Just turning over rocks and sharing. Seems crazy cheap to me. Will likely need to wait for the Russia bruhaha to run its course.
https://www.vaneck.com/us/en/investments/russia-etf-rsx-fact…
https://www.vaneck.com/us/en/investments/russia-etf-rsx/
Current price is $19.22.
What’s the argument against? How might US sanctions wipe me out while I wait?
Just playing extreme what if? Russia’s oil and gas exporting is sanctioned. Russia is cut off from the swift system? The latter would cause a lot of damage,the former,if successful,could ruin Russia’s economy for some time. IMO,Russia is cheap for many reasons.
JK
What’s the argument against? How might US sanctions wipe me out while I wait?
Well, I suppose it’s possible that it might become illegal to own Russian equities, directly or indirectly.
That might be a problem.
Not a likely problem, just one of many possible eventualities.
A bigger issue to consider is that Russian equities are dirt cheap, but then they’re always dirt cheap.
As a random example, the price of RSX isn’t particularly far from its five year average.
What is the logical expectation as a financial outcome? And is it commensurate with the risk?
If your answers are “good” and “sure”, go for it.
Jim
“What’s the argument against?”
Russia
One argument argument for me would be that Charlie Munger wouldn’t go there.
Question: In January, Jeff Gundlach was quoted: “China is uninvestable, in my opinion, at this point. I’ve never invested in China long or short. Why is that? I don’t trust the data. I don’t trust the relationship between the United States and China anymore. I think that investments in China could be confiscated. I think there’s a risk of that.” Obviously, with a significant percentage of the Daily Journal’s marketable securities invested in BYD and Alibaba, you feel differently. Please explain why you are right.
Charlie Munger: Well, of course, only the future knows who’s going to be right. But China is a big modern nation. It’s got this huge population and this huge modernity that has come in the last 30 years. We invested some money in China because we could get more value in terms of the strength of the enterprise on the price of the security than we could get in the United States. Other people, including Sequoia, the leading venture capital firm in the United States, have made the same decision we have.
But I’m sympathetic to Gundlach. If he’s nervous, he doesn’t have to join us. Different folks have different opinions. I feel about Russia the way he feels about China. I don’t invest in Russia so I can’t criticize Gundlach’s point of view. I just reached a different conclusion.
https://junto.investments/daily-journal-2022-transcript/
BHH (someone who followed Munger into China and is currently down 27% on his investment??)
What’s the argument against?
My argument is crude:
When the Russians opened their doors to investment from the West in the post Soviet era, they wanted our capital, but the burdens that are part of the package include clean accounting, audits, rule of law - to its oligarchs, simply Western “blah, blah, blah” minutia.
Putin resorts to theatrics to divert its citizens from a stagnant economy where foreign investment has dried up. Putin’s governance is catching up with him. His own mafia doesn’t trust their nation’s future and have offshored their fortunes. Putin has engaged his nation in dangerous escapism and the cruelty and deceit that requires.
It’s a perilous time to be sitting at this poker table when the master of brinksmanship finds that the others around the table are, at long last, not folding.
There are those that made fortunes in Nazi Germany, those who found their way to great works of art.
They were “successful”, but there are always other ways to get there, where the ride doesn’t require you to ignore the stench of death. My apologies for any perceived dramatics.
“Putin resorts to theatrics to divert its citizens from a stagnant economy where foreign investment has dried up.”
Good piece in the WSJ today:
Weakness at Home Drives Putin to Invade Ukraine
He’s trying to re-create the ‘Crimea effect,’ in which Russians felt strong and ‘forgot their worries.’
Snip: "Consolidating Russians around the regime is almost certainly a priority because, despite appearances, Mr. Putin has created an unstable structure of power. There are signs that the population’s patience with massive corruption is waning. On Jan. 23, 2021, protests broke out all over Russia in reaction to the arrest of anticorruption blogger Alexei Navalny and the contents of his film “A Palace for Putin,” which describes the ruler’s 190,000-square-foot residence on the Black Sea, built in part with funds taken from a $1 billion program to improve Russia’s healthcare system. Popular discontent with corruption has been building for years. A 2011 survey by the Russian Academy of Sciences found that 34% of Russians “always” wished “they could shoot down all bribe-takers and speculators,” while 38% said they “sometimes” did. Much of this corruption is associated with Mr. Putin. In 2017, after accusations that the then-Prime Minister Dmitri Medvedev had embezzed $1.2 billion, demonstrators in Moscow blamed the president as well, shouting: “Putin is a thief.”
https://www.wsj.com/articles/weak-approval-putin-force-ukrai…
Weakness at Home Drives Putin to Invade Ukraine
Putin has been preparing for this war for over 10 years.
Russia was never going to allow a nuclear armed NATO Ukraine and is pushing back on NATO expansion of 20 years.
