• Valmond@lemmy.world
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      9 hours ago

      Because russia is not prepared at all for a recession. They have high inflation and stagnation at the moment (because of burning cash for the war, among other things), this is called “stagflation” and is just by itself a hopeless mess; if you up the steering rate to stop the stagnation and you kill the economy (the rate is already at a ridiculous 21%), lower the rate to favor economic growth and the inflation (which is according to the kremlin somewhere at 10%, but at over 70% for food according independent alalysists) will spiral out of control.

      It’s already an impossible problem to solve, add a global recession and it just gets way worse.

      • aesthelete@lemmy.world
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        5 hours ago

        It’s a problem you encounter because money is just an abstraction for real world conditions and resources. I think people forget that. Printing more money doesn’t make your country magically have more resources. It doesn’t manufacture tanks for you or vanquish your enemies.

        I still remember the picture from the history book where in Germany between ww1 and ww2 they were burning bank notes for warmth because inflation made the currency almost completely worthless.