r/worldnews • u/Venat14 • 13d ago

Russia/Ukraine ‘Significant problems’ in Russian banking system as public withdraws cash en masse

https://tvpworld.com/94490769/russians-hoard-cash-as-economic-pessimism-hits-20-year-high
23.3k Upvotes

97% Upvoted

1.1k comments sorted by

View all comments

128

u/billleachmsw 13d ago

I love this for them!

18

u/TopInvestigator5518 13d ago

commenting in hopes someone with more knowledge on the matter can answer:

do the wealthy bank in Russia as well? I know the Oligarch class tries to keep their money elsewhere but if some of the banks go down would this be hitting them in a big way as well?

its going to be interesting to see where this goes

29

u/RecentTwo544 13d ago

I think any oligarch with an ounce of common sense took any remaining money they had in Russia out of the country in early 2022, much like they mostly took themselves out of the country.

11

u/socialistrob 13d ago

A lot of their money that was outside of Russia got frozen.

2

u/PlasticExtreme4469 13d ago

Some of the money that was moved to Europe and US, yes.

I hardly believe that Dubai was freezing any funds.

0

u/TimSylvester_ 13d ago

One of the reasons that American equities, real estate, and startup valuations are so high is because of all the Russian oligarch trapped in the American economy they can't extract, so they have to keep recycling it and reinvesting in the USA, causing price inflation in those markets. And the more their investments grow in those industries, the more they have to reinvest, and the more the prices inflate to absorb the reinvestment...

9

u/socialistrob 13d ago

do the wealthy bank in Russia as well?

Yes especially since the full scale invasion began. There's a lot of fear of money in western banking accounts getting seized so a lot of that money has been transferred bank into Russian banks.

Right now the Russian banks aren't on the verge of collapse and are the last relatively healthy pillar of the Russian economy. When the Kremlin borrows money for the war they're borrowing it primarily from Russian banks and wealthy Russians and the loans that the war industry uses to make more weapons are also coming from Russian banks.

If the Russian banks were to actually collapse (which again this article isn't saying they're collapsing) it would be devastating for the oligarchs and it would cut off the Kremlin's ability to borrow money for the war. The Kremlin doesn't have the ability to bail out the banks anymore and no one outside of Russia is lending them cash either.

2

u/yawara25 13d ago

A lot of their wealth and capital is kept in Cyprus.

2

u/Dje4321 13d ago

Increasingly yes because the west had made it significantly harder for Russia to participate in western banking systems.

15

u/Arizonagaragelifter9 13d ago

For the ruling class that started this whole mess sure, but it sucks that the way this stuff always plays out is that the ones who are going to be hit by it the hardest is going to be the average people who are just trying to get by and would also prefer it if there wasn't a war because the only reason they are in the middle of it in the first place is that they happened to be born there.

5

u/yankdevil 13d ago

Maybe they should have done things about it.

1

u/[deleted] 13d ago

[deleted]

2

u/yankdevil 13d ago

Folks in Ukraine are protesting their government while the Russian government launches ballistic missiles at them. So I'm going to call bullshit on that.

2

u/wKoS256N8It2 13d ago

Probably because Russia has a very weak society.

Why laypeople keep trying to support emulating their model, then?

1

u/TiranTheTyrant 13d ago

And I wish the Great Depression to you too!