I recently spoke with a friend who retired after 15 years teaching in Ukraine. His view is that the military threat of Ukraine is no concern of Putin’s. He can’t stand to see a successful, democratic, and western leaning country next door. Better to have an autocratic, poor and needy neighbor, like Belarus has been. He also said the “revolution of dignity” was just that, and they will not be returned to subservience easily.
military threat of Ukraine is no concern
Ukraine and “NATO member Ukraine” are two different things.
US military spend: $810B, All other NATO countries: $360B, Russia military spend: $60B
US military spend: $810B, All other NATO countries: $360B, Russia military spend: $60B
What was the Taliban military spend?
tecmo
…
Putin has been preparing for this war for over 10 years.
Russia was never going to allow a nuclear armed NATO Ukraine and is pushing back on NATO expansion of 20 years.
There you go, cheering Putin on. I guess you are an example of what IwannaBsedated (currently at 21 recommendations) was moaning about.
After seeing a few recent speeches & press conferences that the US President made, I think we are lucky if Russia isn’t sitting in mainland Europe next month.
This US Army recruitment ad must have Putin shaking in his boots. https://www.bing.com/videos/search?q=Army+Recruitment+Commer…
For sure he peed his pants after watching it.
“Russia was never going to allow a nuclear armed NATO Ukraine and is pushing back …”
And yet, this stunt has provided such a fresh & substantive case to the powers of NATO, who have harbored real concerns about admission of new members. The drift of Turkey & Hungary from NATO that has accompanied their respective authoritarianism trajectories comes to mind.
Your rebuttal employs the use of the past tense with “a nuclear armed NATO Ukraine”. Did you intend to write “disarmed”? I would urge you to exercise a lot more care when writing on a matter of such gravity. If you don’t understand the breadth & depth of confusion that introduces when facts and clarity carry such a premium, you should perhaps stick to waving Tesla’s flag or reaching back to friendly time segments when making the investment case against Brk.
Corruption in Ukraine over the past 2,5 & 10 years legitimately remains a very deep concern of the EU and NATO when talk about “moving West” surfaces. There has been a resilient, Kremlin friendly element within Ukraine (sidelined since Zelenski’ popular election)ready to aid and abet any reactionary movement. These are stubborn truths & reasons why NATO will be exceedingly careful before committing its existing alliance members to the defense of any applicant country that brings such complicated uncertainty.
Finally, you mentioned that Putin has been preparing for this war with Ukraine “for over 10 years”.
Zelenski was elected in 2019 with 73.2% of vote, replacing Poroshenko (Russia’s dog in the fight), who served following the overthrow of Yanukoych in 2014. Did you simply make an error of arithmetic, or do you have some substantive news you can share? Are you simply suggesting that Putin was seduced by the ease of annexing Crimia in 2014? I’m just unclear what event prior to 2012 triggered Putin’s Feb 2022 invasion of Ukraine.
When I asked my friend who taught 15 years in Ukraine if they would accept occupation/regime change or fight, he was adamant they would fight. I saw an interview with a Ukrainian woman who was educated in Russia, and voted for Poroshenko. One might expect her to be pro-Russian, but no, she said she has military preparedness training from her time in Russia and would be volunteering to help the Ukrainian military. She said her daughter and son had weapons they would use, while she would just “strangle Russians with bare hands”
Against this background, the Russians will need to occupy and control a country of 44 million with what, 200,000 soldiers? I think this thing could go on a long time.
Not sure what that means for BRK and us, but I don’t consider it too OT to be discussing it.
Against this background, the Russians will need to occupy and control a country of 44 million with what, 200,000 soldiers? I think this thing could go on a long time.
There have been statements by the US Ambassador to the UN that Russia has prepared a “hit list” of people to be executed or deported to gulags after the invasion. I suspect the intent is to remove potential leaders of a prolonged resistance.
As a former KGB person, Putin would know the process.
There’s an interesting poster on the METAR board, a retired military Canadian known as Tim. He often reports on the poor quality of the Russian conscripts. I understand Russia has committed a large percentage of their existing trained military, helped by withdrawing some from the China border after their recent discussions. Should Russia lose a significant amount of these in this invasion, they might well get themselves stuck in a sticky situation wherein they become more entangled the longer they stay.
I wonder how much staying power they really have.
Thank you CmoreBmore.
I wonder if these folks would cheer the aftermath of a Russian takeover?
In a former life I was in Cuba just before the Castro takeover. My initial reaction afterwards was that the Cuban people had finally thrown the mob out and took command of their country.
Then the executions began and my eyes opened. The pattern continues …
When I asked my friend who taught 15 years in Ukraine if they would accept occupation/regime change or fight, he was adamant they would fight…………She said her daughter and son had weapons they would use, while she would just "strangle Russians with bare hands.
Everybody has a plan until they get punched in the face.
Joe
je suis Ukraine