Sanctions And Surpluses
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Not much time left till I bug out, so …
Western sanctions are creating real headaches for Russia, like, how should Russia spend all the money they’re pulling in:
Briefly noted via Zerohedge, How Sanctions Have Increased Russia's Oil And Gas Revenue:
Meanwhile:
US GDP contracts further in 1Q
Economists surveyed by Refinitiv were expecting a seasonally adjusted annual contraction of 1.3%
The contraction was 1.5%.
Lastly, I recommend the following Alex Mercouris video from this morning:
Russia 'Cuts off" Severodonetsk, Eyes Zaporozhye, As Ukraine Says Plans Counteroffensive
Pay attention to the bit about Zaporozhye, which concerns an important factory that, up until the war started, was supplying things like jet engines to Russia and … China. Russia has started targeting that factory which, as Mercouris says, suggests that Russia and China have worked out some supply issues. It’s interesting in that it provides some insight into the pacing of the war.
My own brief view regarding what some argue is a slow pace on Russia’s part. In modern warfare countries can’t afford large losses of personnel—there simply are not large reserves available and training takes way too long. It’s one thing for an advanced military like the US military to take on third worlders but, in Ukraine, Russia is dealing with a fairly large and sophisticated military that’s receiving top flight advice and technical assistance. The US can push the pace against third worlders without risking out of bounds casualties, but Russia needs to go more slowly. Nevertheless, its progress is sure, and (as Mercouris argues in the video) it is Ukraine that is suffering the irreplaceable losses—not Russia.
Sanctions And Surpluses
in my early business career, I had experience in commodity markets. Very early in the war (ny March 8), I picked up on how US economic warfare against Russia through sanctions was backfiring in the form of much higher commodity prices and trade surpluses for Russia: https://twitter.com/search?q=exports%20(from%3Aclimateaudit)&src=typed_query&f=live
I'm just waiting for BlackRock to come out with an iShares ETF for Russia. Maybe they could call it the "Great Patriotic Fund." That would appeal both to patriotic Americans and Russians. This ETF would be invested in various metals and natural resources, commodities, fertilizer, energy, Russian government bonds, and the "Rubble." In short, all things that will hold up well during a prolonged U.S. recession. When BlackRock comes out with this fund we will know both that the Ukraine war is over and that the U.S. has met its economic Waterloo.