Publication in Russian on the Zen blog
https://dzen.ru/a/ZnPxLmkrwzCvUFxh
The banned Russian ruble.
The ruble is not a currency. The Russian ruble is not money. The Russian ruble does not exist in any sense or understanding of money. Carl Menger von Wolfensgrün in his book "On Money" published in 1871 describes in detail the origin and definition of money. For something to be money, it must be generally accepted and satisfy a double coincidence of wants*. The problem is that no one accepts the ruble. The ruble will systematically lead the Russian economy to economic collapse in our country. The ruble is not money.
(*Double coincidence of wants is a situation when an individual who has good A for sale and wants to buy good B finds another individual who has good B and wants to have good A).
I claim that the Russian ruble is not money, the Russian ruble is not a currency. Let's talk about my claim about this, and also about the country with truffle-shaped domes, about Russia - a magical country, attractive as a box of chocolates in childhood and a sweet mirage. About the country of opportunities. But first, let's talk about the fact that the Russian ruble is not money, the leaders in Moscow, the people in the government, ordinary people - many do not even realize this at the moment, perhaps they have some suspicions, and then they are like a chess player against whom a move is made to crush them, and they already understand how far they will have to fall.
I claim that it is not about money, because Carl Menger in 1871 explained very clearly that money is a medium of exchange, he even wrote a book about money as a medium of exchange. Exchange is something that is generally accepted and agreed upon, like a social contract, to resolve the double coincidence*. At one time in the past, obviously, we used everything from shells to skins, even in America, even though they had American currency, they used Spanish eights (piasters. Yes, Spanish dollars were once the first world currency) and until recently, the stock market was quoted in US dollars because dollars are the world currency. So money is not something predetermined from above, currency is not something that we tie to a certain rate or rate, it is something that people want to use and agree to use.
Let's go into the Austrian economics of Carl Menger, when he talks about money, if it's in a state of disequilibrium, it has a cascading effect on the entire economy, which means that half of every transaction is money. You exchange something for money, you don't barter in exchange relations, because it's inefficient, you use currency. And in this regard, the Russian ruble is not a real currency, it's not even counterfeit money, it's not money and it's not a real currency, it doesn't even exist.
Let's look at the five major currencies that people use: the US dollar, the euro and others. Japanese yen, pounds sterling and Chinese yuan are the top five. You go to Africa, you ask the question at the market, do they take dollars? What do you think the answer is? You are in Africa, in South America - and having a dollar is normal. Even if you are in Russia at some market, then having only dollars is normal, despite all the prohibitions, they will accept dollars.
What are the next currencies? Australian dollar, Canadian dollar, Swiss franc, Hong Kong dollar, Singapore dollar - these are the top 10 currencies and the Russian currency is nowhere to be found. Below the top 10 are the Swedish crown, Norwegian crown, even Mexican pesos can be used at the market, the Danish currency will do. None of the above, but there are Polish zlotys, or any of the best currencies from the top 200, great. So where is the ruble? The ruble is 0.00% of trading on the international market, wherever you go. It is something like shares, where the nominal value is indicated, just for accounting purposes, it is similar to how the news feed briefly informs you of today's price and price list. But the fundamental and technical aspect of any currency is the price between people exchanging using the currency that underlies the economy of any country. If no one accepts the ruble, you can't exchange, you come to Poland, you can exchange euros for zlotys, but if someone in a store exchanges a ruble for you, that won't happen, you'll be thrown out of town. You can't do that in London, you can't do that in America. But if you take the dollar with you, or any fiat money that's in demand, any generally accepted currency, you can pay in any market anywhere on Earth. Even in the Soviet Union, the nominal value of the ruble was not real, and now the ruble is not generally accepted, it has no influence on the market and no effect on the international economy.
So what is my claim that the ruble is not money, not a real currency, and what systemic effect does this have on society? If you have a choice, you will not buy a ruble. If you are a Russian, it is better to buy potatoes. After all, you can save the potatoes and plant them in the ground next year. This looks crazy if you have not seen how society collapses, if you have not seen the ruins of society in the 90s in Russia. When the very structure of society falls apart, when the monetary system collapses, the government begins to bluff most vigorously with the remaining debris. Bluffing is when you are playing at the table and you know that any bluff does not last long. In the situation with the ruble, many do not even realize how quickly the ruble will collapse, all this debris will turn into smoke. And all those who say that according to the ISM index (the index of business activity of the economy), the ruble is backed by gold, then, alas, no, the ruble is not backed by gold at all, because the gold standard was established between 1870 and 1914. And if you went back to 1914, when the currency was tied to a fixed exchange rate, and you took it to the window of any bank, you would get a bag of gold for it. You can’t do this with the ruble, because the value of the Russian ruble is determined only by propaganda in Russia, and it is worth nothing, it is nothing. You can successfully sell piles of unnecessary garbage on international trading platforms, but the ruble is not even worth the paper it is printed on. Something tangible looks much more valuable, for example, potatoes, which will have at least some value as food next year. Because there is a high probability that there will be no such things as food, water supply and heating. The premise behind this is a non-capitalist top-down system in Russia based on barter relations, where they can take a commodity like oil, take it to the market, and exchange it for other goods. These are non-productive goods that are not produced in Russia. In a country where they do not build bridges, roads, water pipes, in this country they only consume and destroy. Conscious capitalism always wins over totalitarianism. Where there was or is a confrontation of systems, as it was in East Germany against West Germany, in North Korea against South Korea, Venezuela and Cuba against Florida. A totalitarian system based on a delusional economy does not stand a chance. After totalitarianism leads the country to monetary collapse and ruin, this country will return to the 90s, in terms of when this country was a country of opportunity. That same box of chocolates that beckons like delicious lollipops.
The ruble is constantly getting cheaper, it is not even a world currency, it is not money, and history always unfolds in such a way that light conquers darkness. And the best barometer of society is the economy. Whether we like it or not, the world is progressing, and justice always reigns in this world.
By the way, potatoes have become much more expensive in Russia - since the beginning of the year, their price has increased by 49.7%. This is according to Rosstat.
Interesting fact: some CSTO countries immediately stopped trading in rubles, because they knew that every Russian bank would buy up their foreign currency reserves and leave them with mountains of useless currency.
It is expected that many countries and institutions will follow this example (China and India are already refusing to use rubles for exchange with Russia).
In essence, the ruble is now like cheap shares that will go bankrupt. The ruble does not work as money.
The key counterpoint is that Russia still has huge natural resources, and only they provide an effective "standard" for the ruble. Thus, on the international market, Russia can exchange its oil (for example) for industrial goods (say) from China. Therefore, the ruble is relevant for Russia only as an internal means of exchange and is adequate only in this role.
As in the USSR, so now, the ruble is worthless outside the country. During the Soviet Union, foreigners visiting the country could have a great time if they brought any Western currency (DM, Finnish marks, Swedish kronor, etc.), where they could find a black market trader and exchange Western currency for Soviet rubles. Then, for example, they would go to a tourist shop that sold goods only for tourists (you had to prove your status with a passport and visa) and buy out the entire store (exaggerating a little), because the Soviets used these stores as proof that they had everything that the West had, and they genuinely cared about the quality of these products. Of course, officially the Soviet ruble was so expensive that you could only buy some of these goods, but when you got access to the Soviet ruble unofficially, you could get it for almost nothing - after all, it was just paper.
The ruble is a commodity that has no demand outside of Russia.
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Publication in Russian on the Zen blog
https://dzen.ru/a/ZnPxLmkrwzCvUFxh
