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Saturday, May 21, 2022

The war Putin is winning

I have no idea of what is going on in the battlefields of Ukraine. Neither do you. The first casualty of war is the truth. But I do know one thing: Biden's economic sanctions backfired bigly.

The idea was to isolate Russia and turn it into an international pariah. 

The problem with that is most of the world does not care about Ukraine. Everyone has problems of their own.

Red China kept doing business with Russia, as did India. Those two countries have a combined population that tops 2.5 billion people.

The USA and Europe have less than one-third as many people. We are not as important as we think we are.

Africa and South America don't care about Ukraine, although Russia blocking grain shipments from Ukraine will create a world food crisis that will hit Africa hardest. (This raises a question as to why Africa which enjoys a more agricultural friendly climate has to import basics from a country so far north.)

The economic sanctions not only failed to hurt Putin, the sanctions hurt Europe which relies on Putin for energy.

The economic sanctions actually are making Russia great again.

Bloomberg reported, "The ruble closed at the highest level in five years against the euro as more European companies appeared to be complying with Vladimir Putin’s demand that they switch to paying in Russia’s currency for natural gas.

"The ruble jumped as much as 9% against the euro and ended Friday’s session 2.8% stronger against the dollar in Moscow. The Russian currency is the best performer globally this year.

"Capital controls, collapsing imports and surging energy prices have left the ruble about 20% stronger than before the invasion of Ukraine almost three months ago. The central bank’s gradual easing of the restrictions on the market hasn’t been able to reverse the appreciation, which could become a problem for the budget as a large share of revenue comes in foreign currency.

"On top of that, many foreign clients of Gazprom PJSC are complying with Putin’s demands by opening foreign-currency and ruble accounts with the gas giant’s lending arm, Gazprombank, to transfer funds for conversion."

The ruble is doing so well, that I wonder how much Putin paid Hunter to get his dad to impose sanctions on Russia.

33 comments:

  1. Seeing how most of the world kowtows to Putin for his fossil fuels makes one wonder how serious those countries are about Net Zero.

    ReplyDelete
    Replies
    1. Oil and gas became the world's energy source because a superior product - high energy density and transported through pipelines.
      The extreme concentration of nuclear energy makes it the energy source of the future. Inevitable.

      Delete
    2. Net Zero is a myth with current technology.

      Delete
  2. Poot had a lot of countries on the hook before he invaded. We all knew it.

    This raises a question as to why Africa which enjoys a more agricultural friendly climate has to import basics from a country so far north.

    Read Thomas Sowell.

    ReplyDelete
  3. Russia and all commodity producers are riding a wave; the great transition from finance to commodities. It has far, far to go and will transform world politics and economics in a shocking manner.

    ReplyDelete
  4. In Bombshell Editorial, New York Times Questions
    U.S. Strategy in Ukraine
    The Board writes, “A decisive military victory for Ukraine over Russia, in which Ukraine regains all the territory Russia has seized since 2014, is not a realistic goal,” and if it comes to negotiations, Ukrainian leaders will have to make the “painful territorial decisions that any compromise will demand.”

    “Mr. Biden,” the Board writes, “should also make clear to President Volodymyr Zelensky and his people that there is a limit to how far the United States and NATO will confront Russia” because Zelensky’s decisions must be grounded in a “realistic assessment” of “how much more destruction Ukraine can sustain”.
    https://dailysceptic.org/2022/05/20/in-bombshell-editorial-new-york-times-questions-us-strategy-in-ukraine/

    ReplyDelete
  5. As for why a continent which enjoys a more agricultural friendly climate has to import basics from a country so far north, the answer is that Africa and Africans have never been and will never be able to govern their own affairs. Look at South Africa and Rhodesia - whites in charge, completely self sufficient, stable governments, agricultural exporters, high standard of living. Then the blacks took over and both nations are now bankrupt, starving and war-riven. Same with our black-run democratic cities in the US. Increasing poverty, crime run amok, going bankrupt and hell-holes everyone is moving away from. Blacks are never the solution - they are, with very few exceptions, the problem. While that generalization is not true for EVERY black, it is for most. For every Colin Powell, there are a ten thousand George Floyds. The sooner we in the US recognize that 'diversity' is our downfall and not our strength, the sooner we can address the root problem of an out of control minority that has never been and will never be able to be a positive, contributing part of our society.

