Norway SWF has $3b invested in Russian stocks. now all practically zero. but bigger problem for $1.3T Norway fund is that the higher commodities prices the weaker Euro currency and European stocks. so it is losing much more value globally. to compensate that losses Norway has to keep energy prices higher. there is alot of growth stocks in the fund. all will be hit by higher bond yields.
Discussing long term impacts of Ukraine crisis
- Thread starter sndef888
- Start date
DELETE
The fund is bacically a future savings account and not an integrated part of the current Norwegian economy as such.
In stark contrast to how these funds usually work in most energy producing countries like Russia or in the Middle East
So any losses won't necessarily have to be compensated by higher energy prices.
But Norwegians aren't dumb, if there is profit to be made, they won't hesitate to raise prices.
There is a reason they have become filthy rich as a nation.
Last edited:
They did withdraw $37B during Covid when energy prices went down. so its a budgetary machanism. If they feel there fund is going down due to Euro currency and stocks exposure. they will keep energy prices as much higher they can.
I havent seen Norway fund aggressive with Gold or Chinese Yuan. The also lost $3b in Russian stocks. if Middleastern SWF fund start selling the blow back on Norway fund will be huge as most big funds are exposed to nearly identical securities.
It's more complex than that but basically we are both right
-----------
How we spend our savings
Each year, the Norwegian government can spend only a small part of the fund, but this still amounts to almost 20 percent of the government budget.There is a broad political consensus on how the fund should be managed. The less we spend today, the better the position we will be in to deal with downturns and crises in the future. Budget surpluses are transferred to the fund, while deficits are covered with money from the fund. In other words, the authorities can spend more in hard times and less in good times. So that the fund benefits as many people as possible in the future too, politicians have agreed on a fiscal rule which ensures that we do not spend more than the expected return on the fund. On average, the government is to spend only the equivalent of the real return on the fund, which is estimated to be around 3 percent per year. In this way, oil revenue is phased only gradually into the economy. At the same time, only the return on the fund is spent, and not the fund’s capital.
----------
No. Places of weakness don't demand and force other nations. Nations don't get forced to pick places of weakness. "you're either with us or against us" isn't just what the Americans are saying now, it was what George Bush said 20 years ago. I don't know what kind of "compete" you care about, but it's the US that's ruling the most parts of the world. China isn't even ruling Asia. I find it improper saying "the americans know they can't compete against China" to the case of Singapore siding with the US.
I think he's saying, the trade war, tech war, and now Ukraine issues are being played by the US because it feels it's relative advantage slipping day by day. Even with their advantage eroding, they're still the #1 military power on the planet, however the writing is on the wall (decline and get overtaken by China), hence they're pulling all the strings they can grab on to.
Once your power has eroded to the point that others can ignore or go against your wishes with impunity, then you will be forced to accept the terms of outsiders, like Singapore, because it is a tiny city state dependent on external money, resources and protection. This is exactly what the US wants to avoid.
Yes and no.
Yes, Singapore proclaims to be on America's side when it comes to Russia.
No, Singapore proclaims innocence when it comes to China and which side it is on.
The writing is on the wall.
Everyone in the world sees who is slipping and sliding downwards, becoming less and less every year.
Look at who condemned this Russian action in Ukraine. Only the Western countries and three East Asian countries. No one else could be bothered. No one believes that those three East Asian countries voted voluntarily, were coerced by the CIA to do that.
Who is isolating who?
Countries who pick the wrong side of history, they will pay.
That is how it works.
Just ask India.
There were there negotiating with RCEP. Then they were gone.
The US will still be a significant actor because it will still have a lot of economic heft and doesn't really face any challengers near its borders.
It's enough to look at a map covering the US and North America. Does China military bases surround the US? What about Chinese allies surrounding the US? Now look at a map on China and its vicinity and ask the same question.
It's clear which country has the upper hand and its silly to pretend otherwise.
It's clear which country has the upper hand and its silly to pretend otherwise.