign exchange dealers can be very large, involving hundreds of millions of dollars. Because of the sovereignty issue when involving two currencies, Forex has little (if any) supervisory entity regulating its actions.
One anecdotal example is Czech based JetBrains. They announced a few days ago that they're increasing subscription prices. I presume, they have a huge sales numbers in the US.
I really don't understand macro-econ on this scale, Bloomberg article is good, but would be fascinating to read deep analysis of pros and cons.
I have a colleague who likes to say that “every concept expressed with less than three words is adding confusion instead of reducing it”, and I like this saying more and more every day.
Inflation redistributes wealth from people who earn and save in local currency (lower and middle class most impacted) to benefit those who deal more in foreign currency (upper middle class, rich people).
Any inflation above the stability rate, produced by monetary policy, is government thievery plain and simple. I say this as an exporter who financially benefits from local currency inflation.
Only for exports that don't rely on imported components, because such components will get more expensive.
This doesn't matter. You buy wheat at $100 and sell breads at $250. You net $150 and convert that to, say, €150.
Compared to about 5 years ago, the total value had increased by about 40% from what it was initially. This year? Everything's back to around 0% - some of those are in the red, some have measly value increases, but overall it's just like stashing money in a sock somewhere, instead of actually investing it.
In a sense, it's telling of the greater situation economically - and that's even when you ignore the funds that had some Russian investments as a part of the portfolio (the trading of which was suspended altogether).
When you consider the inflation that we're having here (Latvia) and now also the situation with the overall value of Euro, it doesn't look too good, to be honest. But hey, I'm paid comparatively little anyways and people working at US companies probably make in a month what I make in a quarter, so no point in crying over insignificant amounts of money.
I'll continue to have some financial stability, just will never have things like nice cars or owning my own housing at this rate.
It appears to not have crossed exactly 1 yet.
(I'm not a currency trader, though...)
dropping below 1 will drop the "psychological barrier" then they all end up spooking each other into more selling
In contrast, many commentators thought London (and Paris to a much lesser extent) would take financial market share away from New York during the aughts, the heyday of globalization. Celebrities like Gisele famously demanded to be paid in EUR, while Jay-Z showed off his Euro notes in the video for "Blue Magic."
Yeah, the biggest economic problem is definitely nationalism and not, say, excessive covid lockdowns or gas sanctions.
Also importantly, the EU's economic raison d'etre ended last quarter.
It was simple: Germany props the EU with transfer payments and EU members commit to buying German goods. Now Germany has a trade deficit. A major exporter-manufacturer has a trade deficit. That's like China having a trade deficit. This is absolutely cataclysmic and an economic fuse of unknown length just got lit on the EU.
And the worst probably isn't even behind us as Brussels continues to self-destruct for the sake of stopping a comic-book villain version of Putin who is apparently an existential threat to the West, but also not powerful enough to even take over Ukraine.
I'm not one for predictions, but unless Brussels comes back to reality and stops dealing with platitudes and the ideas of insulated Davos elites, it's quite likely the EU ceases to exist as we know it within the decade.
EU people gave control to Schwab. Your timeline looks to be correct for EU crack-up caused in part by unpayable pension obligations. In the meantime, my tourist dollars spend further in Europe this summer.
You might be underestimating how close Vladimir Putin is to a comic book villain. I'd recommend you to take a look at https://meduza.io/en/feature/2022/06/16/the-criminals-in-the... . (Meduza is a reputable Russian journalistic medium, operating in exile from Rīga, Latvia. )
> I'm not one for predictions, but unless Brussels comes back to reality and stops dealing with platitudes and the ideas of insulated Davos elites,
I've noticed from up close how much of the EU structure, especially the EU parliament, is actually very approachable by the ordinary member state citizens it is supposed to serve.
> it's quite likely the EU ceases to exist as we know it within the decade.
The risk certainly seems a lot higher that for the US or Russia. "Quite likely" is a bit of an exaggeration at this point though. I do hope a decent EU will last quite a bit longer. I feel like all recent crises have actually strengthened the EU.
Russia is more than powerful enough to take over Ukraine on its own. But Western aid to Ukraine — because of the perceived Russian threat — has been enormous. US direct military aid since the major invasion this year being more than Ukraine’s most recent annual defense spending.
