Collapse of the Ruble

[samclem]

You would be wrong in him feeling domestic pressure... his approval rating is over 80%..... so far the drop in the ruble has not filtered down to the person on the street.... now, the big businesses are feeling the pinch, but not the masses yet...

But his oligarch pals are "domestic pressure" too.
I wonder if today's Russian populace is really going to be as docile and patient as their long-suffering Soviet forebears. And even they finally got fed up with corruption and an obviously broken system.

 

[gerntz]

The American fracking industry did this. They should have been Time's people of the year.

Thank you, frackers!

 

[NW-Bound]

WW3 would be one of the portfolio failure modes described in The Retirement Calculator From Hell, Part III, where William J Bernstein describes the external risks that make any estimate of long-term financial success greater than about 80% meaningless.

With man-made calamities like what we have seen in the past, who needs asteroids?

And Bernstein pointed out that 97% success rate for a 40-year retirement means no major upheavals for 1200 years. So, why people keep bothering with 100% FIRECalc runs?

Party on, people! You don't have as much control of your future as you think. You certainly influence its course, but the outcome is never 100% certain as you hope for and plan. Party on!

 

[FUEGO]

Maybe there will be new "elections" and the oligarchy will find a new "candidate" to win.

In other news, I bought five figures of international value fund just a day too early. Catching falling knives can leave the occasional gash in your hands.

 

[audreyh1]

I heard Stuart Varney say today on his show that the current oil glut and drop in crude prices (and the Collapse of the Ruble) was due in large part to "fracking". I'm not sure how true that is but I thought it was an interesting comment.

That's a bit convoluted. The oil price drop is due to speculators dumping oil since Saudi Arabia said they wouldn't cut production. Some have speculated that Saudi Arabia did this to shut down the US fracking industry, although why they wouldn't have taken up such a step a year or two ago is a big question in my mind. It's just as likely they did it to hurt Russia directly, IMO. Only they know what their strategy is.

 

[gerntz]

That's a bit convoluted. The oil price drop is due to speculators dumping oil since Saudi Arabia said they wouldn't cut production. Some have speculated that Saudi Arabia did this to shut down the US fracking industry, although why they wouldn't have taken up such a step a year or two ago is a big question in my mind. It's just as likely they did it to hurt Russia directly, IMO. Only they know what their strategy is.

That's totally convoluted. The Saudis didn't do it before because the price of oil wasn't dropping. Duh.

Of course speculators are dumping oil (Dumping rubles is the same thing. It's all Russia produces.). What else are they going to do with it?

There's too much for the demand due to the frackers' production increasing & Saudis not cutting production. While they're hurting the frackers, the Saudis also hurting themselves & most importantly, hurting Russia even more. No love lost there with their cozy relationships with Iran & Syria.

As I said above, praise to the American frackers!! We should give them a tax credit for their production.

 

[aja8888]

I heard Stuart Varney say today on his show that the current oil glut and drop in crude prices (and the Collapse of the Ruble) was due in large part to "fracking". I'm not sure how true that is but I thought it was an interesting comment.

This made me laugh! Stuart Varney showing he knows nothing about the oil industry.

We have been fraccing wells in the U.S. since the 1940's....how else do you think oil drillers break up the oil-rich rock formations to get the oil and gas out?

 

[aja8888]

That's totally convoluted. The Saudis didn't do it before because the price of oil wasn't dropping. Duh.

Of course speculators are dumping oil (Dumping rubles is the same thing. It's all Russia produces.). What else are they going to do with it?

There's too much for the demand due to the frackers' production increasing & Saudis not cutting production. While they're hurting the frackers, the Saudis also hurting themselves & most importantly, hurting Russia even more. No love lost there with their cozy relationships with Iran & Syria.

As I said above, praise to the American frackers!! We should give them a tax credit for their production.

DEF: frackers = oil producing companies...AKA...all oil companies that explore, lease acreage and drill wells looking for oil. This would include Exxon Mobil, Anadarko, Conoco Phillips, Marathon, EOG Resources, Chevron, etc, etc...

Blaming "The Frackers" sounds like a reality TV show or similar.

 

[audreyh1]

That's totally convoluted. The Saudis didn't do it before because the price of oil wasn't dropping. Duh.

So the Saudis waited until the price of oil started dropping a little before they made it drop a whole lot further by refusing to cut production?

 

[Brat]

Recent years "fracked" oil production is piddling compared to other traditional extraction practices.

 

[aja8888]

Recent years "fracked" oil production is piddling compared to other traditional extraction practices.

Yes, what's being done now is very controlled and precise, kind of like taking out an enemy tank with a laser guided bomb instead of like the old days when you would try to blow up the whole town and hope to get the tank.

 

[ejman]

With man-made calamities like what we have seen in the past, who needs asteroids?

And Bernstein pointed out that 97% success rate for a 40-year retirement means no major upheavals for 1200 years. So, why people keep bothering with 100% FIRECalc runs?

Party on, people! You don't have as much control of your future as you think. You certainly influence its course, but the outcome is never 100% certain as you hope for and plan. Party on!

