300 mia € i indefrosne midler

Well, the trick is that those seized asset should be administered in a EU trust fund - or fideikommis. A fideikommis is a medieval construction, that was originally meant to protect the manor and land holdings of prodigal irresponsible - and plain stupid - heirs from squandering the money on frivolous consumption: Such as racehorses and even racier females (including rent boys).
Thus the owners of the funds cannot spend the money, but as nutty uncle Billy is not to destitude, he will get the yield from those funds. Now the EU argument is that the yield should have a nasty uncle Volodymir Zelensky as beneficiary. That does mean, that the principal must be invested securely - and there is nothing more secure than German sovereign bonds (with exception of countries that are energy exporters, such as Denmark and Holland). This means that the principal must be invested in long term sovereign bonds.
And with the sheer amount of cash there will be a high demand for long sovereign bonds - which will push up the price of said bonds.

For Your information: The cash deposit rate in Denmark (as the one I follow most closely) is 3,6% and the yield on 2 1/4% coupon 10 year sovereign bond is 2½%. So clearly there is liquidity that needs security above anything else. Lets say those sovereign bonds become bloody expensive. With that amount of cash in tainted money frozen. The price is determined by the issued amount of long term bonds - which the central bank controls with an iron claw. The coupon is only expected to cover inflation - and as LNG has fallen to an all time low - there will be no long term inflation.

Now this will free up funds for investment in sensible and profitable investments, such as infrastructure, but that investment can be financed by the companies issuing bonds on the background of firm government orders. The money is secure for the pension funds and yield more than sovereign bonds. War profiteering and windfall profits are handled by auditing the firms by government inspection - which is the condition for granting those orders and issuance of the bonds.
That is probably the reason Victor Orban has made so much fuzz about EU investment in Hungary. What the crook DOES NOT want is the chaps with the meat cleavers inspecting his books - and trust me they will. EU funding for infrastructure projects depends on whether the project benefits growth in the beneficiary country and EU as a whole. Paying back is a percentage of GDP - which means if the country is benefiting, it will pay more for future projects.

Take again Denmark as an example: There are sovereign bond circulation with a nominal value of 180 billion DKK and market value about the same. The trick is that these papers are negotiable, as the central bank (Nationalbanken) is ALWAYS a buyer to the long term securities - depending on the price - the central bank just issues more sovereign bonds to replace them.

This is already in effect!
When president Petr Pavel said he could source 800.000 shells - if funding could be found, the PM Mette Frederiksen shouted out: Not a problem! Danish Central Bank had a windfall profit of 1/4 bio. €. This was due to the increase in interest rate, that meant that the old bonds with ½% coupon suddenly became much cheaper and the newer had a higher coupon.
Not only that, but she corralled the Dutch PM Mark Rutte and he got in touch with the Belgians - and I think the Norwegeans joined - in as much as Jens Stoltenberg will be director of Norges Bank (central bank).
Thus several countries had windfall profits, that would benefit Ukraine. And not disturb domestic financial stability.

When there will be a peace agreement Russia WILL release those assets as part of a war reparations.

Thomas skrev:Det er et spørgsmål til Rusland?

Enten betaler I for den skade I har forvoldt på Ukraine - eller også kommer I til det alligevel. Lidt et spørgsmål om en forbryder kan blive gjort ansvarlig/erstatningspligtig for den forbrydelse han begik ved at bryde aftalerne omkring Ukraine.

Hvis (og/eller når) Rusland kollapser og ophører med at eksistere - og afløseren naturligvis ikke vil vedgå arv og gæld, så er det ligegyldigt, fordi arven efter Putin går til at dække dødsboets gæld!