- the dollar is falling compared to US living expenses (US inflation)
- the euro is falling compared to the dollar (exchange rate)
- therefore, the euro is falling faster compared to US living expenses
- but the euro is not necessarily falling faster compared to EU living expenses (EU inflation)
Indeed, EU inflation and US inflation seem to be about the same, which means that the exchange rate change is not because one or the other is experiencing more inflation.
Bad if you're an American selling products to Europeans.
Exports from EU will be more competitive, which in the medium term will strengthen the Euro again.
Commodities like food and gas go to the highest bidder usually. If country A is paying $10/pound for bacon and country B is also paying $10/pound for bacon the bacon suppliers will sell bacon to both countries, but if all of a sudden country A is only paying $2/pound for bacon because their currency went down 80%, the bacon suppliers will only sell their bacon to country B at $10/pound.
On the other hand it’s a great time for Americans to travel to Europe. Americans have for decades been relatively wealthy compared to Europeans but today are considerably so.
If you’re a Euro planning a trip to Disney, it’s very expensive right now.
Imagine two currencies ABC and DEF. They are at parity (ie 1 ABC = 1 DEF). ABC's central bank has 10% interest rates. DEF's central bank has 1% interest rates. What happens? ABC strengthens against DEF just based on the interst rate differential.
Why? Imagine if it didn't. You could borrow DEF 1B, convert to ABC, earn 10% interest and then pay it back later. If the exchange rate remains fixed, that would be a risk-free return of 9%. Because of that it doesn't happen. Think about it. This creates demand for ABC.
Because of skyrocketing inflation, the Fed has raised interest rates. Europe has not [1] and really can't.
Secondly, in uncertain times, there is nearly always a flight to the safety in financial markets, which usually means US Treasury bonds. This too creates demand for US dollars.
So there are issues with th eEuro but really what you're seeing is a strong US dollar. This is a temporary situation.
I'm not saying the energy issues in Europe aren't significant. They are. We can hope this creates pressure for a peaceful resolution to the war in Ukraine. This idea seems to make a lot of people angry like it means capitulating to Russia. Every conflict ends diplomatically (including WW2). Russia too is facing pressure to find a win and end the war as it's not sustainable long term so we're really in a game of chicken. Putin may be hoping a European winter (where the effects of an energy shortage will be more pronounced) will sway the odds in his favor.
Italy already pays 1.9 percentage points higher rates than Germany, and has 140% debt to GDP. If the ECB sharply raises rates, then Italy's debt might become unsustainable. The Economist notes: "The country probably cannot tolerate yields on its bonds much above 4%. Around that point, the goals [of the ECB] of price stability and defending indebted countries would become irreconcilable. Should interest rates surge, the euro area would look dangerously frail. "
https://www.economist.com/leaders/2022/06/23/how-fighting-in...
So, a certain level of inflation is actually good. The general benchmark modern developed nations go for is 2-3%. High inflation can cause all sorts of problems even without getting into hyperinflation. Negative inflation ("defaltion") or even zero inflation causes problems too. Just look at Japan over the last 35 years to see this in action. Deflation promotes saving rather than spending such that there is less economic activity and this has a knock-on effect on creating unemployment.
Side note: lack of consumer spending is a ticking time bomb for China thanks to having to fund your own retirement and the demographics caused by the One Child Policy.
So 2-3% is really the sweet spot.
It's also worth noting that countries that run deficits like inflation too as it decreases the real value of their debt.
Central banks can contrl interest rates by setting the benchmark rate. For example, if the Federal Reserve offers 5% for US Treasury bonds (which are considered essentially "risk free") then why would a bank lend a business or you money at less than 5%? It's more risk for a lower return. This is monetary policy.
So as you can imagine if someone can only borrow money at 20% vs 2% it will have an impact on economic activity. That's the point. In the US, high inflation is seen as being driven by demand outstripping supply so interest rates are a crude tool for reducing demand. That's why the Fed has been raising rates.
The eurozone largely has the same inflation problem thanks to energy demand and housing but doesn't have the economic activity driving it. So if the ECB were to aggressively raise rates, the fear is this could cause a deep recession in the eurozone.
So that's what I mean by "they really can't> The eurozone has the inflation but not the economic activity.
