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A quick breakdown of what SWIFT is and why it matters

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Re: A quick breakdown of what SWIFT is and why it matters

#51

Post by jonny_eh »

sega_sai wrote: post #37

All these sanctions are a bit of the joke when you are dealing with an insane leader in a country without elections and sitting on top of a pile of reserves. And the west is not doing one thing that could actually actually make a difference -- cutting oil and gas export because the west thinks it'll be too expensive for the west. I feel these sanctions are still more of signalling, than actually doing something usefu…

The only people that can realistically help Ukraine right now are the Russian people.

Re: A quick breakdown of what SWIFT is and why it matters

#52

Post by iszomer »

bpodgursky wrote: post #21
jdrc wrote: post #5

bitcoin is going to be tricky. unless most miners are in russia they can be convinced to fork chains

China has basically fully eliminated bitcoin mining.

I think, if the SWIFT ban really was "on the table", they would be making the case for China's own CIPS/CBCD system, if Russia decided to opt for such service as an alternative.

TIL the NSA [1] has it's tentacles in SWIFT too..

[1] https://en.wikipedia.org/wiki/SWIFT#Monitoring_by_the_NSA

Re: A quick breakdown of what SWIFT is and why it matters

#53

Post by pmontra »

User23 wrote: post #15

Interestingly SWIFT was used to effectively depose a Head of State already, specifically Pope Emeritus Benedict XVI. The Vatican's Bank was banned from the system and allowed back on after Benedict's resignation. The lesson was not lost on Russia or China and they have been building an alternative system called BRICS. Edit: Here's a contemporary source[1] from a "reputable" newspaper. It doesn't mention SWIFT by name…

Maybe this? https://www.bbc.com/news/world-europe-20903443

Re: A quick breakdown of what SWIFT is and why it matters

#54

Post by m_ke »

daenz wrote: post #49
hamilyon2 wrote: post #42

Russian citizens like me will be hit hardest, as usual. Large institutions and wealthy individuals will find another ways to transfer money. Costs of goods and services will rise.

I was watching a mainstream news report (I'll try to find it and edit my comment) where the host and the guest were talking about the impact of economic sanctions. They said it's not intended to stop Russia, but to inflict pain on the citizens, so that they citizens will turn against leadership. In that moment, it really clicked for me how much normal people are pawns to be used in much larger games. And there appare…

With all due respect Russian people are the only ones who can stop Putin.

Re: A quick breakdown of what SWIFT is and why it matters

#55

Post by tazjin »

pmontra wrote: post #45
can16358p wrote: post #27

Earlier quoted context omitted.

They do have physical cash reserves in central banks.

Which could be revoked by printing new money with a new design and giving them only to the friendly parties in replacement of the old ones. It's routinely done (Euro is on its second design) and old banknotes and coins are no more valid after some years (the first series of Euros doesn't have an end of life yet.)

Which would significantly devalue the currency because you'd hedge your bets against not becoming unfavourable to whichever regime controls its issuance.

Re: A quick breakdown of what SWIFT is and why it matters

#56

Post by [deleted] »

sega_sai wrote: post #50
dragonwriter wrote: post #43

Earlier quoted context omitted.

> All these sanctions are a bit of the joke when you are dealing with an insane leader in a country without elections Russia has elections, but even having an unelected autocrat doesn't mean that governments are immune to popular opinion. Ask Louis XVI of France or, perhaps more relevantly here, Tsar Nicholas II of all the Russias.

I know that technically they have elections (I'm a Russian living abroad), they just count in a 'special way' so they get the result they want. And yes I agree popular uprisings is a possibility. But in the case of Germany in 1930-1940s that didn't quite work.

[deleted]

Re: A quick breakdown of what SWIFT is and why it matters

#57

Post by tshaddox »

dragonwriter wrote: post #43
sega_sai wrote: post #37

All these sanctions are a bit of the joke when you are dealing with an insane leader in a country without elections and sitting on top of a pile of reserves. And the west is not doing one thing that could actually actually make a difference -- cutting oil and gas export because the west thinks it'll be too expensive for the west. I feel these sanctions are still more of signalling, than actually doing something usefu…

> All these sanctions are a bit of the joke when you are dealing with an insane leader in a country without elections Russia has elections, but even having an unelected autocrat doesn't mean that governments are immune to popular opinion. Ask Louis XVI of France or, perhaps more relevantly here, Tsar Nicholas II of all the Russias.

Didn’t seem to end particularly well after the overthrow of the Romanov dynasty either. Adding nuclear weapons doesn’t make the prospect of political upheaval (let alone violent revolution) in Russia sound any more desirable.

Re: A quick breakdown of what SWIFT is and why it matters

#58

Post by mdiesel »

User23 wrote: post #15

Interestingly SWIFT was used to effectively depose a Head of State already, specifically Pope Emeritus Benedict XVI. The Vatican's Bank was banned from the system and allowed back on after Benedict's resignation. The lesson was not lost on Russia or China and they have been building an alternative system called BRICS. Edit: Here's a contemporary source[1] from a "reputable" newspaper. It doesn't mention SWIFT by name…

The timing would imply that Benedict XVI resigned (at least in part) due to the scandal involving blackmail of homosexual members of the church. The wiki page on the resignation doesn't go into that at all, but does link to the scandal in the "See Also" section.

> On 17 December 2012, the Pope received a report on "Vatican lobbies" ... . The same day, the Pope reportedly decided to resign, a decision he made public in February 2013

It's possible that multiple factors added up to make the job too overwhelming for one man of his age, but the "vatileaks" scandal appears to be far more significant in coverage from what I can see.

Re: A quick breakdown of what SWIFT is and why it matters

#59

Post by diognesofsinope »

sega_sai wrote: post #37

All these sanctions are a bit of the joke when you are dealing with an insane leader in a country without elections and sitting on top of a pile of reserves. And the west is not doing one thing that could actually actually make a difference -- cutting oil and gas export because the west thinks it'll be too expensive for the west. I feel these sanctions are still more of signalling, than actually doing something usefu…

They are signaling. Push came to shove and the unfortunate reality is that Ukraine isn't that important to most countries and the risk of a greater war is worse.

The lesson here is that every country should learn to defend itself.

Re: A quick breakdown of what SWIFT is and why it matters

#60

Post by netsharc »

TekMol wrote: post #26

I often wonder how money is stored. It can't be just a number on a computer in a bank, right? Otherwise some Russian bank could just increase that number to whatever they like. And say "Look, we own 100 Trillion USD. Now let's go shopping.". So I guess USD needs to be recognized by the US somehow? Could the US simply "void" all USD that are owned by Russia?

As far as I know they really are just numbers in databases, but if it's foreign currency, they can't just magic them out of the DBA's fingers. There probably are ledgers that have to agree with each other, e.g. if a Russian bank claimed it had those 100 Trillion dollars from a Cypriot bank, then the Cypriot bank would have to confirm it gave them that much, and then show everyone the source of that money.

Which does make one wonder how easy it'd be for your trick to work.

North Korea is a major printer of fake $100 bills, a piece of paper that's actually worthless but others are willing to trade $100 worth of goods and services, or exchange for a bank transfer. Until a bill is found to be fake and destroyed, I guess there really is $100 more in circulation, and when the last person found out the note is fake, in effect NK has robbed them out of $100.

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