Det var mere eller mindre, hvad Tyskland gjorde ved overtagelsen af Østtyskland. Bundesbank finansierede gennem obligationer med meget lang løbetid, så de overtagne landsdele kunne få reinvesteret og arbejde sig ud af gælden gennem beskatning.

som skrevet andet steds: skrev:There are two models here:

a) Having a - say 30 year maturity bond with a high coupon - say: 5 or 6%. This means that annual payment of the coupon is partly interest payment and partly instalment and partly compensation for inflation. The problem with such a bond is that each year - after the payment - the value of the bond is reduced because in so far as the money is invested in sensible things ( such as infrastructure and weapons) and natural inflation - due to jobs in growth industries paying better than in silly things, such as teaching and schools (school teachers are the lowest and most perverted and evil part of humanity).
Point being that a bond with high coupons reduce in value after each payment as each payment is in part an instalment.

The problem is resolved in price of the bond. Such bonds with (in practice) installments contained in the coupons is inherently becomes cheaper as time goes by.


b) The alternative is bonds with very low coupons. Here coupons lower than 1/4% is not practical, as the difference between the continuous and the discrete case is non-zero. Somewhere the Euler-Mascheroni-constant is messing around - and no, I don't know exactly how.
But a low coupon bond will increase in value, as it approaches maturity.

The bogey-man here is the inflation. 1½% inflation is the rule of thumb of what is appropriate. That covers pay rises in growth industries and decline in shrinking industries. Traditionally the rise in productivity is between 1 and 2% annually.

The real problems are:

1) Noone - and especially YOU - have no idea of what inflation will be in 10 years time, not to mention 30 years. Personally I don't have a firm opinion except that deflation is unlikely on a wider scale in the West, and a runaway inflation is just as unlikely - there will be no return to the 1970'ies if the Bundesbank has any involvement.

2) Noone - knows if there will be a Ukraine or a Russia in 10 years time. Russia is doing more than its level best to ensure that there will be total and utter destruction of Ukraine. The other issue is that Russia may - once again - collapse under its own stupidity and cease to be a legal entity.

As queen Elizabeth 1 once said against war: "Wars have such uncertain outcomes".

In case of such uncertainty the best you can do is to hedge your bets.

So I think a compromise between solution a and solution b is to do both: Having both high yield bonds and low yield bonds. The truth is likely to be somewhere in between.

som skrevet andet steds: skrev:The real problem is the production of new arms to replace the losses.
Now what Nato is doing is issuing firm government contracts to arms producers. With those contracts the manufacturers can invest in tooling - we are not going to produce new grenades on 50 year old tooling (or only to a limited extend), they are simply to expensive in labor. With these contracts the manufacturers can approach the banks and investors to buy now equipment and issue bonds of the serial type where a they are paid back in evenly great installments over the maturity of the bond, say about 10 years, plus an annual interest on the outstanding debt.

If you can't depriciate over 10 years producing quality arms - then both the bank and the manufacturer has done something WRONG,

That is probably why both Sweden and Switzerland has a viable arms industry - they have a niche production of arms: High quality and no unnecessary frills.

The value of the production equipment can only be maintained, with appropriate reinvestment.

Thomas skrev:Afkastet fra de indefrosne midler kan anvendes til forrentning og afdrag på et lån.
Enhver række af betalinger kan (med positiv rente) tilbagediskonteres til en nutidsværdi. Det gælder også den anden vej. En formue kan uddeles som en betalingsrække.

Hele manøvren kan afvikles, når Rusland betaler krigsskade erstatning til Ukraine - og dermed bliver aktiverne i fonden udlignet med lånet. Hvad nu hvis Rusland ikke vil gå med til det? Tja... det bliver de nødt til. Det vil give USA adgang til de frosne midler til finansiering af udskiftningen af våben - og det gælder også for Danmark.

Det betyder, at man undgår en uklædelig blamage i nationalregnskaberne som følge af et kollaps af Rublen og den russiske økonomi. Guldreserver er noget pjat, fordi de kan ikke veksles til rede penge.

1. Jeg er ikke sikker på, at kupon på de statsobligationer bliver specielt stor. Det vil blive reguleret, af prisen på de obligationer. ½% obligationer skulle være ret billige.Jake Broe er ikke bekendt med rentekurven - tilsyneladende.
2. Der er yderligere 125 milliarder EUR i guld reserve, som er værdiløs, fordi de mængder ikke kan sælges.