Russia Beat Me To It

Investment Analysis Clubs Macro Economic Trends and Risks
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I saw a story earlier this morning about a “deal” being reached between Russia and Ukraine providing the means for grain shipments to resume out of Ukraine, providing relief to a anxious world facing a food shortage amid existing supply chain / logistics problems.

I was going to post a snarky comment to the effect of “Uhhhh, this is Russia we’re talking about, they’re not exactly famous for honoring agreements, especially involving the fate of Ukraine.”

Well, snark has nothing on reality.

Russia has already bombed the port in Odesa, less than twenty four hours after the deal was announced.

https://www.yahoo.com/news/russia-ukraine-trade-missile-stri…

I wonder how many extra people rushed into the Odesa area after the deal was struck in an attempt to ramp up cargo operations, inbound trucking, etc. and how many more people were put at risk of death – by this purposeful head fake by Putin.

The rest of the world needs to seriously rethink how to interact with Russia at every level. Russia cannot be trusted to participate in a safe face-to-face negotiation for fear of polonium poisoning, etc. Russia cannot be trusted to honor any terms reached in any political or military negotiation, even for exceedingly short periods of time. Parties cannot trust deals with Russian businesses because those businesses are directly under the thumb of Putin.

There may never be an end to the conflict in Ukraine until there is regime change in Russia. That is not baked into current world markets, much less the additional risks posed by a more desperate Putin likely willing to escalate to other forms of warfare worldwide on communications networks, public utilities, etc.

WTH

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For over 20 years it has been US foreign policy to try to engage with Putin. Which is a rational position, but it has never worked. He has a radically different world view than we do. It is pointless to try to negotiate with him. Isolate and marginalize is the best we can do.

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I also beat you to it earlier today.

https://discussion.fool.com/never-trust-any-russian-agreements-7…

Jaak

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Isolate and marginalize is the best we can do.

Easier said than done. Putin’s Russia has plenty of support outside ‚the West‘, in particular by the BRICS:

Brazil, India, and China’s rush to buy Russian energy shows Putin still has strong allies who can prop up Russia’s economy

https://www.businessinsider.com/brazil-india-china-buy-russi…

It goes as far as the BRICS leaders blaming the West for the food shortages.

Note the Rubel exchange rate is now above the level it was prior to the invasion.

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There may never be an end to the conflict in Ukraine until there is regime change in Russia.

The more I read about this the less I believe regime change will change anything. I’m not sure this is a Putin thing anymore, but a Russian thing. Not saying Putin doesn’t need to go, he does. I’m saying that alone will not fix the problem.

We need to get involved militarily. Nukes be damned.

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The more I read about this the less I believe regime change will change anything. I’m not sure this is a Putin thing anymore, but a Russian thing. Not saying Putin doesn’t need to go, he does. I’m saying that alone will not fix the problem.

Concur. The more I read the more this points to being a culturally Russian issue. Putin may or may not survive this, but his successor is likely to have the same mindset and plugged into the same power networks as Putin himself.

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Suissebear,

The USD is still king of the reserve currencies, but the strength of the USD against the Euro and emerging market (EM) currencies has become problematic due to dollar-denominated debt and massive price inflation in food and fuel around the globe.

It doesn’t take much of an imagination to recognize that leaders of faltering economies with dollar-denominated debt or with dependence upon dollar-denominated foods or fuels will quickly find that big bad Uncle Sam is an ideal scapegoat for their economic woes.

China stands ready to offer EM countries favorable borrowing terms and Russia stands ready to offer EM countries favorable petroleum prices. Meanwhile, the US stands ready to topple governments or cripple economies with sanctions - seemingly at will.

Once the people of EM countries around the world (especially those who have seen the US attack their neighbors) begin to hate the US military, the US government, and/or the US currency, it is quite easy for them to look around for a less clumsy dance partner.

Russia and China are developing a new reserve currency with other BRICS countries, President Vladimir Putin said. The basket currency would rival a US-dominated IMF alternative and let Russia widen its influence, an analyst said.

The dollar’s dominance is already eroding as central banks diversify into the Chinese yuan and smaller currencies. Russia is ready to develop a new global reserve currency alongside China and other BRICS nations, in a potential challenge to the dominance of the US dollar.

https://finance.yahoo.com/news/russia-china-brewing-challeng…

I was shocked that the Ruble regained its standing so soon after suffering the wholesale withdrawal of Russia-based European and US businesses. However, given the fact that the strong USD is causing almost as much pain for EM currencies as US sanctions are causing pain for Russia, it is no wonder that the BRICS nations are banding together without US or EU participation.

