wolfstreet.com / by Wolf Richter / December 3, 2014
Traders have a way with words. These folks around the world – whoever they may be, from the stay-at-home dad trying to make a living in front of a bank of high-resolution screens to central banks trying manipulate the markets – actually don’t need to use words. They just buy and sell. But in doing so, they become very vocal.
And this is what they have decided: the plunge in the price of oil combined with the sanctions are ransacking the Russian economy and finances.
They have expressed their opinions by selling off the ruble over the last few months and particularly over the last few weeks. As I’m writing this, these traders are willing to exchange 53.5 rubles for a buck, down 37% since June. This also happens to be how much the price of oil has dropped over the same period.
And the folks who trade in credit default swaps have decided that Russian debt now has a 22.9% probability of default.
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