I would beg of some one who is not mathophobic as I am to explain to me why the calculation of a 97% success rate for a 40 year retirement means no mayor upheval for 1,200 years and how what happens over 1200 years affects my measly remaining few decades (at best) on this earth. Oh, by the way 40/.03 =1333.33

 

[Fermion]

I would beg of some one who is not mathophobic as I am to explain to me why the calculation of a 97% success rate for a 40 year retirement means no mayor upheval for 1,200 years and how what happens over 1200 years affects my measly remaining few decades (at best) on this earth. Oh, by the way 40/.03 =1333.33

If you have a major upheaval every 40 years then you have a 100% chance of failure in your 40 year retirement plan. In order to only have a 3% chance of failure (assuming everything else was perfect in your investments and SWR) you would need a major upheaval to only happen an average of once every 1200 years.

Reminds me for some reason of the guy who carries a bomb with him when he flies because what are the odds of two people having a bomb on an airplane.

 

[ejman]

Got it. Anybody contemplating a 40 year retirement is doomed to 100% failure. Whew! its a good thing I'm 65 so at best I got a maximum of 35 years - just under the wire!

 

[NW-Bound]

No, not 100% failure over 40 years. But it is impossible to say that it will be 0. In the history of the US since 1776 till 2014, there have been big events like the American Revolution itself, the Civil War, the two World Wars, the Great Depression, etc... Quite a few big events in 238 years. So, how can we say that there's 0% chance of anything big happening in the next 40 years, that won't affect us in a bad way?

I again will say that I am more worried about something happens to me personally, the main thing being health deterioration. Something bad already happened to me while I least expected it, and I recovered but have "nice" surgical scars to show for it. [-]Many[/-] Most of us will not be posting here in 40 years. Anybody cares to make a guess how many will be left? Definitely not 97%. I am not sure of the age composition of posters here, but I think much less than 50%, maybe even [-]25%[/-] 10%, will be left standing, er breathing, as quite a few will be alive but bedridden.

And Bernstein was just rounding off 1333 years to a nice number of 1200. When we talk about probability and randomness, a rough order of magnitude is sufficient to make a point.

 

[NW-Bound]

PS. And if something bad happens to me economically, if I still have my health to enjoy my small RV parked out in the boondocks of New Mexico and living off a meager income and/or SS, I do not consider that a retirement failure. Would you?

 

[gerntz]

So the Saudis waited until the price of oil started dropping a little before they made it drop a whole lot further by refusing to cut production?

The Saudis haven't done anything. So they haven't "waited". And they produce oil the cheapest of anyone, so they make plenty anyway. It's others that get squeezed first. While they're the largest producer, others could have cut & haven't. Why not "fault" equally? Your concern only at the Saudis is peculiar.

 

[gerntz]

Just learned Brits spell it "rouble". They're always spelling stuff screwy.

 

[travelover]

Just learned Brits spell it "rouble". They're always spelling stuff screwy.

Yea, don't they know English?

 

[MRG]

Just learned Brits spell it "rouble". They're always spelling stuff screwy.

Be glad there was no 'zed' in there for them to change into an 's'.

Sent from my SAMSUNG-SGH-I337 using Early Retirement Forum mobile app

 

[Chuckanut]

I'll ask my Russian friend, Barney Ruble, how it's spelled.

 

[Alan]

Just learned Brits spell it "rouble". They're always spelling stuff screwy.

..and making screwy jokes.

 

[2B]

Just learned Brits spell it "rouble". They're always spelling stuff screwy.

And colour, fibre, tyre....

 

[Texas Proud]

No, not 100% failure over 40 years. But it is impossible to say that it will be 0. In the history of the US since 1776 till 2014, there have been big events like the American Revolution itself, the Civil War, the two World Wars, the Great Depression, etc... Quite a few big events in 238 years. So, how can we say that there's 0% chance of anything big happening in the next 40 years, that won't affect us in a bad way?

I again will say that I am more worried about something happens to me personally, the main thing being health deterioration. Something bad already happened to me while I least expected it, and I recovered but have "nice" surgical scars to show for it. [-]Many[/-] Most of us will not be posting here in 40 years. Anybody cares to make a guess how many will be left? Definitely not 97%. I am not sure of the age composition of posters here, but I think much less than 50%, maybe even [-]25%[/-] 10%, will be left standing, er breathing, as quite a few will be alive but bedridden.

And Bernstein was just rounding off 1333 years to a nice number of 1200. When we talk about probability and randomness, a rough order of magnitude is sufficient to make a point.

But there is a problem with this thinking.... thinking that some bad event will result in a failure... for most of the people in any of these events the failure rate is still zero...

My mom just missed WWI.... but lived through the great depression, WWII, Korean war, the bad investments of the 60s or 70s (not sure of the exact dates)... the high inflation during Reagan, the market crash in the 80s... the dot com bubble in 00s... and the almost great depression of 08/09.... all without failure...


SOOO, I say BS on the 1,200 year number... OH, and BTW, if there were a bad event ON AVERAGE every 40 years, that does not mean you will have one the next 40... I remember when I was young that we had a 100 flood two (and maybe 3) years in a row... they can clump together or be spread apart....

 

[Fermion]

Yes, if there is an average failure every 40 years then you may or may not see one in your lifetime. It still means you can't run a prediction model that gives you a prediction of 100% chance of success.

My wife's grandparents had 6000 hectares in Latvia before WWII. After WWII they were just barely able to flee the iron curtain bribing Russian guards with household silver and some gold and ended up coming to the USA with $0.50 total given to them by an American soldier. I would say that is a portfolio failure.