I started this as a reply to a post, but it was, even simplified, too long.
I would have preferred more people read this, and now less will. On the other hand the people who do read it may really read it.
My basic thesis is than a lower ruble will help a very, very few a lot but it will hurt many, many more. Why is that bad for Putin? Well, it's a lot easier to bully, cajole, frame, intimidate or justly try a few people that have unseemly much to lose than it is to explain to millions why life is worse and harder.
Since this will never make a list enjoy the dance of the mating fluke worms before I continue.
So, I'm going to try to use as little math and simplified scenarios to make this diary as understandable as possible. Please do not take that for me being brilliant and you dim. Some people are good at mat, but some aren't; that doesn't mean they are stupid. Some people are familiar with economics, some aren't.
Ok, let's say a US dollar (USD) is worth 10 Russian rubles (RUB). Actually it's about 1 USD = 36 RUB right now but that just makes the math more complicated.
So what happens when a USD is worth 12 RUB? (For simplicity's sake we will pretend only the two currencies mentioned exist, but the same holds true for a RUB falling the same amount against a basket of currencies - as is now the case.)
Well you have to look at several things; imports, exports, tourism, foreigners who own Russian assets or debts in RUB, and Russians who owe debts in foreign currency or foreign assets. There are secondary consequences of course, but one step at a time.
A) Imports and exports
Take exports (from Russia). These will command a higher RUB price than before (assuming a world price, which since most Russian exports are either oil and gas - 60%, metals or military hardware is in fact the case). This will mean higher profits so long as some or all of the costs are in RUB. Say a company had a profit of 11% on sales of 100 million USD that was 10 million USD before. But now costs aren't 900m RUB/10 but 900m RUB/12. No need to do the math, obviously costs go down; since income is the same, profits go up. So this is a good thing for Russia's major exporters. If you do do the math profit goes up by roughly one and a half times.
Now, let's take imports. Well, assuming the foreign companies or importers maintain their profit margins, prices go up. A 10 USD pair of jeans is now 10x12 = 120 instead of 10x10 = 100. Prices go up 20%. Now because most of Russia's imports consist of consumer goods (for which Russian made alternatives are not really an option) and food stuffs (world price again), price increases would roughly reflect the ficticious numbers I've plugged in concerning imported goods.
So secondary consequences: Russian exporting companies employ a small minority of Russian workers, far fewer than the number of Russians buying foreign goods, whether that be chicken livers from the US, jeans from China or champagne from France. Even if the exporting companies paid all the extra profit to average workers [Would. Never. Happen.], most Russians would still be worse off. Theoretically Putin could tax away these extra profits and then redistribute them, but assuming 100% efficiency, it would end up just like before. But when have you know humans to do anything with 100% efficiency, let alone in a country ranked co-127th in transparency.org's corruption index.
Strictly speaking, this is just another import/export , but since foreign travel is not perceived as such by most people and it is a major expense for most people, I thought I would mention it separately. Now a Russian travelling abroad used to pay 100 RUB for a 10 USD pizza, now they pay 120 RUB. An American used to pay 72 USD for a 720 RUB hotel room, but now just 60 USD.
While statistics for visitors to Russia are easy to come by (25m worth almost 12b USD), and the number of Russian visitors to other countries like wise (just over 40m), how much Russian tourists spend abroad is hard to pin down [Neither number represents unique visitors, many people will make multiple visits]. But that's not the point. Almost none of those however-many-people who pay less for their visit Russia get to support Putin. All of those who make 40m trips abroad and who have to pay more, live and work and vote in Russia. Most of them are middle class, the last people - for better or worse (I'm not saying that's fair or just) - a leader wants to piss off.
In all of the above cases average Yuri Shmurinov (aka Joe Shmoe) ends up losing out.
C) Russians owing money in USD
This is a big one. Almost three quarters of Russian debt (570b USD) is owed in foreign currency. Now some of this is owed by companies paid in USD. They are fine. But if you as an individual or as a company earn in RUB but have to pay in USD your debt just jumped. Say you used to owe 10,000 USD. Well that was 100k RUB. Suddenly you owe 10,000x12 = 120k RUB. You owe 20% more overnight. Again, breakdowns are hard to come by, but if even a third of that foreign currecy debt (140b USD) is owed by entities or people whose income is in RUB, that's a serious problem. For the economy and for Putin. Again a government bailout is theoretically possible, but apart from rampant corruption, the markets would react very differently to say an American, EU or Japanese bailout. Who wants to be owed money by a government that de facto annexes parts of other countries and faces sanctions, however minor?
D) Foreign ownership of Russian assets including debt in RUB
Again, suddenly what was worth 100,000 USD at 10 RUB per USD is now only worth 82.500. If you are a bank that has impacts on your Basel-formula for minimum capital. If you are a company, it means your share price suffers.
E) Russians owning assets abroad
This is another small group of winners. But only if they gain more from these assets than they lose in points A (imports) through D. The math: Their 10k USD in stock just went up 20% in RUB - assuming stock prices stayed the same.
Secondary consequences, part two: Since most people are worse off after the devaluation (it's basically a hidden pay cut), they will want higher wages (I would too). But the higher wages then cause higher costs for business, which means higher prices for domestic goods and an even lower exchange rate. It's a vicious circle of inflation, higher price and wages, more inflation etc. with the nasty side effect of high interest rates. Who is going to loan anyone money for two or five years - let alone twenty so you can buy a house - at a fixed rate if they don't know whether inflation might spiral out of control? Who would borrow at a variable rate if interest rates might double in a week? No one. So everyone resorts to forreign currency lending, which makes thinks even more precarious.