You're quite optimistic. I fear this is a 1930 moment. By the end of the decade we might have a Nazi Russia, WW3, North Korea attacking the South, China taking advantage of the situation and invading Taiwan. Japan remilitarising and maybe becoming a nuclear power.
I'm not sure if you're talking about Putin or after Putin. Putin is an autocrat in all but name already. It's unclear whta'll happen to Russia when Putin inevitably dies. It could plunge into chaos, which is a big risk of any cult of personality.
But Ukraine has revealed that Russia's military is a paper tiger. Russia too is in decline (demographically).
> WW3
So if we actually have nuclear war between major powers, it's over. There's really no point worrying about this happening because it's unlikely you can impact this outcome so you'll be better off just assuming it won't happen.
> North Korea attacking the South
I don't fancy their chances. Sure NK has a large standing army but they can barely feed themselves. Kim Jong-Un isn't an ideologue. If anything, he's Saddam Hussein, which is to say he's motivated by his material reality rather than, say, any kind of fundamentalism. Kim likes his luxuries. Attacking the South would invite his own personal ruin. The only way I see this as realistic is if NK will otherwise collapse. Is a collapsing NK really that much of a threat? I mean they could cause a lot of people to die but could they succeed? I somehow doubt it.
Remember too that NK only really exists because China wants it to exist. China, like any major power, likes having buffer states between it and other major powers. The US is no exception here either. The US almost started wW3 over Cuba after provoking the USSR (ie Jupiter MRBMs in Turkey).
China doesn't war on th eKorean peninsula. China likes things the way they are. Just how long would NK survive without Chinese support?
Side note: it has been a huge failure of US foreign policy not to consider that Putin too would want a buffer to NATO.
> China taking advantage of the situation and invading Taiwan
What'll eventually happen with Taiwan is a big open question. China knows what a shitstorm it would be to invade. Success isn't guaranteed either. A small body of water can be a huge barrier to even large militaries. Only 17 miles separates England and france at the closest point and Nazi Germany could never cross it and invade. Had there been a land bridge, the UK would've absolutely fallen in 1940-41. No one has successfully invaded England by sea since 1066.
> Japan remilitarising and maybe becoming a nuclear power.
Japan is a declining power due in large part to demographics. Japan is a bit like the UK in that it is highly dependent on imports. It also has a major power in the form of China as a direct neighbour. I really doubt Japan is the will or even the means to become a major military power.
I'm honestly way more concerned about the rise of fascism in the United States than anything you mentioned.
I mean, if you're calling Japan a declining power due to below-replacement birth rates, then every industrialized nation, including Russia and the US, is a declining power.
Russia has lost the blitzkrieg but gained ground in Donbass through regular warfare. They are throwing USSR era resources into the battle and haven't even issued a general mobilisation order. When China is going to sell them computer chips, they will have the resources to build guided missiles and ICBMs. I'm afraid they are not quite the paper tiger that the Western press is painting them to be, nor the 'glorious' USSR. I hope this war would end up like Afghanistan for Russia, further weakening it and leading to yet another break up. But it might end up like Chechnya.
I don’t think much can help Russia at this point in time it’s really just a matter of time till they run out of steam, it is Afghanistan all over again.
Global warming. Checkmate, Putin.
There are indeed other mechanisms, e.g., currencies with higher interest rates experiencing higher demand, but that also has limits/doesn't hold strictly etc.
The carry trade in FX, i.e., borrow in low yielding currency invest in high yielding currency is a classic trade, but it is not risk free. FX can move against you.
Basically, uncovered interest rate parity says that the interest rate differential creates an offsetting effect in the FX rate. Empirically, that is a bit shaky/doesn't always manifest, there are debates on time horizon, etc., though. In short, FX not easy to predict.
> ABC's central bank has 10% interest rates. DEF's central bank has 1% interest rates. […] You could borrow DEF 1B, convert to ABC, earn 10% interest and then pay it back later. If the exchange rate remains fixed, that would be a risk-free return of 9%.
If you have now 100 ABC = 100 DEF you have the choice of getting in 1 year 110 ABC or 101 DEF. If ABC depreciates against DEF and in one year 1 ABC = 0.918 DEF both choices become equivalent.
WW2 ended with Berlin being captured by the allies and Japan being nuked. How was that a diplomatic end to the conflict?