    ReplyDelete
    Replies
    1. COLD HARD FACTS !!! Well done Brian .๐Ÿ‘

      Delete
    2. Wow. Certainly not politically correct. But correct none the less

      Delete
  6. Last time I checked, gasoline was still around $1.90 a gallon in the Russian wild wild Far East.

    Lowest price in my neighborhood is over five bucks a gallon.

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  7. For 50 years, Xiden has never been right on foreign policy. He has never been right on economics. Thanks to our horrible senators and non-representatives, we are pissing another 40 billion away. Putin must be laughing himself to sleep every night.

    ReplyDelete
    Replies
    1. Senator Rick Scott really disappointed me on this. My rep, Capt. Steube has been doing a good job! I think an axe duel is in order between the two!!!

      Delete
  8. Ok, Don, I guess I need to educate you, and everyone else about the rising ruble. And how well the Russian economy is doing.

    The ruble, which by the way none of you can trade, nor can anyone else, is being propped up by doing the
    only thing Putin could do (well, his Treasury gal who is damn smart). When any company gets foreign currency for anything sold out of country - and most if not all of the energy sales are being facilitated in foreign currency, not rubles. Putin then requires those companies to sell their currency to the government and get rubles in return. This in effect props up the domestic currency and maintains the value of the ruble in the internal economy.

    This requires getting foreign currency into the country. For Russia, that comes in just a few ways - energy of course, wheat exports, raw materials. The only "sanctions" busters really is Europe and natural gas, and India continues to look for opportunities to make a buck. Oil flow is slowing out of the wells, you can see international reports on the oil production. Once the oil stops, all the permafrost wells will be shut down and won't be re-opened. That's just physics. So oil income will trend towards zero. The whole wheat thing of course will result in Russia holding on to what they grow for internal use. It's tough to ship much grain when shipping is so restricted anyway.

    So that leaves India and European NG. India will eventually realize, as China already has, that unfettered trade with Russia will open them up to their own economic dangers. Europe (Germany) is a whole other kettle of fish. I have no idea how that ends up.

    Do I believe sanctions work at forcing regime change? Nope. DO I believe they can impoverish the local economy? Absolutely, as they have in Cuba and Iran. I have no idea what the internal politics are within Russia as it relates to Putin's ability to stave off internal complaint. The recent Russian colonial spouting off on media there makes me wonder.

    As for the Euro, it's not fairing very well against the US Dollar either. In fact the only currency having much success at all against the US dollar is the ruble - where in February it traded for about 1.3 cents. It fell to almost nothing of course but has recovered nicely. According to today's charts it's worth 1.6 cents.

    Using every trick in the book to get it there by the way.

    SO please, Russia does not have much time. They have two lifelines left - and are doing permanent damage to their oil infrastructure. At some point Putin needs a settlement, and right now Ukraine seems to think they want all their territory back. I have zero idea how much they can reasonably to get back. But Putin has to make a decision before the wells shut down. It's the hard end date for him. And at a certain point, the internal ruble policy does have a shelf life. It won't work forever.

    ReplyDelete
    Replies
    1. And what sort of damage is being done to Europes refining infrastructure. Your issue cuts both ways.

      And what will happen when the Middle East goes up in flames due to widespread hunger from cancelling Russian wheat. How will that affect the world price for oil? And how to counter that? ... Get America back to producing oil, or make it possible for Iran to get nukes so that Israel will be forced to attack it. What price will Russia get for its oil then?

      You may have had a point if the West were being led by competent human beings .. as opposed to the passengers of a clown car

      Delete
    2. I wouldn't disagree with any of your ancillary points. They all make sense. But Don's post was Russia is winning economically by way of the ruble's rise. That is false. Russia is in a real tough spot.

      We are run mostly by clowns in a clown car. Once again the inherent advantage the US has is our location, the base strength of our economy and people, and our ability to survive the stupidity of our leaders.

