Gold Holdings, Debt to GDP, Russian Government Bonds, US Govt. Bonds ....
About 2 months ago, on another board, I put forward the suggestion of looking into Russian Govt. bonds as their yields were relatively high when compared to other major countries.
I got one rather "snidish" response .... but I guess that goes with the territory !
Anyway, let's look at a few FACTS ....
Russia has the 5th largest Gold Holding in the world ..... in fact Russia's holdings are larger than China's ! ...
Russia has been steadily increasing its Gold holdings over the last 3 years, up by 34% since 2017 .... some would regard that as a good hedge for the future .....
Then we come to the question of a country's DEBT to GDP .....
In Russia's case it sits at around 14.6% .... seems fairly low to me ....
In fact VERY low when we compare it to the USA's DEBT to GDP ratio of around 110% !! .....
And that then brings us to the question of Russian Government Bonds ...... especially for those who are looking for INCOME, more often than not by those who are regularly in the search of Healthy Dividends from Public Companies ....
Here we have the Yield Curves for Russian bonds. Currently one can get a Yield of about 4.7% for a 2 year bond. You can get about 5.2% for a 5 year bond.
2 Months ago, when I posted my previously mentioned post, you could have got a ~5.5% yield for a 2 year bond, and 6 months ago a yield of about 6%.
All of these yields are a fair bit higher than many of the larger Western countries .....
If we compare this with the equivalent USA 2 year Govt. bond you could get 0.178% yield .....
And it looks like Russian bonds have been in demand in recent times seeing as .....
...... which seems to indicate that there are those who are prepared to invest in the country.
And Russia is a self sufficient country. It has all the resources it needs for its own requirements. It exports agricultural and mineral products ....
Russia has also set up gas supplies, via pipelines, to China (Gazprom), to Western Europe & Germany (Nordstream 2) and to Turkey (Turkstream).
These are major gas exports from Russia earning the country billions of dollars.
Russia also has vast oil reserves. The oil price plunged recently due to the rank stupidity of the king of Saudi Arabia's son, Mohammed Bin Salman, who decided to flood the world with unneeded oil.
However, after he was "brought back into line" and the Saudis cut production, the oil price has moved up to about $34/barrel. This is fairly close to the ~$40/barrel that Russia needs to balance its budget, wheres Saudi Arabia needs ~$80/barrel.
It's therefore hard to see why Russia would be a poor investment destination from which to earn a relatively high annual income from its bonds .....
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