[1]: https://en.wikipedia.org/wiki/German_Instrument_of_Surrender
[2]: https://en.wikipedia.org/wiki/Surrender_of_Japan#Occupation_...
The Allies said to Germany they wanted unconditional surrender. The Germans agreed. Various terms were agreed to including the cessation of military operations (on both sides). This is, by definition, a negotiated agreement ie diplomacy.
Putting the highly questionable ethics of the two atomic bombings of Japan aside for a second, these bombings like any military operation are ultimately a negotiation tactic.
And given the deficit there is more of former happening than the later.
For US entities selling to EU, nothing changes, but for EU entities selling to US, they would receive less Euros for a given amount in Dollar. As their cost structure is in Euro, they will have a lower net income.
[0] https://en.wikipedia.org/wiki/International_use_of_the_U.S._...
(I think this thread is silly though: there's no way enough people will move to warm climates for the winter to make a dent in cold-country fuel consumption.)
Link?
As far as I know, there's nothing like this in the US, and it's something that I've known broke people to do.
They also seem to be the only airline that isn't cancelling thousands of flights right now. As much as I dislike them, they seem to be well run.
I still remember their proposal for ultra-cheap standing-only tickets (couldn't get that one past regulators). Kinda wonder if it was seriously meant or not.
Under the seat bag: 0 Reserved seat: 10 10kg checked bag (carry on size): 16 20kg checked bag (full size): 26 A bag being overweight by 1kg: 70
So they get pricey quickly if you're taking any decent amount of luggage. God help you if you don't have accurate scales at home.
(They have the scales available before check-in, so it's reasonably fair.)
If you read the costs closely and can avoid them, they work great. I flew from SFO to Stockholm with Norwegian Airlines for $400 return on a 787. About the same as SFO to JFK.
But it was no frills. No even free water served (you could ask for it) or any meals. If you prepare it’s great. If you don’t it’s pricey.
Fare USD $ 1.49 Taxes & Fees USD $ 273.96 Total USD $ 275.45
Ryanair repeating this story gets them free advertising reassuring people that they try and minimise costs.
I also respect their honesty. They tell you "we get you from A to B the cheapest way", no more. Traditional airlines' ads are all about traveling in luxury, which is extremely dishonest considering 99% of their travelers experience a not-far-from-Ryanair level of comfort.
At the end of the day most currency holders want a liberalized currency and CNY is far from that.
The flows of money through FX are astronomical amounts of capital, and even central banks struggle to maintain a hold on a subset of their own currency market, let alone artificially dumping and pumping a currency. The SNB (Swiss National Bank) is probably the most powerful in that regard (able to adjust the currency to their liking), but that is due to having an abnormally strong currency they've used to buy foreign reserves they can utilize to maintain the price targets they want.
It doesn't have the natural resources that the US/Russia/China have. It is interesting that the time was the nations that would be the EU were most dominant, they used colonization to get the resources from all over the world (see for example British Empire).
In addition, there is still lack of political unity, with a much less powerful centralized government compared to say China or even the US.
Just an example: https://www.cadtm.org/Africa-How-France-Continues-to-Dominat...
France is still operating a colonial governance system, we just kinda ignore it.
I've had many arguments with people where I can't get it across that it costs a lot to get a human being all grown up, socialized, educated and ready to work in high value industries. Then we get them swept away to the west (and for good reasons, more money, higher quality of life etc.) and end up with nothing for all our societal investment. If we're lucky, some of them come back with some know-how and create a viable business, but most don't bother.
3 / 4 of the people I went to school with (primary, secondary, high school and college) are now gone for good. Almost as many upcoming graduates (soon to be 18+) are planning to either study here and go, or just go.
This pains me as someone that decided to stay behind and try to change something. But I do understand their motivations.
Resources are nothing without people.
They are overrated until you don't have any. It's hard to manufacture anything without natural resources. It's hard to heat your home or fuel your car. As far as the "stable civic institutions" the farmers in the Netherlands would like to have a word with you.
For now. Take a look at those demographic age pyramids and sub-replacement fertility rates. What's the population of the EU going to be in 2100?
I think any sober assessment of which regions will achieve or maintain economic preeminence in the coming decades would have to include Europe and almost certainly exclude Russia.
