Situation Report From The Financial Front
How go the sanctions? The Euros and Americans are still talking sanctions up, but there’s no real unity. It’s something like the promises of military aid to Ukraine—which, upon closer examination to be mostly obsolete or ineffective equipment that will arrive, if ever, after the war is over. The Russians probably won’t destroy, instead taking custody for resale. Maybe these arms shipments are a way to repay Russia for the confiscated reserves.
It seems to me that the financial and economic situation in the US remains dicey, and isn’t being helped by the war. I’m pretty much an ignoramus when it comes to finance, but tweets like this make sense to me:
Others, like Tom Luongo and Karl Denninger, say the Fed has no choice but to raise rates. To them Krainer responds:
Again, what do I know, but what I say is that, one way or the other, it plays into the economic war that is now raging. The Anglosphere is throwing everything it has against Russia—in the form of sanctions that are coming back to bite the EU, especially, in the ass—but Russia is pretty much swatting this stuff away. It’s not all roses, but Russia appears to have done the hard work of preparing for this eventuality. They saw it coming years ago.
Meanwhile … the rubble is not the ruble. It’s US Neocon Globalist policy fantasies:
Some people have wised up, and some haven’t:
Who do you think caved—Russia or Poland?
Oh:
Russia is acting in a principled way. They’re saying, OK, you stole our reserves, so now you pay in rubles—the contracts provided for these eventualities. They’ll ship their gas to paying customers, as long as they get paid, but their energy business isn’t a charity. Their position is reasonable and legal—unlike US led sanctions.
Ursula should get into standup comedy:
The EU is prepared for this scenario? Indeed they are:
A financial system based on financial assets as collateral, versus a financial system based on vast reserves of natural resources as collateral? Which is the strong horse? We used to compete on more or less equal terms, in the sense that our financial system was also based on real collateral. But our rent seeking class wasn’t getting rich as fast or as much as they wanted to, so we outsourced the real economy to a frightening extent. Now we’re trying to pretend that that doesn’t matter in the real world.
The final paragraph of this post is a keeper. Ninety words that punch a ton or so above their weight.
Whatever other motives may have been at play in the Biden Admin decision to run at light speed from any effort to prevent war and the predictable economic suffering it would bring worldwide, at least two of them are easy to spot: 1) it gave them a seamless transition away from the two years of covid policy crimes against humanity, and 2) it gives them a way to put off any serious raising of interest rates before the midterms. Once Rs control Congress, Ds hope they can force the Rs to respond to the Democrat caused inevitable crash in one of two ways: cave in to an economically suicidal more-socialist-than-ever restructuring of the economy or be tagged as heartless do-nothings who could've delivered relief to the people but gleefully chose instead to serve their billionaire masters and let the people suffer mercilessly.
Women and minorities and trans, of course, hardest hit by far.