THE RUSSIAN ECONOMY IS IN CHAOS

The Russian economy has sunk into a crisis that it may not recover from for years, if ever. Even if the war in Ukraine were to end tomorrow, it is unlikely that Western companies and investors who have seen billions of dollars wiped out will rush back into Russia.

1. Russia's credit rating has been downgraded to junk status and a default on Russia's foreign debt obligations is imminent.
2. More than 300 companies have pulled out of Russia.
3. Russia's financial and trade links to the rest of the world have been temporarily and in some cases permanently severed.
4. Sanctions will trigger a severe recession in Russia that will see its economy shrink by 15% in 2022. If such a forecast comes to pass, it would be a collapse worse than the 2008-09 Great Recession and Russia's 1998 debt default crisis combined.
5. Domestic demand will contract by 10% or slighyly more
6. Russia's ruble has lost more than half of its value since the invasion began, and Western investors have dumped Russian assets.
7. The ruble's collapse is worsening the cost-of-living crisis for ordinary Russians by making everyday imported goods more expensive, assuming those goods can even be found amid empty store shelves. 
8. Several banks have been banned from using the SWIFT international payments system.
9. Even before the invasion, the annual inflation rate in Russia was running at around 8.5%. If this rate was sustained in the coming weeks and months, the rate of inflation could almost double at 17% with risks skewed to the upside given that the ruble could sell off further, or the Central Bank may be forced to hike rates more to maintain stability.
10. With no access to half of Russia's foreign exchange reserves, and faced with surging inflation, the Central Bank has doubled Russia's interest rate to 20 %
11. Russian stocks have seen massive sell-offs.
12. All Russia's capital markets appear to be wiped out and they are unlikely to return with anything else than profound reforms.