EM leaders seem to see BRICS nations as the future against the dying US-EU past. Russia and China have been hoarding gold for almost two decades. China has many rare-earth mines and massive factory capacity. Russia has a great many gold mines, along with diamonds, petroleum, and vast wheat-cultivation capacity.

It is not surprising that the BRICS nations plan their own alternative settlement system to the US-based SWIFT network, as well as their own reserve basket of currencies.

Using the USD as a weapon and suspending trade and banking relationships are the kind of behaviors that would make any EM leader (especially dictators) run straight into the welcoming arms of Russia and China.

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Russia and China have been hoarding gold for almost two decades.

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Hmmmmm?

TOGETHER, they barely make it into the #2 position in today’s World!

https://worldpopulationreview.com/country-rankings/gold-rese…

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The more I read about this the less I believe regime change will change anything. I’m not sure this is a Putin thing anymore, but a Russian thing. Not saying Putin doesn’t need to go, he does. I’m saying that alone will not fix the problem.

George Friedman, the geopolitical commentator, makes the case that geography dictates politics, hence geopolitics! Russia’s geography makes it effectively indefensible hence the policy is to create buffer zones all the way to the Pacific and as far to the Atlantic as Europe will allow.

Putin is just the latest Tzar. The Communist Revolution was just a coup, out with the Romanovs and in with the Bolsheviks. Putin is the latest Bolshevik Tzar. Same ill treatment of the population and the same quest for buffer zones.

https://geopoliticalfutures.com/welcome/

The Captain
America has three giant buffer zones, the Atlantic and Pacific oceans and the Caribbean sea and needs a big navy to control them

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The more I read the more this points to being a culturally Russian issue.

More geography creating the cultural imperative.

Russia during the USSR period and the US calculated that a nuclear war was useless between them because colonization of the other was not going to succeed. Both were too large for the other’s army.

If we go into a war with Russia it is more than whether nukes are used. We would stir up the entirety of the Russian public to fight us. We would have something of a war that was much more miserable than Vietnam. We would lose. I am not saying Russia would stand a chance of going into today’s barely armed Germany and winning. Russia would lose.

I am saying on the Russian home turf, even in Ukraine, we will lose and lose badly. Does not matter how well armed we are or how many Russians we kill.

The geography is so expansive in Russia or the USSR that a weaker central power in Moscow can put down revolts far too easily. The energy outside of Moscow to overthrow rule by Moscow can not gather enough power across the land expanses.

This is also how Kissinger early in his career created his analysis of central Europe and in particular Germany’s power patterns. Central Europe between western and eastern powers has always been very unstable in the middle. The US building up central Europe has now permanently changed that.

We can not permanently change power across the USSR region militarily. We can not just say, ‘oh we are only here for Ukraine’s sake’. It wont play that way not for one minute.

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We can not permanently change power across the USSR region militarily

A. The USSR has not existed for 30 years
B. NATO as definitely changed the military power across Eastern Europe.
C. The Nation States of Eastern Europe have been autonomous sovereign entities long before Putin had any real power.
D. It is nothing more than a fantasy that the USSR constructs are viable, it is only a fantasy in the mind of Putin.

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Other than the Baltic nations Eastern Europe was not the USSR region. Note the word region.

I am not speaking to Putin’s motives etc…

I am speaking to fools that think the US military in Ukraine is an option. Even the Ukrainians will be fighting against us by the time we are done…in all likelihood. One botched operation in Ukraine would cost tens of thousands of American lives in payback. Once in we never leave. Bad idea.

The peoples in the region will unite against us. That botched operation would be forced upon our men and women in the theater.

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George Friedman, the geopolitical commentator, makes the case that geography dictates politics, hence geopolitics! Russia’s geography makes it effectively indefensible hence the policy is to create buffer zones all the way to the Pacific and as far to the Atlantic as Europe will allow.

Putin is just the latest Tzar.

But Putin has declared that Ukraine is part of Russia. (Apparently on the basis that it was part of the USSR.)

That means Ukraine, in whole or in part, is not a buffer zone. He needs Poland (among other countries) under his thumb to be the buffer zone. And Poland (along with several of those other countries) is a NATO member.

Even that is under the assumption that he only wishes to restore the old USSR boundaries. An assumption I’m not prepared to make. Yeah, it’s what he says, but how can we know how much more he wants?

He’s demonstrated that there is no such thing as a peace agreement with Russia under his rule. There’s only “concede what we’ve already taken and give us time to re-arm before the shooting resumes.”

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