The USD FIAT is sucking the liquidity out of the other markets.
When it actually happens you'll see 0.99 something.
The OP jumped the gun.
I remember after 2008, greece and other countries, couldn't devalue currency enough to help them get out of the recession as they were all tied to the euro; that extended their pain longer than otherwise would have been expected.
I guess currency traders are having a good day today or did at some stage.
It's also pathetic that both the US and EU both now have to go beg other bad actors for oil/gas.
A lot of processes and heating still use natural gas directly, and that is what is causing the threat of industrial shutdowns.
Many countries have already switched to coal for electricity generation - https://www.reuters.com/business/energy/netherlands-activate...
Germany’s decision to abandon nuclear is one of the most stupid ones ever.
Also, Discussion of Europe's lack of mega companies / weakness is often a theme here, and there are many fair points to be made about its lack of entrepreneur culture and unfriendliness to business. But I'd like to point out that it's worth to think about more than just economies in comparing the EU to the rest of the world. So let me mention a couple of other things worth noting:
Stuff like GDPR or the currently-in-the-works AI act (not to mention all the other rights and wellfare benefits common in much of the EU) don't help the EU's economy but do benefit its citizens in many ways (as far as I am aware).
A bunch of countries in the EU (looks like about 12) has a happiness index score higher or the same as the US (https://www.theglobaleconomy.com/rankings/happiness/Europe/). Many of its countries also have higher life expectancy (https://www.worldometers.info/demographics/life-expectancy/).
- car makers, three of the top ten (world wide) are German, one is French-Italian with brands in Japan and the US
- pharma: pretty even split between US and Swiss companies, two entries in the top ten from the UK, one from France, none from Germany
- chemical: two German (no idea why statista wouod count Linde as an Irish company), one from Belgium and one from France in the top ten
-aerospace&defence: one British, one French and Airbus (by alleans Frenxh but count it as European if you want) in the top ten
I could research this further, but German companies don't seem to be over represented when it comes to large international corporations
I guess you can easily argue that a stronger economy also is pro-citizen and benefits the people. I have had discussions with close friends in EU and I get the opposite response. They're all in tech aiming to move to CH for better salaries and stronger capitalistic/enterpreneurship environment.
US have common language and culture. EU is one zone with different barriers to crack.
It would be like launching your SV startup only in California and not getting the other 49 states for 'free'. For each new state you launch in, there is regulatory burden and language burden, not to mention culture differences affecting UX. Small markets limit growth and reduce ability to raise capital -> ergo the US competitor will almost always win.
Language and culture, you cannot force to change. Something people love in Germany, most likely will not fly in Spain or Greece.
To drive demand is much trickier than solving tax issues.
If you're going to handpick states within the EU, shouldn't you also handpick states within the USA?
This is a great reminder that keeping your money afloat is not that hard as long as you can export. (For the record, what destroyed Venezuela comes from the fact that they needed to import light oil in order to process their heavy one. Once the sanctions cut the input flow, the output flow dried up pretty quickly and it was game over)
I don't think it will matter long, given the catastrophic failure of the Russian military (which is currently demilitarizing Russia pretty quickly, how ironic), but from the economics PoV it's still interesting to witness.
Indeed, thanks. Not a native speaker here, and I got everything mixed up with the early-war pun “the Ruble is going to rubble”
> What definition of strong are you using? Ruble […] has historically been around 85:1 and now its ~60:1. (Rubles:Euros, i.e. 85 Rubles for 1 Euro)
Yes, that means Ruble's purchasing power increased by 40% (one Ruble could buy you ~1.2 euro cent, and now it buys you ~1.7).
IF you had your money in Rubles last year, can buy 40% more of a product than if you had your money in Euros.
*not under sanctions.
They are buying rubles 10.75 RMB and selling at 12.5 RMB. They are selling USD add 674.
This gives 63 rubles to the dollar.
The fact is that major economic powers in the world have not signed onto sanctions and have access to both Russian and Western currency.
It is true that many parts of the West have lower need for rubles because of sanction, but if you I think that the entire Globe has frozen trade with Russia and trade in Russian currency, you are the one that has fallen for propaganda. They just no longer can use western exchanges to convert currency. See the link below.
https://www.google.com/amp/s/markets.businessinsider.com/new...