      Delete
    3. Though I would note, Putin has to get some decision quick enough to save his northern oil fields. because if he can't and the middle east goes up in flames, the price of oil won't matter to Russia. They won't have any to sell.

      Delete
    4. Yawn. Pretty much every doom and gloom prediction against Russia and Putin have proven to be false.

      Russia will be just fine. He is a gangster but he is invested in his country's well being a lot more than Western leaders.

      Delete
    5. Actually pretty much all the doom and gloom has come true, plus. We have discovered that the vaunted Russian military machine isn't. They are now mired in a military action which in reality they cannot win, for territory they probably mostly could have achieved through negotiation.

      If you choose not to look at the oil coming out of Russia, fine. Better put, if you choose to not look at the reduced amount of oil coming out of Russia - and that is falling further - what happens when the northern wells must be shut down? They are no longer operable at that point. How much is domestic oil production worth to Russia? Because the reduction we know of now may be permanent.

      So if throwing away one of the major ways in which you bring in foreign currency and capital is loving your country, interesting definition.

      Delete
    6. You are going to collapse out of exhaustion if you keep shifting the goal posts.First it was the Russian people are doomed, doomed ,doomed due to the financial sanctions , the Russian rouble and economy will collapse in weeks. Now it is "oh the Russian rouble being strongest doesnt mean anything"
      And also the "Russia is beaten and Putin willbe assasinated and replaced, Zelensky is the new Churchill"
      And now it is "Okay they have taken the Eastern region and Odessa but they will never take Kiev"

      "Oil sanctions against Russia will surely bankrupt the country " , and now it is "oh ok Europe is on bended knee begging Russia not to shut off the supply but hahah its two plants are down"

      Just shut up ,sit down and stop embarassing yourself any further. Your pantshitter chief of the coalition is beat and he had his soily ass handed to him to the wailing of the alphabet and pronoun crowd . Are you on their side? That is the question.
      No need to answer. I already listened to enough nonsense from the Slava Ukrainia crowd and their trans Greta Thunberg messiah Zelensky.

      Delete
  9. sounds like black cube globo propaganda. they are raiding the treasury here and laundering it thru ukraine. and kicked our borders wide open again. every time people talk like putin is a gangster, it shows theu dont know zelensky, kolomoisky - or the bulk of our kept criminal political class. who arent really elected. / azovstal has fallen. lets see the stories. russia is fine. european countries are not. and neither are we here. and right on time here comes the hate laws against truthtellers.

    ReplyDelete
    Replies
    1. Russia is not fine. The clock is ticking. They can only do so much - I think the real telling thing will be what Germany ultimately decides to do about natural gas. In this one I tend to think Russia holds the cards. But then I didn't expect Europe to join together and stop buying lots of other Russian goods. We will see.

      The bigger issue, on which I bet we would agree, is that Biden has, with help from Covid and the Ukrainian conflict, destroyed the world's economy by leading the US into a recession, and by restricting domestic supply of energy, has pushed global oil supplies well over $100 a barrel. Natural gas has also increased. You cannot do all these things and expect nothing bad to happen.

      If you voted for Biden, this is partly your fault too. Everyone knew he would do this.

      Delete
    2. I would note the "you" up above is directed at NeverTrump and Democrats, not the poster above.

      Delete
    3. NeverTrumper and "Putin is evil- Slava Ukrainia" are pretty much synonymous.

      It doesnt mean pro Trumpers love Russia as per Hillary borne propaganda. They just think it is not worth the trouble. Of course too many conservatives are sadly NPCs, just like leftists ,and are easily brainwashed by MSM . I would say they are worse than leftists because unlike leftists they despite and distrust the MSM -which makes their falling for this Ukraine hysteria hook like and sinker so much more pathetic.

      Delete
  10. Bidet's sanctions against Russia are nothing like his sanctions against the U.S. He hasn't turned off Russia's oil and gas production like he's done here.

    ReplyDelete
    Replies
    1. True, self inflicted wounds there. As I have noted above, the Russian oil fields are being impacted by the sanctions.

      Delete
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