There have been several developments over the last few weeks regarding the Russian economic situation.  None of these are positive.

          First, S&P has cut the Russian credit rating to junk:

Ratings agency S&P said on Monday it had cut Russia's sovereign credit rating to BB+ or below investment grade with a negative outlook, and said Russia's economic growth prospects have weakened.

This is not a surprising move, as Russian problems are well known.  The primary impact of this development is to limit the market for Russian debt, as now investment funds that have a credit rating criteria (which is most of them) won't be able to purchase their debt.

          Second, the ruble has broken through support verses the dollar:

          Third, Russian central bank reserves are being depleted at a fast rate:

According to the Financial Times, the bank has lost $134 billion in reserves since the start of 2014.  Obviously, that pace can't continue.

          The economic consensus is for Russia to have a fairly severe contraction this year.  The events above simply add to the depth of the calculation. 

Hale Stewart is a former bond broker who has been writing about economics and financial markets since 2006 on the Bonddad Blog.  He is also a tax attorney with a domestic and international practice while also forming and managing captive insurance companies for US companies.   You can follow him on twitter at:@captivelawyer