So far you have changed your position from you can't trade it at all to the spread might become incrementally worse if trade exceeds 700 million US dollars worth a week
Second, this exchange is in Russia. Can you actually move your "yuan" from that exchange to China or anywhere outside the country?
Unfortunately, Europe does not control the flow despite whatever legal arguments they can muster.
The contracts likely have clauses related to failures to deliver, and Russia will have little influence over how those clauses will be implemented.
Im sure there are plenty of clauses, but once you are at economic war with a country, the contracts don't matter. They aren't worth the paper they are printed on. Thats my point.
Russia says old contracts are void and has the gas. EU Can agree to new contracts or go without. They cant use the old contracts to make Russia give them gas on the original terms. What will they do if Russia refuses? sue them for breach of contract, sanction them, and seize their foreign reserves?
E.g. if Russia would continue with gas supplies, the money for gas would got into the locked accounts. After war would end, Russia would get locked accounts minus reparations. Now if Russia stops supplies, after war ends Russia will get locked accounts minus reparations minus penalties for the failure to deliver gas.
Plus, they aren't planning to leave Ukraine, so they aren't planning to get it back
Therefore the money is a sunk cost and not leverage. Therefore finical penalties don't matter.
The u.s. and Canada have a demilitarized border. This would be bad for the u.s. if we went to war with Canada. However, we don't plan to go to war with Canada, so we aren't basing our decisions on that outcome.
Your claim is essentially there's no line, or that there is not a spectrum or that that line is beyond any economic measures. But there's no proof of that, so the logic in your "proof" is circular because your proof predicates on you knowing exactly where the line is (or isn't), when the location of the line is the thing to be proven.
I am saying that it unlikely to be reached and my personal opinion is we are moving further from it not closer.
I'm also saying that Russia is not making decisions as if it will be crossed. They are doing the exact opposite, making decisions assuming that they will not be forced out and will not get the reserves back.
I don't think they would realistically get the foreign reserves back even if they left, so that isn't much of an incentive.
The US and EU have to much politically at stake to hand them back, even if they leave. It would be seen as letting Russia get away without consequences for the invasion.
Time will prove one of us wrong. In 5 years Russia will either be occupying Eastern Ukraine or not. They will either have control of the foreign reserves back or not.
It looks like Russia is also only accepting rubles for wheat [2].
This is the obvious and natural result from the sanctions. OF course they will not accept a currency they can not spend anywhere.
[1] https://www.russia-briefing.com/news/russia-insisting-paymen...
>The EU’s executive body told the EU governments in a closed meeting that the authorities were not preventing companies from opening accounts with Gazprombank and would allow them to buy gas in line with EU sanctions.
>The EU will get a taste of what this means as Russia is turning off the still-operating Nordstream 1 pipeline for ‘routine scheduled maintenance’ from next Monday, July 11th to July 21st.
[2] https://dailytimes.com.pk/962297/russia-imposes-ruble-restri...
Yeah, that's how sanctions work: unilaterally.
To make priorities clear: Attack war is a crime and Putin, his government, and army leaders belong to Den Haag and then into prison.
But every westerner continuing to drive their car, fly to holidays and other wasteful lifestyle activites makes energy prizes go up and pays for Russia's war. Europeans a bit more directly than Americans, but in the end we have a global market so nobody goes free of reponsibility. Nothing they will end up in court for (would be a miracle if even Putin did, Bush and Blair didn't for doing not too differently), but certainly morally wrong.
Haven't checked recently but a month ago or so it was said Russia earns more money for oil and gas than in February, despite the volume having decreased quite a bit.
This restriction has been removed couple of weeks ago. At first it was 80%, then 40%, now it’s gone.
Which Russian companies still have significant income in foreign currency? I thought trade has mostly stopped. Except for energy, but that is dealt with in a different way anyway as discussed above, because still excluded from sanctions from the West and the Ruble requirement from Russia.
Then there is of course China and India which seem to intensify trade. No idea what currency they pay in and whether the increase has already been significant during 4 months.
Once the euros are converted to rubles, it's unlikely they get converted back into euros somewhere else in the supply chain. As opposed to USD, which facilitates 87% of world trade.
That means net selling pressure on the Euro.
I'm one for marking the occasion, but let's actually wait until it's there.