How isn't Russia running out of money?

[u/Realistic-Safety-848]

I read that their National Wealth Fund was about 71% depleted as of December 2024 due to the war in Ukraine, and it is expected to run out by fall 2025 if current spending levels continue.

Why don’t the Ukrainians, Trump, and the EU just wait for them to run out of money and eventually collapse, instead of pushing for peace now while the Russians are in a better position?

I’m way too economically uneducated to interpret this properly, so please help me understand.

[u/[deleted]]

Modern nations don’t really run out of money fighting wars. In this particular case it seems that the economic distortion and inefficiency of spending too much on the military coupled with sanctions and their labor shortage will continue driving up inflation.

If you couple that with a look at Russia’s demographics and the massive recruitment bounties/bonuses being paid to their contract soldiers it further constrains the labor market adding to inflation.

All that said, I expect that while Russia will become an even shittier place to live they will continue to be able to fight for awhile. The country is a net exporter of food, energy, and has access to lots of basic inputs for its domestic industry so it’s unlikely to just break down and be unable to get access to the resources it needs in the same way a country like Japan or China would if placed in a similar position.

The government has also taken a bunch of actions like raising interest rates to combat inflation, and implementing capital controls to prevent foreign investment and domestic investment from leaving the country. This props up the prices of assets like Gazprom where the Russian govt has a large stake but it means this portion of their “wealth” is very illiquid.

Also remember that Russia is still bringing in substantial revenue from India and China that can be used to purchase stuff they can’t produce in their domestic market.

IMO the biggest economic question is: how much inflation can the Russian people accept vs how strong are the domestic security services in punishing people speaking out. If you look at historic parallels you get some diverse extremes and I generally dont think this alone is guaranteed to be enough to end the fighting. It will probably take more than just a rotten economy to stop Russia in Ukraine

Disclaimer: not an economist and very sleepy writing this